You can’t beat this 1:35 minute crash course on how our economy works. It voodoo, not a dark art, not medieval knowledge. Just plain and accessible economics.
This course should be taught in high schools.
You can then nicely progress to various books and textbooks if you want.
@Migueldeicaza I don't understand the dispute here. Orthodoxy seems to say that we have to pay the debt through taxation. MMT seems to say you could also print dollars. But both agree that printing is limited by inflation. So there's only a difference at ZIRP, which is not around anymore. So what's new?
@agocke I would say the main dispute is that 99% of our politicians do not understand the system they are regulating, and they need this crash course. Because they keep spreading incorrect information to voters.
And this number extends to citizens, and worst of all, to economists that have made careers out of being oracles of bloodlettings.
The movie is good because it is a quick crash course, a gateway to more advanced texts.
@agocke I would say, the prevailing view is “the only way to do X, is to tax or cut expenses”, the observation one can make if you grasp MMT is “we can make X happens if we have the resources” (cash not being counted as a resource)
The difference is profound, because then we can have important discussions about what to fund, the role of education, infrastructure, operations, supply chains.
Like the difference between a root cause and a side effect.
@Migueldeicaza ok, but we are currently in a world of full resource utilization, which is why inflation is above target. So this insight was useful 4 years ago, but not useful now.
@agocke inflation is higher due to a basket of reasons, but the larger contributor are the supply chain problems.
As for full resource utilization, we are around 3.9% unemployment; and the highest interest rates didn’t do much to alleviate the systemic problem, which both MMT folks could accurately predict and now folks are at a loss about what to do, because the Shaman’s bloodlettings didn’t work.
@Migueldeicaza yeah “supply chain reasons” meaning there’s not enough supply. That’s what “resource limitation” means. Whether or not interest rates alleviate the pressures is not relevant to whether there is enough productive capacity
@agocke but we are not in a world of full resource utilization.
The supply chain reasons are things like “containers are empty on the wrong ports”for example.
The interest rate changes didn’t fix the root problem. It ended up being government intervention printing money, but without the fiscal incentives and policies to go with it, so it ended being inflationary.
@agocke one of the interesting policy proposals based on the insights of MMT is that a mechanism for stabilizing the economy is “Job Guarantee”.
What’s interesting about MMT, is that once we are equipped with a good understanding of the mechanics, our policy proposals can be rooted on a firm ground. And folks will disagree on the policy or proposals - but at least they are based on the actual system, rather than shamanism.
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