A New Story: Politics for the 21st Century

  To the editor:   After having just read “Biden Can Go Bigger and Not “Pay for It” the Old Way, I wanted to write in support of the basic premise of this argument and of the principles of Modern Monetary Theory in general.   While Dr. Kelton’s article had to be short, she makes several points that your readers should know. First, there is a big difference between a currency user (Me, states) and a currency issuer.   She is absolutely correct in saying that we can literally spend dollars, that we issue, on whatever we want.   She is also absolutely correct in that the real concern is not the debt, but inflation.   Decoupling spending policy from tax policy and looking at the potential inflationary effects of each is how we should look at the problem.   It is time that politicians begin asking the right question about spending and taxes: Will it cause inflation?   Will it provide a rising standard of living?   Do we have the productive capacity to absorb the spendi

 https://www.nytimes.com/2021/03/27/business/biden-taxes-business-rich.html Sunday March 28, 2021.  I woke to find this article about the Biden tax plan in the New York Times.  As a recent convert and now devotee of Modern Monetary Theory, reading this article made me want to pull my hair out.  The "Deficit Myths", to use Stephanie Kelton's phrase, jump right off the page.  I did write a comment on the NYT on-line forum, but it seemed to limited.  And the fact is that there is so much in this article that is informative, I decided to write a much longer piece going through it line by line and annotating the issues.    The title: "Under Biden, Democrats are Poised to Raise Taxes on Business and the Rich" Great!  This is clear.  But the problem comes in the sub-heading; "The president’s infrastructure proposals are likely to require trillions of dollars in new tax revenue." Wait what?  Why are we now talking about infrastructure? Why are the two being li

 My comment at WaPo about the push for recurring checks With the cost of poverty annually over 2 trillion (1 trillion for child poverty alone), this is how you "Pay for it". The question, as Modern Monetary theorists suggest, is not how will you pay for it, but will it achieve the goals, in terms of full employment, reducing the massive costs of poverty, both financial and human, and help close the demand gap.  Universal basic income pilot projects show a wide range of benefits, and virtually no drawbacks; aside from how you pay for it.  But if we get better health outcomes, less crime, less imprisonment, better schools b/c students are fed, secure and ready to learn, the long term costs of the UBI pay for itself.  BUT it is long term; it is an investment in the future. Others disagree and would prefer more a more targeted approach, like increasing the the minimum wage and providing a new deal style federal jobs guarantee.  I personally like universal benefits and

I just read about the Republican moderates counter offer of a $600 billion "stimulus".  Here is my almost over the character limit response/comment that I left at the WaPo.  No Deal.  600b is simply not enough to offset the loss of demand.  It will result in the kind of uneven and slow recovery we had in 2009-2011, which is precisely what R's want to happen so they can run their campaigns; at the expense of the American people yet again. So much demand has been lost, that 1.9 tril may be too low. The only impediment to 1.9 tril is inflation and Powell said that a bit of inflation would actually be a good thing.  We do NOT need to worry about paying for it - we are the sole creator of our own currency, can never go insolvent.  So paying for it is NOT the question.  The question is: is it a good idea? Child care tax credit cuts child poverty in half.  YES Essentially universal checks guarantee that everyone who has been hurt by this virus gets some assistance.  YES

 Another response to Catherine Rampell's attacks on universal direct cash payments. Please explain how it has become "clearer" who has suffered?  Some 50% of Americans have lost income, across all income levels but certainly concentrated among the poor.  But as these comments show, 2019 tax returns will not reflect that.  So yes, in general, it has become clearer, but I disagree that there is a magic wand to decipher who is deserving and who is not.  But making it, say under 150K, like the last round of checks, you only leave out about 10% of the population, so only incur about 10% of the cost.  Not only will people like me, in the top 10%, who have not lost income, use it to pay off debt for schooling, invest in my retirement, give to charities, get work done that we have been putting off, and etc. but I am totally fine with a small extra cost to make sure that no children are left hungry b/c of a virus. Agree, we need to tackle the problem of people who are u

 I have a feeling I will be writing a bunch of these.  In an article criticizing Ben Sasse for crtiticizing Qanon, Jeff Charles ends with this line. "On the right, we must ensure that this asinine fairy tale doesn’t give the left enough ammo to paint us all as conspiracy lunatics. Still, most of us know that this fringe element by no means represents the conservative movement or the Republican Party." The irony here is that so many articles at redstate do exactly this:  they take the actions of one "leftist" and use it to prove that the left is the "thought police" or whatever the latest attack is.  Just today, there were articles using what is known as the fallacy of composition, which Charles says is unfair: Looks Like We Got Another 'Winner': New 'Squad' Member Opens Her Mouth & PROVES IT   GOP Committed CHEMICAL WARFARE by Not Wearing Masks Says Clueless Elected Official   Ever Had a Hard Time Understanding Someone's Accent?