Bill Mitchell-ekin elkarrizketa (euroa eta pandemia)

Sarrera gisa, ikus


Conversación con Bill Mitchell: el euro y la pandemia


26 de diciembre de 2020

El pasado sábado 19/12/2020,conversamos con Bill Mitchell, uno de los economistas promotores de la TMM, sobre la crisis económica causada por la pandemia y sobre los errores de diseño del euro que dificultan sus gestión.


El Profesor Mitchell es un economista australiano nacido en 1952.

Desde 1990 es profesor de Economía en la University of Newcastle en Nueva Gales del Sur, en donde es catedrático desde 1998, y también desde 2012 enseña Economía en la Charles Darwin University, en Australia. Es director del Center of Full Employment and Equity.

Mitchell ha sido profesor visitante de la Maastricht University en los Países Bajos. Ha asesorado a diversos gobiernos como el de Australia, sindicatos, y organizaciones internacionales como la Comisión Europea, la Organización Internacional del Trabajo y el Banco Asiático de Desarrollo.

Se graduó en Comercio en la Deakin University en 1977, consiguiendo la Maestría en Economía en la Monash University en 1982, y un doctorado en Economía en la University of Newcastle en 1998.

Ha publicado numerosos artículos en revistas científicas y capítulos de volúmenes editados sobre macroeconomía, econometría, economía regional y desarrollo económico. Es autor del libro “Eurozona Dystopia: Groupthink and Deinal on a Gran Scale” (2015), publicado en español con el título La Distopía del Euro, “Full Employment Abandoned: Shifting Sands and Policy Failures” (2008) junto con Joan Muysken y “Reclaiming the State” (2018) con Thomas Fazi.

Iruzkinak (2)

  • joseba

    Australia: banku zentrala eta altxor publikoa (kontraesanetan, berrriz)

    Bill Mitchell-en Central bank at odds with Australian treasury – again

    … it is worth commenting briefly on yesterday’s monetary policy decision, which saw the Reserve Bank of Australia hold its policy rate at the record low of 0.1 per cent. That was no surprise. Mildly surprising given all the hype about the size of the public debt at present was the RBA’s decision to expand its asset purchasing program by an addition $A100 billion. In effect, the RBA is doing what many central banks are now doing – buying up the debt that has been issued to match (not fund) the expansion of fiscal deficits by governments as they try to deal with the negative consequences of the pandemic. While all this has helped the Australian economy record the disastrous economic impacts of the virus the state of affairs is still very poor. And the RBA knows that and is urging extending fiscal and monetary policy support until “at least” 2024. Yet, the Federal government is starting to talk about cutting fiscal support next month. This tension in aggregate policy was evident before the crisis. And it has been a global tension. The neoliberals haven’t disappeared. Austerity is in the wind. More struggle is necessary.
    The RBA will continue to purchase both federal and state government debt for at least another 12 months. The current $A100 billion program ends in April 2021 and the RBA said it would continue to buy $5 billion worth of bonds a week to ensure that bond yields remain low.
    In its – Monetary Policy Decision (released February 2, 2021) – the RBA Governor said that:
    … the Board … decided to purchase an additional $100 billion of bonds issued by the Australian Government and states and territories when the current bond purchase program is completed in mid April. These additional purchases will be at the current rate of $5 billion a week.
    Pointedly, the Governor said that while prospects for the global economy have improved as a result of the “development of vaccines”, the recovery in offing:
    … remains dependent on the health situation and on significant fiscal and monetary support. Inflation remains low and below central bank targets.
    Make sure you read every word of that statement and here is a summary.
    1. Significant.
    2. Fiscal AND monetary support.
    3. Inflation is no issue.
    The idea that Australia, or any national government for that sake can think it possible to revert back to fiscal austerity and leave monetary policy to do the ‘heavy lifting’ is far fetched and the Monetary Policy Board of the RBA know that.
    They are also now telling the Australian Treasury that in these shielded words.
    They were saying it before the pandemic as the world economy had started to slow quickly on the back of a lack of fiscal support for non-government saving aspirations.
    The need is even greater now.
    The RBA Board considered that:
    The Board remains committed to maintaining highly supportive monetary conditions until its goals are achieved. Given the current outlook for inflation and jobs, this is still some way off. The current monetary policy settings are continuing to help the economy by lowering financing costs for borrowers, contributing to a lower exchange rate than otherwise, supporting the supply of credit needed for the recovery and supporting household and business balance sheets. The decision to extend the bond purchase program will ensure a continuation of this monetary support.
    In doing so, it has expanded its balance sheet (assets) by around $A160 billion.
    It has also signalled that it will hold interest rates low until (at least) inflation is “sustainably within the 2 to 3 per cent target”.
    Which means that “wages growth will have to be materially higher than it is currently”.
    And when do they think that might be?
    The Board does not expect these conditions to be met until 2024 at the earliest …
    Now consider that:
    1. It doesn’t implicate the current elevated fiscal deficits in any inflationary pressures.
    2. It thinks cost pressures must rise before there is any inflationary pressures.
    3. It also doesn’t think that buying up $A200 billion of government debt with strokes of computer keyboards (as it is doing) is inflationary.
    4. They know they can control yields (and interest rates) on any maturity segment of the yield curve if they want. They are doing that now and can extend it for as long as they like.
    5. They think this ‘significant’ fiscal and monetary support will be needed for AT LEAST the next three years.
    Quite a significant set of statements.
    And diametric to the way the Federal government is trying to manipulate the public debate (as of yesterday).
    The Prime Minister made a speech yesterday at the – National Press Club, Canberra (February 1, 2021) where he started to set the scene for the withdrawal of the fiscal stimulus support that has helped the Australian economy weather the crisis.
    The stimulus was not large enough but was better than nothing. It has saved thousands of jobs even though it could have saved thousands more if it has been calibrated properly.
    But the idea that it should be withdrawn now is crazy given that nearly 15 per cent of available labour are still underutilised in one way or another (unemployment or underemployment).
    I will write more about the plans to cut the unemployment rate again tomorrow.
    But the PM started to reeducate the population back into mainstream myths.
    He knows the cover on all that nonsense has been thoroughly blown so his speech marked the first real effort in a renewed propaganda strategy.
    He said among other things:
    1. “You can’t run the Australian economy on taxpayers money forever.”
    The correct statement would have been “you never run an economy on taxpayers money”.
    2. “We are not running a blank cheque budget.”
    Yes they are. Everyone now knows that they can type any numbers in bank accounts it chooses and the currency is created – instantly.
    3. The PM also said he was worried about lumbering debt on future generations even though the RBA has bought a significant proportion of the new debt issued, and, as noted above has committed to buying another $A100 billion worth over the next year.
    I am sure the PM wasn’t worried about future generations when his government refused to provide any fiscal support to the University sector during the COVID-19 crisis in the face of a massive drop in revenue as a result of the closure of borders, which prevented foreign students from returning for the 2020 academic year.
    A media release this morning (February 3, 2021) from the peak body, Universities Australia – 17,000 uni jobs lost to COVID-19 – has quantified the damage.
    1. “Australian universities shed at least 17,300 jobs in 2020 and lost an estimated $1.8 billion in revenue compared to 2019”.
    2. “The sector is estimated to lose a further 5.5 per cent, or $2 billion, in 2021.”
    3. “We always said universities would face a multi-year hit to their revenues. If an international student didn’t enrol in 2020, the loss would be felt for what would have been their entire three or four years at university.”
    4. “No sector can absorb revenue declines this large without staff losses. At least 17,300 jobs have been lost on campuses in 2020.”
    5. Universities has stalled “infrastructure projects”, cut courses and made other cuts to avoid job losses.
    6. “Unfortunately, it is probable we will see further reductions this year. The loss of any – and every – one of those staff is personally devastating, bad for the university community, and Australia’s knowledge reservoir.”
    And all these cuts will reverberate for the next generation.
    Young researchers have been sacked.
    Experienced researchers have been shown the door via early retirement schemes.
    All of which undermine our children’s capacity to build careers, develop skills, and, probably, find something new that might change the history of the world (discovery).
    Meanwhile, while the academic and research staff has been cut savagely, the bosses of universities have hardly taken a hit and there is evidence in the sector that additional and unnecessary layers of management have been added while the ‘troops’ have been shown the door.
    The point is that the narrative is now beginning to start inflicting austerity long before any spending constraint is necessary.
    In the last month’s labour force data, Australia recorded a total underutilisation rate of 15.1 per cent (underemployment 8.5 per cent and unemployment 6.6 per cent).
    It will take years to get that down at current settings.
    Withdrawing stimulus too early always ends up with an extended period of inferior performance.
    Leading into the pandemic, the Australian economy still had not recovered from the GFC. That is because the Federal government withdrew the stimulus in 2012 (some years too early) and the economy stumbled after that.
    And then we get the Labor Party Opposition leader Anthony Albanese yesterday, demanding to know what the Australian people have got back for all the debt the government has issued since the pandemic.
    He didn’t say that a significant portion of that new debt has been bought up by the RBA.
    But the whole framing that the ‘debt’ must bring something.
    Why not just ask: What has the government’s investment in the economy since March 2020 been able to achieve? The fact that the increased government spending has been accompanied by debt-issuance is not the relevant focus.
    The Opposition thinks it is because they want to stir up the debt hysteria again and perpetuate the myths that neoliberal create about the solvency of Australian government debt.
    Why would the Labor Party want to be the ones pushing that line?
    Answer: Because they are unelectable!

  • joseba

    When progressives remain regressive

    … So just a light blog day but that doesn’t mean what I am writing is trivial. The two stories demonstrate how far we have to go on the progressive side of the debate before we actually make progress. It is, unfortunately a repeating tale and it is hard to define a strategy that will get through the blockades that some progressives erect that sustain neoliberalism at its most elemental level. While the British Labour Party is aiming to reinvent itself by pitching its message at the worst element of the voters that it has lost in recent years – patriotism, flags etc – that sort of nonsense – progressives in Australia are revealing how regressive they can be.
    MOOC Modern Monetary Theory: Economics for the 21st Century

    Over the last several months by way of advancing Modern Monetary Theory (MMT) education initiatives, we have been involved in development a MOOC that will be launched in March 2021.

    I am working with – NewcastleX – which is my university’s digital team to create the course material which will be available all around the world for free.

    That is the philosophy of a MOOC.

    The course – Modern Monetary Theory: Economics for the 21st Century – will start on March 3, 2021 and you can get all the enrolment details (it is free) from the link.

    This will mark the first stage of the – MMTed project – that I have been trying to get off the ground for a while now.

    We have been hampered by lack of funds to date, but the partnership with the University on this MOOC has really been a massive first step. The digital learning team at the University is first-class and have really helped me understand how these new platforms work.

    In terms of – MMTed – if you are able to help on an ongoing basis that would be great. But we will also appreciate of once-off and small donations as your circumstances permit.

    You can contribute in one of two ways:

    1. Via PayPal – which is our preferred vehicle for receiving donations.

    The PayPal donation button is available via the MMTed Home Page or via the – Donation button – on the right-hand menu of this page (below the calendar).

    2. Direct to MMTed’s Bank Account.

    Please write to me to request account details.

    Please help if you can.

    I am very grateful to all those who have donated funds to date. You will start to see the product of our work and your assistance with the launch of the MOOC.

    Other courses will start being offered immediately after that.
    The Labor Party in Australia …

    By the way, the British Labour Party have tried this before when the then leader, Ed Milliband called on his party in 2012 to “embrace a positive outward-looking version of English identity” (Source).

    Interestingly, in the 1980s, it was the Communist Party affiliated Labour members that were pushing this line.

    Anyway, it can be summarised in one word – unelectable.

    Opposition Labor Party leader has instructed his shadow cabinet (Source):

    … to ensure all new policy proposals are offset with spending cuts … Mr Albanese is preparing Labor for a potential early election by ordering his top team to help restore the party’s economic credibility as it readies its pitch to form government.

    Note the way the ideology just slips in uncontested – that the spending offset push equals restoring economic credibility.

    Apparently, the Labor Party lost the 2019 federal election because it “spooked voters” with its spending proposals, which were constructed by the conservatives as a “risk to the economy”.

    Let’s be clear.

    A point that is not understood, is that the Labor Party set its own trap in a similar way that the British Labour Party did when, the latter proposed a substantial public spending campaign after previously conditioning voters with their ridiculous Fiscal Credibility Rule.

    The latter created the view among voters that deficits were bad, that the government could not ‘max out its credit card’, and that public debt should not increase much.

    With that framing being hammered out by the British Labour politicians endlessly in the years leading to the 2019 election, it was little wonder that the voters became wary of the Manifesto spending promises.

    After all, the Party had conditioned them in sound finance principles and few voters would have been able to see through those principles as erroneous, ideological nonsense.

    And so, the Australian Labor Party appears to be going down the same route, although it won’t even offer much by way of reform agenda to reverse some of the damage this neoliberal era has inflicted on the nation.

    It comes down to this – all the Labor Party wants, it seems, is power. And they will do whatever it takes to get it.

    The problem is that they don’t have a very good track record of knowing what it takes!

    An Opposition spokesperson in Australia told the media at the weekend that:

    … all policy proposals should consider options to minimise the fiscal impact and/or be fully offset by savings within respective portfolios …

    So there is no conception that fiscal policy has to actually contract and expand to meet the context presented by the variations in non-government spending and saving decisions.

    What contextual assumptions are the Opposition making to inform this policy position?

    I would bet none!

    They are just running scared and have neoliberal spokespersons on economic matters who, in their public statements and actions, rendered this party unelectable.

    The Opposition leader was on the national news this morning complaining about the current size of the fiscal deficit in Australia and the small increase in debt (that the Reserve Bank of Australia is buying up anyway).

    The framing is all neoliberal despite them saying otherwise.

    The listener hears – big deficits, big debt. Bad.

    They don’t hear progressive policies, even if that is the message the Labor Party thinks it is pumping out.

    We are in a pandemic. The situation is very fragile and the hope that a vaccine roll-out will end the crisis this year are pie-in-the-sky.

    Fiscal deficits will have to rise and be sustained for years if we are to overcome the crisis. Playing the ‘sound finance’ card at this time in history is the height of irresponsibility.
    Enter the Australian Council of Social Services (ACOSS)

    … who are meant to represent the least advantaged people in our society and should be the leaders of progressive thought and activism.

    I have long struggled with this organisation and have dealings with them over a long period – none of which were satisfactory in any way, for reasons that follow.

    The boss of ACOSS came out earlier this week in its so-called – Budget Priorities Statement 2021-2022 – calling on the government to impose a tax on pension income “to help fund aged-care services”.

    This is a version of the ‘tax the rich to pay for services to the poor’ that many progressives think makes them out to be really nice people punishing the cats with all the cash and giving it, like Robin Hood in the fairy tales, to the poor.

    I cannot believe this stuff survives.

    Their proposal comes under their heading “strengthen the public revenue base to meet current and future needs”.

    They claim that:

    It will not be possible for future governments to properly fund aged care and health services for an ageing population as long as only 16% of older people pays income tax.

    Which is false.

    They repeatedly make these sorts of claims but nowhere do they analyse what the appropriate fiscal position should be. What is the purpose of fiscal policy.

    They keep talking about the “fiscal cost” of a pension or something as if it was a ‘cost’. They never mention resource costs just the numbers that appear on bits of paper.

    The Australian government is sovereign in its own currency. The fact that aged-care services are deficient in this country is not that the retirees have too much money and the government has too little money but, rather, because the government has made a political choice not to do that.

    At any time of their choosing they could improve aged-care services by instructing its bank, the Reserve Bank of Australia to type numbers into bank accounts to facilitate the provisioning of the extra real resources necessary to accomplish that improvement.

    ACOSS claimed that for the moment (yes: with low interest rates) the high fiscal deficit is not a problem but it will be in the future and so the government has to “strengthen our revenue base to ensure we can meet community needs”.

    Most of the proposed policy agenda is sound.

    But the framing takes us immediately into irrelevant dead-ends about how can we affords such plans and what do we have to sacrifice.

    We must transition from this financial dead-end to constructing these sorts of narratives in terms of real resource availability and best use options.

    Whatever they might be can be financially accomodated by government.

    Taxing those who have worked all their life and are now enjoying the latter years of their life should only debated if the deprivation of this cohort’s purchasing power is desirable to reduce political power etc.

    The cohort in question comprises ordinary workers and the top-end-of-town, hardly a homogenous group.

    And if that all wasn’t enough, the South African government is claiming they cannot deal with the pandemic unless they pursue fiscal austerity and cut wages because they “do not have enough money”.

    This is a sovereign currency-issuer we are talking about.

    I could tell you about my experiences with the South African government but it wouldn’t leave us on a happy note.

    So over to Mary Wilson for that.

Utzi erantzuna

Zure e-posta helbidea ez da argitaratuko. Beharrezko eremuak * markatuta daude