The theme seems to be “reduce operating spending, increase capital spending”. We’ll see how that will blow over with the opposition.
The theme seems to be “reduce operating spending, increase capital spending”. We’ll see how that will blow over with the opposition.
Krugman has come around on it over the last few years actually, through discussions with noted MMT proponents Rohan Grey and Nathan Tankus. So you might want to search for more recent stuff.
incorrect, in MMT taxes remove money from the economy
In your CERB example, there are a lot of factors involved. One is that there really were supply chain disruptions as spending shifted from services to material goods, combined with a lot of intentional price gouging as inflation narratives took hold.
Neither these phenomena nor the disinflationary effect of taxation are immediate or direct in their effects, so I definitely feel for policymakers when crises like these hit.
But we’re now very far from the original point, and you seem to be pointing to an exceptional circumstance to try to prove a generality, as well as trying to claim I’m saying things about that exceptional circumstance that haven’t said.
Can you share anything to this end? I’ve looked and found a couple of interviews with Tankus but nothing that at a glance would seem to change Krugman’s assertion that MMT is essentially Calvinball. (I’d rather not read through all their chats.)
Pal, you were the one to bring up Covid/CERB as your first defense of printing money!
But at the end of the day, whether the program happened in a pandemic or not, the core issue remains. Governments have deficits to cover spending, e.g., on public servant salaries. According to MMT, this isn’t an issue because you just print money to pay your debts and then tax money out of the system to prevent inflation. Which, groovy but that spending was there for a reason! Like, okay, keep the salaries but then what, just tax everyone else more? You’ve just created austerity with more steps.
Tankus has blogged about Krugman’s evolution.
And my “defense of printing money” was not a judgement about the inflationary pressure of doing so, it was a recognition that there are more things to consider - such as the risk of millions of people being evicted from their homes or going hungry.
You’re still trying to put words in my mouth, and you’re not engaging earnestly, so, goodbye
(edit: typo)
So nothing from Krugman himself? Seems reasonable…
Lol, yes by quoting you and adding the exact context.
I strongly recommend, just give a quick look at any of the dozens well rounded critiques of MMT. Some may be a little obtuse if you don’t have an econ background but feel free to reach out and i’ll explain as best I can!
Cheers.
I am pointing to Tankus’ blog because he outlines the things Krugman has said.
Second: would you have not issued CERB and had millions lose housing? Or would you issue CERB and accept some inflationary pressure (keeping in mind that much of the inflation was gouging and supply chain issues)? You had made a blanket statement “issuing currency is drinking bleach” and I gave one of many possible examples for why that is a ridiculous statement.
And in terms of your arrogance around understanding what you’re talking about:
“Taxes fund services” is flat out wrong from a MMT perspective, quite literally it is the most fundamentally wrong thing one could say about it as an economic framework, so I suggest you develop a better understanding of the thing you claim to understand the critiques of. Or perhaps read critiques from those who actually understand it.
Cheers