Bill Mitchell: Demystifying Modern Monetary Theory

In a challenge to conventional views on modern monetary and fiscal policy, Professor Bill Mitchell of Newcastle University in Australia has emerged as one of the foremost exponents of Modern Monetary Theory (MMT), a heterodox challenge to the prevailing paradigms which dominate how mainstream economics is taught and economic policy implemented. In his works, and the interview below, Mitchell presents a coherent analysis of how money is created, how it functions in global exchange rate regimes, and how the mystification of the nature of money has constrained governments, and prevented states from acting in the public interest.

[@TennesseeJed]

It is fascinating how a system created by our collective consciousness takes on a life of its own as a hyperobject and then has to be theorized to be understood.

[@johncorvo5520]

That would also be a description of any organized human endeavor.

[@ChannelMath]

"emergent behavior" is what complex systems people would call it. I like 'hyperobject' though

[@ThormanBoucher]

If I've learned anything over the past 2 years, it's that life isn't just about money, but money is an important part of life. It impacts every aspect of our lives. When I got my first paycheck, I knew I had to invest. I didn't think a few hundred dollars a month would add up. But it is. From 2020 to date, I have made around $600,000.

[@DanLeahfort]

No doubt. Investing still has the potential for higher returns over time, those returns are not guaranteed! I'm still scrambling for a safe place to invest my savings of around $46,000

[@GarrettDills]

@@DanLeahfort I know it can be daunting to get started, so I would advise you to seek the help of a fiduciary counselor so you don't get ripped off in the market. They have proprietary information and data paths that are not disclosed to the public.

[@TeresaBrickle]

@@GarrettDills I agree. Based on firsthand encounter with a fiduciary counselor KATHERINE DUFFY BURKE, i have $280k in a well diversified portfolio and over the course of more than two years, my reserve moved from $280,000 to $435,000 and i hope for more

[@RachelBrinkmeier]

@@TeresaBrickle I am looking for a Fiduciary like yours, I'm taking a chance on myself even quit my job I have alot of fight I'm putting this act of faith that someone knows someone who is willing to overlook what I'm doing and just tell me how can I make the leap to the next step?

[@TeresaBrickle]

@@RachelBrinkmeier Lookup her fullname on the web to connect with her.

[@johndanson4427]

This reminds me of the line in 'Yes, Minister' where an advisor comments that, "The most dangerous thing imaginable is letting an economist near to the inner workings of an economy."

[@archiefarrer6983]

The reason politicians and financiers around the world deny this reality is because pretending the government needs to 'balance the budget' opens up financing to private financial institutions who can provide the capital and indebt the economy, making huge returns. 'Corporate Welfare' is a good way to put it. A terrific example of this is New Labour and PFI in the early 2000s. They ran a 'budget surplus' meaning they were pulling money out of the economy whilst private financial institutions were funding tons of infrastructure with loans that would be paid off for years to come with a large amount of interest. When you understand what's going on it's completely criminal. If the public wise up to MMT private financial institutions opportunities to indebt the economy will diminish and they will lose their free lunch. This is why they fight so hard to discredit this.

[@mattquinn5183]

Considering the self-evident fact that wages are paid from the value of work-products(i.e after work is done), involuntary unemployment is a bizarre, unnatural state. Am I missing something here? To enforce unemployment on youth, especially, is unconscionable. Why must I elbow aside my dream-filled younger Australian brother or sister in order to secure MY job? If there is no future for the youth, there is no future for the adult, or the civilisation.

[@affinity1]

Congress says "hey, we have a road to build, any takers? Then a spending bill is created to fund the construction of the road. The govt says "hey we need to increase the mental health system so we need 100 new psychiatrists, any takers?" So congress creates a spending bill to fund the pay of psychiatrists. THis money can be created out of thin air because our government is allowed to do that. Look at a dollar bill. It says "backed by the full faith and credit of the United States government". Any dollar in existence came from the government. If govt prints too much money, inflation can occur because there are so many dollars out there that it drives up the price of goods. WHat stops inflation? The governments ability to tax. If the economy starts to get overheated now that everyone is employed and driving the prices of goods up, the govt increases taxes to cool demand which lowers inflation. Taxation is what also drives the demand for dollars so the US dollar will always be valuable. Full employment means that anyone willing and able to work will have a job. We're still enforcing child labor laws. Nobody is being forced to work.

[@brickpitino6793]

This isn't a self evident fact. Productivity has increased drastically since the 90's but real wages have not.

[@bungeebones]

Not only are the youth barred from employment, debt is racked up and placed on them while they are minors and can't vote on debt limts. It's a heinous renouncement of the 500 year Magna Carta's "No taxation without representation" but it's not just the politicians since all the people think saddling future generations with debt is a great idea!

[@soulfuzz368]

Could you imagine the type of infrastructure we would have with a guaranteed jobs program? Educated does not always mean skilled, there is a difference.

[@rickyward6735]

yes the DPRK North Korea a society possibly with far fewer negative social effects than ours.

[@soulfuzz368]

Ricky Ward there are indigenous tribes in my country that have less social problems than the NKoreans without jobs, money or infrastructure at all.

[@JB27888]

The soviet union had a guaranteed jobs programme...employment has to be productive for economic growth.

[@Adam-vo7ji]

What? That doesn't sound feasible or desirable lmao

[@noradlark167]

There are several schools with guaranteed job programs in Turkey. Namely, Military Academy and Medical Doctor degrees. In addition, some corporations has started to launch their own small colleges. They actually produce very very skilled people. However, they utilize extreme performance measurement tools as a subsidy to a level most people rather goes other programs. They are harder to finish than finding jobs LOL.

[@dapperdanman1956]

HE SPOKE TO ONE OF THE GREATEST PROBLEMS, THE PSYCHOLOGY OF YEARS OF OF TRAINING THAT WHEN YOUVE BEEN UDER EMPLOYED, OR THAT THE LOWER PAYING JOBS OFFER, SOON DEPRESSION, TRAUMAS OF NEVER FEELING LIKE WHAT YOU DO BENEFITS YOUR OWN HOUSEHOLD, NOR ADVANCES THE GOALS BASICALLY, PEOPLE WORKERS, THIS DEPRESSION! IS CATCHIN, AS IT TRANSLATES TO ALL THINGS IT COMES IN CONTACT WITH,AND BREEDS POVERTY, BUT WHEN COMMON MAN HAS MONEY, HE WILL SPEND THAT MONEY, ADDING GROWTH TO WHAT IS STAGNANT. THE IDEA IS TO ADVANCE, SO JUST AS POVERTY ADVANCES AND BREEDS MORE! ADVANCEMENT INTO A BETTER LESS STRESSFUL LIFE OF DOING GOOD, ALSO BREEDS MORE OF THE SAME

[@buzoff4642]

Poverty is a man-made creation. It comes from separating people from independent means of subsistence, usually by driving them off their land and into factories, and in quantities greater than the factories need.

[@MrDarthVadersMom]

Yes. -- all of what you say here.

[@robertbrandywine]

@@buzoff4642 Well, poverty was an almost constant state among hunter-gatherers (these people often went a week or two at a time without eating) and among subsistence farmers as well. So it isn't something created by industrialism.

[@buzoff4642]

@@robertbrandywine Hunter-gatherers went a week or two without eating, but gorging when they did eat. Subsistence farmers, when their crops fail. Industrialism manufactures failure of subsistence farming failure. NAFTA, for instance, sent US corn glut to Mexico, wiping out 2M farms/farmers there. Whole Truth Matters

[@robertbrandywine]

@@buzoff4642 Yeah, but I'd say gorging after a long time without eating constitutes poverty. Not many would choose that over what we have now.

[@valilux251]

Bill Mitchell is very rational regarding economic theory and seems to understand the complexity of the problems much more in depth than many other contemporary economists of the modern day.

[@Achrononmaster]

Please everyone read Steve Keen's book "Debunking Economics" (as inoculation against neoclassical Econ), then read Phillip Mirowski's "Never Let a Serious Crisis Go to Waste" for inoculation against neoliberalism.

[@HalimaBrewer]

now on my list for reading. Thanks.

[@karimayoubi74]

Debunking Economics is excellent, and Keen is undoubtedly correct. I shall look up the second one - the title sounds like it will reflect Naomi Klein's "Shock Doctrine" which is another excellent read and one I recommend to everyone.

[@marius6086]

"Here, these people will teach you how to ignore logical arguments, so you can get away with feeling smug when you should otherwise know you've lost." How exciting! I'll have to see if those are on Audible, so I can ensure being nauseous at work tomorrow.

[@karimayoubi74]

@@marius6086 when someone recommends a book, there is usually a good reason for it. By all means, you are welcome to remain in your bubble of ignorance. Have you read Debunking Economics? Because if you haven't, you look pretty stupid commenting on something you haven't read.

[@crushedz]

Mitchell has really crystalised some really useful information in very accessible language.Powerful stuff.

[@ralphmcnall5066]

Absolutely excellent - Every one, especially those responsible for monitary policy, should watch and rewatch this interview until they fully comprehend this discussion of MMT!

[@alexandersuvorov2002]

Great interview, thank you for posting. It resonated with me well and answered some of the mysteries regarding central banking, like why government needs to borrow money at interest from its own central bank (like US government does through Federal Reserve System). To add to this conversation: I think what MMT opponents don't like is the fact of government's involvement in the economy; so while MMT intuitively sounds right, MMT opponents argue for limited government involvement in the economy -- to limit its role to a solution of last resort. We know that power given to government raises temptation for abuse, so there should be a system of check & balances in government's ability to issue currency and provide employment. In this respect MMT is good in describing nature of money, but needs further development / adjustment for particular practical applications.

[@RealProgressInAction]

Ya'll don't listen well, inflation is caused by lack of Real Resources & Productive Capacity. As long as those are in place, a Monetary Sovereign Nation can spend it's currency into it's economy to stimulate the economy by providing public works that improve the nation & the well being of the country. FDR & Eisenhower created a strong Middle Class & decades of prosperity by doing just that thru Deficit spending, which we know created a Surplus in the private sector! 4 decades of "Balancing the Budget" has brought our country to it's knees knees & put the private sector in Austerity & Debt!

[@Rob-fx2dw]

Real Progressives - You are sprouting BS. Wrong facts again claiming that FDR and then Eisenhower created a strong middle class and decades of prosperity through deficits. The reality is that after WW2 the deficits were slashed from 1946 onwards and only then did the prosperity grow. The defict was brought back to balance in 1946 which required a cut of an unprecedented 50 % from a previous series of huge deficts under FDR. Net surplus from 1947 to 1951. Deficts ubder 2% More than a decade of prosperity you claim from FDR was Not So. During his presidency there was defict and great depression with unemployment of over 18% in the 1930's and over 10% for the whole time until the mid to late 1940's. That is despite the FDR government having a deficit policy which expanded up to a massive 30% of GDP during WW2 which resulted in following inflation of up to 18%. Much higher than after the 1929 stock market crash. My source documents for this fact include The Whitehouse.-www.whitehouse.gov/omb/historical-tables/

[@soulfuzz368]

Real Progress In Action you must have a religious faith in “green” tech to think that it’s a good idea to constantly ramp up economic growth.

[@pistolen87]

What happens if the hypothetical country can't produce its own needs and needs to import many goods? Will the exporter country accept the importers currency?

[@kingkoi6542]

@@pistolen87 No sir, that's called a banana republic, just without the bananas

[@pistolen87]

@@kingkoi6542 Well then I don't get how MMT will work IRL

[@19battlehill]

Govt should lend into industry and infrastructure that helps industry to grow --- rather than what we have now is banks lending into asset inflation and turning masses into debt slaves.

[@rickhooper1575]

Government should lend into industry as in bailouts and tax breaks for corporations are considered what? GM, Airline Industry, Tesla, TARP Spending Bank Bailouts are not pats on the back.

[@user-zw8wq9zi9t]

Could just change the rules to make banks incentivised to lend to business to improve capacity.

[@JonesTheSecond]

Where does the government get money from? The People

[@user-zw8wq9zi9t]

@@JonesTheSecond the point of what Bill Mitchell is saying is that this is incorrect. The government has a monopoly on money and doesnt need tax revenue. The reason taxes are charged is not to get your money, its to counteract the inflationary pressure government spending has on the economy.

[@oscarcaballero5662]

@@user-zw8wq9zi9t taxes is so there is demand for the fake fiat currency

[@DanielleA2023]

This channel is ahead of it's time and has never been more relevant than today or more necessary if we are to have a future

[@periklisspanos7185]

If it is in front of his times ,that time it is not here yet

[@shaulasark]

In Japan this MMT is called "新表券主義(Shin Hyo-kenSyugi)".

[@CloneHat]

Neo-Chartism is another name for it in English

[@LisahTali]

I believe Japanese banks declared they did not in fact practice MMT.

[@MegzeeR]

I'm so sick of this lack of "skilled" workers. Well, people can't keep up with the rapid tech advances that requires whole new skill sets in 2 years and this is another way to blame the victims of automation and computer advances which is replacing the labor of people. I see a major, MAJOR crash where everything grinds to a halt. People can't afford to buy due to lack of income and the less we can buy the more industry cuts labor to save costs. Very FEW "economists" and even less business heads even discuss this because that would totally destroy their worlds of "science". At least this man's addressing the problem.

[@IgnacioAguilarToledo]

​@@TheTazzietiger mises.org/library/hayek-paradox-saving "Jobs" are not a separate thing from "spending" neither "demand"

[@roesbabyroos3240]

Okey thanks for your help

[@hinteregions]

I don't see why you see the 'unskilled workers' as blamed or even blameworthy. They aren't skilled by your very own terms. They do not have sufficient or portable skills. This does not mean they are being blamed, any more than is the technology that is making them redundant. It's almost like you think there IS shame in being a victim.

[@SanSha2100]

It’s almost 8 years, still big shots like Larry Fink think that MMT is a garbage. But the fact is Mr Mitchell is way ahead of time if some genuine authority is listening. I am great full that I met Bill Mitchell in this KZbin video today. Hats off to this genius.

[@bonghead6621]

I'll drink to that. MMT if adopted would improve society across the board by allowing anything that can be resourced, ie a national renewable energy policy, to be funded by a federal government that's a currency sovereign such as Australia, leading to near full employment and an overall better society with for example lower crime rates where everything is very well maintained. Sadly I think it threatens the powerful and confuses many others as from birth we are fed the lie that the government is like a household.

[@SanSha2100]

@@bonghead6621 correct !!

[@GenghisVern]

Perhaps we could view education as a form of employment? Apply that to the JG and run it through universities?

[@oddvardmyrnes9040]

Not a bad idea. If the unemployd are 'bought by the government' they must do something. They will compete with the private market and will drive the prizes down and produce bankrupcies. The idea is not bad.

[@frankrusselldesign7563]

Australia now treats education as a multi billion dollar a year export industry which I s completely wrong. You do not train your opposition. You train your own people for free.

[@bzolsen]

@@oddvardmyrnes9040 Wages for the JG are living wages, which form a floor for wages below market rates. If private employers need workers they have to pay more. Not sure this is what you're calling "competition"

[@landcruiserfan4206]

@@frankrusselldesign7563 Exactly. Education should be free for all Australians, not a luxury for those who can afford it

[@RubyGaleHS]

That’s the type of imagination we need! And it beats digging a hole and filling it in, right?? 👏🏼

[@apothe6]

This video from INET is a striking one. He says govts can't run out of money, this I think is one of those fundamental ideas some people cannot agree on. Can you create value and productivity out of thin air? Apparently you can.

[@nd318865]

Governments will only see the error of their ways when they've been changed completely.

[@andrewbaumann2661]

@FreeSpeech TV82 you think that jews are the only people who use their influence selfishly?

[@frankrusselldesign7563]

Govenments will only change their ways when people who swallow the Murdoch Neo Liberal lie wake up and realise they are being lied to and change thier vote.

[@cntthnko1111]

@@frankrusselldesign7563 If governments didn't get in the way, through regulation, of capitalism, which turns it into a sort of pseudo-capitalism or an amalgamation of socialism and capitalism, that is the change necessary right now, there is still hope if they let go willingly.

[@landcruiserfan4206]

@@cntthnko1111 AHAHAH

[@cntthnko1111]

@@landcruiserfan4206 ya, probably not going to let go in any way shape or form, anytime soon.

[@limitless1692]

interesting point of view thanks for the interview

[@TalentedTenth]

So how does government not interfere with market forces in determining what the best uses of material and human capital are? If governments are using their capital to prop up wool prices that can certainly be a good thing...but what if the tastes of consumers market has shifted towards another material such as cotton or hemp? What then?

[@davidmcccsf]

Then they should tell the farmer to grow hemp, eh?

[@billmelater6470]

Are you saying that because customers change what they want, that the government will then go to the farmer and say "grow this" to respond to that want? I think you leave out that often, government props up businesses as a way to influence and shape consumer wants/habits either through the normal desire of power or through the interests and payments from lobbyists, thereby creating a system of cronyism. Government does not necessarily reflect public desire, nor does it react as fast or with near the same flexibility as a real market. We can see this on the subject of hemp right now in the US. But if we are to grant that the government will just respond to the whims of the market and even if it is swift and flexible enough to do so, then why would it be necessary in the first place? At that point, you may as well just let the market do what it does instead of artificially propping up certain people through a system of top down favoritism.

[@MrKongatthegates]

If say during the great recession, just put people to work say building bridges, it would be better than everyone sitting at home going broke. You wouldnt do it in good times

[@andrewprice8820]

Sometimes the public interest trumps what the consumer market wants. If steel factories for example are shutting down and their companies moving over to China or wherever where it can be produced cheaper, but the govt needs steel for its military, it can support the price of steel and purchase output. And keep the manufacturers employed in the process.

[@kingkoi6542]

@@andrewprice8820 So stupid, it's because of government intervention, decades of Keynesian economics, and now mmt we're seeing such a shit show in our economy.

[@genecat]

Bill Mitchell is a role model, he's what all politicians should aspire to be. If you're going to manage a population's welfare responsibly, it should be required that you have mechanical knowledge of the monetary system before proposing or suppressing fiscal policy.

[@mdueri]

I did find this interesting, but I'm not sure if he answered the question regarding how much can a government print. I mean there has to be a logical limit right?

[@juanmadero7941]

+MarkTheShark Inflation is the limits. Peak production capacity

[@mdueri]

What does that mean exactly? I just read today the BOJ owns 10% of 90% of their own stocks. When does inflation occur? when you print more money than can be used?

[@david8157]

+MarkTheShark Not a logical limit .... a reality limit related to production and employment as I understood him

[@akasteve03]

Juan Madero QE is the introduction of new money to the money supply by a central banker. which is "printing money" even if it's done with any printing press

[@damonblake3993]

it's not about printing money.. it's about the government using its spending capacity to stimulate the economy.. if it employs people in infrastructure (building roads and all the other infrastructure - schools hospitals , employing teachers, providing doctors and nurses etc, it stimulates the economy.. people's wages can be spent consuming products and services produced by the private sector (farmers businesses) so the private sector grows as well.. taxes withdraw money from circuation to keep inflation in check annd to give value to the dollar..

[@316Matteo]

7:10 "Of course if you keep spending and you can't produce goods to meet that spending, you'll get inflation - and if you keep spending on top of that you'll get hyperinflation" When you lock down your population, you destroy your country's productive capacity. US trade deficit is constantly increasing, they are not producing their own goods and yet the spending continues to accelerate.

[@Basta11]

Trade deficit is different than Government Budget Deficit. Because the USD is the global reserve currencies, countries want USD to trade or have as reserve. They are willing exchange their goods and services for USD. This is good for importers and people who can afford these cheap goods, but bad for domestic manufacturers and their workers that will be outcompeted. Trade deficits are deflationary as the importing country gets more goods relative to its money supply in circulation.

[@BanBb1]

Did you watch this video?

[@goodgood9955]

A good way to MME the corona economy would be to drastically reduce small/medium business taxes.

[@ericanderson3879]

the term "buffer stock" is used by MMT folk. what does it mean? why is it used?

[@johnb4639]

Warren Mosler: kzbin.info/www/bejne/r57GfKeao7dmnMk Bill Mitchell: bilbo.economicoutlook.net/blog/?p=23578 "Unemployment buffer stocks: Under a NAIRU regime, inflation is controlled using tight monetary and fiscal policy, which leads to a buffer stock of unemployment. This is a very costly and unreliable target for policy makers to pursue as a means for inflation proofing. Employment buffer stocks: The government exploits the fiscal power embodied in a fiat-currency issuing national government to introduce full employment based on an employment buffer stock approach. The Job Guarantee (JG) model is an example of an employment buffer stock policy approach."

[@SchrodingersCat8813]

Him and Keen are two of my favorite economists.

[@ttrons2]

Don't forget Michael Hudson.

[@karimayoubi74]

Add Richard Werner to your list. There's a documentary on YT called "Princes of the Yen" based on his book of the same name. It's excellent.

[@vinm300]

4.15 But what if a country with its own currency (Zimbabwe, Argentina, Venezuela) keep printing money and inflation hits 800%. Bill Mitchell is saying keep printing and spending but what about inflation ?

[@harperhigh6685]

vinm300 Not sure about the other two, but Argentina tied it's currency to the American dollar. So it doesn't have -as much control of it's currency as the US does.

[@Rob-fx2dw]

Ex I Am Cland - Taxation does not reduce inflation but increases the costs of goods and services for all of the community. That is because tax does not reduce the amount of money in the economy but is re spent by government despite the incorrect and misleading information put out by MMT leaders.

[@exiamcland8428]

Rob my boyfriend wrote that I don’t even know what tax is

[@Rob-fx2dw]

EX I AM Cland - Do you always listen to your boyfriend so much that he dominates what you think ? You must be his little toy if that is so. Try thinking for yourself if you want any real respect.

[@Rob-fx2dw]

David Hill . That is not 'all they say'. The say government should spend enough to soak up the unemployed and give everyone who wants one a job. That itself is totally stupid since people who get rewarded for doing a job should be paid on the merit of what they do not on the fact that they formerly had no job. For instance would you pay a plumber who you called to fix something with your water service and he or she did a poor job? Or would you consider the merits of what they did before paying them and not pay them if it was not done in a reasonably skilled fashion.

[@gustavalbericchidurocher9764]

i remember as a kid going to Paraguay, which was an almost taxless paradise for brazilians, where you could get imported goods for cheap and the very own shoppers wouldn't accept the very own currency of their country. they wanted brazilian real or american dollars. of course, in that city, both foreign currencies had better liquidity than their fucked up one, so it's an isolated situation... right? but what MMT seems to ignore is that there are scenarios where this can totally happen. mainly foreigners, but even people from your own country can feel that the liquidity of that money is not a certainty and refuse to get it for the price it has a tag with. of course you can't go bankupt in your own currency if you are to pay yourself, because you won't deny your own papers (what a stupid, but necessary thought). but even the market of a socialist society is not entirely of government paying and receiving their own money. if you have to buy stuff from people (let's say, bonds, raw materials, hours of work), and if this people have to buy stuff from other people and so on - inside and outside of your country - the danger of someone starting to SAY NO to it here and there is real... why you think it happened in old Paraguay? i've just saw a Randall Wray talk where he actually talks about money being an "i owe you X money" promise/bill and that anyone could issue one of those... the problem would be to get it to be accepted by a lot of people (which they supposedly started doing by taxing, fining etc. citizens in that currency), which i agree is a good hypothesis! another good story to add to the possibilities!! but isn't that all?? what these guys are missing is exactly: what if people stop to accept a paper saying "i owe you X brazils"? "i owe you Y US's"? what if people here and there stop to accept it? what if you have to offer more of it for a thing that shouldn't be costing more of it? "i can't get these hundred dollars for this good that is worth a hundred dollars because i don't know it it will be worth a dollar in a month or so". if you are north american i know this can't seem plausible - try to think of a currency of any poorer country and what makes it strong enough. so imagine... if you didn't knew that the price of it would be kept... wouldn't you ask a little bit more for the risk? wouldn't you think of completely denying accepting it? "i don't want your "i owe you 10 swedish crowns... or maybe i would accept 15 for the risk" imagine now if it happened tomorrow? and the day after? and suddenly not only here and there, but mostly everywhere... and everyday? and that's a way how a strong currency can become weak... not everything is supply and demand of goods... there's also supply and demand for government debts.

[@gustavalbericchidurocher9764]

@Current Events Playlist not at all my friend. This is exactly the base of MMT - that one country can't go default on its own currency when it has control over its printing. I can type this on google and find you dozens of videos from the past week talking about it. There may be a guy like me that noticed this stvpid flaw, was willing to help and wrote an article on some university or two on it... but old news? Send me a couple vídeos talking about it then. Bye.

[@MCJSA]

"Fiscal policy should be about reducing idle capacity... advancing public purpose or well-being of society... defined in a number of ways: provision of public service, provision of enough spending to ensure there is enough employment, and provision of public infrastructure." I'm wondering how well this maps to New Deal economic policy in the US in the 1930s.

[@joebhed1]

At around 10 minutes in, you can see why I say that Bill is the best of the MMTers. He, standing almost alone, states that in a sovereign fiat money system there is NO REASON for government debt. Marshall makes an attempt to do the usual MMT spin about moving things from checking to savings so, no difference (Auburn?), and yet Bill comes back and states clearly why Stephanie and company are wrong to embrace the philosophy of the bankers, as told by Frank Newman, and why the people should NOT learn to love government debt for inane and irrational constructs about its accounting - most of which is more BS. Go, Bill.

[@gg_rider]

There is no reason the Treasury *must* have debt to banks. Treasury could swap paper directly with the Fed. I believed Treasury can't spend "money" without a Constitutional amendment, but Lincoln did spend Greenbacks (govt bonds) and those circulated "as money" and were accepted for taxes. But Congress set up that rule in 1935 mandating that Fed and Treasury can't swap paper directly. And Hamilton and other Founders pretty much intended that Treasury must go to private banks for money. Now, govt backs bank deposits so Treasury is for all intents borrowing from Fed, but indirectly, because Congress requires using middleman banks ... there are institutional reasons and alternatives. Managing banks and interest rates. But the idea of DEBT FREE MONEY is a misunderstanding, because money is always an asset and liability of counterparties.

[@joebhed1]

+dilbertgeg When it comes to misunderstanding, dil, a plethora abound in your comment. Starting at the end.Why does the fact of the FDIC lead to a conclusion that ‘for all intents’ the Guv is borrowing from the Fed. Appears a non-sequitur at first glance. And, from what business school did you learn that you can’t have money without “debt”, if you understand the difference between a debt (monetary obligation between parties) and any accounting norm?faculty.chicagobooth.edu/amir.sufi/research/MonetaryReform_1939.pdf And since the GUV-US did issue those ‘Greenback’ Dollars, (they were NOT Guv ‘bonds’ , again if you know the difference), but a circulating (hand to hand in commerce) money-unit denominated media of exchange, in the $$$hundreds of Millions, that circulated for 135 years (unlike all debt-based money) until Rubin convinced Clinton to (un-Constitutionally) remove them from the national economy? Or was that all some misunderstanding? Just like coins of issuance in this country today, ALL money can be issued without any associated “debt”. Yes, the bankers (Hamilton, etc) set up the Bankers Money System in this country so the Guv would have to borrow from private banks.That’s the problem. Your whole construct ignores the money power granted to the Congress to create and issue the nation’s money. Just like coins today, the Congress could directly issue - by spending into circulation - ALL of the nation’s money. There NEED be no “swapping of papers” between the TSY and FED. So, please forget about the ‘swapping’ problem. It does not exist. The process has two parts, one is preventing the private Fed banks from creating money, and the other is to authorize the Congress to do so. Problem solved. www.govtrack.us/congress/bills/112/hr2990/textIt’s all in there. Thanks.

[@gg_rider]

joe bongiovanni Joe, I appreciate that Govt does not need to have debt to banks, but all money IS simultaneously an Asset and Liability of two counter-parties. That is, the term "govt debt" is not actually accurate. Dollars ARE Govt liabilities, and tax revenue is collecting back its own liabilities which is previously spent into existence. The govt has Treasury Liabilities to banks and firms because Treasury issues those Bonds, Bills, Notes, as Congress requires it to do. As I've said elsewhere, Congress can change the rules and design any day of the week, within reasonable parameters depending on operations. (Think about how database admin -- programmers can change things, but sometimes unexpected results.) As for banks, I don't think we wanna see a situation where Govt OUTLAWS banking, because banks merely issue liabilities (contracts) and to outlaw banking would mean making it illegal to sell or trade and IOU with a willing party. That would mess with Contract Law on a very molecular level. Applying for a loan or credit card would be more like applying for a Pell Grant or School Loan -- more bureaucracy and slowness. And more centralized. If bank lending were outlawed, probably outlaw banks would emerge. Anyhow, Congress ain't gonna do it, so it's not worth even discussing. However, if we think citizens should have LESS reliance on bank credit -- such as not having people go deep into debt for basic living expenses like medical care, education, etc. -- well I don't think I need to explain the solution, but you know that Conservatives OPPOSE that solution strongly. The result would be that people would still borrow as needed to desired for certain "bling" or luxuries, diamond rings, yachts, new cars, etc. but people wouldn't be relying on PayDay Loan places charging 500% interest and getting sucked into paying 10x their loan and still owing the full balance -- and all that burden on income actually HURTS the rest of the economy -- people can't shop for normal consumption because the PayDay places got every last penny in interest, fees, fines. As for the GOVERNMENT (Treasury) paying interest to banks, it's true that this could be eliminated, but the Fed would have to pay interest on Reserves instead, for the monetary system to function right (setting base interest, paying interest to citizens, etc.), and it's arguably UNFAIR (if we believe that) for people or firms to receive interest from the Govt on their savings, but it also has NO COST TO TAXPAYERS, since Tax Revenue is irrelevant to Spending, other than how higher or lower taxes affects how the real economy is doing (usually, poor people pay too much taxes, which hurts the economy and kills jobs). Warren Mosler, having a more 'conservative' outlook via MMT, and more pragmatic, I understand him better now that his focus is MORE about *what can we do immediately to help unemployed get jobs, and help working poor survive better, and help middle class grow*, and LESS *immediate focus on going after people who earn 'unfair' income*. You know what I mean? Goldman or Citi or JPMC CEOs should arguably have much less Free Lunch handouts, but wrangling over taxing them is not going to help 40 million unemployed people get jobs or millions more poor people have more take home pay -- to change their lives immediately for the better. Are we on the same page? Considering how MIT has developed Quantum Computing that (literally) accesses Parallel Universes, leaps and bounds beyond current silicon chip computing, that makes MMT skepticism and Gold Std ideology that was designed for the tech of large sailing ships and Pony Express, prior to air travel and digital global communications, it seems that much more idiotic.

[@joebhed1]

+dilbertgeg No, we’re definitely not on the same page at all. Not even close. Your belief system, based on MMT, defies science, law and history.Take, as an opener, your statement that “”Dollars ARE Govt liabilities, and tax revenue is collecting back its own liabilities which is previously spent into existence.”” 1. The government has only EVER spent Greenback Dollars and US Notes into existence - the ONLY public monies issued..2. DOLLARS are the unit of account of the national currency.3. The national money supply is made up of dollar BALANCES in certain private accounts, these being checking and savings, and NONE of those dollar BALANCES were either issued by the government (ALL privately issued), and NONE of those dollar BALANCES are a liability of the government, but of the issuing private bank.4. Tax revenue is the government collecting the private bank’s liabilities (bank credit in taxpayer checking accounts), which, under the Bankers’ Money System is legal to tender in settlement of all debts, public and private.5. The sovereign government is a user of the private "Bankers Money System. see www.sovereignmoney.eu/currency-and-banking-teachings There’s too much of error-laden beliefs being laid down here as claimed facts. MMTers need to either get out more often (reality) , or just talk among yourselves. Thanks.

[@gg_rider]

+joe bongiovanni Someone in MMT circles looked up the stats. Of all the M2 money in circulation, 71% (varies) arises from bank lending. The rest is created by govt. If the govt didn't reduce spending (and/or increase tax collections) at times when bank lending credit-money is growing (healthy econ growth or dangerous speculation bubble), then the combination of bank + govt monetary expansion could become generally inflationary. Vice-versa, if govt issuing money doesn't increase at times when banks are reducing credit flows, that could be deflationary. Deflation is usually more destructive, quicker, more cumulative. Inflation can be annoying. Savers lose a bit. Deflation is a wave of no pay, bankruptcies, foreclosures, associated job losses, which cycles into more of same. I'm not gonna try to rewrite 7DIF but it's not a matter of getting out more, IMO. Mosler has operated one on one with Fed staff, as a money fx trader and as bank owner. He recounted the incident of contradicting and disagreeing with Robert Rubin in some open Fed meeting. Rubin, as you know, pushed policies in the spirit of Ayn Rand or Greenspan, such that he's one of those most responsible for destroying our economy. It seems like govt borrows from banks, but banks have to ultimately rely on govt for a measure of solvency (at times). The chicken and egg can't both come first. Treasury issues bonds to banks because Congress has "banned" Treasury from borrowing from Fed (which gives all its profits to Treasury). So Congress requires Tsy to borrow from banks specially chosen by the Fed, with arrangements transmitted by the Fed, such that these banks could (as needed) borrow funds from the Fed to lend to Treasury a/o cash in their Tsy bonds with the Fed as desired. So Congress has this convoluted process of Fed giving notes to Tsy in exchange for bonds from Tsy going to Fed, what amounts to a "paper swap" like derivatives traders and hedge funds do all the time. This is my best attempt now at explanation as to why govt spending is not actually sourced from banks. It is a matter that private savings a/o surplus reserves perhaps initially from loans are added to govt-supplied storage accounts inside the Fed, and we say that means "borrowing".

[@basemayn]

I literally just discovered MMT economic theory like two days ago and have been watching videos like this one ever since. It seems too good to be true? I've never heard a politician (in the US) democrat or republican, talk about economics in these terms. If what Dr. Mitchell, Stephanie Kelton, and others are saying about fiscal restraints and monetary policy is true, than the entire political conversation in America needs to change. "We can't afford it!" I guess we can? Time for major investments in education, green technology, science and tech, affordable healthcare, etc.

[@soulfuzz368]

Scott Wells you have to have a lot of faith in green technology to think that constantly ramping up the economy isn’t going to have detrimental effects on the earth.

[@kingkoi6542]

No absolutely not true, we can't afford it so our children are going to have to pay for it. This is creating modern day cattle slaves.

[@virginialawrence2277]

I am 68 and discovered MMT six months ago. What I have discovered over my life is that I love having my own beliefs and preconceptions destroyed by clear thinking and logical argument. After processing MMT you start thinking about politics quite differently and realise that governments can afford to look after their most vulnerable. They simply choose not to do so through various pressures from hidden vested interests

[@jackvac1918]

The government is driven by it's influencers (big private enterprises) to ensure an economic environment conduicive for them and them first to thrive. This means reducing public investment in all sectors so the private market can expand into those areas formerly the domain of public services (e.g. the prison system) as an alternative to facing the ruthless competition existing in already established markets. The neoliberal philosophy of deregulation, privatisation, austerity, and globalisation that has dominated government thought for nearly the last 40 years complements the goals of private sector expansion, and expanding public sector involvement in the name of welfare is heavily resisted because restricting the public sector benefits the political competitiveness of politicians that advocate for it though attracting financial support from powerful private interests. The welfare and prosperity of the average Joe and the less fortunate of society is a distant concern, they can be placated by obfuscatory rhetoric and half-measures; the prosperity of the politicians' financial backers is what matters.

[@Individual_Lives_Matter]

It’s a pipe dream and it’s doomed to collapse.

[@rickhooper1575]

When Federal Spending is sent to other countries or for obscure animal research in a foreign land how does this benefit our production and output in the United States?

[@nthperson]

Modern Monetary Theory may improved upon the outcomes of existing arrangements, but changes in how money is issued and spent into the economy does not address the fundamental systemic problem of the private appropriation of rents (i.e., the potential annual rental value of locations, of frequencies on the broadcast spectrum, of take-off and landing slots at airports, of licenses to extract natural resources of all types, and the resale value of any competition-limiting license granted by government). The rents from control over these assets is rightfully THE public income that should be collected to pay the cost of public goods and services.

[@jackstarling2795]

History has a habit of repeating itself, 2000 of years of monetary history says that mmt is not a good idea

[@GerNiels]

Jack Starling how so?

[@mm-zw1zc]

10:55 "In fact spending does not crowd out ...". This is at best hypothesis, but almost certainly not true and has bad assumptions. Up to this point there are logical pinnings, but this is where MMT just goes off the rails. This is just nuts. When has there ever been a case where after the spending on charity to support some bad time followed by some 'good economic situation' where the government has just bowed out returned the spending back over to the private sector? This makes it a one way ticket to inflation because there is never any incentive for a politician to spend less. It leads to infinite erosion of the private sector and increased inefficiency - until the currency collapses because people don't trust the government. It also leads to a Cantillon effect because it robs your liberty to decide where resources should go and gives it to a politician. It hurts the poor because the government spending is executed by the few politicians in power who can direct the spending (typically to favor the wealthy corporations that have lobbyists and that contribute to their campaigns). If you feel compassion for the poor, then donate to private charity. It's not the governments job to do this. It's yours. Think about it this way. Do you believe that your congress is a better judge of who should get charity than your are? The governments job is to provide a level playing field, not decide winners and losers. A level playing field is when there is market choice, transparency and competition.

[@Rob-fx2dw]

Exactly. It's totally badly thougth out socialist rubbish which is based on force rather than choice. It contains false information and makes absurd assumptions based on those false statements and contradicts historical facts.

[@robertatallo9771]

Reading a little too much Hayek, eh?

[@hamsterg0d]

MMT: The structure of production is static. Therefore the more money you throw at it the more productivity there is.

[@MrNetMan11]

Don't even know where you're getting this.

[@andrewacomb6784]

Subtle nitpick- the Wool example is really bad because there are already futures markets that solve that problem within the private sector. His general point is still good though.

[@jkim3275]

The very background rational of this theory has been absolutely failed in some emerging markets already.

[@rahfx5485]

Right, they don't emphasize or purposely ignore that MMT will destroy the value of your currency. It will also eventually lead to a liquidity trap.

[@HicSuntL3ones]

Emerging market are not meant to do MMT, they do not have strong enough currencies nor productive enough economies

[@micahtewersofficial]

He has beautiful hair.

[@mktwatcher]

Actually if Countries were Fiscally Responsible then they would have to compete with business and consumer borrowers making more available for private capital expenditures which would expand the economy.

[@andrewprice8820]

Govt debt does not work the same as private debt does. And also, the reason it needs to run deficits/incur debt is because resources aren’t being used by businesses and private sector actors.

[@tomtesoro7994]

AND... When the job guarantee CAN be acted upon YOU DO NOT HAVE TO BRING in IMPORTED LABOUR ( requested by the private sector at a cheaper rate)

[@user-wr3sy3rn6w]

The modern money theory is the modern alchemy

[@pekka1900]

I hope this is not true, but in this guys wiki page it lists Marx as one of his influences. And this guy is supposed to be taken seriously? As you said. Modern day alchemy.

[@kcufhctib204]

@@pekka1900 Every economist is influenced by marx idiot.

[@SuperNaphtali]

Great video if you're having trouble sleeping!

[@jamesluce931]

Lol

[@adrianstevenson9464]

Big business through lobby groups and donations have too much influence over Government policy. The objective of business is to employ people for minimum pay and conditions. To do that you need a pool of unemployed people to compete for the available jobs at lower incomes. The Government is happy with around 5% unemployment because it provides that advantage to business. When you have full employment businesses find it difficult to find new employees when they want to expand operations. That means they need to compete by offering higher wages to new employees. This would also lead to wage growth - something we can only dream about these days. I like the idea of the Government employing the unemployed but it needs to include free training and education so that those people who want to get better jobs can improve their skills without being burdened with high debt later. If you want Governments around the world to govern for the people then you need to put an end to political donations. But good luck with that. I hope this is clear.

[@josiasnkwana9282]

When expansion is in demand, more money is added to the production cycle which is inflationary. The big shots will be competing for cash flow n often results in acquisitions and mergers and inflation.

[@Wilshire101]

Would the Whitlam RED Schemes be considered unemployment buffer stocks?

[@gimp1325]

When the US went off the gold standard did they sell the gold to Mitchell's mouth?

[@brickpitino6793]

Bruh i was scaning the comments, i was like does he got a bottom grill in! Got the earrings too, looks like a 2chainz video

[@KathleenBassett]

yup, he's awesome

[@arturoesteban2272]

The man is a genius.

[@clarestucki5151]

It's true that "every dollar spent is somebody's income", however it's important to ask from whence the dollars came. If they came from taxation or from investors/lenders, all will be well. However, if they came from the Fed Res created out of thin air, they will raise the ratio of amount of money in circulation to amount of goods and services in the marketplace (GDP). That will represent monetary inflation which will in turn generate price inflation.

[@danielbolton6895]

But economists won't decide the limit of money printing and deficit spending. Politicians will based solely on getting reelected in the short term. So how will we prevent inflationary printing in a political system based on lolly scrambles for the masses?

[@lowpross11]

Daniel Bolton Great question.

[@Liam-yr4uf]

I think it requires humans to act according to precepts which are based on morals that don't change over time.

[@lowpross11]

Yeah, the government exists to help us. What a bunch of ....

[@lutherblissett9070]

Govts exist. That's just the way it is. They aren't going anywhere. Get used to it. You can either want it to make your life better, or make it worse. Choose wisely.

[@gimp1325]

How can you trust a guy with two hoop earrings?

[@davidwarden4974]

He's also a guitarist in a band - that's why!

[@stevendevore7072]

Except a job for many doesn't pay all the bills, not even close so they have to get second or third jobs. How does that add up in the macroeconomic world?

[@gregorysoderberg6062]

issue? Issuing? How is it 'issued'?

Good GOD can this guy whisper in more of a slow motion monotone?! Find his volume knob.

[@threeone6012]

MMT explained in 1 word: Venezuela

[@banzobeans]

#fav

[@KathleenBassett]

facebook.com/RealProgressive/videos/1957906231174411/

[@NathanRyanAllen]

Wrong. Imbalance in supply vs demand caused their issues, which they tried to fix by printing more money, which caused hyperinflation. MMT doesn't claim that printing endless amounts of money is the solution to all of our problems.

[@davidmcccsf]

Three One US Sanctions and meddling to pillage and steal oil=Venezuela.

[@BillyBoi911]

The classic conservative strawman "vENueZUeLa!!!"

[@lewism.henderson9571]

'How many Harberger's triangles can fit in an Okun gap? The answer, of course, is heaps.'

[@anitarose1122]

Love this

[@BobanOrlovic]

I have no degree in economics. And even I know: the government can not tell the central bank to print debt free money for it. If you are over 30 years old, working in economics, and don't recognize that, I don't know what to tell you, go do something else. If the government fails to pay back it's loans, it CAN'T sell bonds, because no one will buy them. Central banks can't buy them directly because that's banned.

[@BlackFlag2012a]

Boban,No, it is not "banned" - the Fed absolutely can and has bought government treasury bills directly.

[@BobanOrlovic]

BlackFlag2012a Why doesn't the Federal Reserve just buy Treasury securities directly from the U.S. Treasury? The Federal Reserve Act specifies that the Federal Reserve may buy and sell Treasury securities only in the "open market." The Federal Reserve meets this statutory requirement by conducting its purchases and sales of securities chiefly through transactions with a group of major financial firms--so-called primary dealers--that have an established trading relationship with the Federal Reserve Bank of New York (FRBNY). - Taken directly from the federal reserve website

[@BlackFlag2012a]

Boban Orlovic- "open market" Correct. This is the manner the Fed uses to gage the "true" price of government debt. HOWEVER, the Fed purchases all *unbought* securities that the market does not acquire. Further, the Fed returns all interest payments back to the Treasury (minus a small fee for costs) - so essentially, the Treasury gets cost-less money from the Fed.

[@BobanOrlovic]

BlackFlag2012a That contradicts what the fed says on their website, can you give me a link of what you're saying?

[@BlackFlag2012a]

Boban Orlovic- www.federalreserve.gov/faqs/how-does-the-federal-reserve-buying-and-selling-of-securities-relate-to-the-borrowing-decisions-of-the-federal-government.htm "The Federal Reserve purchases Treasury securities held by the public through a competitive bidding process"

[@jamiekloer6534]

So you get rid of the market all together.

[@stvwds61]

The Treasury sells bonds in response to inflation not the other way around. Inflation occurs when there is to much money in circulation without enough economic activity generating taxed transactions through which capital is removed from the economy. Treasury sales are another tool used to remove excess capital from the market. The $22 trillion dollar fed deficit, or stated another way, the surplus in the economy, has not caused inflationary pressure because it has been used to purchase treasury bonds using the cheap capital the fed pumped into the economy to stimulate it in response to the Great Recession. This is a dream scenario for corporations and the 1%. They received low to no, to negative interest rate capital which they have used to buy treasuries. Specifically, they were given free capital, often owing less on it than the original principal due to inflation effectively reducing the interest rate below zero. Example, a 0% interest rate with a 1% inflation rate equals a -1% effective interest rate. Meaning they owe less back than the original principal amount. On top of this, we the taxpayer, are paying them interest on the treasuries they have bought from the fed. So not only do they get cheap capital, we are paying them to sit on it! That is why it is not circulating in the economy and being taxed back to the fed. There is also another benefit not considered, the treasuries they own are carried on their balance sheets as revenue generating cash equivalents. Which makes their financials look even better and thereby the value of their stock. This is a compounding effect when coupled to the low rate of investor return on treasuries for the common investor as in a normal market. This is the reason for the stock market backlash in response to the fed increasing interest rates last December. Not only would it reduce the dollar value on the treasuries they held, thereby reducing their artificially inflated balance sheets, it would cause drops in their stock prices at year end. Therefore, reducing the analytic financials used by investors and rating agencies. Further, it would reduce their financial performance bonuses based on stock price!

[@Rob-fx2dw]

All made easy by the Federal government who blindly assists by not understanding that their fiat money expansion is just a delicious apple pie for those who really know how fiat money increases in the hands of government just creates more division of wealth due to the ignorance and arrogance of politicians who think with their emotions and not with their head and are prepared to do almost anything to get into power do. Without that government intervention and big deficits and the Fed's help too boot it would not be so.

[@nb321cmrc]

One of the best replies yet. Thank you.

[@pjdelucala]

The issue is not that a government can or cannot run out of money. The issue is the consequences of increasing the money supply which is inflation and the consequences of decreasing the money supply which causes recessions. Families accept financial constraints. So should governments. It is just common sense. This man reinforces the idea that economics is the dismal science.

[@williamwilson6499]

Peter The Government isn’t a household...two different creatures and it’s a mistake to equate them.

[@pjdelucala]

@@currenteventsplaylist9132 Everything you said is true except for your definition of inflation. Inflation is the inflating of the money supply. That is it! Inflating the money supply means that the Fed is increasing the money supply more than a percentage increase in population. An increase in the population is the only good reason to increase the money supply. Money serves as a measurement of the value of goods, services and assets. When the Fed inflates the money supply, the Fed distorts that measurement to some degree. When the Fed adds more money to the economy, it puts upward pressure on consumer and asset prices. It either increases the general price level or it doesn't allow the prices of goods and service to go down as much as they should when you have, as you said, advances in production technology. Computer products are the perfect example. Look at the PC. The prices of PCs have come down significantly since the late 20th century because of incredible advances in production technology. My first PC cost me $1,100 in 1986. It is now a dinosaur. But can you imagine what the prices would be of today's PCs and laptops if the U.S. hadn't INFLATED the money supply so radically since 1971? Peter de Luca: Economics Professor

[@pjdelucala]

@@currenteventsplaylist9132 New technologies that decrease the general price level is supply side expansion not deflation. It is a supply and demand issue only. This happened from 1865 to 1893 during the Great Industrial Revolution along with a gold standard. Deflation is the shrinking or collapse of the money supply and is not a good thing. It causes recessions due to very high debt that must be paid back or goes into default. Unfortunately, the media confuses lower prices due to supply side expansion as deflation and higher prices due to supply chain disruptions as inflation. They are both supply and demand issues with nothing to do with the expansion (inflation) or contraction (deflation) of the money supply. They require different solutions to heal the economy. If you want to reduce inflation, then keep the money supply constant and allow the economy to grow into the money supply. It is all about supply side expansion. That was done after the Civil War which caused 75% inflation due to money printing by Lincoln. But it took 14 years for prices to fall to pre-Civil War levels. Peter de Luca: Economics Professor

[@PT5684]

Venezuela has its own currency , and they print all they want ...and inflation got out of control

[@robertjenkins6132]

Venezuela destroyed its real economic output capacity with decades of mismanagement. Their economy was not diversified and highly dependent upon oil exports, but valuable human capital was lost when Chavez replaced people who knew how to run the state oil company with loyal but incompetent political appointees who didn't properly invest in oil extraction technology, so oil output has declined despite the fact that they still have vast amounts of untapped oil reserves. The professor says that government spending should be used to activate idle real assets (such as unemployed people who could be doing something useful); he does not claim that spending can miraculously restore the national economy if the underlying real capacity has been destroyed through war (as in Germany) or mismanagement (as in Zimbabwe and Venezuela). The real capacity has to be there. To give an example: If unemployed people are sitting on their butts next to fertile farmlands which the private sector has not utilized, then the government can spend money to get the people to produce additional crops (more money chasing *more* crops); however, if people sit next to an arid wasteland, then no amount of spending will produce additional crops (serving only to inflate the prices of existing crops). Spending can activate under-utilized resources, but you can't spend your way out of fundamental shortages. The U.S. has been running deficits - which is effectively the same as printing money - for most of the past several decades, yet the inflation rate of the dollar has remained in the low single digits.

[@duggydugg3937]

Venezuela used to own it's own central bank...now the cb is bankster owned...now that Hugo Chavez has been iced

[@dicktracy3787]

This confuse money with wealth, which they admit and then ignore.

[@Rob-fx2dw]

You got it in one. It's a confused theory. Not only confused but in denial of the real facts that new fiat money has no value when created and is just a way government gains more control of goods and services when it sells the currency to the private sector (you and I ) for goods and services that others have to actually work for. It supplements the tax take to allow federal governments to spend more than they are willing to disclose as a tax take. Yet the proponents of MMT including Mosler, Kelton , Mitchell and Randall Wray continually misdecribe this sale of currency by repeating the lie that government issues new money to the private sector.

[@limitless1692]

diging up holes and then filling them back up hahaha

[@aliecat1999]

What in the bloody fuck do you mean rob, that new fiat money has no value

[@simonturner1]

"the lie that government issues new money to the private sector. " I don't think you've understood this. The government creates new money by spending. Its account at the central bank is debited and the equivalent amount is credited to the accounts of its suppliers. The money doesn't physically exist, but that act of accounting creates it electronically (and remember 97% of all the money in the economy is electronic). It is brand new money. It is true fiat money has no intrinsic 'worth' because it's just words printed on paper, but it does have 'value' because the government demands you pay your taxes with it. Your local currency could be worth one billionth of what it currently is and it would still have value if your government still said they wanted your tax payments to arrive in that denomination. MMT isn't confused. Its critics just haven't understood what it is saying.

[@naldebol]

Individuals, private citizens, do not determine what the value of the currency of the GOVT is. That is determined and dictated a whole lot more, vastly more, cosmically more by the GOVT, the GOVTs central banks. If you don't believe that, look at the currency wars being launched around the world. WHo's launching the wars ? The GOVTs are, and they are doing it for the absolute result of currency value, whatever the GOVT of any currency tries to do in a currency war. MMT is not understood by those who ignore a wide range of things.

[@nottheguardian7955]

10:39 The claim is made that bond interest is greater than what's given to the poor. In the UK bond interest is about £50bn. Pensions and welfare are £278bn. And that's without including free health, education and the like.

[@bobsmith2886]

I have studied MMT for 4 years. I agree with 99% of MMT, but the idea that higher rates are stimulus is RIGHT ceteris peribus, but it is WRONG in reality. After 40 years of Fed puts and multiple expansion in the stock market, if interest rates are raised, APPL would be trading at 12 times earnings at 5% interest rates rather than 35 times earnings at 0% rates and QE. Imagine if everyone woke up and there stock portfolios were down 50%! Higher interest rates would also tank real estate and yes, money would flow from the gov to the private sector thru bonds, but net worth would crater and this would be restrictive, not simulative. Someone please tell me why I am wrong

[@Rob-fx2dw]

At 3:25 onwards "MMT - "a government that issues its own currency, that has it's own central bank so it controls monetary policy, the setting of interest rates and doesn't sell any debt in a foreign currency, it can never go broke". That is a deliberate twist of the reality of the financial situation of a country. Deliberate by omission of the facts which this person should be aware of. Specifically it uses semantics to cover the fact that a currency can collapse but the country will not be declared bankrupt since it is pointless to do so when a country's finances collapse. In effect private savings in that sovereign currency are wiped out. Contractual obligation are sent to the abyss. That currency default applies to a multitude of governments which have sent their countries broke. That applied to Hungary, Zimbabwe, Germany, in the twentieth century and a host of others including China just prior to the Ming dynasty which anyone can research with a minimum of effort. Oh yes they still could print seemingly endless amounts of currency but it was worth virtually nothing. take Zimbabwe where their currency dropped in value by 79.6 billion percent or Brazil where it's cruzeiro dropped at up to 80% a month before they dumped it and created a new currency. All at catastrophic cost to the people of these countries. The MMT theory completely ignores the reality that is laid out by Bernholz in his examination of 29 counties that had experience the inflation that led to a hyperinflation situation. After an analysis of 29 hyperinflations Bernholz concludes that at least 25 of them have been caused in this way. (See the publication " Monetary Regimes and Inflation: History, Economic and Political Relationships" )

[@pennypacker7209]

Rob Mews I think they do recognize inflation as a problem. And the only problem. MMT is saying that the federal government does not have to collect taxes to operate. Inflation is their only constraint on spending. I guess some think that taxing also helps to control inflation. So yeah i think inflation is their major concern.

[@Rob-fx2dw]

Penny Packer They may recognise that government does not have to tax to spend. Most people who studied or were genuinely interested in any economics at all would recognise that. What they don't recognise is the fact that the mere existence of this facility means politicians are not restrained in their promises no matter how wasteful they may be. I disagree taht there si aplausible argument that tax reduces inflation since tax may mean that government takes more money from the rest of he economy and uses it wastefully driven by politicians' purely political reasons in promising what they cannot deliver effectively. this is often the case. If tax takes what the rest of the economy could spend and uses it infficiently taht means overall wealth decreses because of that wasteful spending. Overall effective use of resources would then mean lower GDP than it would otherwise be. That means a lower standard of living and depreciation of the value of the money ( inflation) is a result of that. In fact that is MMT's argument where inflation has occurred in many countries (reduced GDP )and it is somewhat the cause of that inflation however in economies that governemnts have expanded their money supply rapidly it is much more the money expansion that has caused this. In places like Hungary after WW2 the massive expansion of money supply was the cause of inflation since government sought to keep up it's share of wealth at the expense of the rest of the economy which suffered as a result. Similar inflation happened in Brazil in the 1980's.

[@gg_rider]

+Rob Mews Nobody stated that a nation should print unlimited currency. A glut of gasoline doesn't mean you should shove 200 gallons into your tank ... though you will certainly do so over time, depending on the car and your travel and driving habits. MMT says there's infinite *capacity* for spending -- subject to real world conditions in the real economy, not subject to some scare story about fiscal insolvency. Infinite *capacity* doesn't mean infinite spending at once. A currency "collapses" when the govt can't collect taxes, during political upheavals, civil war, being conquered by a foreign army, production facilities bombed to smithereens, farm failures and famine, being forced at gunpoint to pay debts in a foreign currency, choosing to have debt obligations in a foreign currency, and and then trying to meet those conditions by money printing without regard to real economic conditions, such as capacity of materials, production, labor. Weimar under Versailles had no choice ... until that foreign debt part of Versailles was abolished unilaterally. Russia and Zimbabwe suffered famines due to (a) weather (b) political upheavals. The US suffered near-famines in the 1930s due to insufficient money. There was plenty of capacity to provide food, but farmers going bankrupt because no money to pay for output, no income to pay farm debts. Ditto for other production in the 30s. Plenty of healthy capacity, but bank credit issuance had collapsed, and banks themselves were collapsing like dominoes. That's called DEFLATION ... in extremes, hyper-deflation aka Depression. In debt-deflation, it is not some steady declining value of the currency/savings as prices rise. What happens is that real value, and including physical tangible assets that had taken decades or generations to grow, gets wiped out rapidly -- seized for debts -- and nobody to sell to. Intellectual capital gets wiped out too ... or starved for lack of payment to hire people to create it. What happens is an entire generation like 8-15 years of high school and college graduates gets shoved into idleness or forced underemployment, and doesn't get to start their careers or start being productive and creative. Scientists, engineers, and technologists get laid off or never hired. People on their way to being production engineers wind up as cashiers and greeters, and are lucky to have that work. Black market economics expands too. Along with that, prison jobs. That's capitalism running in reverse, running backwards in both profits and in time. Capitalism can't run in reverse, just by the nature of capitalism. Interesting "experiment" though, very exciting to watch ... or very depressing to watch. Mao and Stalin also did ideological economic experiments, and practiced confiscation of resources. Confiscation of food or net confiscation of money is not much different in practice, in a money economy. All that worth it for ideological reasons or to prevent a drop in a few points of value of money over years or decades? While defending the "value" of savings, financial savings and tangible wealth is actually wiped out. The US population is suffering hunger and homelessness today. Is there a lack of homes? Lack of land? Lack of building material or lack of builders? Insufficient food or insufficient capacity for food production or food imports? None of the above. Lack of money to buy food, and lack of jobs to sell stuff into insufficient aggregate demand -- which causes businesses to reduce output. In some cases, businesses reduce output by layoffs, then reduce output by shutting down and declaring bankruptcy. I'm sure you have seen plenty of For Lease signs on storefronts and offices and factories with no takers, even at productive malls and strip malls and industrial parks. And that's still occurring at current levels of fiscal expansion. I'm sure you are aware that there's tens of millions of productive people willing to work in some capacity, who are unable to find a job with a paycheck. Or they get hired by displacing another worker. But Obama's budget deficit is approaching zero, yay. Wages have already been reduced by globalization and layoffs, as people have shifted to jobs at half of previous salaries and curtailed spending on non-necessities, often curtail spending on necessities too. Many businesses have reduced labor costs by 95% by hiring 3rd World employees or contractors. Automation too, of course. Has that extreme reduction in labor costs resulted in an economic boom? Does business create jobs or do customers with money create jobs? Why is sales and marketing to customers the most important functions of a company, more important than production or engineering? The bottom line. Yet mainstream macro econ at it's base of micro is premised on a barter economy without actual money or actual credit operations. While credit has risen to 40% of all corporate profits, dropping to 30% in recession, and that sustained by foreign speculation. Hmmmm, something missing in this logic? People? Reality? Money?

[@gg_rider]

+Penny Packer Yes, inflation is a result of *possible* excess spending by anyone -- foreign net importers (if we had that), prosperous working population (if we had that), bank expansion of credit on consumption (if we had that), or government fiscal expansion (if we had that). Particularly if for some reason a level of spending exceeds *capacity*, short-term or long-term capacity. Like in World Wars, the US needed a massive ramp up in steel and rubber, etc, and it took industry a while to ramp up production. The answer was rationing combined with the voluntary rationing made popular by War Bonds. War Bonds didn't "pay for" the war -- they prevented the booming work force from spending all their income on new stuff, holding that money off the market at least until after the war effort ended. (The US decided for military and economic reasons to maintain that productive capacity after the war --- part of the reason for the Cold War, an *economic stimulus* for 45 years, vs bankruptcy and recession in military-related production. We did rebuilding of Europe with the Marshall Plan to prevent a rise in socialism or communism. Who do we suppose got paid? US corporations, US labor.) US Govt -- unlike even state or local govts -- has the benefit of being a total non-profit. State govts may not have a surplus, some have a "rainy day" fund, but at least must have a balance of spending vs taxes over a long haul. Businesses can also endure losses for a period, but not without end. The US Govt as sole currency issuer has no need and no justification for aiming for 'profits' or a surplus --- a surplus which *must* mathematically project a net deficit into the non-govt, the private sector. Demand-inflation is separate from inflation caused by resource shocks or resource constraints. An oil shortage or embargo. Other energy shortage. Droughts. Orange trees freezing. Animal disease epidemics like chickens recently, mad cow disease in the past. That is not properly considered demand-driven inflation. That ought to include spikes caused by a flood of credit into commodity futures. Commodity futures mkts used to be limited to 70% real buyers and 30% speculative froth. Deregulation flipped that to 70% speculation and 30% real buyers taking delivery. A flood of commodity futures speculation backed by infinite credit -- called "paper oil" in the past -- can drive up prices by creating a "paper shortage" of the commodity, until the selloff and collapse. That is not properly considered demand-driven inflation. The 1970s oil embargo by the Saudis -- rumor from some authors has that engineered by Kissinger's "diplomacy" on behalf of Wall Street -- was a resource Supply spike that got called "stagflation" and was "treated" not by increasing supply or by business or labor absorbing the hit, but by a policy which spiked interest rates up to 22% to "cool off" the economy, freezing lending and investment, and wiping out 55000 businesses and countless blue collar jobs, just in time for Reagan to open up China and expand financialization under Greenspan. So inflation as CPI increase is not necessarily "inflation", not demand-driven inflation. Determination depends on understanding the *causes* and factors of events in historical time. These are issues to which mainstream neoclassical econ is typically deaf and blind.

[@Rob-fx2dw]

+dilbertgeg You and nobody else, particularly politicians just know what a nation's "capacity" is. They cannot since they don't know what people will buy at any price. The term "capacity" is bandied around as a fact when it is really some dream made to satisfy a theory. How can anyone know "capacity" of any industry. It's all based on the demand supply price curve. This changes sometimes rapidly and predictions are never quite right. Yet you talk about it as if it is al laid out and unquestionable. You say "Russia and Zimbabwe suffered famines due to (a) weather (b) political upheavals.The US suffered near-famines in the 1930s due to insufficient money. There was plenty of capacity to provide food, but farmers going bankrupt because no money to pay for output, no income to pay farm debts. Ditto for other production in the 30s. Plenty of healthy capacity, but bank credit issuance had collapsed, and banks themselves were collapsing like dominoes." Well that Zimbabwe statement is also incorrect since Zimbabwe had inflation and then hyper inflation. None of this hyper inflation could have happened unless the government expanded the currency massively which they did. People got the new money from their bank and needed two or thee times the amount a day later to buy the same amount. That new currency came from government not anyone else. You attribute to political upheaval and weather. That is absolute rubbish. How did the currency drop by billions in value and the output of the economy only drop by 60%. ?? That does not add up at all. Your allocation of cause and effect and the maths, or lack of it, is totally disproportionate and off the planet. You say that there was a lack of money that caused the famines in the 1930's because there was a lack of money. Yes, the sovereign government confiscated people's money including their gold so there was a big downturn caused by this as well as the panic buying of gold from overseas by the US government. No wonder credit was short. That was after the recovery had started and showed a reduced amount of unemployment in the early 1930's. The trend all reversed when government stepped up taxes and made a huge number of legisalative requirements for anyone entereing the agricultural industry to follow as well as imposition to restrict trade with the Smoot Hawley tariffs which restriced the movement of goods. This movement of goods had been a huge export earner for the US after WW I . Imposting these tariff resulted in reciprocal tariffs by Europeans to reduce imports into European countries. This was another high cost measure which all had to pay for. You also say " Many businesses have reduced labour costs by 95% by hiring 3rd World employees or contractors. Automation too, of course. Has that extreme reduction in labor costs resulted in an economic boom? " That may be so but there is only one way to address this effectively which is work smarter and compete. If you can't there is nothing that can save you from someone else who is prepared to work more or for less remuneration. Why should it be otherwise just because it is you and not someone else. You say that wages have reduced. Yes they have and globalization not caused that overall but the non private sector (you personally) have no doubt felt the effect since the disproportionate increase in expenditure by government has because your productive effort is used by goverenment increasingly instead of it being in your pocket. People who talk of globalisation reducing their well being are wrong in principle since the principle is that trade allows increased wealth and sepcialization rather than the need for people to gain a range of unrelated skills use them infrequently and keep them up to date which is impossible in a modern economy . Has government revenue reduced the same amount? No. Government expenditure has increased massively.

[@threeone6012]

The Venezuelan stock market declined 25% in the last year despite 1000% inflation. MMT LOL!

[@guskalo1981]

Venezuela is under attack by the U.S Treasury and its proxy Colombia. Their currency is being taken out of the country as a hostile act. www.telesurtv.net/english/news/Venezuela-Extends-Colombia-Border-closure-to-fight-Currency-War-20161212-0017.html

[@threeone6012]

Typical "Russian hackers" excuse from the left.

[@UltraAporia]

Three One very thorough and smart counterpoint.....

[@lawrencesmith4960]

Three One In theory it makes more sense than the debt system we now have, which inevitably by definition implodes and transfers the majority of wealth to a handful of people. Every system relies on people to administer it, within the guidelines of how it is intended to function. I am not a banker or an economist but it is not to hard to grasp the concept that the central banking system is little more than a ponzi scheme, built on debt and destined to fail. The problem with MMT is not so much the system but a case study on people who inevitably end up running government. Self interest, greed and political will or lack of it will kill any system because logical or not they don't wisely run themselves.

[@Rob-fx2dw]

David Hill - Totally wrong statement lacking in depth. Where is your evidence. It shows no understanding of or account of any sense of proportionality that you should have taken before making such a factually unsupported statement. Example:- Chile had no appreciable drop in capacity during or before the mid 1970's but had inflation of 600%. That was summarised in the report on Fiscal and Monetary history of Chile 1960 to 2010 by the Central Bank Chile itself. It states "Chile experienced deep structural changes in the last fifty years. In the 1970s a massive increase in government spending, not financed by an increase in taxes or debt, induced high an unpredictable inflation."

[@crushedz]

Rural lobbies[14.20] are very powerful[especially in Europe].Land ownership is outrageous in the UK.Dont believe democracies can co-exist with such huge inequalities.

[@gregorysoderberg6062]

Even with the gold-standard we still had to be in debt to get money into circulation. Under the principle of Free Coinage in America we did not have to be in debt.

[@user-hp9eg3gf6s]

True now we have inflation in Europe due to the natural gas supply problem that reduces industrial capacity. Before we had expansion of the money supply and no inflation.

[@TractorJack]

I think wages should reflect productivity. In our modern society making goods to throw them away is grossly stupid. I'm not saying just produce what we need but not producing more than we can possibly use.

[@davidhewins]

At about 7 min he admits MMT is wrong: 'of course if we increase the money supply w/o corresponding increase in productivity we get inflation.' I would add that money was historically tied to gold, as he mentions, now is debt-based. So now debt service costs tend to limit the amount of money. If we proceed to divorce money from debt, what remains to prevent MMT people from ballooning the money supply? The changing money supply will destroy reasonable measures of productivity (prices), so productivity will have to be measured bureaucratically. That is, #socialism.

[@marciebalme588]

excellent stuff

[@z9chemao]

There should be an issuance of debt free currency by government.

[@kingmantheman]

The first Canadian Central Bank was set up that way

[@se7ensnakes]

John Kenneth Galbraith once wrote “The study of money, above all other fields in economics, is one in which complexity is used to disguise truth or to evade truth, not to reveal it.” I think of this when I think of MMT. On one hand the MMT crowd acknowledges that Banks do not lend from deposits. They acknowledge private bank endogenous money. But then they claim that "THE FEDERAL GOVERNMENT IS WHERE THE MONEY COMES FROM". So when we actually look at data we see the the M0 (which is government created) and the M2 (if you subtract 1.70) you find the endogenous money that the bank created. Are they trying to explain this difference using the Fractional Reserve Lending money because that was debunk decades ago? I believe that MMT is another ideology meant to confuse the public. They are paid shills to misinform and keep people off the track to what is really happening. So what is really happening? Bank of America et al are creating over 90% of the money stock with absolutely no supervision from the Federal Government. This is highly illegal as the constitution gives only the congress the power to manage the nation's money supply. Please refer to article 1 section 8 clause 5.

[@KingNeptune151]

Can you help me, you seem like you know your stuff and I want to learn as well, What do you think of austrian economics? And where should I start learning about economics in general? Thank You

[@se7ensnakes]

Austrian economics is crap because they are into the idea of fractional reserve lending. The banks dont lend from the deposits. MMT also ignores the money that Bank of America et al, creates which is most of the money we use. Read Steve Keen and Richard Werner. Then go and read Tom Schauf: www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=1&ved=2ahUKEwi9uouqop7kAhUPLa0KHWeiCcEQFjAAegQIAxAC&url=http%3A%2F%2Feducationcenter2000.com%2FSecret_Banker%2527s_Manual.pdf&usg=AOvVaw2n2p57YmcuLYLftVmWyDs8

[@Julian-iy6hz]

The state supervises the creation of private bank money through the reserve bank's 'discount window'. Banks operate on fractional reserve principles but can borrow reserves at the discount rate to reach the requirement. In this way the reserve bank interest rate controls the 'price of money' and the speed at which new loans are created. Private credit creation is not really limited by fractional reserve, as the required reserves can be borrowed instantly, but it is limited by the margins imposed by the discount window. A better way of envisaging the relation b/w state and private bank is that the private bank's money creation is an *extension* of the state's fiat via franchise. This occurs with the state issuing of a 'banking license'. Private banks have the ability to create loans for credit worthy customers, but are restricted by reserves to the extent to which the price of reserves adds risk and subtracts margin. The reserve bank can therefore theoretically stimulate new lending by lowering interest rates. This monetary operation shifts the burden of money creation onto private banks rather than the fiscal operation of the state. Capitalists prefer monetary operations to fiscal operations because they fear that state money creation crowds out private ownership. MMT shows that that is not necessarily the case, as fiscal spending creates private savings and therefore increasing potential investment. "High powered money" by fiat also does not necessarily create a corresponding debt obligation, so can provide a stronger stimulus to a lagging economy.

[@hinteregions]

You lost me when you went into the conspiracy theory bit. This idea of 'shills' is so over-used, usually as just a handy pejorative against someone who you don't like whose arguments you don't understand. There is no lack of real shills: media, government and institutions, and so forth, owned and controlled by people with more money and power than them, the corporations, are arguably 'shills' but now I think we are losing the sense of the word. And people who make KZbins about vapes XD Those entities, the corporations, do not need to stuff around buying academics, not even top notch ones, as that's a waste of their resources when the gigantic apparatus they have works just fine.

[@se7ensnakes]

@@Julian-iy6hz fractional reserve banking was debunked decades ago. Private commercial banks do not need to borrow from the discount window, nor a cent from the government to issue loans. You can see that plainly on the excess reserves vs credit created. If the money issued as a "loan" goes into default the bank's books are balanced by 1) mortgage insurance, 2) Federal reserve buying toxic assets 3) Mortgage back securities. The trick here is that the banks keep the collateral assets.

[@boyjimini11]

You don't run out of money you just dilute infinitely.... what am I missing?

[@RubyGaleHS]

Government has the ability to remove excess money in the economy via taxation policy, thereby controlling the risk of runaway inflation.

[@anteeko]

Ok someone debt is someone else income but why this concept should make me worry less about debt? Particularly when the income generated is concentrated at the top.

[@philipadams8436]

As someone who's Prime Minister has bought into this theory full on, I hope this man is right.

[@robertbrandywine]

Which country is that?

[@philipadams8436]

@@robertbrandywine Canada, with Justin Trudeau as PM.

[@user-zw8wq9zi9t]

Cant find anything regarding this online. In what sense has trudeau implemented an employment guarantee?

[@hinteregions]

We managed to lose that hand-clapping fossil fuelled boofhead. Now we have someone ordinary and not very effectual but sane, at least.

[@matiascova]

goverment reduction expansion is not a idea that stem from economic orthodoxy. The mainstream new keynesian model that is at the core of modern macroeconomic theory is insistent on the idea that income=spending. He is criticizing Alesina, as everyone does.

[@alandebenham6825]

Well done Richard Wolff for laying low the planning versus markets controversy as basically a very false debate and both socialism and capitalism work on economies which are a mixture of both with more government planning as a percentage in relation to socialism and less dependency on markets and vice versa being the case in capitalism. I'm a retired maths teacher and computer systems designer very much favouring everything in life relating to judgements based on percentages rather than the either /or or the true/ false arguments. ( Good for judging 'religion' I find as an active Humanist in the dogma versus scientific evidence discussion ) As a green socialist i like to put essential left/ right political divide directly on the field of play between public/ private as 70%/30%, and the other way round if ever I was to describe myself in favour of capitalism. What is your reckoning on this front Richard and any others ?? Nowadays of course these debates are now completely skewed by the climate and ecological emergencies which we all face in the accelerating advance to 'climate hell' and the 'sixth extinction' of life on this planet, probably coming to a very serious head in the next few decades ( also said by UN Chief Secretary Guterres and top experts ) Apparently our only possible salvation must come from an immediate big REDUCTION in all economic activity, especially within the so-called 'first' world nations, mainly because the 'having and doing' lifestyle philosophy of capitalism ( our globally severely conditioned behavioural conditioning ) has brainwashed us all into this and we all find spending much time on our 'state of being' ( having and doing nothing - say, hibernating in winter -and doing much thinking, reflecting and creating ) not possible. First Global Climate Conference in 1992 in Rio produced, via local Agenda 21 and many other initiatives, the new bible of sustainability ( sustainable 'undevelopment', 'un-consuming, 'de-growth', 'de-militarisation', 'de-materialism' NOT sustainable business as usual ) and the '3Rs' of Reduce, Re-use, and Recycle with emphasis on the first 'R' which politicians seem to not dare to mention its name, plus the related 's' which I include as the dire need for everyone to SHARE one hell of a lot more, including living in communes rather than privately owned things of a really big attack on the environment called 'houses'. There is NO SOLUTION, as most studying people know, in a big surge into renewable energy since it appears to discount the other essential elephant in the room known as ecological/ biodiversity destruction and the totally untenable amount of increase in very damaging global excavation/ mining of uncommon metals and minerals demanded by solar panels, electric cars/ lorries, wind turbines, storage batteries' lithium, heat pumps etc. Ask yourself : do you want life on this planet including your future offspring, and other life on which we depend, to disappear in horrendous extinction death throes or not ? IF YOU CAN'T REDUCE THEN DON,T BOTHER TO GET OUT OF BED !

[@arunkumarvikram]

This video delves more on Keynesian economics than MMT. Nice video but slightly misleading title.

[@paulspring105]

Not really. I believe Keynes focused on borrowing to correct a failing economy rather than printing money. MMT, at least as presented here, calls into question the validity of gov't borrowing. Welfare for business as he described. You may disagree but I think the MMT basis was very clear.

[@arunkumarvikram]

Paul Spring I am not saying MMT discussed here is more like a Keynesian prescriptions. I am saying the time duration for which they discuss MMT is very short and they discuss more about Keynesian fiscal spending part more.

[@paulspring105]

arun kumar You may be right. But I believe this is because MMT doesn't seem to focus on implementation - it is mainly an explanation of what they consider the true meaning and function of money. The guaranteed job of last resort is a political decision a society might want to institute once it accepts MMT concepts. I do get frustrated with MMT when it dwells on explaining the failings of Fed policy.

[@SchrodingersCat8813]

Well to be fair, MMT IS a Keynesian derived school of thought. MMT is actually, at least from my research, just a specific strain of the "Post Keynesian" school, they may not be exactly the same, but share a lot of space so MMT is just a school of Keynesian thought I suppose

[@runthomas]

he said spending = income...but in reality spending = income + credit/debt

[@ivanstojcic7250]

No, MMT states government spending = all private sector net savings. And that is actually a tautology. If someone in the private sector saves, someone else has to be in deficit. So all savings net to zero. Only if the government spends, the net savings go up.

[@crushedz]

Are markets/demand that can be afforded not essential to creating employment?Markets are the source of wealth and a national resource exploitable by governments to generate money for public services.Capitalism is the privatisation of the markets.What is relationship between government and private sector?

[@qones3574]

He didn't factor in true productivity. You have to, at least it needs to be remembered We consume non-renewables. Unless a sufficient portion of the profits go into finding replacements, you'll become poorer over time. You need enough of the harvest to be seed corn. If an unemployed person costs 2000 kcal/day. But you pay the employed person 5000 kcal, then they need to produce at least 3000 kcal in their job, or they're a net loss. You can't do that with mere hole-digging. They need to be actually producing, even if inefficiently. Obvs, it's best if they produce more than 5000 kcal. *kcal is a proxy for true output and consumption

[@MusicalMemeology]

You're not paying them in calories though its fiat currency. About 80% of food is used to feed animals for humans to eat and large amounts for ethanol so that is a really bad analogy.

[@derekmcdaniel6029]

Very well, but unemployment is a typically symptom of excess production, not a lack of productivity. If there truly was a productivity shortfall, then a JG would likely both be unnecessary and also not a good policy. Governments replace inherent conflict of interests with cooperation. This is the premise behind property rights and all aspects of the social contract. Without rule of law, people's interests are typically in conflict and not aligned, and power is only maintained with continual posturing and threat of force. When government enforces property rights under rule of law, it presents the problem that people can be actively excluded from access, because private interests have no incentive or even ability to account for exclusion that results from aggregated effects. This necessitates the social contract to take into account basic opportunity and access as a condition of enforcing objective property rights.

[@randygeyer7673]

Excellent

[@shabanamahfooz7380]

Awesome.

[@404errorpagenotfound.6]

What a dishonest fraud, the wool store in Australia got so big and the value so artificially inflated it collapsed spectacularly. I lived thru it directly and worked in those red brick buildings he mentioned. If he uses that to justify MMT we are doomed.

[@kainalrik]

meaningless drudgery is also bad for both mental and physical health. people need a purpose and to see that they accomplished something.

[@Rob-fx2dw]

Mitchell needs to listen to what Fed Chairman Jerome Powell has just clarified . He said " the idea that deficits don't matter for countries that can borrow in their own currency is just Wrong. kzbin.info/www/bejne/bWiaepyImLKEaLc and "MMT is the idea that the national debt won't be a problem if the Fed can keep rates low without sparking inflation." The US debt is growing faster than GDP fairly significantly faster. We're not even close to primary balance which means the deficit before interst payment. So we are going to have to spend less or raise more revenue." And "MMT is just Wrong" .

[@GerNiels]

Countries dont borrow their own money under mmt, they simply create it and spend it into the economy. Jerome Powell is a stooge for the current system so obviously he would lie about this.

[@Rob-fx2dw]

@@GerNiels The crazy MMT theory is just a fantasy that ignores proper accountability by applying two separate standards -one to the people in the private sector campared to those in the government sector and expecting nothing to go wrong. The claim they are acountable but their government accounting just does not add up with high deficits . When it comes to the private sector they require full accountability that demands everything adds up.

[@Rob-fx2dw]

@@GerNiels What you have said assumes there is someone outside of the economy (The Fed or government) which is just a notional partitioning of part of the economy and applying one set of rules to it and another to the private sector. Secondly you have to understand that the problems of wealth in any society are Not a lack of money because money can be created by adding digits to people's accounts. The problem is ensuring a consistent accounting rules and principles for production of goods and services and having a system that does that across time and all of the entities involved. Nobody spends money into an economy because the term "economy" encompasses all of the actions in the whole system, and not just the private sector or government sector. So technically nobody can' spend money into an economy' because they are part of it to start with and their actions are within the economy.

[@GerNiels]

Rob i don’t see how it is a problem that a government has the exclusive power to issue its nation’s currency. MMT just opposes the idea that all currency has to be a form of debt, which i wholly agree with. This enslavement of entire peoples to wealthy creditors as a result of the current system disgusts me and needs to end.

[@Rob-fx2dw]

@@GerNiels Government does Not have exclusive power to create new money. It can mandate that a certain currency is used but why mandate a certain number of money units must come from the government. That has never worked. There si much confusion about te origin an nature of money. The whole point about money this :- The important thing is understanding that that accountability is the origin of all money. Nothing else precedes it's creation since all physical form of money followed the need for accountability as do present digital forms. That is where money came from originally. The evidence is that money is in a many forms and no participant in the creation of money in a system is more important than any other since it could not have existed without being created, put into the form (digital, metal, paper or other) with certain actions taking place such as minting, printing or other. To say it originated from the person who minted it is just ignoring reality since it is in many forms other than those that resulted in minting. It would be absurd. Equally it is wrong to say the person who extracted it from the earth as copper or other metal is the origin since that ignores the fact it is not always in that form being more often in the form of digits. The currency (notes and coins) comes from whoever manufactured it. That is sometimes a government owned organization or it may be a private company. It may even be bought from another country. The digital money in the economy (most money by value) originally came from the need to account for goods and services. Notes and coins were introduced as a medium of exchange but the weight and quantity of those forms of money made it impractical as a means of exchange over long distances so accounting records were raised as exchange of goods or services were traded. New money came from governments decreeing a uniform currency for their economy and exchanging the taxes they had collected in other existing money which was being used in the economy. That process happened with the introduction of the Euro where government exchanged old forms (each country member's money) for new. The majority of money in the system today comes from accounting records of the assets and liabilities arising originally from actions of traders and savers. The fact that money originated from trading is the prime reason why consistent rules and procedures for accountability by the private sector and public (government) are paramount and when that is not the case there is always chaos. .

[@ricklarson392]

Brilliant insights!

[@roesbabyroos3240]

Hello handsome 🥰 man

[@Mark65845]

What about Venezuela? They have hyperinflation, yet they are a major oil producer

[@roc7880]

mmt might work for countries with global currencies or currencies of last resort but not for the rest. even UK saw the pound crashing when the smart guys in the cabinet proposed some unfunded tax cuts for rich and companies.

[@jamiekloer6534]

Sorry I have a lot of questions? I totally understand that a government should not be paying back interest to a bank that creates money out of thin air that is ridiculous. But what about interest to other governments who have leant you money? They only lend you money if they are assured that you won’t print to much money and inflate the currency right. I believe the government should employ people in the private sector to build infrastructure and stuff. Their is no need for unemployment and infrastructure being built. But I had more of a problem with the government paying people to do nothing. I think it is a problem for society.

[@spacebunyip8979]

He’s describing manipulation of the wool market via government intervention as though it’s positive . Free markets should determine price. If wool providers can’t remain profitable, they should work on more efficient ways of running the business or, go out of business so the remaining providers can turn a profit based on demand for the product.

[@hinteregions]

Show me a free market.

[@nottheguardian7955]

9:40 Bonds bearing interest are "corporate welfare"? No. They're a way of producing exactly what an MMT tax rise would do, save that they're voluntary.

[@markcampbell7577]

The minimum wage act and social security act with the unions almost reduce this need for welfare. Work for a living local commute is the minimum wage act and social security act the landlord and welfare departments rightfully expect 4 times the rent for one bedroom apartment local commute as enough income to reliably pay the rent for one bedroom apartment local commute. This is the minimum standard of living for social security act and disabled people and elderly people. We have homeless population across the country because of criminal wages and criminal entitlement amounts for disabled adults and elderly people.

[@gp-xe6mu]

MMT advocates have obviously never heard of greshams law

[@andrewstabback4747]

yeah no Understanding Greshams law is not hard. Infact its a brain fart!. Its also a very US centric view of the world where basically the view of any government is bad. to be fair if i had the US government Id hate them as well. Understanding what good governments look like would be a great start. What government fiscal stimulus should do is much harder for people that dont even understand what good government looks like. So before trashing something you dont understand you might want to widen your view to understand the difference between good and bad.