Posted To RWER Blog

Both capitalism and socialism are passe’. The way to move beyond that false dualism lies in integrating only the particles of truth in each while focusing on remedying the most relevant problem (the monopolistic and hence de-stabilizing paradigm of Debt Only that private for profit finance dominates with). Then finding the most effective point in the economic/productive process to implement policies aligned with the new paradigm whose ethical concept is not only the highest humans are capable of self actualizing but also resolves the individual monetary scarcity, systemic austerity and lack of stable free-flowingness all heterodox economists say they want to resolve.

Call it The profit making system of Direct Monetary Distributism whose new monetary and financial paradigm is grace as in Direct and Reciprocal Monetary Gifting.

Wisdomics-Gracenomics and Direct and Reciprocal Monetary Gifting: The Next Mega-Paradigm Change

Systems were made for Man, not Man for systems.   C. H. Douglas

This ethical statement is obviously true, and yet economies and money systems have virtually never been organized to make it a reality. This is because they have always been based on the wrong and/or inadequate concepts. Finding the right concept and the ways to apply it to the economy will immediately and continuously change the nature of the economy, benefit every individual and every commercial agent. It will also have dramatic positive effects on systems and bodies of knowledge beyond the economy.

And that is the very definition of a mega-paradigm change of which there have only been two in the entire history of the species. Those changes were the emergence of human self awareness and the process of going from nomadic huntering and gathering to the use of agriculture, homesteading and urbanization. These two changes even though they took a long time to become reality immediately changed anyone and everyone with their fundamental natures. So it will be with the new monetary and financial mega-paradigm change of Direct and Reciprocal Monetary Gifting.

Let’s look at the top three reforms, how the new paradigm broadens and completes their insights and policy potentials and then how the new paradigm qualifies as a mega-paradigm change.

MMT: MMT has the mechanics of money creation correct and its advocates are inclined to utilize fiscal deficits to keep the economy from being sluggish or falling into recession., but its policies all exist within the current paradigm. Take for instance its job guarantee policy which is a good policy that can be incorporated into and expanded much more than what MMTers imagine when one recognizes the new monetary paradigm concept and the significance of the discount policies at retail sale and the point of loan signing.

MMTers believe that inflation will not be a problem with fiscal deficits and with their job guarantee policy, but that is not recognizing that injecting more money into the economy is by itself not the operant cause of inflation, but rather the chronic individual monetary scarcity that tempts the decision by corporate executives to inflate when they perceive more money coming into the system. In other words money is a secondary if not tertiary factor. The system itself and most deeply the current paradigm concept of Debt Only, which keeps all of the economy’s seemingly unresolvable problems in suspension, are the real causes of inflation.

The new paradigm completes and expands the correct but lesser observations and policies of MMT, and of course MMT does not have the positive trans-systemic, trans-body of knowledge effects that the mega-paradigm concept of Monetary Gifting  has.

Steve Keen’s Minsky Financial Instability Hypothesis and Debt Deflation:  Steve Keen’s excellent debunking of the current macro-economic orthodoxy of Dynamic Stochastic General Equillibrium and his recognition that the build up of private, not government debt resulting in debt deflation are undoubtedly worthy of a Nobel Prize or a better accliam, namely our admiration.

He’s also recommeded some policies that are worthy (his Pll policy for instance), but again they do not have the the real world trans-systemic, trans-body of knowledge benefits that the new monetary and financial mega-paradigm enables.

Keen’s belated recognition of the significance of double entry bookkeeping/accounting and its digital system of debits and credits equaling out to zero is also enlightened, although he has not fully recognized that the entirety of the economy is embedded in that accounting infrastructure and how monetary and price policies could utilize that digital nature to profound effect.

Michael Hudson’s Historical Financial Parasitism: Hudson’s chutzpa in calling out the historical dominance of finance and the unethical machinations of financialization is very admirable. It enlightens the civilization long negative effects that finance has had on humanity and in so doing should tell us that the time for further palliatives is over and that the time for the permant progression of paradigm change has arrived. About the only thing Hudson lacks is the conscious knowledge of the specific new monetary and financial paradigm concept and the where, when and how much of implementing policy to make its temporal universe benefical effects most immediate, universal and irresistible. That’s what Wisdomics-Gracenomics does.

The new monetary paradigm and its policies are a strategically pinpointed and powerful assist to the entire economy, a direct assist to the the long suffering mass of individuals who have never been granted the full benefits of our cultural heritage of technological and productive processes built up over the last several centuries, and most importantly, an ethical setting right of the dominance that the current paradigm of Debt Only has afflicted humanity with for the entire history of civilization.

Smith naively trusted finance to obey the second tier force of markets and Marx and his interpreters naively thought that outright ownership of the means of production or that palliative re-distributive taxation could tame and make ethical Finance’s monopolistic powers, but we who have even a little knowledge of history need to realize that it requires the depth of a new paradigm, a new single concept to fully change the world. Therefore, we must awaken to the new paradigm concept of  Monetary Gifting and integrate it into the economy. Only then will systems be made for Man.

Humanity Unite! You have nothing to lose but your paradigmatic chains!

Crashing Through To The Necessity of Paradigmatic Analysis

The truth is macro-economics has become much more of a theoretical “straining at a knat while swallowing a camel.” I’m not saying there aren’t insights to be discovered there, but when otherwise brilliant guys like Steve Keen and Michael Hudson correctly discern that the economy is financially unstable and that private for profit finance is a giant parasite on the legitimate productive aspect of the economy and yet can’t recommend other than palliative policies in order to remedy those facts…it’s time to drop the abstract fugue one has habitually fallen into via macro-economics and look more directly at the economy in order to find insights that run much more deeply and that with an understanding of historical paradigm changes evoke and reveal the land beyond the current muddle.

That is what the micro and macro insights that 1) the economy is inextricably embedded within an accounting infrastructure, 2) that the monopolistic paradigm of Debt Only is just that, an un-economic monopoly concept that must yield to the ethical and evolutionary process of change and that 3) retail sale is currently the terminal ending and thus extremely powerful application point for policies logically aligned with the new paradigm concept,  can reveal.

And then, with the historical insight that paradigm changes are characterized by 1) conceptual opposition, 2)  inversions of present realities,  and 3) the discovery of a new tool and/or insight that resolves the major problems of the old paradigm and reveals the efficacy of the new paradigm concept, we can more effectively apply those insights to the macro-economic monetary and financial insights of instability and parasitism.

Directness, A Primary Aspect of The Natural Philosophical Concept of Grace and of The New Monetary and Financial Paradigm

Yoshinori:  It seems for me that what Craig demands as monetary reforms is still in an old paradigm of the efficacy of monetary policy.

Me:  Yoshinori,

That would be true if those monetary policies were of the indirect, largely fallacious and monopolistically enforced kind that neo-classical economics foists on us. Fortunately the 50% discounts, universal dividend and debt jubilee monetary policies are direct to the consumer and equally direct and reciprocal back to the merchant. As I have often posted here one of the primary aspects of the natural philosophical concept of grace which is the operant concept behind the new monetary and financial paradigm is directness. In fact that same aspect of the operant concept was the one effecting the new paradigm of The Reformation, that is that humans could have a direct relationship with god instead of having to slavishly perform the Church’s monopolistic sacraments in order to obtain grace.

Of Paradigms, Concepts and Discernment

Dave,

“May first frame my response by pointing out to Craig that a paradigm is an example (if you like a theory embedded in a particular practice), and what happened to Ptolemy’s cosmology was its replacement by a more realistic fundamental theory. That assumed the perfect circles of geometry, which Newton effectively transformed into “rubber” topology, allowing for not only balloon-like inflation of boundaries but for their deformation by outside and internal forces.”

Of course a paradigm is a theory. It must be, as it is also an entire pattern, and a new paradigm is a new theory/pattern that fits seamlessly into all of the valid insights and workabilities of the present pattern. What you’re not including is that a paradigm old or new is also a SINGLE concept whose aspects and applications define a present pattern and in a new paradigm effect an entirely new pattern.

The problem with paradigms are most basically twofold. 1) Unconsciousness of the present one’s singular concept and 2) what is the new paradigm derived from discerning both the valid insights and the delusions of the present one as hints about what the new paradigm concept and its applications might be.

Given that the three major reform ideas “out there” are Minsky’s FINANCIAL instability, Hudson’s financial parasitism and Mosler’s Modern MONETARY Theory it very strongly suggests that the problem ACTUALLY IS in the present monetary and financial paradigm.

Another less discussed problem we are presently facing is habituation to the current paradigm for inquiry, namely Science Only, which inhibits what is most important in any search for the truth, namely discernment, which is just another word for wisdom…and which integrates science wholly within its method and mindset. Wisdom is BOTH ontology/understanding AND science.

So rather than continually examining the entrails of the current monetary and economic paradigm a Wisdomics-Monetary Grace as in Gifting-Gracenomics appears to hit all of the relevant marks.

Reply to a Poster on RWER Blog Regarding Complexity and Emergence

“The macro problem is how to uncomplicate it – reduce it to mere complexity).”

Yes! And that is precisely what 50% discounts at retail sale and at note signing do. It takes the fact that retail sale is the sole integrative point between the micro and macro economies because it is the most significant aggregative point of the micro economy, and macro-economics is about aggregates. It is also the terminal ending point of the the legitimate economic/productive process, that is where production exits the economy and becomes consumption, which makes it a genuine and potential pivoting/inverting/paradigm changing point.

Emergence/evolution and complexity are facts of life in the temporal universe and hence regulation is always inevitably necessary, but paradigm changes are the slayers of “emergent factors”. No amount of tweaking was ever going to eliminate the “emergent” factors of Ptolemaic cosmology….because what was necessary was a paradigm/entire pattern change. As in cosmology, so in economics and money systems.

In Response To A Post Entitled MMT = Keynes on RWER Blog

MMT = Keynes IS Keynes in that it’s a mere reform. Why? Because it does not comprehend private for profit finance (PPF) as a monopolistic, parasitic and hence illegitimate business model because it adds costs POST retail sale. Retail sale is the terminal ending point of economics. Hence PPF is non/anti-economic. (Spare me the mathematical justifications.) Furthermore it neither recognizes nor analyzes on the level of the paradigm/pattern thus rendering it inevitably reductionistic, palliative and non-resolving of the real problem which IS the current monetary paradigm of Debt Only.

The one thing MMT has going for it is that it philosophically aligns with the new monetary paradigm one of whose aspects is abundance.

Posted In Frustration on RWER Blog 07/24/2020

We can fret over ontologies, maths that are easily thwarted/supplanted by power and continue to ignore the looming deadline for species and ecological disaster, or we can recognize that the real and deepest problem isn’t economics or money itself AT ALL, but rather the MONETARY PARADIGM.

Then we can recognize that every historical paradigm change was accompanied by a new tool and/or insight and that the tipping/pivotal point of retail sale is just such an insight because it is a particularly powerful point to implement a price and monetary policy that with a few additional policies and regulations will enable us to resolve all of the above problems….instead of “straining at a gnat while swallowing a camel” for another 5000 years…..or at least another 50 until the resource wars and social chaos brought on by climate change puts most of us out of our misery.

The New Paradigm of Monetary Gifting Resolves Our Current Economic Problems and Completes The Thinking of Present Major Reforms

GH:  The bit missing from the discussion on MMT is that no-one is obliged to take anyone else’s money. Money is a claim on resources but it is not a legal claim on anyone in particular. That means its utility depends entirely on a general confidence that other people will accept it in return for the things I want to buy. Inflation is no more than an erosion of that confidence so that money exchanges on worse and worse terms. In a Zimbabwe style hyperinflation the confidence fails completely and money becomes worthless. Governments can issue as much money as they like but if the amount of money they issue far exceeds the value of the goods and services it can buy, confidence begins to erode. That might sound theoretical but it acts as a limit on the issuance that governments can make.
The practical difficulty is that governments do not know how much money is too much. They have only a vague idea of the supply potential of the economy at any time and an even vaguer notion of whether private people and companies will want to spend stocks of money they may be holding. Moreover while they control their own direct issuance via expenditure they have only weak control of secondary money creation by commercial banks.
MMT is not wrong but it doesn’t get us much further because it does not address the practical difficulties. Note that monetary gifting is subject to similar uncertainties; the central authority would always be unsure how much it could safely gift.

Me:  “Moreover while they control their own direct issuance via expenditure they have only weak control of secondary money creation by commercial banks.”

Not if we create a truly national non-profit banking, financial and monetary system based on and fully aligned with Monetary Gifting which private banking cannot compete against seeings how they require profit, interest and clients willing to pay far more than what they would need to pay from the new national system.

“Note that monetary gifting is subject to similar uncertainties; the central authority would always be unsure how much it could safely gift.”

In the consumer economy it would be 50% of whatever was purchased by the consumer. That’s a nice empirical figure. Fiscally, if it ought to be whatever makes the economy more internally integrated, self sufficient and thus robust and independent from any coercion from import platforms like China. In the mean time I doubt China would refuse our currency as it is still the largest consumer economy on the planet and thus their major importer, and if they try anti-social inflation of their prices you just slap a 100% tariff on the increase. Meanwhile, as the cost decreasing effect of Monetary Gifting’s policies are implemented we become competitive with them. And as we wouldn’t have to worry about unemployment, individual monetary scarcity or inflation, re-industrializing in the most efficient and ecologically sane way possible would be the obvious thing to do…no matter whether China or anyone else liked it or not.

MMT, Keen’s Minsky Financial Instability Hypothesis and Hudson’s Financial Parasitism are all good research. They just need the policies of Monetary Gifting to complete the paradigm change.

Reply To a Post on RWER Blog Regarding Money

Me:  A very good post. And you’re right that money is about power and control. Power and control are the zeitgeist/ethics of the present age.

The problem with money is its present paradigm, that is Debt Only. There isn’t anything inherently wrong with the idea or the nature of debt, but the monopolistic pattern of Debt Only keeps all of the economic problems heterodox economists want to change, in suspension. Integrate a new monetary and financial paradigm of Gifting into the economy and all manner of beneficial resolutions to those problems present themselves.

DT:  So I agree basically with Craig too, though I find his language as confusing as his money. Didn’t he say before that the ‘gifting’ had to be mutual? On a one-one or one-many basis?

Me:  Dave,

What is confusing about crediting a 50% discount to the consumer at the points of retail sale and at note signing, and the monetary authority debiting every cent of that retail discount back to the enterprise giving it to the individual? And the true national bank simply reducing the already 50% reduced note by another 50% at note signing, which because it is not a profit making concern and the credit is created ex nihilo like all fiat money is, can simply apply the debit credit convention at that point as well?)

That way commerce is facilitated not inhibited by austerity/individual monetary scarcity, both the individual and commercial agents benefit and the natural philosophical concept of grace as in Gifting is self actualized in the economy and in the minds of everyone participating…continuously?

It’s just double entry bookkeeping and wisdom applied to the economy and the money system.

NR:  Really ‘Craig’ ? You & your old time ‘funny-money’ chevaliers, still embody the ancient , wisdom of the great Japanese {Zen Buddhist ?} haiku: “When the glaciers melt & recede, old weeds bloom afresh”. But ! ‘FISCALLY confront climate change’ ? Egad ! Is that ‘rigged’ too ? i.e. By whom ? heh’ heh’ heh’ . As if we can’t guess. But CAN THEY actually ‘rig’ the climate? If they’re that omnipotent, wouldn’t it be ‘Pareto-opitimal’ to join THEM, rather than always be pointing fingers at ’em ? But, Take comfort from your righteous agony, Craig old sport. Because Major Douglas, Anton Drexler, Dietrich Eckhart, Nesta Webster et al, are still pining away for you ‘in the place where they are at, where it’s always double drill and no canteen’ to paraphrase Kipling.

Me:  Sorry to offend so badly Norman. It’s just that such policies seamlessly implemented into the current system are too simple for the intellectual vanities of the erudite and too generally temporal reality altering not to be a paradigm change.

IK:   What is “Gifting” in your theory? You need to define it and explain it. As it is your “Gifting” is just a black box term to me. I have no idea what is in the black box nor how it connects and interacts with anything else.

Me:  Monetary Gifting in a monetary economy (it IS a monetary economy not a “veil over barter” as neo-liberal economists have re-defined and obfuscated it) is simply the strategic giving of additional purchasing power/money in the form of a universal dividend of say $1000 monthly, and via the twin policies of a 50% discount to the consumer at retail for virtually every consumer item and also at the point of note signing for big ticket items. The latter two policies work exquisitely because they are summing, ending and terminal factor expression points in the economic process and hence legitimate potential turning points. They are also universally beneficial. So much so that every retail enterprise would need to opt into them or rapidly go out of business because if you didn’t opt in they would have to get 100% of their price from the consumer while their competitors would only need to get 50% of same.

These three basic policies (there ARE more policies, regulations and systemic changes) are a gigantic assist to all economic agents and resolve what heterodox economists say are the major problems with the present system, namely systemic monetary austerity, systemic financial instability and manipulation of the system by the dominant business model of Banking and Finance whose exclusionary and monopolistic paradigm of Debt Only as the sole form and vehicle for the creation and distribution of credit/money is the root cause that keeps all of these systemic problems in suspension.

Do I say there will not be any borrowing? No. Do I say that resolving the major cause (the present monopolistic paradigm) of the current system will have major stabilizing and beneficial effects? Absolutely yes. Paradigm changes are always permanent beneficial and progressive phenomena, and mega paradigm changes imminently and continuously effect everyone and are trans-systemic and trans-body of knowledge beneficial and progressive. Do I say there will not be other
problems? No. Systems, Life and the cosmos are emergent processes that will always evoke change and present problems, but again, historically, paradigm changes are permanently progressive.

Be happy to address any other questions.