In a recent post on the Tax Research blog I quoted Richard Murphy’s* own words because he seemed to be rather distressed that progressive economists didn’t seem to support Modern Monetary Theory (MMT) calling it a cult! Perhaps it is time to notice that ProgressivePulse readers have better christened it ‘Sustainable Government Finance’ (SGF).
“And yet many on the left seem to have no understanding on this. For them affordability is constrained. And debt repayment remains paramount. ”
I replied along these lines:
So what do these so called left of centre economists think the economy is for then?
So we can all spend our lives in debt bondage?
If that’s the case then either they need changing or the economy does.
If people don’t think that the purpose of the economy is something like ‘to enhance the well-being of everyone, in order to enable them to live full and interesting lives by using resources in common – while having regard to climate sustainabilty’ then I suggest they’re not of the left at all.
The beauty of simple plain manilla SGF is that it shows that the existing economy can much better enhance the well-being of everyone just by changing the way we explain and think about that same economy.
If people who are radical are going to constrain their radicalism on the basis of voluntarily incurred nominal debt then they are not properly radical.
When you are the monopoly issuer of a currency and you have persuaded people to lend to you in that currency then it is not really a loan at all.
In that contest worrying about debt that you can repay at will when you’re the only one to create the credit that cancels it is literally the last thing that should concern us.
*For the sake of clarity and openness I should indicate that Richard Murphy is also the publisher of ProgressivePulse.