On a scale of consciousness graciousness as in love in action is at the top. Knowingness is right below it and right below that is unknowingness. Master the art of alternating the second and third states with the universal solvent of graciousness and you have time and the experience of freedom, enslavement, science, religion and with diligence every other dualism potentially resolved.

“Verily I say unto you, Except ye be converted, and become as little children, ye shall not enter into the kingdom of heaven.”

Bliss is atunement to and finally union with the cosmos as it is.

Steve Hummel 04/19/2020

Me:   You’re absolutely spot on about the need to inject more money into the economy. The best way to do that would be a 50% discount to every consumer product from a package of chewing gum to autos and homes.

Then mandate that the FED or any other monetary authority like the US Treasury rebate every cent of the 50% discount back to the merchant giving the discount. This would simultaneously double every working individual’s purchasing power (and the purchasing power of a universal dividend as well) and forever end inflation as normal garden variety inflation is never more than 1-3% and the highest it has ever (temporarily) been was 14.5% during a war and or a huge cost increase like the oil embargo in the 70’s.

You could also prevent anti-social business decision makers from raising their prices higher than normal by taxing any income they may (or may not) garner from doing so at a rate of 100%.

I like your persistence and focus on these matters. Hopefully the present crisis awakens people to the efficacy and necessity of monetary sovereignty and the new monetary paradigm of Abundantly Direct and Reciprocal Monetary Grace as in Gifting.

RMM:   I’m not sure how the mechanics would work, but it’s an interesting concept. I’m more in the “helicopter money” school.

Me:  It would actually be a rather simple debit/credit accounting procedure where retailers would open a sales account labeled total discounts with a debit balance for all sales and the monetary authority would credit them that amount.

It doubles the purchasing power of both “helicopter money” and earned income. Plus, again it will utterly end inflation.

Economists worry about “monetary” inflation which is a misnomer actually because the money is at best a tertiary cause of inflation. It’s actually as you have observed scarcity, a chronic systemic scarcity of money that tempts corporate decision-makers to commit the economic sin of price inflation. Why?

Because they are aware of the chronic system-wide scarcity of demand so that when they perceive more money coming into the economy they inflate in order to attempt to garner more business revenue.

The 50% retail discount/rebate ends the scarcity reality and ironically stabilizes the economy with twice the demand and yet actual price deflation.

RMM:   I misunderstood to think your suggestion was that the money first would go to the buyer. But, I see you meant the money first would go to the seller. True?

You might wish to examine motivation. That is, if the money goes directly to the seller, what is his price motivation and compared to the buyer’s motivation if the money goes directly to him.

In the latter case, we have mini-versions in case of coupons and credit card rebates. There, I suspect the motivation is to spend.

But in the former case, where the dollars go first to the seller, what is he motivated to do?

I would be interested in your thoughts on this.

Me:   My thinking is that the 50% discount is “an offer that the retailers cannot refuse” and hence means you’d get virtually 100% participation in the policy because if they opt out they’d have to get 100% of their best competitive price while their competition only would need to get 50% so it’s a no brainer to opt in.

The universal dividend is a necessary direct gift to the individual and its purchasing power is doubled by the 50% discount. I’m not that concerned with over production so much because doubling purchasing power doesn’t automatically translate into a doubling of economic throughput. In other words everyone is not going to go out and buy twice as many socks and underwear or eat twice as much food as they did before.

The 50% discount/rebate is good for enterprise and for the individual, for management and labor. That means it would be politically integrative of traditionally opposed political constituencies. It’s not so much legitimate business models that are the problem, but the illegitimate business model of finance as money creator and monopolistic paradigm enforcer of Debt Only as the sole form and vehicle for the distribution of credit/money.

And as I said in my other post if anti-social business decision-makers want to inflate or game a universally beneficial system then tax the shit out of them. Also, in my book I suggest a new department of Innovation, Competition, Boycotting and The Bully Pulpit that would encourage the first two economic virtues, help to organize the third against recalcitrant gamers and have its department head get up and expose those who arbitrarily inflating by saying: The new system more than doubled your purchasing power and corporation x, y and z are trying to erode it. What are you going to do about that?

The beauty of the 50% discount policy is that it could be used to finally get us off the dime toward sane ecological/industrial policies. In my book, I suggest a second 50% discount/jubilee policy for all green consumer products and big-ticket items at the point of loan closing. So $40k worth of solar panels would become $20k at retail sale and $10k at loan closing. Likewise, a $300k home with the best energy-efficient options becomes $150k at sale and $75k at loan closing. A $50k electric vehicle becomes $25k at sale and $12.5k at loan closing. Finally, if we don’t have to worry about inflation because of the 50% discount at retail we could also be free to do huge top-down fiscal deficits for infrastructure and the mega projects that will be necessary to survive climate change.

RMM:   Perhaps your thinking already has gelled on this idea, but if not, let me assist you:

Why 50% rather than some other %?
How long would you maintain this program? Forever? Just to cure recessions?
Only for 100% domestic retailers? What about importers? Exporters? Assemblers? Wholesalers? Distributors? (Think new and used automobiles. Who gets paid?)
Any limits on what can be done with the money? (i.e. buy stock vs. pay salaries? Invest domestically vs. overseas?)

Me:   “Why 50% rather than some other %?”

It’s a nice round number that the general populace can understand, and immediately makes up for the erosion of purchasing power the 95% have experienced over the last 40 years. I’m maleable on the percentage (mostly on the upper side, for instance, even if we have “normal” inflation of 1-3% with the regulations I suggest then we just make the discount 51-53% and so no erosion of purchasing power)

“How long would you maintain this program? Forever? Just to cure recessions?”

Basically yes. Eventually, if it started to contribute to excessive consumption or proflicacy concerning price you could call a temporary moratorium on it. The concept behind the new paradigm is grace as in love in action/policy. The natural philosophical concept of grace in all of its universally applicable to life and living aspects is the key concept behind all of the world’s major wisdom traditions, and self actualizing them would be a giant step forward toward the maturation of humanity.

“Only for 100% domestic retailers? What about importers? Exporters? Assemblers? Wholesalers? Distributors? (Think new and used automobiles. Who gets paid?)

There would be no discount to exporters. They would have to hope for the discount/rebate policy to be implemented in whatever country they export to. For the moment importers would enjoy the discount/rebate, but the universal dividend and the cost cutting and tax savings aspect enabled by the discount/rebate would enable us to re-industrialize the nation in the most efficient and ecologically sane way possible.

And that would push export platform countries like China and Germany toward the same policies and the kind of robust subsidiarity a national economy needs….instead of the uber financialized wet nightmare we presently are moving toward.

Business models prior to retail will benefit from the both the additional demand which would translate into greater revenue and the cost savings these policies would bring (for instance, with a sufficient universal dividend and 50% discount/rebate insuring a relatively abundant and dignified income for life all transfer taxes paid by both employees and employers for welfare, unemployment insurance and even social security would become redundant and could be eliminated. You could either phase social security out or give people the option of getting a bulk distribution of what they have paid into it.

I believe that private for-profit banking must be resigned to the dust bin of history. A publicly administered non-profit national banking system would replace it.

Speculation on actually productive purposes and to ensure innovation and competition would still be allowed although firmly regulated (no more derivative nonsense and other purely financialized casino capitalist idiocies like naked shorting of currencies).

There would be no discount for hardcore pornography. The discount would apply to pump prices but could be phased out as the second 50% discount/jubilee policy at note signing for EVs and solar panels etc. reduced much of the market for petroleum.

The non-profit national banking system would still be on the lookout for malinvestment, and again while reasonable speculative leveraging would be possible if it was for actually productive purposes and aligned with the new paradigm concept there would craziness like the present. Let the gamblers/speculators use their own money to invest without leverage.

That way there’s no question about who’s on the hook when a bet goes bad.

RMM:   You might consider taking the arbitrary or moral considerations out of it. (” . . . actually productive purposes . . . “, ” . . . hardcore pornography,” ” . . . reasonable speculative leveraging . . .” ” . . . actually productive purposes . . .”) Consider what a dictator would do with those options.

Before the crash, GDP was about $22 Trillion. Your program would invest about $10 Trillion a year in federal deficit spending. What about education and healthcare? How would they fit in?

Me:  Yes, there’s always the possibility that a demagogue like Trump would corupt such phrases even though by “actualy productive” I meant simply non-financial, but such stupidity is a posibility anyway. There would be no atempt to ban hardcore pornography, but it wouldn’t be subsidized either. The same for alcohol, tobacco products and marijuana. They’re all fine as consumer products, but subsidized, I don’t think so.

The human world is by nature of human self-awareness an ethical world. (Ethical as in ethics is the rational consideration of morals.) Pre-scientific dogmas will remain, but hopefully, they increasingly are looked at as mandalas to facilitate self-actualization of virtues and the many applicable aspects of grace as in love in action/policy.

The discount/rebate policy would reduce the retail cost of premiums for all forms of insurance and the dividend would make paying for those premiums easier. I have no doubt that a publicly administered single-payer system would be cheaper and better than the mess we have now, but paying for it with re-distributive taxation when a fiat monetary system that increases everyone’s income and transforms chronic price inflation into beneficial price deflation is available is stupid IMO.

Having said this it’s obvious that the healthcare and pharmaceutical industries have been exceptionally inflationary price gougers for decades and that truth would be addressed co-equally and co-immediately with that of private for-profit finance’s illegitimate money creation and monopoly paradigm powers. And if they do not “grok” the new paradigm concept of monetary gifting and both do not honestly confront their history of inflation and continue to inflate they are obvious candidates for a national non-profit system.

Higher education has become a large source of inflation ever since the government-guaranteed student loans and that would have to end even if some academics and institutions have to take pay cuts. As tuition is the retail product of education the 50% discount would go a long way toward making education affordable for students, and it would increase academics’ purchasing power even if they needed to take a pay cut.

99 times out of a hundred Pols left to themselves will either cop out with wishy washy compromise which accomplishes nothing or try to ram through some orthodoxy which will always be opposed by the opposite party and which contains an amalgam of truths and untruths any way. The only way to accomplish real change is to find an integration of monetary and economic truths that has strong ethical content that people can relate to and start a mass socio-economic movement with it that benefits everyone in obvious ways. That is how Gandhi moved the entire political apparatus. That’s how MLK, Jr, did it.

Another four years of Trump’s dis-integrationist idiocy is likely to be difficult to recover from. If Biden wins and just does a tweak of the same old, same old the dis-integrationists will be back with a passion and some other demagogue that may be the end of our democracy. Pols are stupid, economists are stupid, intellectuals are way too often erudite dummies. Wisdom and heeding the signs of paradigm changes are not.

Everything that was (correct or false) data and observation in Ptolemaic cosmology kept leading to “emergent” qualities until the telescope revealed that terra-centrism was the real problem and helio-centrism was the reality. So it will be when this viral “act of god” reveals that monetary gifting works better and the specific discovery and insight regarding the efficacy of a 50% discount/rebate price and monetary policy at the point of retail sale resolves the deepest problems of the present Debt Only paradigm.

The key to recognizing paradigms is the ironic truth that the correct simplicity resolves complexity. Too simple for the erudite to countenance, too temporally effective and problem resolving to deny.

JD:  I would like to hear a smart economist explain exactly what would happen if the US government paid 100 percent of the wages of every person laid off because of the pandemic. Most of those people would spend their entire paycheck on rent, food, and other necessities, as they did before they lost their jobs. The firms they buy these things would continue to pay their suppliers, as they did before their customers lost their jobs. Their suppliers would continue to pay for materials and labor to generate the products they provided and to make payments on debt, exactly as they did before the economy went sideways. So what is the argument against this approach? Is there some unintended consequence that I’m missing?

Me:   No, there isn’t. You’ve just broken through the sound barrier on the new monetary paradigm of Gifting, specifically direct and reciprocal monetary gifting, and that is the enlightening lesson that the current (kinda) bail out legislation we’re seeing can bring us all.

Of course like every system it will require thoroughgoing thought to maximize its rationality potential good, and regulation in order to effectively control the more anti-social and irrational human and corporate elements that would try to game and de-stabilize the new paradigm, but for the potential economic, personal, sociological, psychological and philosophical benefits….its a fork in the road moment where we can choose life, liberty and human advancement, or stay on the current path toward economic collapse, resource wars, ecological collapse and god knows what else.

Congratulations!

TCB, Terminal Confirmation Bias, is the bread and butter of conspiracy theorists. There is nothing wrong with valid research methods and/or contrarian views, but hasty broad conclusions about conscious conspiracies have an extremely low rate of truthfulness.

The merging of the FED and Treasury is of course stealth domination which is what we already have now. Government debt is a side show that MMTers, who have the mechanics of money creation correct, obsess about when the real problem is aggregate private/personal debt….and the only way that will be resolved and we will become free instead of enslaved is a modern debt jubilee, a monthly ($1000/mo.) universal dividend, a 50% discount/rebate price and monetary policy at the point of retail sale and a 100% tax on any revenue a business may garner because they inflated their prices when seeing a lot more money coming into the system (despite the fact that such policies will save every enterprise the significant costs of all transfer taxes for welfare, unemployment insurance and social security which become redundant when everyone, whether they work or not, has a middle class income guaranteed.

GH:  Craig, your question is rhetorical.You’re not really interested in why we are not all proselytising for monetary gifting. You know what you think and it’s a long time since you listened to any counter-argument.

Me:  I will listen to any argument/theory that adds to the list of policy solutions I have advocated here that the new monetary and financial paradigm of Direct and Reciprocal Monetary Gifting accomplishes.

Virtually everyone here is engaged only in rhetoric. Several times I have asked for posters here to give their specific policies. Nothing but crickets. Instead of complaining about how arduous a nomadic existence is, how the rains haven’t come, the game is scarce and the lions that lurk are increasingly hungry this name dropping debating society should be looking to discover that if you put seeds in the ground and corral a male and female bovine your world is turned upside down in incredibly beneficial ways. In other words think paradigmatically.

So please do not lecture me about being rhetorical. Ya know what I mean?

NR:  I still think Mr. Edward Ross makes some very valid points about the age-old practice of a needy “STATE” shoveling” printed & stamped coinage {plus borrowed money in the form of the glorified I.O.U’s; known as bonds, bills, debentures & notes} at any problem that cannot be solved otherwise. And he does so with a trenchant wit. ‘Monetary gifting” was once called “Prairie freigeld” back in the 1930’s when the social credit government of Alberta started printing the attractively designed stuff, as “social dividends”. But when their pulp ‘n paper product was proscribed as not acceptable as legal ‘coin of the realm’, it suffered the same fate as Confederate dollars during Reconstruction. But, rest assured that Ralph Hawtrey, Keynes & several other chaps from the Cambridge Mathematical Tripos & British Actuarial Society, whom you may not respect very much, were quite gentle in their debunking of the rather temperamental Major Douglas’ s opus magnum.
“Major Douglas’s monetary theories are about as useful as a misprint in a multiplication table”, said M. Hawtrey. Not to mention the Major’s rather curious misunderstanding about Say’s ‘law of markets’ embodied in the “A + B theorem”. That one can be easily ‘offed’ by a couple of Venn Diagrams’. Thank you for your patience. My critique is intended only as a didactic argument which I hope benefits all; In the old German academic sense of “erklarung”.

Me:  Hawtrey did not understand money at all and was rebutted quite thoroughly by Douglas. Keynes actually plagiarized Douglas by simply restating one of his major points and claiming it as his own. How convenient and covert it was that the Canadian federal government declared Alberta’s monetary gifts ultra vires.

I’m not a social crediter by the way. Social crediters are stuck in classical ideas of equilibrium, I’m not, as all of what I advocate aligns with what Steve Keen has written regarding the financial instability hypothesis of Minsky with the exception that he, who even though he has correctly complained that an economist can get his PhD in economics without taking so much as a rudimentary course in accounting, still does not recognize the fact that the entirety of the economy is embedded in an accounting cycle that invalidates the quantity theory of money and the velocity of its circulation.

Your Telos and Technos is a quite good philosophical book. However, like virtually every present tome on economics its ideas and abstractions need the focus on present time reality that the garden variety accountant, mostly unaware of the underlying economic significances he deals with every day, could bring to it.

DT:  Craig, you and Norman are here saying some interesting stuff, but as a “jonny come lately” Englishman who can only imagine the history you North Americans are talking about, I would appreciate a few references. For example, I know about Venn diagrams, Norman, but apart from the fact that Douglas has been accused of misunderstanding Say’s Law, not in what way. I didn’t know about the ‘ultra vires’ as against the suggested logical put-down, Craig, but I do know that the financial instability Minsky wrote about and Keen simulates is what happens when one uses PID control logic to achieve an equilibrium, and uses D corrections to avoid danger faster than one uses I feedback to re-correct one’s aims. This is standard chaos theory, applied to (representing) financial entrepreneurs shuffling nominal investments to make monetary profits. I do recognise as fact your bit about the entirety of the economy, but that only explains the error in the theories, not the chaotic implications of the facts.

Me:  The instability/chaos comes from the monopolistic onlyness of the monetary and financial paradigm, and allowing private finance to maintain that paradigm is the height of idiocy. There are plenty of legitimate private financial services that can aggregate and find investment for prior-ly created money and savings, but money creation is not one of them

Money creation either as debt or as monetary gifting must become a public utility guided by the supreme ethical concept of grace as in love in action and its applicable monetary, financial and economic policies. Anything less is folly and/or non-confront.

Helio-centrism and the discovery of the ellipse ended the unstable anomalies of Ptolemaic cosmology and the policy of a 50% discount/rebate at retail sale and the concept of monetary grace as in gifting will end financial instability.

Money is non-neutral. The current MONOPOLISTIC paradigm of money creation, Debt ONLY, is WAAAAYY non-neutral. A universal dividend and the 50% discount/rebate price and monetary policy at retail sale, the latter of which is the very expression of the new monetary and financial paradigm of Direct and Reciprocal Monetary Gifting, resolves seeming unresolvable opposite economic realities, universally benefits and unites seeming opposite economic and political constituencies and ironically could enable both a bottom up consumer and top down fiscal means of navigating man made climate change.

Why in the hell don’t all of you have your hair on fire advocating for it, especially in view of the fact that the corona virus has recently shown the efficacy of fiscal and direct monetary gifting???

AT:  But the point is this! Many Trump supporters, especially the anti-war Q followers, are talking about federalizing the Fed…and that being a good thing. This is really a teaching moment!!!

Me:  The problem is, nationalizing the FED is probably leaping from the frying pan into the fire. It’s a further consolidation of power and into a class of people who are at least as unethical as the financiers, namely the pols. Make no mistake….politics is about power. And this is why the real solution lies at the paradigm concept level….not just the reform or structural one. Power, profit and control are the watch words of the current monetary and financial paradigm of Debt Only and of the current zeitgeist of power. Monetary grace as in gifting is the new monetary and financial paradigm, and grace as in love in personal action/systemic policy is the emergent realization of the new zeitgeist.

EB:  Yes agreed, Steve H., Steve Mnuchin isn’t necessarily the guy we want in charge. But it’s still a promising development, one we can work with and capitalize on. Here are questions I just asked one of our advisory board members who is a professor and lawyer. If anyone here knows the answers, great!