Read it at Monetary Sovereignty
MMT’s Job Guarantee (JG) — “Another crazy, rightwing, Austrian nutjob?”
by Rodger Malcolm Mitchell
Well, I really did it this time. A few days ago, I posted Why Modern Monetary Theory’s Employer of Last Resort is a bad idea, and I feel like a guy who has kicked a hornet’s nest. The MMT folks have responded in exactly the same way debt hawks respond when they are told they are wrong (which proves people are people, no matter what their stripe).
Here is just one of many written comments I received, and this is 100% verbatim: “Are you serious, or just yet another crazy, rightwing, Austrian nutjob jacking off in public to get your jollies off?” Believe it or not, that clever note came to me from one of the most respected MMT people in America. I won’t embarrass him by giving you his name, but if you know MMT, you know of him.
I know what you are thinking, but it wasn't me. :)
8 comments:
It seems like Rodger is in the BIG camp
Here's what I said in response to Rodger's post (with a few typos corrected here):
Rodger, I think there are at least four other reasons for moving toward a commitment to full employment. A full employment commitment will help us:
1. Do a better job at accomplishing the things that only the public sector can accomplish, or accomplish well, and that we are failing to accomplish now on a massive scale. These include strategic economic investments that require organization and expenditures on a very large scale, and tending to the conservation and improvement of the public’s wealth.
2. Give people the opportunity to participate in their society and thereby build social solidarity. People who are contributing to any kind of social effort generally feel more integrated into society, have more self-respect, have more friends and acquaintances, have stronger networks of social support and are more socially and politically engaged.
3. Eliminate the permanent buyers’ market for labor. Force businesses to compete more aggressively for workers by offering those workers a better deal. Full employment will exert strong pressure from below which will improve the distribution of income, build job security, ameliorate the miserable working conditions of low-skilled labor in contemporary America, and counteract the massive agency failures that have lead to management paying themselves ridiculous salaries and bonuses while looting their companies.
4. Achieve our potential. When a lot of our people are not working, we are failing to achieve all we can achieve as a society.
I think a lot of resistance to the idea of full employment is based on the vague sense that if someone is not working, there must be a good economic reason for that. But I think we are being held back here by ideology. We have too much of a habit of relying on private sector business to do things that the private sector just can’t deliver on its own. Then when the private sector fails to deliver all of the employment opportunities we need we blame the individuals who haven’t been employed. But it seems to me that the main problem is that we have failed to mobilize the public sector adequately to fulfill its purposes and achieve our social potential. There is so much of vital importance to be done. Failing to organize the work to do these thing in the hopes that eventually some entrepreneur will figure out a way to organize that work for private gain just strikes me as stupid and stubborn.
Charity is an inevitable and essential need in any society. But a society which maintains large under-castes of people who are long-term recipients of not charity, but a kind tolerant rejection and disposal – is undermining its social compact, and setting the stage for persistent problems of social dysfunction, discord and under-performance.
I quickly clarified this on FB as soon as he posted, he is only for "this" now during this time period. So it is like a BIG/Keynesian prime pumping which probably wouldn't hurt in the US atm.
However it led me to this conclusion:
Do people not know what an automatic stabilizer is? And how it works?
Whilst the GFC led probably everyone to MMT and its principles, they still all apply post-GFC. What I keep reading is get rid of it once things are back on track and that's where everyone pre-GFC MMT disagrees (or at least they should).
Well, answer the question?
Seriously though, the whole:
"Believe it or not, that clever note came to me from one of the most respected MMT people in America. I won’t embarrass him by giving you his name, but if you know MMT, you know of him."
I can only presume this was said or written in a private conversation. Which quite frankly, is where it should stay. Really bad form otherwise. And the only thing I've learned from this JG debate is to never, EVER privately talk to anyone associated with MMT that has access to the web. About anything.
At least though, man-up and cite the source and context because for all I know this was written in response to:
"I'm not calling your mom a 'ho', I'm just asking how much she charges."
In addition to economics, the JG debate gave us a glimpse of the value and judgement systems people utilize to create the fabric that binds us together as a society beyond our basic family units. Fundamental differences from person to person lead to vastly different estimates of rights and obligations to and from one another. Without quantified costs and benefits of these social choices, I don't think the arguments can be settled because the arguments end up being normative versus positive.
TB, the problem with economics and society is that a lot of what counts most for people is qualitative rather than quantitative and therefore eludes quantitative cost-benefit analysis.
The BiG, JiG, JG debate has got a way to go.
I find the objections to BiG from the MMT professors unconvincing, but then I suppose it depends what you mean by BiG.
There is a lot of talking past each other here and I think quite a few different permutations in people's minds.
I think we need to tie down some specific 'use cases' and talk about them.
As I said above, this is more than data. It affects real people and that involves quality more than quantity. Purely economic analysis the way it is presently done is insufficient for taking into account the complexity of quality-quantity mix and dealing with the social import of the issues. We need new thinking here that takes into account input from the humanities and social sciences.
Present economic approaches are basically max u based, and that approach is fundamentally flawed, as is evident from the result of its application. MMT has to break out of the pack here instead of trying to upgrade a broken system that is obsolescent if not obsolete.
It's not just designing an efficient system but an effective one, and effectiveness wrt to human beings and societies is heavily qualitative — human right, dignity, etc, instead of just quantitative approaches to "utility."
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