WG: It seems to me that the problem MMT has to solve is how to substantially increase the buying power of low- and middle-income families without triggering inflation. We’ve seen that giving huge tax breaks to the wealthy doesn’t spur inflation because the rich have a high propensity to save. But if the bottom 80% of Americans receive a financial windfall, they are going to spend it. And thus we get inflation. One solution is to institute rigid price controls that will allow the 80% to spend freely and “catch up” on the goods and services they have been forced to do without. Price controls can be repealed once the economy has found a new supply/demand equilibrium.

I suppose another possibility is to simply allow inflation to run its course without any active measures taken by the Federal Reserve. So imagine the gov’t cuts a check for $100,000 to every household in America. Inflation will go wild–for the sake of argument let’s say 20% the first year. So the $100,000 is suddenly only worth $80,000. As supply begins to catch up with demand and buying power decreases, inflation for year 2 might be 15%. Now that $80,000 is only worth $68,000. With each passing year inflation ratchets downward along with the value of the initial gov’t payment of $100,000. And, of course, during this time a great deal of money gets spent and taxes get paid. Some households may be able to sock away a few bucks in a savings account. Others might burn through the whole $100,000 and have nothing to show for it at the end except for a higher standard of living.

Of course, the wealthy will howl. A guy with $100 million in the bank is not going to be happy if it’s suddenly worth only $80 million. Perhaps this guy can be mollified by the protection of inflation adjusted bonds. This would create the Mother of All Deficits, but who cares? It’s just money. Think of the enhanced living standards for 300 million Americans.

I’m just spit-balling here. If anyone else has any ideas, I’d love to hear them. But the policy of simply hoping the creation of more jobs will solve the problem seems to me to be the problem.

Me: You’re getting close to seeing the new paradigm, but you have to let go of the final conceptual vestiges of the present one and all of the theoretical falderal that accompanies it. For instance your first statement: “It seems to me that the problem MMT has to solve is how to substantially increase the buying power of low- and middle-income families without triggering inflation.” assumes there is no way to effectively do that. However, a 50% discount to the consumer at retail sale DOES do that because retail sale is the terminal ending point of the entire economic/productive process where production becomes consumption and exits the economy. So the individual gets $100 of groceries for $50, a $60k EV for $30k, a $500k house for $250k and the 50% discount reduces the payment on your $250k loan by half and the same for your insurance premiums etc. etc. etc. and every merchant gets their full price with the rebate aspect of the policy. Voila! You are the greatest American president or politician EVER in the eyes of the general populace. Sure, sure. sure you have to have some additional rules and regs o stabilize the system, but thats just human reality instead of slavishly believing in “free” market theoretics that turns economic theory into a fetish that is too holy to touch or amend in any way.

You could make the Discount 52% and allow enterprise to inflate their prices by 2% per anum before taxing them 100% on any illegitimate additional inflation costs. For any additional inflation that might be able to slip through the new system’s perousal you also index inflation to any same rise in inflation. Of course you’d want to make opting into the potential doubling of demand for all their goods and services with the discount/rebate policy (YIPPEE! for the merchant), conditional upon that enterprise agreeing to not unethically attempt to destabilize the system which the current fetishistic theoretics allows, by the 100% tax rule over 2% per annum. Wouldn’t it be nice if the economy and its rules was imbued with an ethic of gratitude for a gift instead of unregulated greed??? Finally, I suggest we create The Department of Innovation, Competition, Boycotting and The Individual’s Bully Pulpit which would do weekly press conferences that congratulated complying businesses and pointed a severe finger at non-complying ones and then asked the public: What are you going to do Mr. and Mrs. America, buy from this ungrateful enterprise…or the ones who actually have good will toward your long suffering and neglected self?

New paradigms are beneficial conceptual inversions of both temporal universe realities and mental inversions as well. That in fact is how you know its an actual paradigm change. So lets get to it!

RCS: What is also CRITICAL is the Education of our Masses of the BASICS of Modern Monetary Theory, which I honestly believe ,as a big assist and attention getter, due to our millions on the “day to day brink of disaster” ,that MMT’s NO#1 Policy- Government Guaranteed Job Program needs to be featured.

Me: Completely agree. A job guarantee is a direct gift of revenue to the individual. With the beneficial deflationary effects of my Discount/Rebate policy at retail sale both the job guarantee and a universal dividend of say $1000/mo. which with the discount/rebate would give every adult $2000/mo. worth of purchasing power for their entire adult lives could also be implemented.

Implementing the new key/core idea utilizing double entry bookkeeping resolves inflation and terminates the quantity theory of money. The world changes for the better for everyone.

Trump is an orthodox merchant of chaos there is no doubt of that. However, confusion and uncertainty is always the momentary reaction to significant change. The problem is we don’t recognize the change that needs to be accomplished. Instead of mistaken, wrong headed and ham handed messing with the anomalies of the current paradigm that needs to change you find the key/core applied concept that will resolve the current paradigm’s problems. That new paradigm is strategic Monetary Gifting that breaks up the monopoly monetary paradigm for the creation and distribution of new money AKA Debt Only that the private banking system has wielded since the first day of human civilization. Simply initiate a supplemental version of the same accounting process the banks utilize to create all new money (equal debits and credits that sum to zero) with a 50% Discount/Rebate policy at retail sale and everyone’s purchasing power is immediately and continuously doubled while chronic erosive inflation is transformed into beneficial price and asset deflation. Of course, even though the above single policy would reduce the rate of increase of private debt by 75%, because “free” market theoretics is a delusional framework for slow motion chaos and instability you’ll have to further regulate/bring order out of that lose end by ending the kind of “innovation”/idiocy that brought us 2008, but thats just the reognition that economics is a complex system and we learn by doing as Aristotle said…particularly by learning from mistakes.

HM: With a significant structural trade deficit – ironically thanks to a US-inspired neoliberal ideology – the only way to maintain a positive balance in the non govt sector, or at least minimise the size of the negative balance in the form of dissaving is to substantially increase the fiscal deficit. If we don’t learn the lesson from Godley’s sectoral balance analysis then our future will be one of a severe debt deflation.

Me: Correct because a deficit is actually what? Thats right a form of monetary gifting, except a government deficit is indirect and not as widely beneficial as a 50% Discount/Rebate at retail sale. Also, unlike a 50% Discount at retail sale a deficit also doesn’t terminatedly deal with the fact that due to the fetish of “free” market theoretics commercial agents are free to game and inflate away the purchasing power of that deficit.

Suggest we legislate a 50% Discount for virtually every retail product which means we are implementing beneficial price and asset deflation because everyone pays only $50 for $100 worth of groceries, $30k for a $60k EV, $250k for a $500k house and only pay 50% of their insurance premiums and mortgage payments, but because the FED or the government rebates every cent of the discount back to the merchant they get their full price…if they compete and innovate instead of inflating. And, if they do inflate, any revenue they may get is taxed at a rate of 100%. I mean if their response to a single policy doubling the potential demand for everyone of their goods and services is to attempt to destabilize that benefit to the consumer…is that showing good will toward their customers???

This policy simply applies MTT’s correct observation that equal debits and credits/double entry bookeeping/accounting is how new money is actually created…it simply creates it as a gift…that resolves inflation instead of causing it, benefits both consumer and merchant and breaks up the monopolistic monetary paradigm that new money must ONLY be created as debt that has always backfired on both businesses and the individual whether the money creating power is in the hands of The Pallace or the Banks.

Stephanie you must suggest this policy. You can do the simple algebra (-50% of price discounted to the consumer + 50% of price rebated back to the merchant = them getting their full price, a doubling of demand for the merchant but no additional cost to them) and the simple accounting (equal debits and credits that sum to zero). Have Moore be the consumer and you be the merchant and just dramatize the policy. Then ask him if he as the consumer experienced inflation or deflation and declare that you as the merchant are ecstatic because there is now potentially double the amount of demand for your goods and services than there was before the new monetary paradigm was implemented by this single policy. I can give you many other policies and regulations that answer all of the replies you’ll still get from the terminally orthodox like Moore as well as honest insights into the nature and effects of historical paradigm changes. C’mon, lets finally blow away the delusional current economic and monetary paradigms by making it Christmas every time we go to the store.

Stephanie,

If Copernicus, Gallileo and Kepler would not have said that the earth revolved around the sun instead of the sun revolving around earth (the inversion of both mental and temporal universe reality signature of every historical paradigm change) nothing would have changed in astro-physics for god knows how long.

And nothing will change the fact that money flows uphill in an oligarchy, new money creation is only allowed to be in the form of debt and private debt has always destabilized economies…until you or someone else has the guts to illogically but correctly declare that Strategic Monetary Gifting will not cause erosive inflation, but rather beneficial price and asset deflation, and among other benefits will reduce the rate of increase in private debt sufficiently that its human civilization-long destabilizing curse will be resigned to the dust bin of history the same as Ptolemaic cosmology has been.

Take the chance. Do the simple algebra and simple accounting operations of the policies I suggest and become the first authority to acknowledge the new monetary paradigm.

DJM: I’m sure you can explain how the national risk-free debt ain’t no prob

Me: 1) the national “debt” indeed ain’t no problem. 2) the monies created to rebate merchants’ discounts AIN’T DEBT JUST MONEY, and 3) because its distributed at the terminal ending point of the entire economic process where production exits the economy and becomes consumption, i.e. retail sale and 4) hence it is also at the terminal expression point for inflation 5) we’ve never had y/o/y inflation of 50% let alone moment to moment and so 6) the 50% Discount implements beneficial price and asset deflation and 7) along with the other carrot and stick tax and regulatory regime I’ve suggested before that stop various forms of greedflation and speculative financial “innovation” and align the economy with more rational goals and so 8) we end the fetish of “free” market theoretics and instead have a system that is designed to graciously create abundant free flowingness.

Its just my way of “offing the terminally orthodox conservatives, libertarians and sociopathic narcissists” whose delusional beliefs unconsciously enforce Finance’s current monopolistic monetary paradigm. So sad about the identity crisis, but it won’t kill them.

The right has bamboozled themselves and all of MAGA all of who are not economically astute, and of course libertarians are famous for being terminally orthodox despite neo-classical macro being unstable and utterly unfair. The policies I’ve posted here will create wildly beneficial economic effects for the individual, all commercial agents and will even enable bigger tax cuts than Trump wants to see. And it will all be accomplished by doing what libertarians want to see, that is beneficial price and asset deflation.

I’m all for efficient government, but he real deep state is the suave oligarchy we’ve had for most of the nation’s history. Trump (probably unwittingly because he’s not an astute person in any sense except perhaps political demagoguery) is, again unwittingly enabling the formation here of the kind of overt kleptocratic oligarchy extant in Russia and other barely civilized states in the world.

Why not apply to economics and the money system the same illogic that Gallileo (and every other person who originally suggested a new paradigm concept) did. Historically its worked everytime: unconscious survival at all costs to self awareness and reality of ethics…nomadic tribal hunting and gathering to homesteading, urbanization and agriculture…salvation via Roman Catholic sacraments Only to the Protestant Reformation.

Here, I’ll help you a little: New money can only be created as Debt to strategically integrating Monetary Gifting into the economic process at points where everyone (macro-economically) participates…and how about the new economic moral paradigm from…the individual must personally pay full retail price and must personally fully repay indebtedness Only to strategic Monetary Gifting.

New paradigms: always logically and conceptually absurd…until they’re THE answer.

The problem with MMT and “a new economics” is they are preaching to a very small choir. That plus they do not analyze on the conceptual level only the systemic factor/problem level. As I have said many times here systemic analysis is all well and good, but it is no where as deep and effecting as conceptual/paradigmatic analysis. Dr. Keen occasionally throws the word paradigm around, but thats as far as it goes. Finally, if money is the core economic problem then recognizing that “free” market theoretics is a complete misnomer, that is it is actually merely a framework for unstable financial chaos to dominate and be the only agent to emerge unscathed from periodic crises. For humans and human systems there is only freedom amongst know and enforceable barriers. You don’t want total freedom which again is actually chaos you want universal relative abundance and free flowingness and the new monetary paradigm of Gifting strategically applied and regulated is the vehicle MMTers and Dr. Keen seek.

If C. H. Douglas could create the world wide movement of Social Credit with a palliative policy of a low percentage compensated retail price then a 50% Discount/Rebate policy at retail sale and a reflective 50% Gift/Debt jubilee at point of loan signing could be the paradigm changing duo the mass of humanity needs.

Ask yourself this: What is a job guarantee? Its a GIFT of purchasing power to the individual. A very good application of monetary policy. But its not a macro-economic as in universally experienced/aggregative application, and it doesn’t arithmetically, mathematically and macro-economically address inflation…like a 50% Discount/Rebate policy at retail sale which coincidently is also a GIFT, is the ultimate direct monetary application of double-entry bookkeeping which:

1) MMT says is the way new money is created and

2) if repeated at point of loan signing or at the retail point of indebtedness i.e. your monthly loan payment

3) these two policies would A) turn chronic erosive inflation into beneficial price and asset deflation, B) double everyone’s purchasing power without incurring any additional cost, C) enable everyone to purchase $100 worth of groceries for $50, buy a $60k EV for $30k while also cutting your car payment in half and a $500k house for $250k and cut your loan payment in half.

So these policies are the ultimate application of MMT. Stephanie, Bernie Sanders and AOC need to be made aware of these policies for these reasons and because they are the ultimate satisfaction and application of the political insight that “People vote their pocketbooks”.

MMT aligns with the new monetary paradigm of GIFTING. SO ALIGN IT!!!

…look for the ideas behind the systems and institutions that enforce their realities, that keep the anomalies that grow up within them in continual stimulation, and find the new idea and its applications that resolve those anomalies.

Steve Hummel 03/23/2025

The map is the orthodoxies of the Christian or any other of the world’s religions; the topography is the self actualization and expression of graciousness. Please do not confuse the two.

Steve Hummel 03/23/2025