Sarrera gisa, ikus Pavlina Tcherneva eta Bill Mitchell (2021ean)
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MMT Podcast ep 91: MMT And The New Social Contract
@billy_blog & @ptcherneva talk with the team at @ModernMoneyAus about lessons learned from the Covid crisis and a new way forward.
Pavlina R Tcherneva eta beste 4
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#91 Bill Mitchell, Pavlina Tcherneva & Modern Money Australia: MMT And The New Social Contract
Mar 10, 2021
MMT co-founder Bill Mitchell and Job Guarantee expert Pavlina Tcherneva talk with the team at Modern Money Australia about lessons learned from the Covid crisis and a new way forward.
Entzun hemen: https://pileusmmt.libsyn.com/91-bill-mitchell-pavlina-tcherneva-modern-money-australia-mmt-and-the-new-social-contract
Transkripzioa:
[Transcript] Opening monologue for episode 91 – Bill Mitchell, Pavlina Tcherneva & Modern Money Australia: MMT and the new social contract
At the beginning there, you heard MMT co-founder Professor Bill Mitchell, and in a moment, we’re going to be hearing Bill along with Professor Pavlina Tcherneva in conversation with Anne Maxwell, Jayne Flanagan and Marcus Champ of Modern Money Australia at an online event which took place on the 26th of February 2021.
(…)
A central theme of the conversation you’re about to hear is the MMT Job Guarantee, and if you’re familiar with MMT, you’ll know that the government is the monopoly issuer of the currency you use if you live in a country with a monetarily sovereign government, like say the UK, the US, Japan, Canada or Australia.
Governments like these issue new money when they spend, rather than recycling previously-collected tax money, and taxes in countries like these serve primarily to create a demand for the currency among its users (that’s you and me, the private sector) and then after that, taxes serve to control the level of spending power in the private sector as a whole, and also to incentivise and disincentivise certain types of economic activity, and you can listen to our first three episodes if you want an introduction to how all of that works.
The good news is that your government, when it’s acting rationally and functioning properly, usually spends more than it taxes back over a given period of time, and that money left over, after we’ve paid our dollars or pounds or yen back to the government, is our spending money, and we the private sector get to spend that money on whatever we want, on consumption, or investment, or maybe building a business of our own, but the bad news is that that number of pounds or dollars or yen circulating in the economy, changing hands for these goods and services is called the government deficit, and it would seem the most hated word in all the land is “deficit”, and the second most hated word in all the land is “government”.
And it would seem that it’s the work of politicians to blame Everything Bad In The Universe Ever on the existence of a government deficit, and it’s the work of the rest of us who want rational economic policy to remind people of the elementary truth that every deficit is balanced by a corresponding surplus and that the government’s deficit must be equal to the non-government surplus – in other words, it’s our money – and arguing for government deficit reduction amounts to arguing for austerity.
MMT economists suggest that instead of targeting an arbitrary deficit figure, and letting the chips, or the hungry schoolchildren, fall where they may, we should target oh, I don’t know, a good economy, and let the deficit, which is a number on a spreadsheet at a central bank, be what it needs to be to achieve that.
Some may argue that a good economy is one where they live in a castle and and the rest of us gather on select occasions to cheer them on, but if you’re not Bono, and you understand that the government is the issuer of the thing that we all need to acquire to feed ourselves and put a roof over our heads, it becomes clear that unemployment and poverty are the result of the the issuer of currency not maintaining enough spending power in the economy to give everybody a job. It’s the evidence of government underspending, or overtaxing, and the challenge then becomes how to increase the private sector’s surplus (aka the government deficit) in a way that gives everybody a job, but doesn’t cause a damaging acceleration in inflation.
The MMT solution is for the government to have a buffer stock of jobs and to guarantee one to anyone who is willing and able to work at a fixed, socially-inclusive wage, and for this pool of Job Guarantee labour to expand and contract with the business cycle, to ensure that no-one suffers due to a lack of currency ever again.
We’ve made a few episodes about the finer points of the Job Guarantee, and I’ve linked to those in the shownotes and to some other great resources – chief among them Professor Tcherneva’s excellent Job Guarantee FAQ page and of course her book, The Case For A Job Guarantee. I’ve also linked to a list of political initiatives worldwide that are advocating for a Job Guarantee, if you’d like to get involved.
Three things to bear in mind if you’re new to the idea of a Job Guarantee.
One: it’s voluntary, it’s a guaranteed offer of work rather than a demand to work. It’s there to solve involuntary unemployment, for people who want a job but can’t yet find one. You can still be voluntarily unemployed under this scheme, it would be an extra option to what we have now.
Two: The Job Guarantee is not designed to replace financial support for people who can’t or shouldn’t work (for instance disabled people), and of course if you have an understanding of where money comes from, and that poverty and unemployment are the consequences of the government maintaining too little spending power in the economy, it becomes clear that support payments to people who can’t work could and should be paid at a much higher level than they are now in most so-called advanced economies.
Three: The Job Guarantee wage becomes the de-facto minimum wage and any other conditions you put into put into the Job guarantee become the national minimum standards. So if you are an advocate of, say, a four-hour work week, the way to make sure everybody has that is to make sure that the Job Guarantee job is a four-hour work week, paid at a socially inclusive wage.
If you can’t get behind that, probably what you’re advocating for is a four-hour work week for you and not everybody else. Not that that’s a good or a bad thing, but just to emphasise: the way our money system works right now means that whether we know it or not, and whether we like it or not, the currency issuer, the government does set the minimum pay and conditions for all workers in our respective economies – and the way we do things right now, the minimum pay is zero and the minimum conditions are you’re dead. So call me a utopian, but I think we can do better.
Couple more points before we dive in, You’ll hear Pavlina talk about the NAIRU, for first time listeners that’s the non-accelerating inflation rate of unemployment which is the technical term used to justify the trade-off between inflation and human life and I’ve linked to a quick overview of the MMT counter-acronym, the NAIBER, the non-accelerating buffer employment ratio, should you need some ammunition with which to outwonk the wonks.
And most importantly, Professor Bill Mitchell is running an online MMT course which is underway at the moment – it looks to me like you can still join right up until the end of March, but I’d say, the sooner you join the better, because new content is added every Wednesday until the course finishes, and speaking from experience, it’s a great course – it’s free to all – or if you want to earn a certification it’s very, very inexpensive.
So I’ve linked to where you can sign up for that in the show notes, (…)
So thanks as ever for the time you put into understanding MMT – and huge thanks to Jayne, Anne, Marcus and the rest of the Modern Money Australia team for organising this event. We start with opening remarks from Anne, let’s dive in!
Notes here: https://www.patreon.com/posts/48523726
