The Magic Money Tree and Private Banks , misunderstood and kind to small children and animals?or Just another Fix of Crony Capitalists
Neo-Liberalism, Billy No Mates? , or, just misunderstood and kind to small children and animals
Discussion with Founder member of The people’s party/Ecology Party and Now The Greens Clive Lord.
In the recent hustings for the Green Party leadership for the Green Party of England and Wales I have had a few interesting dialogues with Clive Lord and sought out some of his writing to see what made and still makes him Tick. I have also had a similar exchange of tweets and comments with Dereck Wall another former speaker candidate for the Green Party of England and wales.
Clives Stich is citizens income or universal basic income. Its mine too so we have a common objective and our reasoning to get to that place one would think would be similar. Well to answer that yes and no. Clive and I agree that exponential growth on a finite planet is impossible and that the strain on the Common resources of the planet is to great and decisions uninformed by externalities are less than sensible. We are in a completely different place on Political Economy though and our understanding of Money and Money creation.
Consider the problem of money. Money is of central importance to any modern capitalist market economy. Yet it is mainly sociologists, philosophers and dissenters that have maintained an interest in what money “is” with a view to continued critique and development … One might think this is because economics has already provided an agreed clear concept of money. But this is not the case. Contemporary economics defines money in terms of function (unit of account, store of value, medium of exchange), but puts aside both the actual history of money (after an origin story) and the conceptual problem of money, both of which likely affect the functionality of money in the broader sense of its role and consequence in real systems …
What appears weird to those outside of the mainstream is that in economic theory in general money is typically absent. It is usually assumed that in a properly functioning market system prices express the value of output such that all prices effectively become representative of ratios between goods and services (and inputs), and this ultimately means a market system operates as though it were barter. Money simply becomes the convenient symbol (in its medium of exchange guise) that expresses these ratios. As such, it has no independent significance, and one ought to look through money to the operation of “real” economic factors, and can in effect ignore money as a contributory, contextualising or significant component in a system …
The role of money in real systems has generally been peripheralised because of an arbitrary limitation created by the assumption that money is separate from and then circumspectly significant to “real” factors. This statement may seem odd to a non-economist, since we live in a world where monetary policy is high profile, and a great deal of attention is paid to central bank policy (inflation targeting for price stability), and to the existence and activity of banks.
posted on 21 May 2018
Some Preliminary Questions For MMT
by Steve Keen, Steve Keen’s Debtwatch
I had an impromptu debate with Warren Mosler (see end of this article), the founder and still one of the leading figures of “Modern Monetary Theory” recently. We disagreed on the role of trade deficits, and this has led another MMT luminary, Bill Mitchell, to write two commentaries critiquing my position (see “Trade and external finance mysteries – Part 1” and “Trade and finance mysteries – Part 2”.