Me: “and almost everything to do with the fact that human free will/action will always remain a strong motivation for enterprise in profit making systems”
stf: well, add that to the list of nominees for most vague and completely useless statements of the year.
Me: Money itself does not magically make prices go up. It is actually entirely a decision by a human being(s) in economic/commercial firms. As Hyman Minsky correctly observed “the fundamental direction of capitalism is up.”
What we need to do is craft distributive type MMT monetary policy and implement it at a strategically aggregative and integrative point in the economy. I have suggested the following perhaps 50-60 times in the last 5-6 years to certain macro-economists but either because they just didn’t look at it or were so focused on the macro numbers and/or prejudiced against anything to do with the micro-economy/day to day operations of commerce….they just didn’t see it. Lets see if MMTers actually look and are more willing to see it.
The decision to inflate prices for mere reasons of increasing profits can occur throughout the entire economic process from taking ore out of the ground to the point of retail sale. Generally this is only slight increases as competition and fear of loss of market share are also valid realities. Now, as mentioned before retail sale is the terminal end of the economic process and also where total costs and so total prices are terminally aggregated/summed as well. Hence retail sale is where whatever inflation does or doesn’t occur….is terminally expressed. The accounting system, the pricing system and the money system are all digital in nature, that is $10 of price/credit are liquidated by $10 of income/debit and the same occurs with debt/loans. This is also why “a modern debt jubilee” if the credit for it was compelled to be applied to an individual’s debt….would work to help free them.
So, if we implemented a policy of a 50% discount to the point of retail sale of every consumer item or service and either the FED or better yet a new monetary authority was mandated to create and rebate that discount back to the enterprise that gifted it to the consumer this would be the result:
1) an immediate doubling of everyone’s purchasing power (when was the last time any other pol or economist came up with a policy that beneficial?)
2) not only completely eliminating the possibility of erosive inflation, but what up until you just read this was considered impossible, and that is painlessly and beneficially integrating price deflation into profit making systems.
These and other policies are part of the book I am now compiling Entitled Wisdomics-Giftonomics: The New Economic Theory and Paradigm.
anon: Still banging the old ‘all cost must be in price, all the time, no exceptions’ drum, eh Steve? That concept was obsolete in Keyenes day, in any variant.
Me: No, not at all. You can keep charging less than your costs….right up to the point of going bankrupt. And with ponzi finance and a lot of accounting legerdemain that can be quite a while.
And when the system becomes inherently ponzi, as it has been since before Keynes, because continual debt build up is necessary to avoid recession/depression as Steve Keen has re-discovered and also because the only systemic monetary paradigm allowed is Debt which even at 0% interest eventually overwhelms the ability to service debt….then you no longer actually have a legitimate system, just a con where Finance “owns the joint” and everyone has to “lie, cheat and steal” as Michael Hudson so aptly describes it.
Ask Bill Black for instance.
anon: Hi, Steven Greenberg, the comment wasn’t for you. It was for the other Steven. He has a long standing attachment to the fiction that ‘all cost must be in price at all times, no exceptions’. It is present in everything he writes, as a (faux) first principle.
Me: You apparently didn’t read my reply to your (incorrect) assumption. Please stop mischaracterizing what I post.
With a few policy exceptions I’m in agreement with what MMT, Steve Keen and Michael Hudson all say. All I’m really trying to get those three and a couple more reformers and theoreticians to do is consciously recognize the single concept that defines and is the new monetary and economic paradigm. That’s what a paradigm is actually, a single concept like Agriculture or Helio-Centrism that creates a new pattern that while fitting seamlessly into the current paradigm transforms almost everything about it and also resolves its deepest and most chronic problem(s). Again, new paradigms are clarifying, focusing and unifying. That’s what I want for monetary and economic research and theorizing.
Note: I suspect that “anon” is likely Billy Mitchell, a prominent MMTer who very dogmatically advocates for a job guarantee ONLY and who has also attempted to denigrate a universal dividend thus betraying again, his dogmatic leftist slant on MMT and his unconsciousness of the new monetary paradigm of Monetary Gifting. However, it could also be Steve Keen with whom I’ve also had trumped up and authoritarian problems (from his side) regarding my posts on his sites because I’ve pointed out to him that most of his iconoclastic debunking of neo-liberal DSGE and his conclusions about financial instability are in fact a RE-discovery of much of what C. H. Douglas said in his theory of Social Credit almost 100 years ago. And of course It could be just another orthodox MMTer trying to invalidate me…even though as can be seen from the above thread….I’m in almost complete agreement with MMT, Keen and other anti-austerity economists.
Unfortunately orthodoxy, ego and their fragmenting and delaying effects are alive and well even in heterodox minds.