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Always amazes me how the names Starmer and Reeves seem to be used instead of terms such as 'UK Government', or 'The Police', or 'Crown Prosecution Service' and so on, you'd think we were living in Russia, North Korea or Belarus with the amount of credence you give Starmer in terms of his power and reach.
If you consider how Starmer has led expulsions and parachuted in candidates into safe seats his aim clearly was to centralise power and control with the LP and the PLP with him at the centre of it. This is borne out by his talking of 'my Labour Party'. I doubt if Reeves consults much within the party but rather with bankers and financiers. So quite reasonable to refer to them by name, I'm sure they'd be flattered.
A different opinion is not what theotherjonv is getting at, it’s the lack of tolerance of it
And yet another political thread gets derailed by focusing on individuals rather than the subject.
A couple of days ago Mark made this comment on the Gaza thread:
Ad Hominem is where someone starts to attack the individual rather than put forward their argument.
And explained that is what gets threads shut down.
Personally I can't see any evidence that theotherjonv's opinions are not being "tolerated". If you want to see a lack of tolerance on political threads just try posting something vaguely critical of the EU. Your past vitriolic personal attacks on me for daring express anything other than full support for the EU are truly something Ed.
So quite reasonable to refer to them by name
Plus it is a completely normal and accepted practice as this headline shows:
Will things get worse like Keir Starmer says?
https://www.bbc.com/news/articles/c8rx1jjg35ko
There is nothing strange nor unacceptable about that headline rather than an alternative "Will things get worse as the government claims?"
I am not sure of the point of playing down the role of the Prime Minister of the UK.
It's not even about opinions being tolerated. It's kind of the opposite of ad hominem attacks; it's the lack of credit being given to the opinions.
I've never made a secret who I work for. I've provided as much insight as I can from 'inside' before and I made the same comment again today
From my little corner of government funding land, we see generally good things.
If you google you'll see who visited this week; now of course I can't say what was discussed, or give any details of any of the other discussions ongoing with Gov, etc.
You’ll forgive that I can’t say exactly what
But they are diligent, professional and give me great encouragement that decisions are being made by Government broadly that are in the interest of the country. I don't hugely care what another survey says, I know what I'm seeing first hand and I trust that.
What was your opinion?
an answer with no substance, you talk about diligence, tough decisions, and that apparently you “hear noises” without explaining what these noises are.
So while opinion might be 'tolerated' when that's how it's valued what's the point of trying to engage any longer.
There - reason given why I don't feel I want to be here any longer.
But this place is no good for me anymore.
So what you are upset about is folk writing stuff online that you don’t like/disagree with?, and you are going to flounce over that?
Really?, who gives a flying **** over what gets posted,
Really?, who gives a flying **** over what gets posted,
I do.
I take time to put decent thoughts down. To those that say 'just ignore' - is there any point then posting if you just ignore what comes back, that's not how debate works.
Contrary to other people's experiences I (used to) enjoy the politics threads but all we seem to have now is death by volume of posts by the same few people, saying the same thing over and over.
So while opinion might be ‘tolerated’ when that’s how it’s valued what’s the point of trying to engage any longer.
With the greatest respect theotherjonv you are just some random geezer on a MTB forum who I don't know personally. I am not sure why you expect everyone just to accept everything that you say unquestioningly and without providing any evidence.
Especially when you add stuff like this:
"now of course I can’t say what was discussed, or give any details of any of the other discussions ongoing with Gov, etc."
So what, everyone has to accept that the government is doing a great job because you have secret information which you cannot devulge? You are expecting an awful lot of trust from a bunch of individuals who know nothing about you beyond on what they know from a MTB forum. And in my case we don't even share a similar political vision.
However expecting that level of trust isn't even the strangest angle of all of this. It is the announcement that because some people aren't accepting your take on the political situation you are considering/have decided to cancel your subscription to stw. Again with the greatest respect that's just weird. If it was an issue of bullying and relentless insults then I could understand but that is clearly not the case here.
Personally despite our obvious political differences I would be sorry if you were to indeed stop posting. A diversity of opinions is what creates a healthy political debate, echo chambers in contrast are unhealthy and of little constructive use imo
I would have thought that you might welcome the opportunity to confidently provide evidence of how the government is indeed taking us in the right direction.
To be fair, those of us prepared to give the government more time are unable to do what you want.
We don't have the confidence/arrogance in our position to declare it sacrosanct as some seem to want us to. We might end up disappointed along with the rest of you. But we are at least prepared to wait and see rather than kick off the minute we don't see what we wanted.
Do you flounce out halfway through the starter when someone says something you disagree with? FFS man get a grip.
Given jonv's time and contribution to the forum, and how he's been incredibly open and honest about things he has gone through, that was a cheap shot.
A diversity of opinions is what creates a healthy political debate, echo chambers in contrast are unhealthy and of little constructive use imo
Maybe you and others need to consider how you respond to people then, rather than take a tone that discourages participation and drives the echo chamber
I don't know if this is a good idea or not but
But maybe that's just a random account I found on the internet, and I really am some sort of Mitty. Do you need a photo of me holding a random item you specify before you'll trust that I have some relevant insight?
What pisses me off about that BBC headline is the underlying statement whether from Starmer or the government "get worse before they get better". FFS don't do stuff you know will make it worse. Is there absolutely nothing they can think of that will make things better for the people who voted for them as of now? Austerity hasn't worked so ditch it. Leaving the EU hasn't worked so go with the majority of those who voted for you and paint out those red lines which will allow a Norway or Swiss deal. Fill in all those legal loop holes that mean the richest pay next to no tax. Put an end to all the fiscal niches and financial arragements that amount to legalised tax evasion. Give up on "net zero" lies and invest in an energy transition that will cut CO2, reduce reliance on imported energy and create future jobs/businesses. How about some nationalisation, protectionism... selling off public assets hasn't worked, it's led to shitty services at inflated prices; reverse the trend. And some education, its all very well having universities handing out degrees to those (foreigners) who can pay but making it worthwhile for young people to learn skills that are actually needed in the modern world should be the priority.
More of the same won't work, dare to do something different. Disease, want, squalor, ignorance and idleness - do something.
To be fair, those of us prepared to give the government more time are unable to do what you want.
Despite your best efforts to suggest that it is this isn't simply about "me" being uncomfortable with the direction that the government is going. It is the majority of the UK voters:
Maybe you and others need to consider how you respond to people then, rather than take a tone that discourages participation and drives the echo chamber
Again despite your best efforts to suggest otherwise nothing I have posted can be interpreted as aiming to discourage theotherjonv from posting. I just don't agree with his political assessment.
And it is obvious that big hitters like yourself have no issues personally attacking me at every given opportunity, ironically.
Do you need a photo of me holding a random item you specify before you’ll trust that I have some relevant insight?
You on a mountain bike, at least 50cm off the ground, with no wires. 😉 And fusion power stations won't happen. 🙂
And it is obvious that big hitters like yourself have no issues personally attacking me at every given opportunity, ironically.
Says one of the rare big hitters to have survived the culls, Brexit, metoo, Friday Kylie and religion threads. You are the biggest hitter by a country mile on politics threads Ché Ernie. Indeed the only member I'm aware of with a poster revolutionary as his STW pseudo. (this is meant as friendly teasing not getting personal - the Brexit stuff was as you note personal and something I still can't get my head around because your personal situation makes your views unfathomable)
But maybe that’s just a random account I found on the internet, and I really am some sort of Mitty.
Jon I don't doubt your qualifications, that isn't the issue. Honestly.
Sir Keir Starmer himself could post on this thread and announce that we should all trust him because as Prime Minister he is qualified to know stuff that none of us will know. I would not however necessarily accept the claim.
Nor do I doubt your sincerity btw. However if you had a track record of being close to me on political issues I would trust your evidence-lacking comments more readily.
For example the threshold for me accepting and trusting what Mick Lynch says is much lower because no more than a fag paper separates me and him politically. If he made certain unsubstantiated claims I would be much less likely to say "prove it".
Expecting blind faith from someone who doesn't share your political vision is strange.
I just don’t agree with his political assessment.
That's not my problem. You can have your opinion, I can consider your assessment or I have the evidence of my own experience. I do have a problem with the credibility you give me (I'm not expecting 'blind faith'), and I accept that you don't know me from Adam, although I'm prepared to confront that too. I'm not as you or others allege a dreamer or a staunch Starmerite, and indeed I'm talking about Gov as a whole, including the CS and scientific advisors rather than just the big offices of state, who have stumbled in places.
And I know, as you keep posting, that 50-odd % of people don't like the current direction. I'd suggest that a chunk of those wouldn't like the direction whatever it was because it's under a Labour administration (as you also repeatedly post, only a minority of people voted for them while 30% of the population voted for RW parties). And a chunk are being led by what they read and hear in the media (I'd ask again, who's setting that agenda?). It's not however a popularity contest yet, that'll come in 1750 days time; in the meantime they can get on with their majority in doing what they think needs doing. Even if it isn't MMT*.
So 56 days into their admin I still can't tell you what specifically is being discussed, just again to reassert that in my opinion it's positive in its approach, even if the outcomes aren't yet what I'd like. Time will tell, in the autumn SR and budget in all likelihood.
* I'll say again, IDK if MMT is right or not, IANAEconomist. It appears that's not the path being chosen, although until the SR is finalised i'm not ruling out that some additional borrowing will be accepted alongside both spending cuts and income receipts (taxes). I'm just bored that every 5th post seems to be moaning that MMT isn't the choice.
So what, everyone has to accept that the government is doing a great job because you have secret information which you cannot devulge? You are expecting an awful lot of trust from a bunch of individuals who know nothing about you beyond on what they know from a MTB forum.
Ernie, I really think you are out of order here. This, and your previous disdain for Jon's report is awfully close to just calling him a liar. Of course he can't give more details, he has a duty of confidentiality, and asking him to do so just suggests that you have no experience of working at those kind of levels in those kind of organisations. If you would just accept that and stop being so bloody rude things would go a bit better.
I’m just bored that every 5th post seems to be moaning that MMT isn’t the choice.
Skip every 5th post?
My comment with regards to the majority of the population was purely in reference to the suggestion that a few individuals on this thread were unhappy with the governments direction.
Sure, as you point out plenty will have been Tory/LibDem/SNP/Green voters but only 22% expressed satisfaction with the direction the country is going. 34% voted Labour two months ago so that's a few million disappointed Labour voters.
And if you include possible/likely Labour voters you are probably looking at potentially about 44% of the electorate.
I agree that it isn't simply a popularity contest but we are talking about an ill-defined "direction". You would expect that just two months from a general election where Labour won a landslide more than 22% of voters would be happy with the direction of the government, if not the detail. Would you not?
Apparently the current government is supposed to be going in a different direction to the previous government.
Sure, as you point out plenty will have been Tory/LibDem/SNP/Green voters but only 22% expressed satisfaction with the direction the country is going. 34% voted Labour two months ago so that’s a few million disappointed Labour voters.
Polls are pointless just now, maybe in another 4 years it'll worry them, but just now we appear to have a government making hard choices, are they required, i don't know, but i'd hazard a guess that the government do, and as governing isn't a popularity contest, they appear to be not too bothered about disappointing people.
awfully close to just calling him a liar.
You mean like saying that I don't doubt his sincerity?
Of course he can’t give more details, he has a duty of confidentiality, and asking him to do so....
Nowhere have I asked him to do so. I am suggesting that he can't expect everyone to accept everything he says without providing some evidence, although obviously you do.
I don't understand the point of posting "I know stuff that you don't know" and expecting everyone to simply accept it. He could have chosen another way of convincing people. Can you imagine if politicians all relied on that tactic? It might work for those who don't need convincing but not really much use at winning people over.
Skip every 5th post?
It's not a debate if you only respond to the points you like; if you don't challenge the ones you disagree with (caveat, I don't even disagree, I just don't know) then they just become accepted. 'The standard you walk past is the standard you accept'
We aren't doing MMT, no matter how much STW want it.
The question 12 hours ago was how did the 'dreamers' think it was going. Which I tried to answer and then spent ages justifying the answer from the point of my experience.
Not how did an opinion poll of mainly uninformed people think it's going.
Not how did an opinion poll of mainly uninformed people think it’s going.
You do realise that despite your apparent optimism the Prime Minister keeps telling the whole nation that everything is really shit, even worse than they had previously imagined, and to expect even more shit/"hard decisions" ?
<em style="font-size: 0.8rem;">Keir had his holiday ruined so he’s ruined ours – by telling us everything’s hopeless
"It wasn’t as if Starmer had anything new to say. He’s spent much of the past seven weeks telling us all that things are even worse than he had imagined and Tuesday’s speech was basically more of the same. By now we have all lost count of the number of black holes he has found in the country’s finances."
You do realise that despite your apparent optimism the Prime Minister keeps telling the whole nation that everything is really shit, even worse than they had previously imagined, and to expect even more shit/”hard decisions” ?
I don't know what optimism you are ascribing to me; personally I think we will see directional changes to come but 56 days in I'm uncoupling the state the country's been left in (poor) and whether I think the Gov (all of it, not just the big offices) are doing a good job in how they're addressing it. They could be far higher in the opinion polls by just doing popular stuff but I like that they are addressing tough challenges instead of aiming for nice poll numbers.
So if your problem with how it's going is based on not having fixed 14 years of damage then I can't help you there. I can only comment on the process they're taking to address it, and I accept that 50-odd % of people have a different view to me. But of course I think they're wrong - to stick to my opinion if I thought they were right would be idiotic, and because I use the evidence of my own experience.
We aren’t doing MMT, no matter how much STW want it.
Honestly just about every single criticism of MMT is a total misunderstanding about MMT.
We are doing MMT.
It's a description of the current system as it is.
What we are not doing is optimising the benefits of government spending for the majority of people in the UK. And Reeves is lying to gain political justification to drive through austerity.
Here's Danny Blanchflower with Owen Jones on Starmer's current cock ups. Neither are MMTers. (Although Blanchflower is starting to talk that way.)
To be anti-austerity you have to absolutely get to grips with the arguments.
https://twitter.com/owenjonesjourno/status/1829954110524670431?t=KMveqny-A_LloQECviNRWw&s=19
This country is going nowhere with the current political mindset. Doomed to repeat all the errors of the past.
He's a top scorer
It's a decent conversation.
The main point being a plan should have been ready to go and there's no reason for it to be not happening now.
The time to deliver something is well understood. But to have not have things in place is a disaster.
(I happen to believe that Labour don't really have plan - of real utility. )
They've soaked themselves in the Tory's greatest hits of fiscal failure.
This was all pretty obvious to me during the campaign.
The whole idea of voting in a representative democracy is that we vote for people who we hope will/trust to understand the issues and act in our best interests. Then there's the hopefully independant civil service to maintain a certain order, continuity and respect for the law whatever the government.
Where that's broken down is that the hope has gone because the trust has broken down. The post truth world we live starts at the top. The higher the office the bigger the lies, we'd be mad to believe a politician after Blair, Brown, Johnson, May, Truss and Rishi.
So where do people go for truth? Working in science I was appalled at how corrupt some very qualified scientists were - completely sold out. The civil service is far from neutral, 9000 irregular appointments I read somewhere. The universities and research institutes just scrabble for funding and publish hundreds of garbage papers for one that's really a worthwhile addition to our collective knowledge - quantity not quality, just think about the funding. A forest in which you have to hunt for trees. There's so much well-promoted disinformation out there you have to go looking for stuff that ain't misleading cherry picked something washing worthless bollocks. Even where there are some solid healthy trees the Daily Mail will favour a rotten one lying on the ground.
So is it any surprise that the Net is riddled with SM rabbit holes for people to go down. With no trust in the "establishment" (and who can blame people), any pied piper with a hint of credibility and modicum of charisma can string people along behind them. A woman peeved by an increase in the price of diesel stuck a gilet jaune on her dashboard and made a few SM posts that escalated into France grinding to a halt. Jordan Peterson has roughly double the number of Twitter followers that Starmer has, Tate more than five times.
Politicians have never had a reputation for being the most honest of people, over the last decade they have trashed any credibility they had left. They did it all on their own with us as apologists. We still vote for rich, self-interested liars that really don't have our best interests at heart - and this is where I disagree with you , theotherjonv, they aren't worthy of our votes, trust admiration or faith and we have every reason to be displeased with them. They are shit: they have hood-winked, u-turned, mislead, bullshitted and disappointed their way into the pits of the opion polls - all on their own. I have no reason to think Starmer is any different, he's already neck deep into all of those.
So who do I trust?
Wiki ain't bad
Stop oil tells it like it is
Insulate Britain has part of the solution
LGBT rallies versus the dark ages
MeToo versus machist misogyny
Greta say it like it is
Fridays for future have a point.
Thomas Picketty can be relied on for economic sense
In fact when I see/read something that follows the science/social science/common sense/humanist values it's all to often those railing against the government that have the facts and arguments on their side while the government panders to the money/lobbyists and their propaganda lies.
Honestly just about every single criticism of MMT is a total misunderstanding about MMT.
We are doing MMT.
It’s a description of the current system as it is.
So why aren't Stephanie Kelton, Richard Murphy, Danny Blanchflower et al happy with the way the governments run the treasury, surely they should be cheering the government for continuing to utilise their preferred method, why isn't Rachel Reeves getting plaudits for this?
So if your problem with how it’s going is based on not having fixed 14 years of damage then I can’t help you there
My "problem" as you well know isn't that Labour hasn't fixed the 14 years of damage in two months. It is the direction which it has pledged to take - I listen to what Starmer and senior Labour politicians say and commitments they make and I am aware of those which they won't make.
None of this comes as a surprise of course - Starmer and the Shadow Cabinet made it clear what to expect. Which was nothing substantially different to the Tories. In fact Starmer and Reeves went out of their way to emphasis that in government their taxation and spending policies would not be significantly different to the Tories.
Some on here suggested that this was simply done so not to scare away Tory voters. Well the first two months of a Labour government doesn't provide much evidence that this theory was correct.
And contrary to your often repeated claim I personally could easily and enthusiastically support policies adopted by Starmer, in fact I have very strongly in the past. I am not asking for much btw, just basic social democracy. (I am not a social democrat but would be perfectly satisfied with a social democrat 2024-29 government programme)
The sort of things which Starmer has supported and argued in favour of in the past:
Okay so Starmer has shifted to the right, but why do expect everyone else to also shift to the right? Starmer has a mindbogglingly large majority and no general election to worry about for 5 years - what's holding him back?
surely they should be cheering the government for continuing to utilise their preferred method
It is not their "preferred method" it is the way a fiat economy operates. There isn't another method.
It is not their “preferred method” it is the way a fiat economy operates. There isn’t another method.
Ok, happy you agree that as we all use MMT that it ends the whole discussion, happy days, i never knew Starmer and Reeves, sorry, the UK government were listening to you guys so well, you have to give them some kudos for that.
Er, I think you'll find Danny Blanchflower was captain of Spurs and we'll never know if he agreed with MMT, he might've though.
i never knew Starmer and Reeves, sorry, the UK government were listening to you guys so well,
And presumably you didn't know that the UK abandoned the gold standard long before anyone of us were born?
So why aren’t Stephanie Kelton, Richard Murphy, Danny Blanchflower et al happy with the way the governments run the treasury, surely they should be cheering the government for continuing to utilise their preferred method, why isn’t Rachel Reeves getting plaudits for this?
Within the current system (described by MMT) there are many things Reeves could be doing and none of them would be lying about not having enough money and having to fill a 22bn 'black hole'. That is the problem some of us have.
You presumably love what Reeves is doing?
Ok, happy you agree that as we all use MMT that it ends the whole discussion, happy days, i never knew Starmer and Reeves, sorry, the UK government were listening to you guys so well, you have to give them some kudos for that
Look this is total ignorance of a subject.
You don't use MMT. It describes the system as it is. A lens.
Way back Kelton (Bell) did a paper into - 'do bonds fund spending'. She did hours of academic research to try and prove that they did. She couldn't find any link whatsoever.
Whereas the establishment were simply telling everyone they did with zero research. That's why the paper was initiated.
Warren Mosler (a successful hedge fund manger at the time) was in parallel also starting to discover the same thing but from the point of view of a financier.
Kelton contacted him and they shared the same information.
That was the start of MMT - 25+ years ago
Back on point - it's not that the politicians use MMT. MMT is defined as a framework for analysis by Mosler. Meaning you can look at the system as it is and make much better choices.
What Reeves is doing is what (nearly) every other politician does - she assumed a household finance situation. MMT says it's not. This is totally evidenced in tonnes of work.
She is looking at the a system accurately described through an MMT lens with the lens of a household and making decisions.
Bad decisions..
Don't forget this was born out of Thatcher language. She made several mythical observations about the economy.
Some of which have stuck today - and look at the state of everything.
I've no idea why MMT makes certain people so angry. It's there to look at what can be done with real economic information rather than the stuff (resources etc) Thatcher rammed down your throat.
The trouble is as I've said a thousand times many Centrists assume Neoliberal economics as truth without evidence (such as higher interest rates control inflation) without any body of work .
Within the current system (described by MMT) there are many things Reeves could be doing and none of them would be lying about not having enough money and having to fill a 22bn ‘black hole’. That is the problem some of us have.
No need to explain, as Ernie has stated, FIAT = MMT, so the entire MMT theory is basically just about a currency and the value put on it, i'm happy to stand down now on all things MMT as it's been explained we already do it.
You presumably love what Reeves is doing?
I'm not sure there's been much doing in the time she's been in office, lots of discussion, but i'll wait and give it more time, Parliament will be back as of tomorrow as well, so more doing hopefully on the horizon.
So why aren’t Stephanie Kelton, Richard Murphy, et al happy with the way the governments run the treasury.
They're not happy at hall.
Because she's not using an MMT lens in making her decisions. She's using Neoliberal framework to make decisions.
https://twitter.com/StephanieKelton/status/1829841155833422245?t=mrLsgbnm_5QLmIHZJSyLew&s=19
You can get in a plane and fly it well or badly but it will still work within the laws of physics.
Look at the state of this:
https://twitter.com/jryancollins/status/1829949707491426379?t=pEverYtNGCWZlMllahAk9Q&s=19
No need to explain, as Ernie has stated, FIAT = MMT, so the entire MMT theory is basically just about a currency and the value put on it, i’m happy to stand down now on all things MMT as it’s been explained we already do it.
MMT systems work with countries that have fiat systems and central banks.
I.E Countries with the euro don't but. here are some concessions since the pandemic.
What's more, totally separately and away from MMT analysis - austerity didn't work. In fact it ruined lives and livelihoods.
Labour know this. We have the data and the history.
Shy why choose it? Why are a progressive government choosing it?
If it was Tories making these choices I can't think of member that would say it was necessary.
Are there any articles putting out the opposing argument? All we get is a tidal wave of why the economy is not like household finances which I get but there must be downsides - otherwise everyone would be doing it?
Any proper economists care to chip in?
I found these but quite old (if 4-5 years is old in MMT years). Don't ask me to summarise, or whether sources are reliable - IANAE. Elsewhere I've found a comment that it's touted as a left/socialist leaning policy by rich people for whom taxation would be a bad thing. Thoughts on that?
https://jacobin.com/2019/02/modern-monetary-theory-isnt-helping
MMT works. Until you have to buy something in a currency other than your own - a currency that belongs to a country that isn't going full MMT.
And yes, I know MMT is a description, but it always comes tagged to the notion of just printing money to pay for everything a country produces but can't sell.
So far this round of “austerity” is taking from the better off retired folk, and genuinely working to resolve public sector pay disputes. Fully expecting increased taxes on the really well off this autumn, and the cancelling of a few more gravy train projects in favour of the public services that ordinary people desperately need to start working better… again. Resetting who’s taxed, reshaping government priorities… as is desperately required… while looking to blame the previous governments where people lose out, and take credit (in a few years time) for where people will gain… that’s the politics of it.
there must be downsides – otherwise everyone would be doing it?
I've asked Rone this question a few times and he's never once attempted to answer it. Its the elephant in the room, if it was all as easy and obvious as he makes out........, in the meantime we just get post bombed into submission. Its like we should just take his (and a number of randoms he post clips of) word for it.
I consider myself an amateur economist. At uni it was only the first year course that covered general macro economics, the specialities I chose the next year were the British tax system (which obviously included a lot of macro) and Labour economics and industrial relations. From then on it's just been using that knowledge to analyse the policies of the governments I've lived under.
Money supply is what were arguing about when MMT is evoked. Too little and the economy runs out of fuel, too much and inflation rises to levels where it becomes damaging. Extremes were the gold standard which limited the money to the amount of gold held and run away inflation (Geramny post WW1, Agentian, Iran etc.). The lesson of the great depression led to the US and UK abandoning the gold standard - they then economically outperformed the French led gold block that continued to use the gold standard. Countries notably the US and Germany still hold huge gold reserves so there is clearly stil a feeling that holding gold gives one's currency credibility.
The EU and UK have chosen the arbitary number of 2% for their inflation targets. The idea is that if you have 0% inflation the money supply is obvioulsy insufficient and holding back the economy. Modest inflation shows that there's enough money kicking around - or does it?
Managing inflation shouldn't be the only objective in managing money supply. Lipsey, the guy who wrote the economics text book generations of economists used also published on how meeting one economic objective can have undesirable consequences in other areas. You can manage money supply perfectly but fail dismally in other economic objectives.
This is where the "independance" of the BOE, ECB, Fed etc. can be damaging for the economy, especially as one size won't fit all in economies the size of Europe or the US. Governments need to use money supply as an economic tool and to deny themselves that is to ignore Lipsey's wise words.
Looking at the UK (and most of the rest of the world) I see areas of the economy that are stagnating to level that is creating major economic distortions and hardship.
Housing: the UK housing stock is in a dismal state. Ageing energy pits and too few of them. Building land in the hands of companies with the objective maximising profits rather than solving the problem. The post war slum clearances stopped and even the "homes for heros" aren't fit for purpose. What's needed are affordable energy efficient homes near to where there are jobs. On a recent visit to Brum I saw ageing sold-to-occupier council houses with gardens big enough to feed the family if anyone could be bothered to cultivate them pumping out steam from condensing gas boilers (in Summer) and so far from work there were three cars on the drive. The only way that will be changed is with public money and fiscal policy. Print the money and vote the policy. Insulating materials, heat pumps, solar thermal - make it a no-brainer for people to adopt them.
Cars: A huge part of the British economy. 2-3 million sold each year of which less than a million are made in the UK and only 313000 were EVs in 2023. The Tories made wild claims such as 80% of EVs by 2030 whilst having no plan as to reach that. Labour could and should invest massively. Don't rely on Tata for a few batteries or oil companies for a few charge points, throw money at it. From fossil fuel free energy production to a charge point to fil up a UK built car with a UK battery that should be the objective. And tell people that the ICE they buy today won't be allowed in any town over 50 000 inhabitants in 2030.
Money that's printed and stays in the British economy wil be used, cycled and reused. Print it, spend it wisely.
I'm sure you can al theink of many other areas where public money would be well spent contributing not only to the well being of the population but also to UK business, manufaturing, exports... .
And as I've said previously, at the moment we're into a proper diligent assessment of what we need to do and what it will cost, and how to pay for it. I haven't yet ruled out that when that is complete, that the assessment is such that we can't afford to do even the essentials and then we'll have to borrow above 'spending rules' because we have to. It might not be the intent, it might be the necessity. Bit like a household budget.... I've got money saved up to do my expected maintenance projects, if I suddenly find I need a new roof then I will have to borrow no matter what my intent was. And pay it back - somehow, sometime.....
Another question on 'MMT' - I get we can put more money in to do projects that are needed but there has to be resource to do that. And the projects we are needing to do, like building hospitals, or funding proper health and social care, we aren't unlimited by resource. We don't have the people, unemployment is low (particularly if you discount those that don't want to work in eg: social care) and we seem to be turning against using imported labour to deliver these things. We are reliant on imported materials to build these hospitals, for the O&G to drive the machines that build them, and we also have an environmental budget to meet; even if we can just get it all from outside then at what overall cost and is that right. What does the 'as long as you have resource' really mean?
Or we can put newly created money into Universal credit or the 2 child cap to reduce poverty (not against that although may be other ways) but what does that do, other than increase general spending and is that at a risk of inflation which is the threat of MMT AIUI. Maybe that is a risk to accept given the benefit.
What’s more, totally separately and away from MMT analysis – austerity didn’t work. In fact it ruined lives and livelihoods.
Now here's a question...........when did austerity end?
According to the current Chancellor of the Exchequer the answer is 2015.
“There’s not going to be a return to austerity under a Labour government. We had austerity for five years and that is part of the reason why our economy and our public services are in a mess today.
- Rachel Reeves
Even the Tories don't claim that austerity ended in 2015. If Rachel Reeves believes that post-2015 wasn't austerity then that doesn't exactly inspire a great deal confidence.
She either doesn't understand simple numbers or she has redefined the meaning of austerity. I think we can easily discount the first option.
Money that’s printed and stays in the British economy wil be used, cycled and reused. Print it, spend it wisely.
as per crossed post, what does that mean when we lack both the labour and resources in our economy? Sending it overseas to buy Indian steel, Saudi oil and Chinese concrete?
At uni it was only the first year course that covered general macro economics
I bet you were told that quantitative easing/helicopter money was a definite no-no which should never be considered?
And yet those were tools used by the last Labour government to create the conditions by which ordinary people were barely inconvenienced by the worse global banking crisis since the 1930s
To solve your problems, theotherjonv
1/ restablish freedom of movement with the EU.
2/ reorganise education. Most current graduates can't get graduate jobs and work in jobs they are not qualified for. Identify the needs of society and create training, reduce the places on courses with few jobs. Quotas on training for some job sectors, incentives on others. Provide government financed retraining places where there are shortages. Be interventionist.
3/ on resourses: again interventionism. Experiment structures that work elsewhere. Finance industrial coopertives based on the Basque model.
4/ tax unfair competition. If the EU can levy a 30 something percent tax on some Chinese imports so can the UK
I bet you were told that quantitative easing/helicopter money was a definite no-no which should never be considered?
There weren't many no-nos, it was very much a cause and effect analysis with extreme examples of what could happen in extreme cases. We were taught more about the failures of the gold standard and the opportunity cost of overly tight money supply than the risks of hyperinflataion. This was in the middle of the debate around Thatchers monetarism trip and the lecturers were critical of the dogma that said bring down inflation, cut government spending, privatise and **** the consequences. One lecturer was well to the economic left of yourself, Ernie.
I think the problem with MMT is it's at least as big of an over-simplification as the household budget analogy. If you want a good example of this then see Sri Lanka, whose economic policy was informed by MMT.
Cue lots of 'no true Scotsman fallacy' arguments about why Sri Lanka's problems actually had nothing to do with MMT.
It's also interesting talking to MMT enthusiasts about the Euro. Apparently, the Euro is a terrible thing because a bunch of countries gave up their sovereign currencies and central banks.
My next question then is, 'So you're saying the US should get rid of the dollar and each state should have its own currency and central bank?' Cue silence.
MMT can be used to help explain part of what is going on in an economy but to then turn around and say, 'Scarcity doesn't exist if you have your own central bank' is clearly wrong.
Yes, MMT simply describes what happens. The question still is why is Reeves obsessed about the 22bn black hoke when there is no need to be and certainly not if plugging it means a lot of people are going to be worse off?
Yes, I get the point that the tories were terrible (they got voted out) but I just don't understand why bleating on about it and then making things worse for people is the right thing to do.
Written again from the perspective of a MMT fan. There's a big caveat:
why is Reeves obsessed about the 22bn black hoke when [IF YOU SUBSCRIBE TO MMT] there is no need to be
But so far no-one seems to broach the 'what are the downsides' or answer why if it's really that easy we aren't all doing it, and there's at least as many well respected economists that don't think it's a solution as the ones that do.
bleating on about it and then making things worse for people is the right thing to do
Well, perhaps it's because they believe it IS the right thing to do. It only isn't if you think increased borrowing / printing money is the answer; others see it as a necessity, to stabilise and then improve.
(and 'making a lot of people worse off' and 'making things worse for people' also misses the point; so far I've seen plans that are directed in the main at the better off; means testing for the WFP, measures at higher rate tax paying pension savers with hundreds of thousands in pots, IHT thresholds, and so on]
Slowing the economy does make a lot of people worse off because for the majority there will be a real and or opportunity cost. Businesses will go bust, the least qualified will pass by a period of unemployment, there will be more competition for qualified posts, saleries will stagnate and decline in real terms, there wil be less overtime available, part time working will hit some. People will spend less on goods and services, tax revenues will decline. The danger is vicious circle and downward spiral rather than stabilisation and then rebound. It's more a question of how low can we go before the revolution or an economic breakdown. Plenty of countries have already been there through inappropriate monetary and fiscal policy.
Brits delighted in slagging off Greece which combined having inappropriate interest and exchange rates due to having gone into the Euro at an unrealistic level, having most of its wealthier citizens money out of the country and a reluctance to impose necessary but unpopular taxes on those with the ability to pay. It was proof that populism in fiscal measures doesn't work more than the Euro problem it was cast as. Starmer is telling us he's going to do the same.
Just got people that think the Winter Fuel job might get reversed:
The government will not reverse its decision to scrap winter fuel payments, the leader of the House of Commons has said.
Lucy Powell on the BBC earlier.
why is Reeves obsessed about the 22bn black hoke when [IF YOU SUBSCRIBE TO MMT] there is no need to be
I don't get why you don't understand actually.
Reeves doesn't subscribe to MMT. She's talking as though the economy is a household.
Hence, she's misunderstanding/lying about the 22bn deficit being a limitation to further spending - to gain political capital.
MMT says it doesn't need to be filled.
That's the nature of government deficits. She could simply ignore it and move on.
But so far no-one seems to broach the ‘what are the downsides’ or answer why if it’s really that easy we aren’t all doing it, and there’s at least as many well respected economists that don’t think it’s a solution as the ones that do.
I and others have been bleating on for ages, and listed the downsides.
The downsides of spending too much money are inflation - which can be controlled with taxation. (Removing money from the economy.) And you need the resources to make it all work.
The money is the easy bit.
Money and budgets are largely irrelevant in terms of restrictions - just an IOU mechanism for keeping measure on movement of money.
Many well respected economists don't understand it/accept it. But you know what - let's assume these respected economists are the ones calling the shots - why have they made a such mess of the economy?
Is it not time to accept that many of the monetarist ideas (often with no body of work to support things.) have failed the country?
Besides most economy choices clearly favour wealth over work.
The BoE has been paying 5% interest to people with money for the last few years. So we've been rewarding the wealthy after the pandemic.
That could have been deficit spending instead. Did you query where the interest came from to pay them?
Many well respected economists don’t understand it/accept it. But you know what – let’s assume these respected economists are the ones calling the shots – why have they made a such mess of the economy?
I can'r remember who said it above but like flying a plane.... if I tried it and crashed that means the plane is flawed then?
Or is the system perfectly good but has been abused / run badly for the last 14 years.
Are you saying the 'traditional' model has never worked?
why is Reeves obsessed about the 22bn black hoke when [IF YOU SUBSCRIBE TO MMT] there is no need to be
I don’t get why you don’t understand actually.Reeves doesn’t subscribe to MMT. She’s talking as though the economy is a household.
I think it's you that doesn't understand. The 'fact' above is only a fact if you believe in MMT. She doesn't, therefore she's 'obsessed' about dealing with the deficit (or if my feeling is right, some of it)
I and others have been bleating on for ages.
I think we can all agree on that point.
The downsides of spending too much money are inflation – which can be controlled with taxation. (Removing money from the economy.) And you need the resources to make it all work.
The money is the easy bit.
Money and budgets are largely irrelevant in terms of restrictions – just an IOU mechanism for keeping measure on movement of money.
So if that's all there is too it why aren't governments all around the world doing it.
Many well respected economists don’t understand it/accept it
Maybe that's why......
let’s assume these respected economists are the ones calling the shots – why have they made a such mess of the economy
Hello, have you not been paying attention for the last few years, respected economists have not been calling the shots, Liz Truss, Boris Johnson and other idiots with populist agendas and simple answers for complex problems have been calling the shots, which is why the economy is such a mess , Brexit anyone?
So again assuming we accept the current government is actually full of grown ups who generally want to sort the problems out please give one credible reason why they aren't embracing your economic advice?
MMT is a classic case of the logical (?) consequences of that age-old weakness of a lot of theoretical economics which includes the phrase “all other things being equal”; as though whole economies behave in isolation. By ignoring inconvenient facts that if you set off on a course of MMT you need someone to fund it, and some of the finders will be overseas investors who may not necessarily agree with your course of action and/or will demand a higher price for their support in terms of higher interest rates. And that is without allowing for the trashing of the exchange rate, higher inflation and higher interest rates etc.
Just because the arcane intricacies of part of the monetary system can be explained, it doesn’t mean you can game a whole economy on that insight; that’s balancing an elephant on a pin head material.
Seems to be a lot of naivety on here among those asking why MMT isn't openly supported by the govt and making comments like 'if it worked everyone would be doing it'. The explanation of why govts and politicians don't openly acknowledge or support MMT is one of simple politics and power. The people with all the power are also the ones with all the money. They stand to lose out massively if MMT is implemented for the good of the whole economy rather than a tiny group of super rich people and corporations. The politicians are dependent on the support of these people and corporations to put them in power, so they continue with the status quo. Also can you imagine the anger and outrage if politicians suddenly admitted that everything they've told voters about the economy being like a household was a flat out lie?
And for those saying 'respected economists don't support it', that's coming from an assumption that economics is a science and those practising it are impartial and objective. The very opposite is true. Mainstream economics is nothing more than a study in how neoliberal capitalism and modern nation states work and spends most of it's time finding justifications for these rather than questioning whether they work or what the alternatives are. Most economists are no more than willing apologists for a system in which they have a vested interest so are not objective or reliable authorities on whether MMT is viable or not.
Seems to be a lot of naivety on here among those asking why MMT isn’t openly supported by the govt and making comments like ‘if it worked everyone would be doing it’.
Actually, my comment was, 'Sri Lanka openly supported it and it doesn't seem to be going well for them.'
I know, I know, it's not 'real' MMT because if it was they wouldn't have had any problems...
Not saying it's not a useful way of looking at government spending, but like most theories and models it's better at dealing with ideal situations than reality.
Actually, my comment was, ‘Sri Lanka openly supported it and it doesn’t seem to be going well for them.’
Which only supports my point that MMT-critics aren’t being objective or impartial. Comparing the Sri Lankan economy and govt policies to the UK is clearly ridiculous. That and most other criticisms of MMT are no more than economic flat-eartherism. If MMT was so wrong it should be very easy to debunk, so why rely on straw men arguments about Sri Lanka, Zimbabwe, Weimar Germany etc?
Maybe I am naive then but why does MMT have to benefit the little person? Surely MMT would be brilliant for the last bunch - sod the deficit, keep printing money, give enough to the little man to keep them happy enough, while shovelling more and more into the pockets of the rich - business owners, property owners, etc. You'd be in power for ever, whereas taxing the little man to benefit the rich?
I mean there's also a widely help opinion that extra money to the rich doesn't cause inflation, because they can't spend it and what stuff they spend it on isn't generally inflationary. I don't think villas on Caribbean islands and superyachts are part of the basket of goods used to measure CPI?
Most economists are no more than willing apologists for a system in which they have a vested interest
You'll have to explain that further. Most economists don't seem to be superwealthy, what's their interest and how are they benefiting?
Well, Stephanie Kelton certainly seems quite keen to use Greece as an example of the dangers of a country not being it's own currency issuer.
I think anyone with even the vaguest understanding of the Greek economy knows that MMT would not have saved it in 2008. Greece is a strawman many MMT proponents turn to regularly.
The problem with MMT is it completely ignores the fact countries have to trade with each other.
The US can ignore the fact that other countries have to trade with it given the fact their currency is used to by so many other countries.
Any country pretending it is the US is likely to find itself struggling paying for imports before too long if it pushes the idea that it can print as much money as it likes.
what’s their interest and how are they benefiting?
Employment.
Sorry, you'll have to give a bit more than that. What do you mean?
Employment.
The employment argument, I'm assuming, is the government guaranteed job thing?
Even though it's not strictly speaking a part of MMT it always seems to get tacked on there.
Let's face it, what we are talking about is UBI and not a guaranteed job. Unless it's a job I can do without actually having to do anything or even be there it's not a guaranteed job.
Stephanie Kelton wrote an excellent book full of easy to understand analogies but **** me did it make people think they understand far more than they do.
I am not an ecconomist. I know very little but I at least know enough to have an understanding of the scale of my lack of understanding.
Unfortunately most people have read Kelton's book and suddenly they have the answers to all the world's problems and have no problem telling everyone else they've been brainwashed by Big Economy.
There are some interesting people out there with interesting ideas about MMT but unfortunately none of them seem to be on this thread.
So let's forget about MMT as it seems to confuse people. What if Reeves just ignored the 22bn, after all there is always a deficit, this is just 22bn more. No need to cut services, or cut anything in fact, and just carry on with plans for growth (requiring investment). Once growth happens then the 22bn goes away without any further damage to public services.
If you want to do stuff like remove winter fuel allowance from those who don't need it then great do that but don;t pretend it has to be done because of 22bn just come out and say it was done because it was not setup properly in the first place. Same for increase of any taxes, if that is for equality or to control inflation or whatever but just state that.
She can't, because she believes (idk why, some would say dogmatically) in the balance the books process. If as you say that's not important I'm yet to understand why it isn't widely adopted.
You can only do the things you say if you believe the processes of MMT work. She doesn't, so she can't.
Sorry, you’ll have to give a bit more than that. What do you mean?
The system provides them with employment. Their job is to provide the economic basis for whatever political argument. Some economists are very right-wing, some are very left-wing, nothing they argue is based on "truths" otherwise they would all agree.
Politics/economics is based on priorities, you decide your priority and work from that starting point.
Zimbabwe was earlier suggested as an example of economic failure. Depending on your priorities Zimbabwe was/is not necessarily an economic failure. If the priority was to make Robert Mugabe and his cohorts very wealthy it was a huge success.
If as you say that’s not important I’m yet to understand why it isn’t widely adopted.
A challenge for you, theotherjonv. Find me and economy in the world that has balanced books. It is widely adopted, it's just a question of degree. You note I don't use "MMT" because I don't like it. It suggests a frivilous and irresponsible attitude to money supply management. I don't expect the government to balance the books and would encourage printing money to invest in and grow the economy in an ecologically and socially responsible manner. At the same time I wish them to look at all of their departements and cut where money is being squandered or not producing desired results. And I very much wish to see a more equitable and progressive tax system that makes tax evasion on the curent massive scale imposible.
You’ll have to explain that further. Most economists don’t seem to be superwealthy, what’s their interest and how are they benefiting?
They benefit with their careers. As Ernie says economics is about opinion and belief. It’s more of a religion than a science. Asking a mainstream economist whether MMT is a good idea or not is like asking a hardcore Muslim whether Jesus was better than Muhammad. I’m not saying they don’t know their subject, of course they do, but it’s not a science, and their opinions and analysis should not be seen as sacrosanct.
I'm not the economist (or even someone pretending to be one as I suspect the exponents on here are) I've been clear what my experience is. I don't need to find an economy with balanced books to prove any point, I'm asking others to provide some balanced opinions so I can understand more and make my own mind up. So far I can see some basis for MMT but when then when I ask about the bits I don't get, the tone of answer becomes dismissive one words or "I don't get why you don't understand"
Which bits don't you get? I'll do my best or answer "don't know"/"nobody who's being honest knows".
i don’t need to find an economy with balanced books to prove any point, I’m asking others to provide some balanced opinions so I can understand more and make my own mind up
But you appear to be ignoring the responses to your enquiries. You post :
She can’t, because she believes (idk why, some would say dogmatically) in the balance the books process. If as you say that’s not important I’m yet to understand why it isn’t widely adopted.
The response is :
Find me and economy in the world that has balanced books. It is widely adopted
And you come back with :
I don’t need to find an economy with balanced books to prove any point
Deficits are normal, unless you can prove otherwise? Now you can make up your own mind and answer your own question......... are balanced books necessary?