There has been discussion in the economic blogosphere recently, from a left perspective, about the merits or otherwise of employing an understanding of Modern Monetary Theory (MMT) in debates over policy and efforts to transform the economic system. There is an interesting post, for example, by Dan at Pruning Shears (h/t Tom Hickey) suggesting that MMT might be a “dicey bet for liberals”. In reading this and similar arguments presented elsewhere, I find myself agreeing on some (though certainly not all) points, but differing in the conclusion to be drawn from them.
Demands on time in the MMT community include (i) providing “simple as possible” explanations of “basic MMT” for public consumption and (ii) exploring theoretical and policy ideas informed by an understanding of those basics together with insights from related approaches to economics. Although the latter task is perhaps more enticing for those who have by now (mostly) absorbed the basics, and is certainly an area worthy of pursuit, the former task remains politically pressing and so equally deserving of time. It doesn’t matter what progressive policies, institutional reforms or plans can be devised if the public believes they are “unaffordable because the nation is bankrupt” or “impossible because capitalists won’t stand for them”. This indoctrination has occurred over decades and clearly many in the community are not freeing themselves of it easily.
In any society, there will be real output (real income) and real wealth that is not produced solely by humans. Some real income is due to the contribution of nature – land, natural resources, beneficial weather patterns, animals and so on. Some real income is produced by machines, robots and other means of production that were created by prior applications of labor in combination with nature. In any given accounting period, this real income is ‘unearned’ in the sense that it is not due to human effort exerted within the period. Much of it currently flows to industrial capitalists and rentiers on the basis of property ownership rather than productive contribution. Over time, the real productive contribution of means of production can be expected to rise, due to technical progress. In this post, a framework is tentatively suggested for thinking about the distribution of unearned income, both at a point in time and as it grows over time.
Technology has reached the point where nobody should be compelled to spend most of their waking hours working in dangerous, menial or otherwise unpleasant jobs (‘bad jobs’, for short). It is increasingly possible to mechanize most menial and repetitive tasks. But of the bad jobs that continue for a time, there remains the question of how best to share the burden they impose. Even with better jobs, there is the potential to reduce standard working hours and create more free time for those who want it. Here, too, there is the question of how to manage such an overall reduction in working hours. Since some people will desire to maintain or increase their current working hours, ideally there should be latitude for them to do so, just as there should be latitude for others, so inclined, to shorten their labor-time commitment. In this post, three alternative approaches to the problem are briefly considered. They can be labeled ‘universal job sharing’, ‘optional job sharing’ and ‘job or income guarantee’.
A fair amount of computer ink has been spilled on the screen here at heteconomist on the topic of money. For as long as there continues to be a monetary system, this remains an important topic. However, in a better world, which is becoming technically more feasible by the year, perhaps is already feasible, there would be no need for money at all. Accordingly, I have signed The Free World Charter. Well, I would have signed it earlier but became aware of it only now.
I spent a lazy hour browsing past discussions in the ‘Future Society’ and ‘Job & Income Guarantee’ categories. A comment by Jim O’Reilly caught my eye. In part, it reads:
[M]ost of us probably spend a fair number of hours regularly thinking on our own about how to advance to a better world. That’s a bit of a waste though as we’d be far stronger if we combined our efforts. Is it absurd to think of combining resources and working together in a project that would try to make a sound case for “utopia”? Or is that madly beyond our pay grade?
I like the idea. The task is daunting, but also exciting. It would be a worthwhile contribution if we could add to the public discourse on this question.
Patience may be a virtue, but frankly I have waited long enough for others – whether the International Working Class, Wall Street Occupiers, the Tea Party, or some other Subset Of Society – to prepare a viable proposal for a better world and put it into action. It seems mother was right. If you want something done in this world, you have to do it yourself. So, I have taken it upon myself to announce the next step in our evolution as a species. If what follows seems too easy to be true, it is only because it still falls far short of where we should be heading. It is, at best, a humble beginning, or perhaps a stepping stone on our way toward liberty, equality, fraternity. The modest proposal is in five parts: 1) The Clean Slate; 2) Temporary Reorganization of Labor; 3) New Currency, Tax Obligation, Basic Income; 4) Free Stuff; 5) Democratic Determination of Priorities, Environmental Standards. I consider it a blight on my character that initially I thought it safer to file this post under ‘Humor’, solely on account of its audaciousness in stating what is rarely spoken but both simple and obvious. It has now been moved to the more appropriate category of ‘Future Society’. My only consolation is that the enemies of liberty, equality, fraternity will find very little to laugh about in what follows.
Here is a link to an interesting four-part lecture series by Mary Mellor, filmed in February 2012 (h/t Tom Hickey at Mike Norman Economics):
The first part traces the historical development of money, emphasizing its social nature. The middle two parts concern money and banking, and the crisis. The fourth part, which most motivated me to link to the lectures, considers the social potential for democratized money to enable sufficiency, sustainability, and social justice.
Come on, what’s going on? This should have happened already! Love not war. Cooperation not competition. Liberty, equality, fraternity. Too easy! What’s the hold up? Let’s go!
The recent discussions over what is or is not Modern Monetary Theory (MMT) have brought out some differences in perspective on broader questions of where we might want to head as a society. As far as I am concerned, the Modern Monetary Theorists have defined their theory to include both descriptive and prescriptive elements, and that is fine. For non-academics who have taken a strong interest in MMT in the blogosphere, the definition provided by the academics has clarified our position relative to it. There are some on the political right who would not consider themselves to fall within the definition. And, of course, there are some of us on the political left who likewise consider ourselves outside the definition. In this post, I thought it might be interesting to touch on what appear to be some similarities and differences in vision between those on the left and right.