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文字起こし
[Music] you might have noticed stephanie kelton's voice at the beginning of our show last year stephen and i had the opportunity of interviewing stephanie at length we wanted to mark the first mmt tuesday on kerberos media productions by sharing with you what she had to say about the deficit myth and a green new deal we hope you enjoy this special edition of mod money donuts [Music] now it's time for modern money donuts with stephen hale and gabrielle bond it's great to have everyone here today before we start i'd like to acknowledge that i'm joining you from the land of the ghana people of the adelaide plains and pay my respects to elders past present and emerging i'd also like to acknowledge the important role played by first nations people all around the world in the fight for climate justice um i'd encourage everybody to make your own acknowledgement by typing the in the chat the name of the traditional owners of the land that you're on and you could also put the name of the city you're zooming in from too so that we can see where people are joining us from from right around the world um and just a quick housekeeping because of the large number of people we'll just be asking people to type your questions in the chat for this session uh thank you very much for your patience with this and i will hand over to stephen thanks very much gabrielle i'd like to start by thanking gabrielle and the volunteers of the sustainable prosperity action group for organising this event and the australian greens and specifically david shoebridge member of the legislative council in new south wales and our own tammy franks member of the legislative council here in south australia for suggesting it and promoting it and the school of economics at the university of adelaide for supporting it there have been so many other groups that have been involved too i have people will forgive me for not mentioning everybody on the list i perhaps also to also mention democrats abroad who've been very helpful our guest stephanie kelton is professor of public policy and economics at stony brook university on long island near new york for the benefit of any economist listening she first came to my attention as the author of two papers which are among the foundation stones of modern monetary theory one was entitled do taxes and bonds finance government spending which was in the journal of economic issues the other was the role of the state and the hierarchy of money which was in the cambridge journal of economics um you sometimes see people online suggest that there are not many modern monetary theory papers in peer-reviewed journals that's not right that just means they've been reading the wrong journals if you'd like a reading list anybody if you are an economist then just write to me and i'd be happy to send you one subsequently stephanie was head of the department of economics at the university of missouri kansas city and editor of the new economic perspectives website in recent years she has been a chief economist on the senate budget committee in obviously in washington dc advised senator bernie sanders across two presidential campaigns being a fellow of the sanders institute and holder of visiting professorships at the new school for social research in new york and university of ljubljana prospect magazine named stephanie one of the 50 most influential thinkers in the world and politico as one of the 50 people most influencing the policy debate in america she was in the bloomberg 50 for 2019 and in baron's hundred women in finance for 2020. best of all from my point of view she was the 2020 visiting jeffrey harcourt professor at the university of adelaide as you almost certainly know stephanie is also the author of the deficit myth which is a new york times bestseller the number one selling book in the world on economics last year and is having a huge impact on policy debates globally thank you very much for joining us stephanie.
Kelton:
my pleasure um thank you that was uh a bit over overdone but thank you for that very kind introduction and it is so nice to be back with the two of you gabby and steven uh i you know i was with you in january of uh last year right i mean it's hard to believe that it was it was just last year that i was there in adelaide with you all and with probably many of the people who are are joining tonight so i'm really happy to be with you i i'm trying to pick up my second win because i've done a lot of events today and it's uh getting late here but i'm gonna um i would be as animated as i can and i look forward to getting into these these questions that you know steven's going to take us through so thank you for you know everything that you have done you too and i know a number of others to help uh push the ideas forward there in australia and to support the book and you know all of our work in advance uh really i think what's what's happening is that we're we're having a lot of success we are changing the nature of the policy debate and it's it couldn't come at a more important moment in time so let's dive in and thank you so much.
C:
and well that's that's perfectly okay uh a big part of changing the policy debate has been the book and writing academic papers is one thing writing a book which leads so many people to question things they've always taken for granted about economics is another thing entirely.
what inspired you to take the project on in the first place?
Kelton:
well it's about right you know it's writing for a different audience and communicating with other economists is really what you're doing largely when you're writing articles and publishing in peer-reviewed journals to be frank they don't get read by all that many people and even the most popular articles uh and influential articles are mostly read by other economists and yes you can influence the policy debate that way.
but i really wanted to empower just ordinary people you know that we are bombarded on a daily basis everyone here who's joining tonight knows that you know the the public discourse is so broken that when you have the president of the united states as we had with uh president obama literally going before the nation and getting a question about where all the money is coming from to deal with you know supporting the economy after the last crisis after the financial crisis.
and at what point do we run out of money when the president of the united states says we're out of money now right and when the discussion is so broken that we're wringing our hands about deficits and what we can afford and we're drawing the wrong lessons from the experience you know what's unfolding in uh in europe in greece and and so forth i just wanted to you know put the ideas forward in the most accessible way that i could.
um and try to get them out there and into the hands of a broader population so that people can be empowered to both engage in the debates because sometimes it feels overwhelming like you know these are lofty economic arguments and ordinary people can't possibly um you know take on a nobel prize-winning economist or a senator or a president you know or journalist when they say something um but to give them uh and a set of arguments that they can use to fight back against some of the broken thinking. and so that's what i wanted to do with the book.
C:
absolutely yeah well the political debate over here in australia at the moment is between three parties really one of which has pivoted towards austerity already and the second party the main opposition party is talking about for every dollar it spends for every extra dollar it spends in one area of public policy finding a dollar of saving somewhere else and the third party is talking about taxing billionaires more in order to raise money to pay for investments in education and healthcare. what's wrong with that narrative what are they missing?
Kelton:
well they're the fundamental thing they're missing i think is chapter one of the book right chapter one i call i say don't think of a household that's that's the title of the chapter so i'm trying to set us off on like getting off to a good start putting you know getting the right foot forward and so getting the right foot forward in this context means recognizing that the that the government is just fundamentally different from the rest of us that governments issue the currency and the rest of us are users of the . so the currency issuer can operate its budget different from a household, right. it doesn't have to quote unquote find the money in order to be able to spend so this idea that you know deficits are inherently irresponsible that good stewardship of the public finances means matching up uh how much you take in and how much you spend that if you want to spend that dollar more. then it's got to come from somewhere you got to carve it out of some other part of the budget as you said or you've got to find new revenue. and so that's broken thinking right that is thinking of the government as having constraints as having a budget constraint that's sort of akin to what households face. instead of recognizing that governments are nothing like households. and the main thing that distinguishes them is that they get to issue the currency they literally get to spend the money into existence and so we have to think about the limits very differently and how the government can operate its budget so the three uh scenarios that you just laid out there are all reflective of broken thinking none of that shows an appreciation for what makes the government different from businesses or from households.
C:
it's so strange really that that that is the narrative when you come to think of it that out in australia and it's it's even more true in the us the government budget has nearly always been in deficit.
Kelton:
yeah i mean i'm not going to tell you how old i am unfortunately you know i think it's.
not as old as me.
Kelton:
i think you know it's funny um this is a little off topic but i do notice this weird thing that uh you know there will be an article written about me that will include my age and never see that really happen with men with men it comes i don't see them the age included there but it always happens with me so i'm not going to tell you but it's all it's all over the place but the point is that i think for four years of my entire lifetime the us government's budget has not been in deficit right four years uh that that the government has either balanced the budget or had a budget surplus and that's what you're saying right deficits are the norm. it is normal for the federal government's budget to register a fiscal deficit nothing inherently problematic unusual it's a perfectly normal thing to uh to have happen. it's been that way almost my entire lifetime and without the sort of you know fallout the negative consequences that everybody warns about you know increasing deficits or persistent budget deficits result in increasing the national debt and you at some point you know the narratives are always that this leads to armageddon that there's there's there's fallout from this it's just done it's just not true it's not borne out by the history but the story just hangs around you know?
C:
well it's such an attractive story to tell i suppose it's so easy for them to tell during the heat of a election campaign you never seem to be put under pressure as a result of being too much of a hawk as far as fiscal policy?
Kelton:
yeah right i mean you sound like the grown-up in the room when you stand up and give a speech and pound your fist and fire and brimstone about how you vote for me because the last party um you know left us with these huge notice the language they often use blew a hole in the budget drowning in red ink you know charging the national credit card driving us into debt they always use that really inflammatory language so you stand up and you come in sounding like the sober um statesman you say you know the the last party did all of these things that put us in danger we're at risk because of the way the finances were managed in the past vote for me and i will put the budget right i will you know protect us from becoming like greece or you know some event where china turns off the spicket and no more dollars come out and then we're in real trouble sort of thing and you know to the extent that people don't know better it sounds reasonable it sounds responsible it sounds like the kind of thing you want to get behind right so you scare people and then you tell them to vote for you because you're the person who will keep them out of danger out of harm's way.
C:
so what what should a responsible fiscal policy look like?
Kelton:
so the the key thing is to avoid thinking at all really about the number that falls out of the budget box at the end of every year that is largely irrelevant right it doesn't matter whether the government's budget ends the fiscal year with a small surplus a small deficit a large deficit a large surplus a balanced budget the right fiscal outcome is the one that balances broader conditions in the economy. so if you can achieve a good economy if you can uh you know carry out an agenda that allows you to create a good economy you know. high levels of employment good paying jobs low inflation poverty rates are coming down your infrastructure is being maintained. if if the things that matter are um being realized right you're delivering on good outcomes in the economy. and it takes a deficit that's five percent of gdp to get there so what you have low inflation full employment high wages low poverty rate your what difference does it make if you can get there with a two percent surplus. okay fine right. that that is the point that the budget outcome isn't what we should pay attention to you're not trying to balance the budget you're trying to balance your economy. and you you want to stay laser focused on those objectives right the things that matter and then let the number go where it needs to go it's like you know i have an oven in my house. i don't choose to you know cook dinner at 300 degrees because last night i cooked dinner at 375 and i say well i can't i have to lower the temperature tonight because i used all the btus that are available or something. you know um you you can start fresh each year and and readjust things to just try to maintain a good economy.
C:
so we say that every dollar the government spends is a new dollar the government being the currency issuer every dollar the government spends is a deposit the government's making somewhere in the monetary system in the in the banking system the government doesn't have to raise taxes in order to go and engage in additional spending what's the tax system there for.
17:00
文字起こし
[音楽]去年のショーの初めにステファニー・ケルトンの声に気づいたかもしれませんが、ステファニーにインタビューする機会がありました。彼女が言わなければならなかったことをあなたと共有することで、ケルベロスのメディア制作の最初のmmt火曜日をマークしたいと思いました。赤字の神話とグリーンニューディールについてこの特別版のmodマネードーナツをお楽しみください[音楽]今度は、スティーブンヘイルとガブリエルボンドを備えたモダンマネードーナツの時間です。私はアデレード平原のガーナの人々の土地からあなたに加わっていることを認め、過去の現在と新興の長老たちに敬意を表します。また、世界中の最初の国の人々が果たした重要な役割を認めたいと思います。気候正義のために戦うdチャットにあなたがいる土地の伝統的な所有者の名前を入力して、すべての人に自分の承認を与えるように促します。また、ズームインしている都市の名前を入力して、私たちが見ることができるようにすることもできます。世界中から人々が参加しているところです。たくさんの人がいるので、簡単なハウスキーピングを行っています。このセッションのチャットで質問を入力するようにお願いします。ご理解のほどよろしくお願いいたします。これと私はスティーブンに引き渡しますガブリエルに感謝しますdガブリエルと、このイベントとオーストラリア緑の党を組織してくれた持続可能な繁栄行動グループのボランティア、特にニューサウスウェールズ州の立法評議会のデビッドシューブリッジメンバーと、ここ南の立法評議会のタミーフランクスメンバーに感謝することから始めたいと思います。それを提案して推進してくれたオーストラリアとそれを支援してくれたアデレード大学の経済学部他にもたくさんのグループが関わっています。海外の民主党員に言及するゲストのステファニー・ケルトンは、ニューヨーク州のロングアイランドにあるストーニーブルック大学の公共政策と経済学の教授であり、経済学者の話を聞いてくれました。彼女は、基礎となる2つの論文の著者として最初に私の注意を引きました。現代貨幣理論の1つは、経済問題のジャーナルにあった政府支出に税金と債券を融資する権利があり、もう1つは、経済学のケンブリッジジャーナルにあった国家の役割とお金の階層でした。ピアレビューされたジャーナルには現代貨幣理論の論文があまりないということは正しくありません。つまり、経済学者であれば誰かが読書リストを希望する場合は、間違ったジャーナルを読んでいるということです。ステファニーはミズーリ大学カンザスシティ校の経済学部長であり、近年は新しい経済展望ウェブサイトの編集者であり、明らかにワシントンDCで上院予算委員会のチーフエコノミストを務めています。サンダース研究所のフェローであり、ニューヨークの社会研究のための新しい学校とリュブリャナ大学の展望誌でステファニーを世界で最も影響力のある50人の思想家の1人とポリティコに指名した訪問教授の保持者である2つの大統領選挙で上院議員バーニーサンダースに助言したアメリカでの政策論争に最も影響を与えた50人の1人として、彼女は2019年にはブルームバーグ50に、2020年には男爵の100人の女性に所属していました。何よりも私の観点からすると、彼女は2020年にアデレード大学を訪れたジェフリー・ハーコート教授でした。ステファニーは、ニューヨーク時代のベストセラーであり、世界で最も売れている本である赤字神話の著者でもあることはほぼ間違いありません。昨年は経済学に携わり、世界的な政策論議に大きな影響を与えています。ステファニーにご参加いただき、誠にありがとうございます。
ケルトン：
ちょっとやり過ぎでしたが、とても親切な紹介をありがとうございました。ギャビーとスティーブンの2人と一緒に戻ってきてとても嬉しいです。去年の1月に一緒にいたことを知っています。去年のことで、皆さんと一緒に、そしておそらく今夜参加している多くの人たちと一緒にアデレードに参加したのは信じがたいことです。今日はたくさんのイベントをやったので、2回目の勝利を手に入れようとしています。ここでは遅くなっていますが、できる限りアニメーション化するつもりです。あなたが知っているこれらの質問に答えることを楽しみにしています。スティーブン」私たちを案内してくれるので、あなたがあなたがしたことすべてを知ってくれてありがとう、そして私はオーストラリアでアイデアを前進させ、本をサポートするのを助けるために他の多くの人を知っています、そしてあなたは私たちのすべての仕事を前もって知っていますええと、本当に私は何が起こっているのかというと、私たちは多くの成功を収めているということだと思います。私たちはポリシーディベートの性質を変えています。それはもっと重要な瞬間に来ることができなかったので、飛び込んで感謝しましょう。そんなに。
C：
それは完全に大丈夫です。ポリシーディベートの変更の大部分は本であり、学術論文を書くことは、多くの人々が経済学について常に当たり前だと思っていたことに疑問を投げかける本を書くことの1つです。 。
そもそもプロジェクトを始めたきっかけは何ですか？
ケルトン：
それは、別の読者のために書いていることを知っていることです。他のエコノミストとのコミュニケーションは、記事を書いたり、ピアレビューされたジャーナルに公開したりするときに、実際にはほとんど行われていることです。多くの人々、そして最も人気のある記事でさえ、ええと影響力のある記事はほとんど他の経済学者によって読まれています、そしてそうです、あなたはそのように政策論争に影響を与えることができます。
しかし、私は本当に私たちが毎日爆撃されていることを知っている普通の人々に力を与えたいと思っていました今夜参加するここの誰もがあなたが公の言説が非常に壊れていることを知っているのでオバマ大統領は文字通り国の前に行き、金融危機後の最後の危機後の経済を支援することを知っているあなたに対処するためにすべてのお金がどこから来ているのかについて質問を受けます。
そして、米国の大統領が私たちが今はお金がなくなったと言ったとき、そして議論が非常に壊れて赤字と私たちが買うことができるものについて手を絞っているとき、私たちはどの時点でお金を使い果たしますか？ギリシャなどのヨーロッパで何が起こっているかを知っている経験から間違った教訓を再描画します。私はあなたに、私ができる最もアクセスしやすい方法でアイデアを提案することを知りたかっただけです。
ええと、彼らをそこに連れて行き、より広い人口の手に渡して、人々が両方の議論に参加できるようにすることを試みてください。ノーベル賞を受賞したエコノミスト、上院議員、またはあなたが知っている大統領やジャーナリストが何かを言うときは、彼らにええと、壊れた考えのいくつかと戦うために使用できる一連の議論を与えることを知っています。それが私がこの本でやりたかったことです。
C：
確かにそうですね、現時点でのオーストラリアでの政治的議論は、3つの政党の間で行われています。そのうちの1つはすでに緊縮財政に向けて動いており、2番目の政党は1ドルに費やす1ドルごとに話し合っています。公共政策の分野では、どこか別の場所で1ドルの貯蓄を見つけており、第三者は、教育と医療への投資に支払う資金を調達するために、億万長者にさらに課税することについて話し合っています。その物語の何が問題になっていますか？
ケルトン：
まあ、彼らは彼らが欠けている基本的なものだと思います私は本の第1章であると思います私が呼ぶ第1章私は言う良いスタートを切るのと同じように、右足を前に出すことを知っているので、この文脈で右足を前に出すということは、政府が通貨を発行する他の人々とは根本的に異なることを認識することを意味します。私たちはのユーザーです。そのため、通貨発行者は家計とは異なる予算を運用することができます。それはしません 支出できるようにするために引用符を付けずにお金を見つける必要があるので、赤字を知っているというこの考えは本質的に無責任であり、財政の適切な管理は、あなたがどれだけの金額を受け取り、必要に応じてどれだけのお金を使うかを一致させることを意味しますそのドルをもっと使うために。それからそれはあなたが言ったようにあなたが予算の他の部分からそれを切り分けなければならないどこかから来なければなりません、あるいはあなたは新しい収入を見つけなければなりません。政府が制約を持っていると考えているのは、家計が直面しているのと同じような予算の制約があるということです。政府は家計のようなものではないことを認識する代わりに。
C：
それは本当に奇妙なことであり、オーストラリアでそれを考えるとそれが物語であり、米国では政府予算がほぼ常に赤字であるということはさらに真実です。
ケルトン：
ええ、私は私が何歳であるかをあなたに話すつもりはないということを意味します残念ながらあなたは私がそれだと思うことを知っています。
私ほど年をとっていません。
ケルトン：
私はそれが面白いことを知っていると思いますええと、これは少しオフトピックですが、私はこの奇妙なことに気づきます。私の年齢を含む私のことについて書かれた記事があり、男性と男性で実際に起こることは決してありません。そこに年齢が含まれているのを見ないでください、しかしそれはいつも私と一緒に起こるので、私はあなたに言うつもりはありませんが、それはすべての場所にありますが、ポイントは私の生涯の4年間、米国政府の予算だと思います政府が財政のバランスを取っているか、財政黒字を抱えているということは、4年間赤字ではありませんでした。それが、正しい赤字が標準であるとあなたが言っていることです。連邦政府の予算が財政赤字を登録するのは普通のことであり、本質的に問題のあることは何もありません。
C：
選挙運動の最中に、財政政策の面でタカになりすぎた結果として圧力がかかることは決してないように思われることを彼らが簡単に伝えることができると私は言うのはとても魅力的な話です。
ケルトン：
ええ、そうです、あなたが立ち上がってスピーチをし、あなたが私に投票する方法についてあなたの拳と火と縁石を叩くとき、あなたは部屋で大人のように聞こえることを意味します彼らがよく使う言葉は、あなたが知っている赤インクに溺れて予算に穴を開け、私たちを借金に追いやる彼らはいつもその本当に炎症的な言葉を使うので、あなたは立ち上がってあなたが知っていると言う地味な政治家のように聞こえます最後の党は私たちを危険にさらすこれらすべてのことをしました過去の財政管理の方法のために私は危険にさらされています私は予算を正しくします私はあなたが私たちをギリシャのようになることから保護することを知っていますまたは、中国がスピケットをオフにし、それ以上のドルが出てこないというイベントを知っています。本当の問題のようなもので、人々がよく知らない程度にそれは合理的に聞こえるそれは責任があるように聞こえるそれはあなたが正しく取り残したい種類のもののように聞こえるのであなたは人々を怖がらせそしてあなたは彼らに投票するように言いますあなたは彼らを危害から遠ざける人だからです。
C：
では、責任ある財政政策はどのように見えるべきでしょうか？
ケルトン：
ですから、重要なことは、毎年の終わりに予算枠から外れる数についてはまったく考えないことです。これはほとんど無関係です。政府の予算がわずかな黒字で会計年度を終了するかどうかは関係ありません。小さな赤字大きな赤字大きな黒字バランスの取れた予算正しい財政結果は、経済のより広い条件のバランスをとるものです。ですから、もしあなたが良い経済を達成することができれば、あなたはあなたが知っている良い経済を作り出すことを可能にする議事を実行することを知っています。高水準の雇用高給の仕事低インフレ貧困率が低下しているあなたのインフラストラクチャは維持されています。重要なことが正しく実現されていれば、経済において良い結果をもたらしています。そしてそれは赤字がかかります」■GDPの5％がそこに到達するため、低インフレの完全雇用、高賃金、低貧困率があり、2％の余剰でそこに到達できる場合、どのような違いが生じますか。大丈夫ですよね。それは、予算の結果が、経済のバランスをとろうとしている予算のバランスをとろうとしているのではないことに注意を払うべきではないという点です。そして、あなたはそれらの目的に焦点を合わせたまま、重要なことを正しく行い、それから数を必要な場所に移動させたいと思っています。まるで私の家にオーブンがあることを知っているようです。昨夜は375度で夕食を作ったので、300度で夕食を作ることを選択しません。今夜は、入手可能なすべてのbtusか何かを使用したので、温度を下げる必要はありません。
C：
つまり、政府が費やすすべてのドルは新しいドルであり、政府は通貨発行者です。政府が費やすすべてのドルは、政府が税金を上げる必要がない銀行システムの通貨システムのどこかに政府が作っている預金です。行って追加の支出に従事するために、そこの税制は何のためにあるのか。
17:00
Kelton:
well you you could get me into a a long monologue with that question stephen as you know um you know there's an origin story there's a way to talk about the role of taxes from the beginning like if you wanted to start a currency from scratch the tax or something that works like a tax is important because you're trying to get people to work and accept your currency and to provide you with the stuff that you're after so if you want a military if you want infrastructure you want hospitals and roads and bridges and a standing army and all that governments have used taxes or fees and fines other things to move those real resources from the private domain into the public domain. so it's a way to start up a currency from scratch you say to the population all right everybody uh you're going to owe me you know at the end of the month or whatever a certain number of units of my currency. and you don't have it so everybody starts scrambling around to figure out how to earn the currency that they need in order to settle their obligation to the state so that tax is important in that origin story i'm doing this quickly obviously. once you have a monetary system up and running then taxes are important for a lot of other reasons like you might think and a lot of people ask this question. well if the government can issue the currency why bother taxing it all. why don't you just spend and leave the rest of us alone like cut our taxes to zero everybody hates taxes you'd be so popular. you know if you just eliminate taxes and just spend your currency and most people can figure out pretty quickly that you're going to run into trouble because if all you're doing is spending the currency and you're not subtracting any of it away from people by taxing it away then you're going to very quickly undermine the value of the currency you're going to create an inflation problem why would people work for something that's so readily available right there's too much of it so taxes are important because taxes are for subtraction. so the currency is a tax credit it's important because it takes some purchasing power away from the rest of us and that helps to mitigate inflationary pressures taxes are important because government might care about things like distribution income and wealth uh distribution and so you might think about changing the tax code closing loopholes introducing a new tax raising an existing tax cutting attacks right because you're trying to disincentivize or incentivize certain behaviors you might do it because you want to actually alter the distribution of wealth and income you might look at what's been happening over the course of the last 100 years or so.
and say my god you know we are allowing the inequalities to become so extreme that this is bad not just for the way our economy works.
but it's bad for the way democracy works wealth is too concentrated in the hands of too few and you can you know make adjustments to to taxes um not because you need the revenue not because you need the money but because you want to deal with those you know um inequalities you want you want to address the concentration of wealth and ownership in the economy so tax are important for a lot of things but not for revenue.
20:10
ケルトン
その質問には長い独白が待っています スティーブン ご存じのように......原点があるんです 税の役割について最初から話す方法があるんです ゼロから通貨を始めようと思ったら 税金や税のように機能するものが重要です なぜなら人々に働いてもらおうとするのだからです 軍隊が必要なら、インフラが必要なら、病院、道路、橋、常備軍など、政府は税金や手数料、罰金などを使って、実際の資源を私的領域から公的領域へ移動させてきました。だから、ゼロから通貨を立ち上げる方法なのです。国民に、「みんな、月末に私の通貨を何単位か借りてくれ。一旦、通貨制度が出来上がると、税金はあなたが思うような他の多くの理由で重要です。多くの人がこの質問をします。政府は通貨を発行できるのなら、なぜわざわざ税金をかける必要があるのでしょうか。税金をなくして、ただ通貨を使えばいいのです。ほとんどの人はすぐにわかると思いますが、問題が起こります。通貨を使うだけで、税金によって人々から通貨を差し引かないのであれば、通貨の価値はすぐに損なわれます。インフレ問題が起こります。なぜ人々はこんなに簡単に手に入るもののために働くのでしょうか。通貨は多すぎるのです。税金とは差し引くものだからです 通貨は税額控除です それが重要なのは 私たちから購買力を奪うからです インフレ圧力を緩和するのに役立ちます 税は重要です 政府は所得や富の分配といったことに関心があるかもしれません だから税制を変えることを考えるかもしれません 抜け道を塞ぐ 新しい税を導入 既存の税を上げる 攻撃を減らす 特定の行動を抑制または奨励しようとするからでしょう 実際に富と所得の分配を変えたいからそうするかもしれません 過去100年ほどの間に何が起こっているかを見てみるとよいでしょう
過去100年ほどの間に起こったことを見て、不平等が極端になるのを許しているのは、経済がうまく機能しないだけでなく、悪いことだと言えるでしょう。
しかし、それは民主主義が機能する方法にとって悪いことです 富があまりにも少数の手に集中しすぎています あなたは税金を調整することができます 収入が必要だからではなく、お金が必要だからではなく、 それらの不平等に対処したいからです 経済における富と所有権の集中に対処したいので 税金は多くの事柄にとって重要ですが 収益にとってではありません。
20:10
C:
it's so uh attractive to progressives to who want a more progressive tax system who want to address the distribution issue to frame it in terms of taxing billionaires to pay for things isn't it it's it it is attractive i call it so i don't know you've probably heard me say this but i call it the two itch problem because look robin hood we we sort of think back uh about robin hood and he's sort of this hero right we think robin hood was this guy uh who you know took from the rich and gave to the poor and that's a very heroic thing so you hear a lot of progressive politicians and others talk about um raising taxes for the purpose of getting the money that you need that you need and that word is important in order to feed a hungry kid or repair a crumbling infrastructure or whatever right so we're going to take from the rich and we're going to heal our nation we're going to feed people and and better fund our schools and our health care and all this kind of stuff okay so what are the problems with that well one is that's just bad economics because that's not how government finance works so the story is wrong the other problem from well two other problems from my perspective you tend then only to go after concentrations of of wealth in a very timid way because you see you say well i only need 10 billion or i only need 70. so i can do this with a very small tax on billionaires a wealth tax you know right we heard this from senator elizabeth warren who i like i'm a fan okay but when she talked about the wealth tax she talked about taxing um the very wealthy people with 50 million or more net worth net worth right 50 million 50 million or more you're free and clear on the first 50 million but on the 50 million and first dollar she said we want two cents you just chip in two pennies right on that next dollar and then you keep paying two percent on your wealth above 550 million up until a billion and then once you hit a billion we want one percent more okay so three three percent on everything over a billion and she said they won't even feel it okay they won't they won't even notice it she literally made the argument that it's such a tiny imposition on what they have that they won't even notice it because wealth tends to accumulate at a more rapid rate right so they're still going to become richer and richer and richer and my reaction was well hang on okay if the purpose of the wealth tax is actually to aggressively get at concentrations of wealth then what's the point of a little bitty old thing that nobody hardly even knows is happening right and the answer is well that's the way to pay for everything so if you can do this you just peel off just what you need so that you can claim to the congressional budget office and and play the legislative process and you say well this is all i need to pay for making public colleges and universities tuition-free pre-k and some student debt cancellation which is what she wanted to do with the well tech so i guess what i'm saying is if you're coming at this from an mmt through an mmt lens and you think about the purpose of taxes the way that i do then you're not thinking of the taxes the pay for it's not about paying for things it's not about the revenue you're using the tax to achieve a different goal which is addressing you know deep concentrations of inequality and then you could make a case for something like a wealth tax at least in a consistent way with through an mmt lens and you'd presumably go much higher because you're not worried about the pay for it's not motivated by that yeah we say don't we the federal governments in monetary systems like australia's or in the us have no purely financial constraint on their spending but we are not implying that there are no constraints at all are we so what the limit right right so exactly and in fact that's really in many ways kind of the core you're taking us right to the core of mmt so you know i will sometimes say that if if i'm pressed to describe mmt in a sentence like give me the sound bite uh mmt is about replacing an artificial fake phony imaginary budget constraint with a real resource constraint an inflation constraint so is there a limit yes is it the limit that almost everyone wants us to believe that is that the government can run out of money like obama said become like greece have bills you can't afford to pay go broke and bankrupt the nation and so forth no that is not the punishment for overspending the punishment for overspending is inflation so there is a limit the limit is how many dollars can safely be spent into the economy before the economy runs out of capacity to meet that spending that higher demand with more supply and remember you know government spending isn't the only kind of spending you have to worry about government doesn't do the majority of the spending in the economy the private sector does specifically the household sector they normally account for about 70 percent of total spending so the government has to share spending space with everybody else who wants to spend into the economy there's only so much space available and the government has to respect the the total limit right the capacity limit for the economy so yes there's a limit and um we're nowhere close to it in a pandemic depressed economy with unemployment that's very elevated but if you push things far enough you will approach that limit we often say that it's just a matter of accounting that sexual balances have to come to zero in the monetary system and you put it in a rather more accessible way you say their red ink is all black ink that's one of the that's what the title of one of the chapters of your book um what do you mean by that well so you use the phrase red ink in australia yeah you know because when i was doing the book and writing the chapters i remember asking as i would do presentations you know in the uk before the book came out and i was using you know the public person red ink and so forth and that wasn't necessarily a common turn of phrase there so okay so you use reading the title of the chapter their red ink is our black ink so what does that mean well it means that the government deficit is just the difference between two numbers that's literally all it is we have this visceral reaction we've been conditioned to you know hear the word government deficit and think whoa something bad is happening no nothing bad is happening the deficit is just the difference between two numbers so what are these numbers the first number is how many dollars the government spends into the economy each year and the other number is how many they subtract back out mostly through taxation so in the book i stick with the same example which is suppose the government spends a hundred dollars into the economy and it only taxes 90 away from people in the economy taxes 90 back out we label that a government deficit so we write minus 10 on the government's ledger we say oh they're swimming in red ink right this deficit what we forget to do is pay attention to the math which says if they put 100 in and only take 90 out they're depositing 10 right their deficit is our financial surplus their red ink is our black ink their deficit is nothing more than a financial contribution they're making a deposit into some other part of the economy so that's why i say every deficit is good for someone every government deficit is good for someone because on the other side of that red ink is somebody else's surplus financial surplus so the question should never be you know is it should should the government be in deficit the question is really you know deficits for whom and for what i mean it's just that simple every deficit is good for someone you reminded me of a cartoon you used in the lecture you did here when you were the harcourt professor of our treasurer josh freidenberger's cupid firing firing dollars into the private sector and it was supposed to refer to there being an imminent budget surplus and they're not so confused wasn't there you're going to get me i'm tired i'll make a bad joke or something but you're making me think of like a double 07 movie there was something like from russia with love or something well there's the cupid right it's um where our deficits come to you with love sort of thing yeah it's a i'm i'm shooting sometimes i say a deficit a government deficit works like a blower right it blows financial assets onto the balance sheets of people outside the government sector a government surplus works like a vacuum it hoovers financial assets off of the balance sheets off of the ledgers of people in the non-government part of the economy so we have this idea that a government surplus that is the real um thing to achieve that is the the badge of fiscal uh responsibility if the government can achieve a surplus man that's showing you you know how to run the budget but when the government is running a surplus it is reducing the financial assets from the rest of the economy so it is literally like hoovering up uh dollars from the rest of us in order to put their budget in the black everybody else has to be driven into the red yeah it's weakening private sector balance sheets it either drives the economy into a recession or it drives the private sector further into debt which is what of course happened here during the howard government years when the government ran surpluses eight years out of ten unless unless you happen to be in a situation where the rest of the world is blowing dollars onto your balance sheet and you can do that through a current account surplus or we could loosely call it a trade surplus so it's not necessarily the case that a government surplus dooms the private sector because the private sector can be kept in good uh financial shape if the rest of the world is supplying the financial assets that keep the private sector but somebody somewhere else has to be running a deficit there you go yep that's right everybody can't be in surplus at the same time now when you explain all these things to people and i often say why would you want a government surplus unless you actually need to have one it means they're taking more dollars off you than they're giving to you doesn't sound like a good thing in itself people talk about growing uh government debt and increasing national debt and uh recently a couple of times i've had people say our national debt in australia is over 800 billion dollars now it's heading towards a trillion dollars isn't this going to lead to a crisis isn't it something we should be concerned about should it concern us well no i mean again with the mmt lens in place what should concern you are you know high levels of inflation high levels of unemployment when i say that the goal should be a broadly balanced economy that's what i'm talking about i'm saying you know if you can get the unemployment rate down without triggering inflation you know that you consider excessive and you can manage the inflationary pressure and get the economy to full employment and we could talk about how to truly achieve full employment then no well you know that again the deficit the difference between two numbers right so you spend 100 in you tax 90 out you've deposited 10. what happens as this is occurring is that the government is matching up its deficit spending by selling government bonds so that 10 deposit is immediately transformed into a government bond let's call it a 10 government bond so that's somebody's financial assets part of their savings part of their wealth so when people look at you know the government's finances and use language that you would use to describe a household's finances then you start describing this as borrowing and you start using the word debt to describe what's happening i don't look at it that way at all i think that you know using the word borrowing is misleading i think the word debt is misleading when we talk about what the government is doing if i borrow money i borrow money because i don't have it right so i go to a bank i sit down with a loan officer i say i'm here to borrow money and the loan officer says what do you want to borrow money for and i say i want to buy a car or start a you know expand my small business or whatever and maybe i'm granted a loan now i have debt okay i have to repay that with money that i got to come up with from somewhere right the federal government's different when the government runs a deficit it puts 100 in subtracts 90 leaves 10 and then comes along and says well i want to sell these government bonds who wants to buy them and sure enough there's ten dollars that's been made available that gets turned into ten dollars worth of government bonds so it's not like when i borrow right i didn't walk into the bank and put the money down in front of the loan officer and then ask the loan officer to lend me that money that's what the government does their spending supplies the dollars that are then available to buy the government bonds i think the word borrowing is misleading i think the word debt is misleading those bonds are just another monetary instrument there's another thing that government issues it's it's interest bearing so the government is choosing that's a voluntary thing right the a currency issuing government never has to borrow its own currency from anyone never has to do that this is an optional thing that they do and it you might think it's a nice thing i mean we could debate that but you might think oh you get to give up your currency and hold a risk-free asset and you get a reward risk-free reward wow that's kind of nice right so this is an instrument that is interest bearing very safe and it provides a risk-free subsidy to the bondholder so um you can you know we suggest that we really should be thinking of the outstanding total stock of government securities bonds as just part of the broader money supply not use that word debt to describe what it is it's really just an interest bearing form of currency absolutely and that the pros the pros and cons of uh issuing bonds could get us on to a quite another long right notion but it is a choice governments like the us government and the australian government they're not forced to issue treasury bonds at all where there are uh regulations or practices in place which which encourage bond issuance at the moment they could be changed they're not fundamental to the monetary system no they are an instrument that allows governments to support interest rates at positive levels right you can maintain and manage interest rates but there are other ways to do that absolutely um people sometimes confuse mmt i don't know whether deliberately or not i'm journalists for example with quantitative easing when it's got nothing really to do with quantitative easing and uh there's a question from a member of the public from uh uh peter holding which uh kind of relates to this he says that alan kohler the uh famous financial journalist in australia and somebody who definitely understands mmt thoroughly called on the reserve bank to buy up all the government's debt and just write it off recently would this change anything significant and is it a worthwhile suggestion and they are buying up they bought up an eighth of the government's debt over the last year as a result the the fed is buying 120 billion a month right um so but the thing is when the central bank buys the bonds the treasury is still continuing to make the payments so every government budget includes that line item that says interest on the public debt people in the media often call it the debt burden or the debt service burden so that language is problematic right when i worked in the senate uh i don't know how many times i heard u.s senators say they look at that number and they see 400 billion or 350 billion as the line item in the budget called interest expenditure right interest on the debt and they go oh my god we're spending we're on track to spend more on interest than we spend on the military if you project out you know some number of years and they would just it would blow their minds and you know i would i would point out that well there are a couple of ways to deal with that right one is you don't have to issue the bonds at all and as as all the bonds matured that line item would just disappear if you don't like the number being as large as it is you could always cap interest rates we did it before the fed has done it before the bank of japan is pinning the 10-year on japanese government bonds at zero because the the boj says we're gonna keep it at zero we're doing something similar to that here now okay once they're pinned at 0.1 so but i guess the point is as long as they still sit on the balance sheet and this gets to the question about writing them off we would say mmt economist would say once the central bank buys the bonds it's as if the treasury never issued them in the first place in the sense that the treasury will make the payments the central bank remits the profits back to treasury at the end of the year so it's like a left pocket right pocket thing the problem with that is that everyone still sees the line item in the budget the interest expense and it's still there right people still see it so this question uh is about whether there would be advantages to having it not still be there to actually writing it off once the central bank buys it just make it disappear from the whole you know accounting uh and and dispense with the exercise where you pay the interest and you pay back the principal at maturity and then it goes you know um politically yes there would be uh probably advantages to doing that we have a debt ceiling limit and the bonds that are held by the fed are counted as part of the public debt and subject to the debts it's like crazy you know so yeah there are advantages to i i suppose doing it that way you see that with a negative capital position on the central bank's balance sheet but that really doesn't matter no i mean again it's the politics right you only have to deal with the politics the economics are fine um maybe we'll move on to luke heffernan's question luke asked whether the deficit myth has got anything to say about nations without a sovereign currency yes um uh there's a whole chapter that deals with uh you know it's it's the open economy or the trade chapter and so the answer to the short answer the question is yes and the long answer could go on for a long time but uh you know the answer is yes i don't know how much it explains why countries like greece or italy can get into difficulties as far as uh financing fiscal deficits are concerned yeah i mean the point is to to emphasize that countries that have a particular set of arrangements that you know the country has a monetary system in place where the government issues the currency the currency is a floating exchange rate where the government doesn't promise to convert its currency into something it could run out of so you're not on a gold standard where you're promising to convert your currency on demand into gold you're not on a fixed exchange rate where you know you're russia in the mid 90s and you promise to convert rubles into dollars at a fixed price you're you're on a floating fiat currency system you're the issue of the currency you're not borrowing in currencies that you don't control so you're if you're um you know the u.s you're not borrowing in foreign currencies if you're um argentina or russia and you start borrowing venezuela you start borrowing in u.s dollars heavily then you're talking about a totally different animal right and the constraints on government finance are different you're mentioning greece and countries that um are part of the emu those countries gave up their sovereign currencies they gave them up they abandoned them and they adopted a a common currency the euro which these individual countries cannot issue so there are different constraints we all saw that play out in 2010 when the debt crisis gripped countries like greece and portugal italy spain uh ireland and and so we know what can happen when a country has debt that it literally can't afford to service right it's got to go out and it's got to borrow the currency because it doesn't issue it it goes to capital markets capital markets are lending to governments that don't issue the currency so they perceive rightly that there is default risk involved that this country might not be able to pay you back so they want a premium to compensate them for the added risk associated with lending to currency issuing governments and at one point you know in the 2010 era interest rates just completely blew out and you had a full-blown debt crisis notice that that didn't happen in the uk didn't happen to japan it didn't happen in the u.s didn't happen to australia you know we are all operating our governments operate with a sovereign currency we can manage our interest rates we don't have to borrow in the first place borrowing is optional yeah greece doesn't have that option and it's it's worth pointing out that your one-time colleague win godley warned the architects of the eurozone about the potential for a crisis like this in in the early 90s when they were system up i was so fortunate as were some of the other mmt economists to um to meet and work alongside wynn and he actually you know served on my doctoral dissertation committee and you know truth be told he he kind of was my dissertation advisor in in all but name um wynn was brilliant a british economist who um spent many years as really forecasting the british economy and i think you know had earned a reputation of of being just about the best there ever was in terms of you know his ability to accurately see where where things were headed you know well ahead of the rest of the pack so you're quite right the euro was introduced in january of 1999 officially became a currency but you know people understood for years ahead of that that this was the direction that many european countries were heading and you know the maastricht treaty and the um you know uh um i don't know what to call them the laws that were shaping up were leading in that direction and as early as 1992 win was writing and saying uh oh you folks are you're putting in place a blueprint that is going to lead to trouble down the road because you're proposing to do something that really hasn't been done before in a sense you are divorcing monetary policy and fiscal policy in a way that is going to leave you vulnerable to economic downturns and unable to act when a crisis comes and you're not going to be able to use fiscal policy and you're going to have face debt crises and all this and when could you see it plain as day it was so crystal clear to him that when you give up your currency you're giving up a lot more than just the ability to depreciate your currency to try to improve the you know terms of trade and and so forth that you were really compromising your ability to stabilize your economy in times of crisis and he meant specifically fiscal policy so when wynn had it all figured out as early as 1992 and because i was working with him um you know in the late 90s but before the euro became official uh currency i i was lucky enough to be influenced by his thinking and to not fall into the crowd that was cheerleading this um you know currency arrangement because i could see what he saw which was basically a design flaw in the blueprint yeah i recommend anyone who hasn't read it look up when godly's article maastricht and all that um which also had one called curry emu the first one was maastricht yeah yeah both of them are terrific yeah absolutely they are well i mustn't uh finish our conversation finish our conversation before asking you about the job guarantee there's renewed discussion of a job guarantee in the u.s i've got the resolution of congresswoman anna presley in front of me which looks as though it's very much inspired by modern monetary theory and you've been one of the main advocates alongside uh pavlina cheneva and in australia professor william mitchell as well of a federal job guarantee for many years would you care to explain why it would be such a progressive measure yeah i mean so we have this incredible member of congress and you just mentioned her congresswoman uh ayanna pressley and she just in the past you know a few days i think friday of last week if i'm not mistaken uh formally introduced a a resolution in congress now that's different from a bill it's it's not a formal piece of legislation or i mean a bill but it is a resolution and she is getting it on the table and she has come out in favor of a federally funded basically a public option in the labor market right a federal job guarantee where anyone who wants to work wants a job and cannot find one anywhere else in the economy has a right right to a good paying job right a a job that pays well we can debate 15 an hour but a living wage job and benefits so a wage and benefit package that you always have as an alternative to unemployment so you know i saw today and i i was pretty busy and i didn't really get a chance to watch the whole thing but i saw that the daughter of martin luther king jr and coretta scott king was retweeting and sharing a video that congresswoman uh presley put out where in her own words you know she's laying out the answer to your question which is what makes this such a progressive policy and so for people who maybe haven't seen that yet you know go find her twitter feed and watch this incredible video i think it's about three minutes long but it's that arc of history you know that martin luther king jr talked about that that bends toward justice and this resolution is her effort to bend that arc toward justice so that you know people who have nothing who have no entry point in no way to support themselves no way to to get a job and and to survive uh always have the security of knowing that whatever else happens in their lives you know you have a right at the end of the day to a job that pays a decent wage and comes with benefits and that's a very different answer than you know the kind of answer that a you know buttoned-up economist might give about the benefits of a program like this just you know in terms of efficiency making the labor market more liquid allowing workers to transition in and out of this program as some way of better stabilizing the economic system which it has those benefits as well but there's also really important human and moral side of the job guarantee and that's that's certainly what uh congresswoman presley is leading with and it's what we are campaigning for including our sustainable prosperity action group in australia and greens and members of the labour party right the way across the country as well and stephanie covers the federal job guarantee proposal and its role as a counter-cyclical stabilizer in modern monetary theory in her book and i also recommend pavlina schneider's book the case for a job guarantee which is a great read as well and uh goes into some of these issues in in a lot more detail too oh yeah probably almost any question that you you or the people joining would have about how the program would work and the benefits you will find in her book and she also has a website where she um has created a nice faq frequently asked questions and that that is just really sharp because just any question that pops into your head i'll bet you uh she's got it there and and she's got an answer to it so and pavlina was involved in a successful job guarantee style scheme in argentina in the mid 2000s wasn't she which they should never have removed actually she left it in place yeah pavlina and uh matt forstadter who is a fellow mmt economist and a professor at the university of missouri in kansas city um i think both of them worked with someone in the argentinian government in the ministry of labor to design and implement a version of a job guarantee program that was for that was extremely meaningful and successful to people who were able to take advantage of it while it existed yeah i recommend reading about clan heifers in the book i might end my um section of the event this evening just by asking another question from a member of the public from neil halliday he points out that our central bank governor philip lowe recently said at a national press club event we don't do mmt in australia uh was he right and how can we change his mind how can we change his attitude well okay so on valentine's day i tweeted you know that everybody does this every valentine's day the roses or red violets are blue and then you finish this phrase i think i tweeted roses are red violets are blue mmt is a lens not something you do so you know is he right no um because if he's under the impression that mmt is something you do and he's not doing it then he already is revealing that he doesn't understand what mmt actually is it's a description and i hate to break the news but we're providing an accurate description of what he actually does right what the central bank does the mechanics of government finance how the monetary system works and the mechanics of government finance and we're just trying to tell the truth to people about the nature of it all and how it works and you know central bankers like to be shrouded in this sort of veil of you know secrecy and it's all supposed to be sort of mysterious and we don't do that and we don't uh but frankly we're just telling the people how it works so yeah he's mistaken and they really should know better because his deputy was at a talk you gave in in sydney last year guy de bell yeah you said that i mean i think i sat next to him and we probably had some small talk and i think if i remember correctly maybe he asked one question at the end of some remarks that i gave but um i don't know how much of an effort he's made to actually engage with any of the scholarship so he may be next in line to be the governor so maybe we'll see thanks very much stephanie i'll hand over to gabrielle now thank you both thank you thank you um there are a lot of great questions coming through from the chat but um if you don't mind i'd like to um just bring david shoebridge into the meeting which i'll have to do by uh finding him in the list and giving him a co-host permission so if you don't mind i'll just quickly do that because he's got a question that he'd like to put to us this event was really david's idea just oh sorry talk amongst yourselves well i'm finding that i'll unmute myself it's great thank you so much stephanie for doing this we know how busy you've been today and how busy you are virtually all the time you're absolutely wonderful and please come back to adelaide soon i listen i would love to come back i can't wait to come back thank you for hosting this go ahead david oh um oh thanks scott and thanks for doing um all of the hard work behind the scenes often not celebrated enough stephanie um i'm really grateful for you taking the time out i'm sure you've got global demands and and i particularly like the way you um dealt with what often i see as a criticism a criticism of mmt is this sort of tribalism between a job guarantee and mmt and putting to bed that sort of false dichotomy has been really useful but i thought i'd just bring it down to earth with the misery that is australian politics um and so for example i don't often do this but and i blame gab for this she sent me matt canavan's tweet that went out this morning matt canavert is a a um i'm trying to think of a polite way of saying a right-wing nut job um in the government at the moment senator as well and a senator yeah senator thank you steven he's a senator um government senator and very pro resources very you know right-wing he put this tweet out so on the day it was revealed that surging coal exports could add two billion dollars to government revenues we are promising to spend two billion extra on the dole they're putting some extra a tiny amount of extra money into social security he then says this if we don't have coal we can't pay the bills um stephanie what's your you're going to comment in the moment you've got to do a tweet in response to that um uh what's your response well i mean that he's just wrong right i mean he's missing the fundamental point here that we've just spent the better part of an hour talking about which is that governments that issue their own currency can always afford to purchase whatever is available and for sale in their own currency so there is no financial constraint if you don't have 2 billion coming in uh from some channel that doesn't deprive you of the capacity to spend two billion dollars whatever the government commits the money will go out that's the reality of the nature of the system the way it is set up with the central bank and uh and the federal government so you can commit to the spending and you don't need to rely on the rest of the world to supply you with australian dollars you're the issuer of the australian currency um so could i could i add something i mean he's just talking about going from forty dollars a day to forty three dollars a day to take people back out of poverty it needs to go to seventy dollars not only can they have another three times a day you build another thirty it's it wouldn't be inflationary as stephanie's just explained there's no problem in funding it and uh i don't believe that matt canavan actually believes what he's saying here hopefully not getting myself into too much trouble it's just a political point and every time we play into this notion that mining billionaires pay for things through their taxes we actually reinforce the arguments that um people like matt cannon make even though they're foolish arguments people just hear them who are only half paying attention to them to the media and they perhaps don't catch on what where he's coming from he just wants to punish the unemployed i mean we have the same conversation here right at one point early on in the coronavirus pandemic the federal government did something truly remarkable right they passed the cares act which was then the major piece of legislation 2.2 trillion dollar uh spending package that included a top up in unemployment insurance from the federal government on top of what you get at the state level if you get anything uh an additional six hundred dollars a week from the federal government twenty four hundred dollars a month that was enough to pull so many people i mean the the research that came after the cares act suggests that that in concert with some of the direct cash payments helped to prevent 18 people from going into poverty right lift 18 million people out of poverty so though that kind of cash assistance income support was a lifeline and then it expired and then when we came back and we got another package together the republicans did this in december with the democrats we had a bipartisan bill in december of last year they cut it in half so it went to 300 a week that is going to expire mid-march so a few weeks from now so this covid relief package that president biden is trying to usher through is uh includes 400 a week so we went from 600 cut down to 300 now we're talking about taking it up to 400 but that number can go it could be 600 again it could have been but they didn't do that and so what stephen you know i saw a tweet about this how this has gone from something fairly generous whittled down and then up a little and now whittled down again so yeah you you can choose the the amount of relief that you want to provide to you know support um people in this in this crisis you can pick the number was there anything else david oh sorry i i thought i had i i was going to hand over to the rest no look i mean we've had almost exactly the same debate here about the level of support for um uh we called it job keeper so so businesses were given money um that they could they were meant to but not required to redirect to wages to keep people on the books during the recession from the caused by the contraction from covert and then job seeker which was basically an unemployment benefit that job seeker benefit as well as the job keeper benefit is just about to be pulled from the economy in about a month's time and i think we're probably going to see a significant amount of hardship caused at that moment um stephanie can you can you give us some analysis about you know a useful way to talk about that um and a useful way to respond to what i think is going to be a sort of wave of pain and and poverty i mean i can tell you that what the experience was here when we allowed the relief the income support to expire prematurely when we didn't stay committed and continue those payments what happened is we went from pulling 18 million people out of poverty by summer when the income support started to disappear 8 million people fell back into poverty by september so you know that seems to me to be about as good an example as i could offer you in terms of you know knowing exactly what the outcome is likely to be you can pull millions of people out of poverty with the income support and if you cut it off they will fall back into poverty uh it it's just sort of that simple you know and it's a choice just it's just a simple choice do you want to extend the income support and keep people whole or largely you know replace lost income and avoid the long-term bouts i mean we talk a lot here people like jerome powell talk a lot about scarring effects and the longer term damage that's done when you know people become detached from their employers remain unemployed for long periods of time become unemployable and it's much harder to you know fully restart the economy and get a robust recovery underway probably like we do you know we have this uneven bifurcated sort of recovery people describe it as a k-shaped recovery and we don't want a k-shaped recovery we want that bottom leg lifted up and we can do that with the kinds of you know uh programs uh income support and and the fiscal support you just have to put it in place and commit to keeping it in place for as long as necessary the problems are in trying to figure out you know which date on the calendar is the right date to cut off the support and that's what we continue to do with our legislation and that's why we have to keep coming back again and again if we could get you know better automatic trigger stabilizers in the legislation where the payments continue for as long as the economy remains weak and people need the support and you know then it's a one-off pass a bill have those income support payments continue and then have them taper off as the labor market shows evidence that you know people are returning to work and the support is not necessary yeah i think that task of convincing people that um you know poverty is a political choice it's just fundamentally a political choice this is part of the work we need to do on the left of politics but it's these i mean that was a very persuasive macroeconomic assessment but i would have thought from an equity point of view um that those payments should never be ceased but that perhaps put a trigger in them so that as people move into employment take up a job guarantee that's when those payments transfer across oh hey if you're allowing me to put a job guarantee in place then that's absolutely the trigger that that then becomes the program that right sizes the spending right as long as the economy is weak and people remain job well not jobless they're employed but they're not employed in private sector uh the program supports them and as the economy recovers and gains strength and people are hired out of the program the spending on the program is automatically um you know adjusting to changing economic conditions but yeah you're you're absolutely right with a job guarantee in place you're the the hard the hard work is done the heavy lifting is now automated yeah that's the policy setting that sort of um um automatically it's sort of like a super keynesian policy setting that addresses the micro the macro and the micro economic issues you know address and it addresses the dysfunction in the politics where you have to keep waiting for in our case congress or parliament to come back with another bill and how many weeks are we going to extend this time or months it takes all the guesswork out thanks you're welcome very much david i just thought um i might uh quickly just as a response to david's original um question which was about a tweet from our resources man minister matt canavan i also found this on twitter from rohan grey i'm not sure if you've seen this one but i'll read the tweet out because it kind of appeals to me as someone who's in the activist space rohan says it's tempting for the left to lean into the taxpayer money trope because it ostensibly strengthens the argument for redistributive taxation and then he says but it's a trap and ultimately leads to one place only the politics of scarcity exclusion xenophobia and white supremacy would you he's good yeah he's good exactly every word yeah every word of it yeah because it's you're in an austerity frame what you're saying when you do what he just said and advise not to do you know i sometimes said you know you're in an unless and until world i'm not going to be able to feed this hungry kid i'm not going to be able to support this jobless prayer i'm not going to be able to do unless and until i'm successful in putting up this new tax or you know coming up with the revenue to do that so you're picking two fights and you got to win both of those fights and you're holding hostage a progressive agenda or even a humane agenda that is held hostage unless you can collect all the votes that are needed to push up the tax to generate the revenue so that you can pretend that you found the money that allows you to pay for something and and what happens 99 times out of 100 is that you don't win both fights you don't get the votes and therefore you don't get the tax revenue and therefore the spending doesn't happen and that means people just stay in misery right and it's gratuitous because you could you could address problems without you know that secondary and unnecessary fight you can get there in a more direct way alleviate human suffering in the now um but if you if you are committed to not addressing problems unless and until you can peel off a few bucks from the billionaire class then there's a pretty good chance that you're going to be stuck with just you know crumbling infrastructure poverty homelessness and all the rest of it yeah and of course the most marginalized people are the ones who are going to suffer the most from the effects of climate change and austerity and they're often well they're they're the people who are also um from you know different they're immigrants or migrants or traditional owners or um indigenous people here in australia already we can see that happening it's really stark so i think the racism aspect of it is really important that we acknowledge and work on couldn't agree more there's um there's a bunch of questions that i picked up from earlier on in the session shall i throw a few of those in and um then we might also towards the end that another one of our um uh greens politicians here in south australia tammy franks is on on the call and she has helped us put this webinar together so we might give her co-host as well in a few minutes and she could ask a question she says no rush but we will get to you tammy um so just back from because there's at least a hundred great questions in there and we won't have time for all of them i'm very sorry um but back a fair way james asked what um what have you been using as an alternate metaphor to government as household do you have any suggestions for how we might change that metaphor i mean i i just tend to say currency is sure um uh i use yeah never use taxpayer dollars or taxpayer money i say public money or federal dollars more and more politicians at least here in the us are starting to to do that to get more careful about the language you ever notice that the the phrase taxpayer money is usually invoked when you're trying to spotlight something that you don't like so democrats will say taxpayer money when they're talking about the pentagon budget and defense spending how the taxpayer because that right gets you right republicans say taxpayer money when they're talking about you know welfare programs or something oh taxpayers are supporting these welfare programs but um no you just it's our money it's our money it's public money and the government is where it comes from you know i use the power of the purse so i say uh government has the power of the purse that's what makes them unlike a household they have the power of the purse i think i read in your book as well that you use the metaphor of like um a football match or you know where the one team is scoring and um will you know will the referee run out of points no if a team keeps scoring points they just keep adding points to the score yeah we sometimes just use the phrase the government is the score keeper for the dollar so you know that does drive home the point that the point that it really is about you know just think of the government as standing on the outside of some giant excel spreadsheet where all of us are a cell you know there are columns and all of our names are there and they can click a button and the numbers in our cell can go up they spend dollars into our account the numbers can go down if they tax dollars out of our account but they're sort of standing on the outside as they have this unique capacity the rest of us don't have to change the numbers up and down um so the score keeper right aussies will get that yeah um there's another question about um what are some good ways that people like the people here on this call for example what are some ways that we can start getting the message out what are some ways that have been effective for people that you know of you i know one way that's effective you've done it that's definitely kelton here for about 10 days we were all over the media yeah have stephen hale organize a calendar of events for you and fill it up for 10 days and always come back to can we do one more can i just add one more thing um no i mean you know we have now after all these years we do have a deep bench in the early years there were a smaller number of economists who were trying to put these ideas out and i mean after a quarter of a century their the ranks have grown and it's not just economists anymore you have legal scholars and historians and um you know philosopher there there are and that's just in academia and then you have you know journalists who have you know come very much on board and are sympathetic and that's powerful when people in you know posit with positions of influence and a megaphone um can also start improving the discourse just in the way that they conduct interviews and the things that they talk about the way they talk and then there are you know activists and um and thought leaders and other like there's just this huge community now and it's everyone doing their what you know contributing in their own ways that's created that tailwind that's i think really brought us in the last couple of years so much the ball has moved so far down the field because of you know the efforts of so many different people people in the uk with podcasts i mean i can't imagine the work that people do curating articles and maintaining websites where you can go to get you know a collection like steven said get in touch with me and i'll send you all the mmt scholarship well there are people out there who you know work very hard to maintain a library of resources to make these things available so you you can help in ways big and small you know one one of the small but hopefully um helpful ways that that we things that we'll be doing here in adelaide this year our volunteers who many of you who you met when you came over for our conference uh we are training to deliver short talks on mmt to public to the public so we're going to be going around to like local rotary groups and university of the third age wherever we can get a speaking gig public radio we're going to train up a bunch of people and start we've got slides prepared you can even that's awesome from our website if you want awesome so you know i've been in touch with someone who reached out to me four or five months ago and he went through a program this was you know kind of in a way well it's like what you're describing he did it because al gore organized something and al gore said we need the population to understand that humans are contributing to global warming that that climate change is you know a result of you know actions that we take right human uh action and so he brought together i think thousands of people and trained them and in a sense kind of certified them and then sent them off to become you know a messengers in in this effort to to shape and change the public's understanding of what was happening and it sounds a lot like what you're describing you know a couple of days ago i got an email from a woman that i have a i i met years ago and she sent me an email and she had a photograph and she was asking if i would give her permission to use the picture in um an advertising that she was going to do about public talks that she so here i am in the picture with this gal and this guy from who knows how many years ago but she's going out in her community and giving talks on mmt and she wanted to know if it would be okay to use the picture i said of course you know go for it and good luck and i i'm sure it's going to be great but people are you know amazing what people are out there doing quietly and behind the scenes and and publicly people are pouring in a lot of their energy to try to you know be part of getting us to a better place um amazing absolutely and i think we can all help each other to communicate well and to communicate with compassion and kindness even to people that we don't agree with and that's how we in the argument yeah that's such a good i'm glad you said that because you know you could get very impassioned and it is often frustrating to hear people you know espousing these myths but everybody hasn't arrived i once didn't know you know i didn't always have this understanding of things so i was once as confused and probably worried about deficits as anybody else so take a sympathetic approach and meet people where they are and and try to help bring them along [Music] you. 文字起こし 00:00 [Music] 00:06 you might have noticed stephanie 00:07 kelton's voice at the beginning of our 00:09 show 00:10 last year stephen and i had the 00:11 opportunity of interviewing stephanie at 00:13 length 00:14 we wanted to mark the first mmt tuesday 00:17 on kerberos media productions by sharing 00:19 with you what she had to say about the 00:21 deficit myth and a green new deal 00:23 we hope you enjoy this special edition 00:25 of mod money donuts 00:28 [Music] 00:52 now it's time for modern money donuts 00:54 with stephen hale and gabrielle bond 00:59 it's great to have everyone here today 01:02 before we start i'd like to acknowledge 01:03 that i'm joining you from the land of 01:05 the ghana people of the adelaide plains 01:07 and pay my respects to elders past 01:09 present and emerging 01:11 i'd also like to acknowledge the 01:13 important role played by first nations 01:15 people all around the world in the fight 01:16 for climate justice 01:19 um i'd encourage everybody to make your 01:22 own acknowledgement by typing the in the 01:24 chat the name of the traditional owners 01:26 of the land that you're on 01:28 and you could also put the name of the 01:30 city you're zooming in from too so that 01:32 we can see where people are joining us 01:34 from from right around the world 01:36 um and just a quick housekeeping because 01:38 of the large number of people we'll just 01:41 be asking people to type your questions 01:43 in the chat for this session 01:45 uh thank you very much for your patience 01:47 with this and i will hand over to 01:49 stephen 01:51 thanks very much 01:52 gabrielle i'd like to start by thanking 01:56 gabrielle and the volunteers of the 01:57 sustainable prosperity action group for 02:00 organising this event 02:02 and the australian greens and 02:04 specifically david shoebridge member of 02:06 the legislative council in new south 02:08 wales 02:09 and our own tammy franks member of the 02:11 legislative council here in south 02:12 australia for suggesting it and 02:14 promoting it 02:16 and the school of economics at the 02:18 university of adelaide for supporting it 02:19 there have been so many other groups 02:21 that have been involved too i have 02:22 people will forgive me for not 02:24 mentioning 02:25 everybody 02:26 on the list i perhaps also to also 02:29 mention democrats abroad who've been 02:30 very helpful 02:32 our guest 02:34 stephanie kelton is professor of public 02:36 policy and economics at stony brook 02:39 university 02:40 on long island near new york 02:43 for the benefit of any economist 02:44 listening 02:45 she first came to my attention as the 02:47 author of two papers which are among the 02:50 foundation stones of modern monetary 02:52 theory 02:53 one was entitled do taxes and bonds 02:55 finance government spending which was in 02:58 the journal of economic issues 03:00 the other 03:01 was the role of the state and the 03:02 hierarchy of money which was in the 03:04 cambridge journal of economics 03:07 um you sometimes see people online 03:10 suggest 03:11 that there are not many modern monetary 03:14 theory papers in peer-reviewed journals 03:16 that's not right that just means they've 03:18 been reading the wrong 03:20 journals if you'd like a reading list 03:22 anybody if you are an economist then 03:24 just write to me and i'd be happy to 03:25 send you one 03:27 subsequently stephanie was head of the 03:29 department of economics at the 03:30 university of missouri kansas city and 03:32 editor of the new economic perspectives 03:35 website 03:36 in recent years she has been a chief 03:38 economist on the senate budget committee 03:40 in obviously in washington dc 03:43 advised senator bernie sanders across 03:45 two presidential campaigns 03:47 being a fellow of the sanders institute 03:49 and holder of visiting professorships at 03:52 the new school for social research in 03:54 new york and university of ljubljana 03:57 prospect magazine named stephanie one of 04:00 the 50 most influential thinkers in the 04:02 world and politico as one of the 50 04:05 people most influencing the policy 04:07 debate in america 04:08 she was in the bloomberg 50 for 2019 and 04:12 in baron's hundred women in finance for 04:14 2020. 04:15 best of all from my point of view she 04:18 was the 2020 visiting 04:20 jeffrey harcourt professor at the 04:22 university of adelaide 04:24 as you almost certainly know 04:26 stephanie is also the author of the 04:28 deficit myth 04:29 which is a new york times bestseller 04:32 the number one selling book in the world 04:34 on economics last year 04:36 and is having a huge impact on policy 04:38 debates globally 04:40 thank you very much for joining us 04:41 stephanie 04:44 my pleasure um thank you that was uh a 04:47 bit over 04:48 overdone but thank you for that very 04:50 kind introduction and it is so nice to 04:52 be 04:53 back with the two of you gabby and 04:55 steven uh i 04:57 you know i was with you in january of uh 05:00 last year right 05:02 i mean it's hard to believe that it was 05:04 it was just last year that i was there 05:06 in adelaide with you all and with 05:09 probably many of the people who are are 05:11 joining tonight so i'm really happy to 05:14 be with you i i'm trying to pick up my 05:16 second win because i've done a lot of 05:18 events today and it's uh getting late 05:21 here but i'm gonna um i would be as 05:23 animated as i can and i look forward to 05:26 getting into these these questions that 05:28 you know steven's going to take us 05:29 through so thank you for you know 05:32 everything that you have done you too 05:35 and i know a number of others to help uh 05:38 push the ideas forward there in 05:40 australia and to support the book and 05:43 you know all of our work in advance 05:45 uh really i think what's what's 05:47 happening is that we're we're having a 05:50 lot of success we are changing the 05:52 nature of the policy debate and it's it 05:55 couldn't come at a more important moment 05:58 in time so 05:59 let's dive in and thank you so much 06:02 and well that's that's perfectly okay 06:05 uh a big part of changing the policy 06:07 debate has been the book 06:10 and writing academic papers is one thing 06:13 writing a book which leads so many 06:15 people to question things they've always 06:17 taken for granted about economics is 06:18 another thing entirely 06:20 what inspired you to take the project on 06:22 in the first place 06:24 well it's about right you know it's 06:26 writing for a different audience and 06:29 communicating with other economists is 06:31 really what you're doing largely when 06:33 you're writing articles and publishing 06:35 in peer-reviewed 06:36 journals 06:38 to be frank they don't get read by all 06:40 that many people and even the most 06:42 popular articles uh and influential 06:45 articles are mostly read by other 06:47 economists and yes you can influence the 06:50 policy debate that way but i really 06:53 wanted to empower 06:55 just ordinary people you know that we 06:57 are bombarded on a daily basis everyone 07:01 here who's joining tonight knows that 07:03 you know the the public discourse is so 07:05 broken that when you have the president 07:08 of the united states as we had with uh 07:11 president obama 07:12 literally going before the nation and 07:15 getting a question about where all the 07:17 money is coming from to deal with you 07:19 know supporting the economy after the 07:21 last crisis after the financial crisis 07:24 and at what point do we run out of money 07:25 when the president of the united states 07:27 says we're out of money now right and 07:30 when the discussion is so broken that 07:33 we're wringing our hands about deficits 07:35 and what we can afford and we're drawing 07:37 the wrong lessons from the experience 07:39 you know what's unfolding in uh in 07:42 europe in greece and and so forth i just 07:44 wanted 07:46 to you know put the ideas forward in the 07:48 most accessible way that i could 07:51 um and try to get them out there and 07:54 into the hands of a broader population 07:56 so that people can be empowered to both 08:00 engage in the debates because sometimes 08:02 it feels overwhelming like you know 08:04 these are lofty economic arguments and 08:07 ordinary people can't possibly um you 08:10 know take on a nobel prize-winning 08:12 economist or a senator or a president 08:14 you know or journalist when they say 08:16 something um but to give them uh 08:20 and a set of arguments that they can use 08:23 to fight back against some of the broken 08:25 thinking and so that's what i wanted to 08:27 do with the book 08:29 absolutely yeah well the 08:31 political debate over here in australia 08:33 at the moment is between 08:35 three 08:36 parties really one of which has pivoted 08:40 towards austerity already 08:43 and the second party the main opposition 08:45 party 08:46 is talking about for every dollar it 08:49 spends for every extra dollar it spends 08:52 in one area of public policy 08:55 finding a dollar of saving somewhere 08:56 else 08:57 and the third party is talking about 09:00 taxing billionaires more in order to 09:03 raise money to pay for 09:05 investments in education and healthcare 09:07 what's wrong with that narrative what 09:08 are they missing 09:11 well they're 09:12 the fundamental thing they're missing i 09:14 think is chapter one of the book right 09:17 chapter one i call 09:19 i say don't think of a household that's 09:21 that's the title of the chapter so 09:24 i'm trying to set us off on like getting 09:27 off to a good start putting you know 09:28 getting the right foot forward and so 09:31 getting the right foot forward in this 09:33 context means recognizing that the that 09:36 the government is just fundamentally 09:39 different from the rest of us that 09:41 governments issue the currency and the 09:42 rest of us are users of the currency so 09:46 the currency issuer can operate its 09:49 budget different from a household right 09:51 it doesn't have to quote unquote find 09:53 the money in order to be able to spend 09:56 so this idea that you know deficits are 09:58 inherently 09:59 irresponsible that good stewardship of 10:03 the public finances means matching up uh 10:06 how much you take in and how much you 10:09 spend that if you want to spend that 10:10 dollar more then it's got to come from 10:12 somewhere you got to carve it out of 10:14 some other part of the budget as you 10:15 said or you've got to find new revenue 10:18 and 10:20 so 10:21 that's broken thinking right that is 10:23 thinking of the government as having 10:26 constraints as having a budget 10:28 constraint that's sort of akin to what 10:30 households face instead of recognizing 10:33 that governments are nothing like 10:35 households and the main thing that 10:37 distinguishes them is that they get to 10:40 issue the currency they literally get to 10:42 spend the money into existence and so we 10:46 have to think about the limits very 10:48 differently and how the government can 10:50 operate its budget so the three 10:52 uh scenarios that you just laid out 10:54 there are all reflective of broken 10:57 thinking none of that shows an 10:59 appreciation for what makes the 11:01 government different from businesses or 11:04 from households 11:06 it's so strange really that that that is 11:08 the narrative when you come to think of 11:09 it that out in australia and it's it's 11:11 even more true in the us the government 11:13 budget has nearly always been in deficit 11:17 yeah i mean i'm not going to tell you 11:18 how old i am unfortunately you know i 11:21 think it's not as old as me 11:24 i think you know it's funny um this is a 11:26 little off topic but i do notice this 11:29 weird thing that uh you know there will 11:31 be an article written about me that will 11:34 include my age and never see that really 11:35 happen with men with men it comes i 11:38 don't see them the age included there 11:40 but it always happens with me so i'm not 11:42 going to tell you but it's all it's all 11:44 over the place but the point is 11:46 that i think for four years of my entire 11:49 lifetime the us government's budget has 11:52 not been in deficit right four years uh 11:55 that that the government has either 11:57 balanced the budget or had a budget 11:59 surplus and that's what you're saying 12:01 right deficits are the norm it is normal 12:04 for the federal government's budget to 12:06 register a fiscal deficit nothing 12:08 inherently problematic unusual it's a 12:11 perfectly normal thing to uh to have 12:15 happen it's been that way almost my 12:17 entire lifetime and without the sort of 12:21 you know fallout the negative 12:22 consequences that everybody warns about 12:25 you know increasing deficits or 12:27 persistent budget deficits result in 12:29 increasing the national debt and you at 12:32 some point you know the narratives are 12:33 always that this leads to armageddon 12:36 that there's there's there's fallout 12:38 from this it's just done it's just not 12:39 true it's not borne out by 12:41 the history but the story just hangs 12:44 around you know 12:46 well it's such an attractive story to 12:48 tell i suppose it's so easy 12:50 for them to tell during the heat of a 12:52 election 12:54 campaign you never seem to be put under 12:56 pressure 12:57 as a result of being too much of a hawk 13:00 as far as fiscal policy 13:02 yeah right i mean you sound like the 13:04 grown-up in the room when you stand up 13:07 and give a speech and pound your fist 13:09 and fire and brimstone about how you 13:12 vote for me because the last party 13:15 um you know left us with these huge 13:18 notice the language they often use blew 13:20 a hole in the budget drowning in red ink 13:24 you know 13:25 charging the national credit card 13:27 driving us into debt they always use 13:29 that really inflammatory language so you 13:31 stand up and you come in sounding like 13:34 the sober um statesman you say you know 13:38 the the last party did all of these 13:40 things that put us in danger we're at 13:42 risk because of the way the finances 13:44 were managed in the past vote for me and 13:47 i will put the budget right i will you 13:49 know protect us from becoming like 13:52 greece or you know some event where 13:55 china turns off the spicket and no more 13:57 dollars come out and then we're in real 13:59 trouble sort of thing and you know to 14:01 the extent that people don't know better 14:03 it sounds reasonable it sounds 14:05 responsible it sounds like the kind of 14:06 thing you want to get behind right so 14:09 you scare people and then you tell them 14:12 to vote for you because you're the 14:13 person who will keep them out of danger 14:15 out of harm's way 14:17 so what 14:18 what should a responsible fiscal policy 14:21 look like 14:23 so the the key thing is to avoid 14:27 thinking at all really about the number 14:30 that falls out of the budget box at the 14:32 end of every year that is 14:35 largely irrelevant right it doesn't 14:37 matter whether the government's budget 14:40 ends the fiscal year with a small 14:42 surplus a small deficit a large deficit 14:46 a large surplus a balanced budget 14:49 the right 14:50 fiscal outcome is the one that balances 14:53 broader conditions in the economy so if 14:56 you can achieve a good economy if you 14:59 can 15:00 uh you know 15:01 carry out an agenda 15:04 that allows you to create a good economy 15:06 you know high levels of employment good 15:09 paying jobs low inflation 15:12 poverty rates are coming down your 15:14 infrastructure is being maintained if if 15:16 the things that matter 15:18 are 15:19 um being realized right you're 15:21 delivering on good outcomes in the 15:23 economy and it takes a deficit that's 15:25 five percent of gdp to get there so what 15:28 you have low inflation full employment 15:30 high wages low poverty rate your 15:33 what difference does it make if you can 15:35 get there with a two percent surplus 15:37 okay fine right that that is the point 15:40 that the budget outcome isn't what we 15:42 should pay attention to you're not 15:43 trying to balance the budget you're 15:44 trying to balance your economy and you 15:47 you want to stay laser focused on those 15:50 objectives right the things that matter 15:53 and then let the number go where it 15:55 needs to go it's like you know i have an 15:57 oven in my house i don't 16:00 choose to you know cook dinner at 300 16:03 degrees because last night i cooked 16:05 dinner at 375 and i say well i can't i 16:09 have to lower the temperature tonight 16:10 because i used all the btus that are 16:12 available or something you know um you 16:15 you can start fresh each year and and 16:19 readjust things to just try to maintain 16:22 a good economy 16:24 so we say that every dollar the 16:25 government spends is a new dollar the 16:27 government being the 16:28 currency issuer every dollar the 16:30 government spends is a deposit the 16:31 government's making somewhere 16:33 in the monetary system in the in the 16:35 banking system 16:36 the government doesn't have to raise 16:38 taxes in order to go and 16:41 engage in additional spending 16:43 what's the tax system there for 16:47 well you you could get me into a a long 16:51 monologue with that question stephen as 16:53 you know 16:54 um you know there's an origin story 16:57 there's a way to talk about the role of 16:59 taxes 17:00 from the beginning like if you wanted to 17:02 start a currency from scratch 17:05 the tax or something that works like a 17:07 tax is important because you're trying 17:10 to get people to 17:11 work and accept your currency 17:14 and to provide you with the stuff that 17:16 you're after so if you want a military 17:18 if you want infrastructure you want 17:20 hospitals and roads and bridges and a 17:22 standing army and all that governments 17:24 have used taxes or fees and fines other 17:27 things to 17:29 move those real resources from the 17:31 private domain into the public domain so 17:34 it's a way to start up a currency from 17:35 scratch you say to the population all 17:38 right everybody uh you're going to owe 17:40 me you know at the end of the month or 17:42 whatever a certain number of units of my 17:45 currency and you don't have it so 17:48 everybody starts scrambling around to 17:50 figure out how to earn the currency that 17:51 they need in order to settle their 17:53 obligation to the state so that tax is 17:55 important in that origin story i'm doing 17:58 this quickly obviously once you have a 18:00 monetary system up and running then 18:03 taxes are important for a lot of other 18:05 reasons like you might think and a lot 18:08 of people 18:09 ask this question well if the government 18:10 can issue the currency 18:12 why bother taxing it all why don't you 18:14 just spend and leave the rest of us 18:16 alone like cut our taxes to zero 18:18 everybody hates taxes you'd be so 18:20 popular you know if you just eliminate 18:22 taxes and just spend your currency and 18:25 most people can figure out pretty 18:27 quickly that you're going to run into 18:28 trouble because if all you're doing is 18:30 spending the currency and you're not 18:32 subtracting any of it away from people 18:35 by taxing it away then you're going to 18:38 very quickly undermine the value of the 18:39 currency you're going to create an 18:40 inflation problem why would people work 18:42 for something that's so readily 18:44 available right there's too much of it 18:46 so taxes are important because taxes are 18:49 for subtraction so 18:51 the currency is a tax credit it's 18:53 important because it takes some 18:55 purchasing power away from the rest of 18:57 us and that helps to mitigate 18:58 inflationary pressures taxes are 19:00 important because government might care 19:03 about things like distribution income 19:05 and wealth uh distribution and so you 19:08 might 19:10 think about changing the tax code 19:12 closing loopholes introducing a new tax 19:14 raising an existing tax 19:17 cutting attacks right because you're 19:18 trying to 19:20 disincentivize or incentivize certain 19:22 behaviors you might do it because you 19:25 want to actually alter the distribution 19:27 of wealth and income you might look at 19:29 what's been happening over the course of 19:31 the last 100 years or so and say my god 19:36 you know 19:36 we are allowing the 19:39 inequalities to become so extreme 19:42 that 19:42 this is bad not just for the way our 19:44 economy works but it's bad for the way 19:46 democracy works wealth is too 19:48 concentrated in the hands of too few and 19:51 you can you know make adjustments to to 19:54 taxes 19:55 um not because you need the revenue not 19:58 because you need the money but because 19:59 you want to deal with those you know um 20:02 inequalities you want you want to 20:04 address the concentration of wealth and 20:07 ownership in the economy so tax are 20:09 important for a lot of things but not 20:11 for revenue it's so uh attractive to 20:14 progressives to who want a more 20:18 progressive tax system 20:20 who want to address the distribution 20:22 issue 20:22 to frame it in terms of taxing 20:25 billionaires to pay for things isn't it 20:26 it's 20:27 it it is attractive i call it so i don't 20:30 know you've probably heard me say this 20:32 but i call it the two itch problem 20:34 because look robin hood we we sort of 20:36 think back uh about robin hood and he's 20:39 sort of this hero right we think robin 20:41 hood was this guy uh who you know took 20:44 from the rich and gave to the poor and 20:46 that's a very heroic thing so you hear a 20:48 lot of progressive politicians and 20:50 others talk about um raising taxes for 20:54 the purpose of getting the money that 20:56 you need that you need and that word is 20:59 important in order to feed a hungry kid 21:02 or repair a crumbling infrastructure or 21:05 whatever right so we're going to take 21:06 from the rich and we're going to heal 21:08 our nation we're going to feed people 21:10 and and better fund our schools and our 21:12 health care and all this kind of stuff 21:13 okay so what are the problems with that 21:16 well one is 21:17 that's just bad economics because that's 21:20 not how government finance works so the 21:23 story is wrong 21:25 the other problem from well two other 21:27 problems from my perspective you tend 21:30 then only 21:31 to go after concentrations of of wealth 21:35 in a very timid way because you see you 21:38 say well i only need 21:41 10 billion or i only need 70. so i can 21:44 do this with a very small 21:47 tax on billionaires a wealth tax you 21:51 know right we heard this from senator 21:53 elizabeth warren who i like i'm a fan 21:56 okay but when she talked about the 21:58 wealth tax she talked about taxing 22:02 um the very wealthy people with 50 22:05 million or more net worth net worth 22:08 right 50 million 50 million or more 22:11 you're free and clear on the first 50 22:13 million but on the 50 million and first 22:16 dollar she said we want two cents you 22:19 just chip in two pennies right on that 22:22 next dollar and then you keep paying two 22:24 percent on your wealth above 550 million 22:28 up until a billion and then once you hit 22:29 a billion we want one percent more okay 22:31 so three three percent on everything 22:33 over a billion and she said 22:36 they won't even feel it okay they won't 22:38 they won't even notice it she literally 22:40 made the argument that it's such a tiny 22:43 imposition on what they have 22:46 that they won't even notice it because 22:48 wealth tends to accumulate at a more 22:50 rapid 22:51 rate right so they're still going to 22:53 become richer and richer and richer and 22:54 my reaction was well hang on okay 22:57 if the purpose of the wealth tax is 22:59 actually to aggressively get at 23:02 concentrations of wealth then what's the 23:05 point of a little bitty old thing that 23:07 nobody hardly even knows is happening 23:09 right 23:10 and the answer is well that's the way to 23:13 pay for everything so if you can do this 23:16 you just peel off just what you need 23:19 so that you can claim to the 23:20 congressional budget office and and play 23:23 the legislative process and you say well 23:26 this is all i need to pay for making 23:29 public colleges and universities 23:31 tuition-free pre-k and some student debt 23:33 cancellation which is what she wanted to 23:35 do with the well tech so i guess what 23:37 i'm saying is if you're coming at this 23:40 from an mmt through an mmt lens and you 23:43 think about the purpose of taxes the way 23:46 that i do 23:47 then you're not thinking of the taxes 23:50 the pay for it's not about paying for 23:52 things it's not about the revenue you're 23:54 using the tax to achieve a different 23:57 goal which is addressing you know deep 24:00 concentrations of inequality and then 24:02 you could make a case for something like 24:05 a wealth tax at least in a consistent 24:08 way with 24:09 through an mmt lens and you'd presumably 24:11 go much higher because you're not 24:13 worried about the pay for it's not 24:15 motivated by 24:16 that yeah we say 24:19 don't we the federal governments in 24:21 monetary systems like australia's or in 24:23 the us have no purely financial 24:26 constraint on their spending but we are 24:28 not implying that there are no 24:30 constraints at all 24:32 are we 24:34 so what the limit 24:36 right right so exactly and in fact 24:39 that's really 24:41 in many ways kind of the core you're 24:43 taking us right to the core of mmt so 24:46 you know i will sometimes say that if if 24:50 i'm pressed to describe mmt in a 24:52 sentence like give me the sound bite uh 24:55 mmt is about replacing 24:58 an 24:58 artificial fake 25:00 phony imaginary budget constraint with a 25:04 real resource constraint an inflation 25:06 constraint so is there a limit yes is it 25:09 the limit that almost everyone wants us 25:12 to believe that is that the government 25:14 can run out of money like obama said 25:15 become like greece have bills you can't 25:17 afford to pay go broke and bankrupt the 25:19 nation and so forth no 25:21 that is not the punishment for 25:23 overspending the punishment for 25:25 overspending is inflation so there is a 25:28 limit the limit is how many dollars can 25:32 safely be spent into the economy before 25:35 the economy runs out of capacity to meet 25:39 that spending that higher demand with 25:42 more supply and remember you know 25:45 government spending isn't the only kind 25:48 of spending you have to worry about 25:50 government doesn't do the majority of 25:51 the spending in the economy the private 25:53 sector does specifically the household 25:55 sector they normally account for about 25:57 70 percent of total spending so the 26:00 government has to share 26:02 spending space with everybody else who 26:05 wants to spend into the economy there's 26:06 only so much 26:08 space available and the government has 26:10 to respect the the total limit right the 26:14 capacity limit for the economy so yes 26:17 there's a limit and um we're nowhere 26:20 close to it in a pandemic depressed 26:23 economy with unemployment that's very 26:25 elevated but 26:27 if you push things far enough you will 26:30 approach that limit 26:33 we often say 26:35 that it's just a matter of accounting 26:36 that sexual balances have to come to 26:38 zero 26:40 in the monetary system and you put it in 26:42 a rather more accessible way you say 26:44 their red ink is all black ink that's 26:46 one of the that's what the title of one 26:47 of the chapters of your book 26:50 um 26:50 what do you mean by that 26:53 well so you use the phrase red ink in 26:56 australia 26:58 yeah 26:58 you know because when i was doing the 27:00 book and writing the chapters i remember 27:03 asking 27:04 as i would do presentations you know in 27:06 the uk before the book came out and i 27:08 was using you know the public person red 27:11 ink and so forth and that wasn't 27:13 necessarily a common turn of phrase 27:16 there so okay so you use reading 27:19 the title of the chapter their red ink 27:22 is our black ink so what does that mean 27:25 well it means that 27:27 the government deficit 27:29 is just the difference between two 27:31 numbers that's literally all it is we 27:34 have this visceral reaction we've been 27:36 conditioned to you know hear the word 27:38 government deficit and think whoa 27:40 something bad is happening no nothing 27:43 bad is happening the deficit is just the 27:45 difference between two numbers so what 27:46 are these numbers the first number is 27:49 how many dollars the government spends 27:51 into the economy each year and the other 27:53 number is how many they subtract back 27:55 out mostly through taxation so in the 27:58 book i stick with the same example which 28:01 is suppose the government spends a 28:02 hundred dollars into the economy and it 28:05 only taxes 90 away from people in the 28:08 economy taxes 90 back out we label that 28:10 a government deficit so we write minus 28:12 10 on the government's ledger we say oh 28:15 they're swimming in red ink right this 28:17 deficit what we forget to do is pay 28:20 attention to the math which says if they 28:23 put 100 in and only take 90 out 28:26 they're depositing 10 28:29 right their deficit is our financial 28:32 surplus their red ink is our black ink 28:35 their deficit is nothing more 28:37 than a financial contribution they're 28:40 making a deposit into some other part of 28:42 the economy so that's why i say 28:44 every deficit is good for someone every 28:47 government deficit is good for someone 28:49 because on the other side of that red 28:50 ink is somebody else's surplus financial 28:54 surplus so the question should never be 28:57 you know 28:59 is it should should the 29:01 government be in deficit the question is 29:03 really you know deficits for whom and 29:05 for what 29:06 i mean 29:08 it's just that simple every deficit is 29:10 good for someone you reminded me of a 29:13 cartoon you used in the lecture you did 29:15 here when you were the harcourt 29:17 professor of our treasurer josh 29:18 freidenberger's cupid 29:20 firing 29:21 firing dollars 29:23 into the private sector and it was 29:25 supposed to refer to there being an 29:27 imminent budget surplus 29:29 and they're not so confused 29:35 wasn't there you're going to get me i'm 29:37 tired i'll make a bad joke or something 29:39 but you're making me think of like a 29:40 double 07 movie there was something like 29:43 from russia with love or something well 29:45 there's the cupid right it's um where 29:47 our deficits come to you with love sort 29:50 of thing yeah it's a i'm i'm shooting 29:53 sometimes i say a deficit a government 29:56 deficit works like a blower right it 29:58 blows financial assets onto the balance 30:02 sheets of people outside the government 30:04 sector a government surplus works like a 30:07 vacuum it hoovers financial assets off 30:10 of the balance sheets off of the ledgers 30:13 of people in the non-government part of 30:14 the economy so we have this idea that a 30:17 government surplus that is the real um 30:20 thing to achieve that is the the badge 30:24 of fiscal uh responsibility if the 30:27 government can achieve a surplus man 30:29 that's showing you you know how to run 30:31 the budget but when the government is 30:34 running a surplus it is reducing the 30:37 financial assets from the rest of the 30:39 economy so it is literally like 30:42 hoovering up uh dollars from the rest of 30:45 us in order to put their budget in the 30:47 black everybody else has to be driven 30:50 into the red 30:51 yeah it's weakening private sector 30:53 balance sheets it either drives the 30:55 economy into a recession or it drives 30:57 the private sector further into debt 30:59 which is what of course happened here 31:01 during the howard government years when 31:03 the government ran surpluses eight years 31:05 out of ten unless unless 31:07 you happen to be in a situation where 31:10 the rest of the world 31:11 is blowing dollars onto your balance 31:14 sheet and you can do that through a 31:15 current account surplus or we could 31:17 loosely call it a trade surplus so it's 31:19 not necessarily the case that a 31:21 government surplus 31:23 dooms the private sector because the 31:25 private sector can be kept in good uh 31:29 financial shape 31:31 if the rest of the world is supplying 31:34 the financial assets that keep the 31:36 private sector but somebody somewhere 31:37 else has to be running a deficit there 31:39 you go yep that's right everybody can't 31:41 be in surplus at the same time 31:43 now when you explain all these things to 31:45 people and i often say 31:47 why would you want a government surplus 31:50 unless you actually need to have one it 31:52 means they're taking more dollars off 31:54 you than they're giving to you doesn't 31:55 sound like a good thing in itself 31:58 people talk about growing uh government 32:02 debt and increasing national debt and uh 32:05 recently a couple of times i've had 32:06 people say our national debt in 32:08 australia is over 800 billion dollars 32:10 now it's heading towards a trillion 32:11 dollars 32:13 isn't this going to lead to a crisis 32:14 isn't it something we should be 32:15 concerned about 32:17 should it concern us 32:19 well no i mean 32:21 again with the mmt lens in place what 32:25 should concern you are 32:27 you know high levels of inflation high 32:29 levels of unemployment 32:31 when i say 32:32 that the goal should be a broadly 32:35 balanced economy that's what i'm talking 32:37 about i'm saying you know if you can get 32:39 the unemployment rate down 32:41 without triggering 32:44 inflation you know that you consider 32:47 excessive and you can manage the 32:49 inflationary pressure and get the 32:51 economy to full employment and we could 32:53 talk about how to truly achieve full 32:55 employment then no well 32:58 you know that again the deficit the 33:00 difference between two numbers right so 33:02 you spend 100 in you tax 90 out you've 33:05 deposited 10. what happens as this is 33:08 occurring is that the government is 33:10 matching up its deficit spending by 33:13 selling government bonds 33:15 so 33:16 that 10 deposit is immediately 33:19 transformed into a government bond let's 33:22 call it a 10 government bond so that's 33:25 somebody's financial assets part of 33:27 their savings part of their wealth so 33:29 when people look at you know the 33:32 government's finances and use language 33:35 that you would use to describe a 33:37 household's finances then you start 33:39 describing this as borrowing and you 33:41 start using the word debt to describe 33:43 what's happening i don't look at it that 33:45 way at all i think that you know using 33:47 the word borrowing is misleading i think 33:50 the word debt is misleading when we talk 33:52 about what the government is doing if i 33:55 borrow money i borrow money because i 33:58 don't have it right so i go to a bank i 34:00 sit down with a loan officer i say i'm 34:03 here to borrow money and the loan 34:04 officer says what do you want to borrow 34:06 money for and i say i want to buy a car 34:08 or start a you know expand my small 34:10 business or whatever 34:12 and 34:13 maybe i'm granted a loan now i have debt 34:16 okay i have to repay that 34:18 with money that i got to come up with 34:20 from somewhere right the federal 34:22 government's different when the 34:24 government runs a deficit it puts 100 in 34:27 subtracts 90 leaves 10 34:30 and then comes along and says well i 34:32 want to sell these government bonds who 34:34 wants to buy them and sure enough 34:36 there's ten dollars that's been made 34:38 available that gets turned into 34:41 ten dollars worth of government bonds so 34:44 it's not like when i borrow right i 34:47 didn't walk into the bank and put the 34:49 money down in front of the loan officer 34:51 and then ask the loan officer to lend me 34:53 that money that's what the government 34:55 does 34:56 their spending 34:58 supplies the dollars that are then 35:00 available to buy the government bonds i 35:02 think the word borrowing is misleading i 35:04 think the word debt is misleading those 35:07 bonds are just another monetary 35:09 instrument there's another thing that 35:11 government issues it's it's interest 35:14 bearing so the government is choosing 35:16 that's a voluntary thing right the a 35:19 currency issuing government never has to 35:21 borrow its own currency from anyone 35:23 never has to do that this is an optional 35:26 thing that they do 35:28 and it you might think it's a nice thing 35:31 i mean we could debate that but you 35:32 might think oh you get to give up your 35:35 currency 35:36 and hold a risk-free asset and you get a 35:39 reward risk-free reward wow that's kind 35:42 of nice right so this is an instrument 35:46 that is interest bearing very safe and 35:49 it provides a risk-free subsidy to the 35:52 bondholder so 35:54 um 35:55 you can you know we suggest that we 35:57 really should be thinking of the 35:58 outstanding total stock of government 36:01 securities bonds as just part of the 36:04 broader money supply not use that word 36:06 debt to describe what it is it's really 36:10 just an interest bearing form of 36:12 currency absolutely and that the pros 36:14 the pros and cons of uh issuing bonds 36:17 could get us on to a quite another long 36:20 right notion but it is a choice 36:23 governments like the us government and 36:25 the australian government they're not 36:26 forced 36:27 to issue treasury bonds at all where 36:30 there are 36:31 uh regulations or practices in place 36:33 which which encourage bond issuance at 36:35 the moment they could be changed 36:37 they're not fundamental to the monetary 36:38 system 36:40 no they are an instrument that allows 36:42 governments to 36:44 support interest rates at positive 36:47 levels right you can maintain and manage 36:50 interest rates but there are other ways 36:52 to do that 36:53 absolutely um 36:55 people sometimes confuse mmt i don't 36:58 know whether deliberately or not i'm 37:00 journalists for example with 37:02 quantitative easing when it's got 37:04 nothing really to do with quantitative 37:06 easing and uh there's a question from a 37:09 member of the public from uh 37:11 uh peter holding 37:12 which uh kind of relates to this he says 37:15 that alan kohler the uh famous financial 37:19 journalist in australia and somebody who 37:20 definitely 37:21 understands mmt thoroughly 37:24 called on the reserve bank to buy up all 37:26 the government's debt and just write it 37:28 off 37:29 recently 37:30 would this change anything significant 37:32 and is it a worthwhile suggestion 37:36 and they are buying up they bought up an 37:38 eighth of the government's debt over the 37:40 last year 37:41 as a result 37:43 the the fed is buying 120 billion a 37:46 month right um so 37:50 but the thing is when the central bank 37:52 buys the bonds 37:53 the treasury is still continuing to make 37:56 the payments so every government budget 38:00 includes that line item that says 38:02 interest on the public debt 38:04 people in the media often call it the 38:06 debt burden or the debt service burden 38:09 so that language is problematic right 38:11 when i worked in the senate uh i don't 38:14 know how many times i heard u.s senators 38:17 say they look at that number and they 38:20 see 38:21 400 billion or 350 billion as the line 38:24 item in the budget called interest 38:27 expenditure right interest on the debt 38:29 and they go 38:30 oh my god we're spending we're on track 38:33 to spend more on interest than we spend 38:35 on the military if you project out you 38:37 know some number of years and they would 38:39 just it would blow their minds and you 38:42 know i would i would point out that well 38:44 there are a couple of ways to deal with 38:46 that right one is you don't have to 38:48 issue the bonds at all 38:50 and as as all the bonds matured that 38:53 line item would just disappear if you 38:55 don't like the number being as large as 38:58 it is you could always cap interest 39:00 rates we did it before the fed has done 39:02 it before the bank of japan is pinning 39:05 the 10-year on japanese government bonds 39:08 at zero because the the boj says we're 39:11 gonna keep it at zero we're doing 39:12 something similar to that here now 39:15 okay once they're pinned at 0.1 39:18 so but i guess the point is as long as 39:21 they still sit on the balance sheet and 39:23 this gets to the question about writing 39:25 them off 39:27 we would say 39:28 mmt economist would say once the central 39:30 bank buys the bonds it's as if the 39:33 treasury never issued them in the first 39:35 place in the sense that the treasury 39:38 will make the payments the central bank 39:40 remits the profits back to treasury at 39:42 the end of the year so it's like a left 39:43 pocket right pocket thing the problem 39:46 with that is 39:47 that everyone still sees the line item 39:50 in the budget the interest expense and 39:52 it's still there right people still see 39:54 it so this question uh is about whether 39:58 there would be advantages to having it 40:00 not still be there to actually writing 40:02 it off once the central bank buys it 40:04 just 40:06 make it disappear from the whole you 40:08 know accounting uh and and dispense with 40:11 the exercise where you pay the interest 40:14 and you pay back the principal at 40:15 maturity and then it goes you know um 40:18 politically yes there would be 40:20 uh probably advantages to doing that we 40:23 have a debt ceiling limit and the bonds 40:26 that are held by the fed are counted as 40:28 part of the public debt and subject to 40:31 the debts it's like crazy you know so 40:35 yeah there are advantages to i i suppose 40:38 doing it that way you see that with a 40:40 negative capital position on the central 40:42 bank's balance sheet but that really 40:44 doesn't matter 40:45 no i mean 40:47 again it's the politics right you only 40:49 have to deal with the politics the 40:51 economics are fine um 40:55 maybe we'll move on to 40:57 luke heffernan's question 40:59 luke asked whether the deficit myth has 41:02 got anything to say about nations 41:04 without a sovereign currency 41:07 yes um 41:09 uh there's a whole chapter that deals 41:12 with uh 41:14 you know it's it's the open economy or 41:16 the trade chapter and so the answer to 41:18 the short answer the question is yes and 41:21 the long answer could go on for a long 41:23 time but uh you know 41:26 the answer is yes i don't know how much 41:28 it explains why countries like greece or 41:31 italy 41:32 can get into difficulties as far as uh 41:35 financing 41:36 fiscal deficits are concerned 41:38 yeah i mean 41:39 the point is to to emphasize that 41:43 countries that have 41:45 a particular set of arrangements 41:48 that you know the country has a monetary 41:51 system in place 41:52 where the government issues the currency 41:55 the currency is a floating exchange rate 41:58 where the government doesn't promise to 42:00 convert its currency into something it 42:02 could run out of so you're not on a gold 42:05 standard where you're promising to 42:06 convert your currency on demand into 42:08 gold you're not on a fixed exchange rate 42:11 where you know you're russia in the mid 42:13 90s and you promise to convert rubles 42:16 into dollars at a fixed price you're 42:18 you're on a floating 42:19 fiat currency system you're the issue of 42:21 the currency you're not borrowing in 42:23 currencies that you don't control so 42:26 you're if you're um you know the u.s 42:29 you're not borrowing in foreign 42:30 currencies if you're um argentina or 42:34 russia and you start borrowing venezuela 42:36 you start borrowing in u.s dollars 42:38 heavily then you're talking about a 42:40 totally different animal right and the 42:42 constraints on government finance are 42:44 different you're mentioning greece and 42:46 countries that um are part of the emu 42:49 those countries gave up their sovereign 42:51 currencies they gave them up they 42:53 abandoned them and they adopted a a 42:56 common currency the euro which these 42:59 individual countries cannot issue 43:01 so there are different constraints we 43:03 all saw that play out in 2010 when the 43:07 debt crisis gripped countries like 43:08 greece and portugal italy spain uh 43:11 ireland and and so we know what can 43:14 happen when a country has debt that it 43:18 literally can't afford to service right 43:20 it's got to go out and it's got to 43:22 borrow the currency because it doesn't 43:23 issue it it goes to capital markets 43:26 capital markets are lending to 43:28 governments that don't issue the 43:29 currency so they perceive rightly that 43:32 there is default risk involved that this 43:34 country might not be able to pay you 43:36 back so they want a premium to 43:38 compensate them for the added risk 43:40 associated with lending to currency 43:43 issuing governments and at one point you 43:46 know in the 2010 era interest rates just 43:49 completely blew out and you had a 43:51 full-blown debt crisis notice that that 43:53 didn't happen in the uk didn't happen to 43:55 japan it didn't happen in the u.s didn't 43:57 happen to australia you know we are all 44:00 operating our governments operate with a 44:02 sovereign currency we can manage our 44:04 interest rates we don't have to borrow 44:06 in the first place borrowing is optional 44:08 yeah greece doesn't have that option 44:11 and it's it's worth pointing out that 44:12 your one-time colleague win godley 44:15 warned the architects of the eurozone 44:18 about the potential for a crisis like 44:19 this in in the early 90s 44:22 when they were 44:23 system up 44:24 i 44:25 was so fortunate as were some of the 44:28 other mmt economists to 44:30 um to meet and work alongside wynn and 44:34 he actually you know served on my 44:36 doctoral dissertation committee and you 44:38 know 44:39 truth be told he he kind of was my 44:42 dissertation advisor in in all but name 44:45 um wynn was brilliant a british 44:48 economist who um spent many years as 44:52 really forecasting the british economy 44:55 and i think you know had earned a 44:56 reputation of of being just about the 44:58 best there ever was in terms of you know 45:01 his ability to accurately see where 45:05 where things were headed you know well 45:06 ahead of the rest of the pack so you're 45:09 quite right the euro was introduced in 45:12 january of 1999 officially became a 45:16 currency but you know people understood 45:19 for years ahead of that that this was 45:21 the direction that many european 45:24 countries were heading and you know the 45:26 maastricht treaty and the um you know uh 45:30 um 45:31 i don't know what to call them the laws 45:33 that were shaping up were leading in 45:35 that direction and as early as 1992 win 45:39 was writing and saying uh oh you folks 45:42 are you're putting in place a blueprint 45:44 that is going to lead to trouble down 45:46 the road because you're proposing to do 45:49 something 45:50 that 45:51 really hasn't been done before in a 45:53 sense you are divorcing monetary policy 45:56 and fiscal policy in a way that is going 45:59 to leave you vulnerable to economic 46:02 downturns and unable to act when a 46:04 crisis comes and you're not going to be 46:06 able to use fiscal policy and you're 46:07 going to have face debt crises and all 46:09 this and when could you see it plain as 46:11 day it was so crystal clear to him that 46:15 when you give up your currency you're 46:17 giving up a lot more than just the 46:20 ability to depreciate your currency to 46:22 try to improve the you know terms of 46:25 trade and 46:26 and so forth that you were really 46:28 compromising 46:29 your ability to stabilize your economy 46:32 in times of crisis and he meant 46:34 specifically fiscal policy so when wynn 46:37 had it all figured out as early as 1992 46:41 and because i was working with him um 46:44 you know in the late 90s but before the 46:46 euro became official uh currency i i was 46:50 lucky enough to be influenced by his 46:52 thinking and to not fall into the crowd 46:55 that was cheerleading 46:57 this um you know currency arrangement 47:00 because i could see what he saw which 47:02 was basically a design flaw in the 47:04 blueprint 47:05 yeah i recommend anyone who hasn't read 47:07 it look up when godly's article 47:10 maastricht and all that 47:11 um which also had one called curry emu 47:16 the first one was maastricht 47:18 yeah yeah both of them are terrific yeah 47:21 absolutely they are 47:22 well i mustn't uh finish our 47:24 conversation 47:25 finish our conversation before asking 47:26 you about the job guarantee there's 47:28 renewed discussion of a job guarantee in 47:30 the u.s i've got the resolution of 47:32 congresswoman anna presley in front of 47:35 me which looks as though it's very much 47:37 inspired by modern monetary theory 47:39 and you've been one of the main 47:41 advocates alongside uh pavlina cheneva 47:44 and in australia professor william 47:46 mitchell as well of a federal job 47:48 guarantee for many years would you care 47:50 to explain why it would be such a 47:52 progressive measure 47:56 yeah i mean 47:57 so we have this incredible member of 48:01 congress and you just mentioned her 48:03 congresswoman uh ayanna pressley and she 48:07 just in the past you know a few days i 48:09 think friday of last week if i'm not 48:12 mistaken 48:13 uh formally introduced a a resolution in 48:16 congress now that's different from a 48:18 bill it's it's not a formal piece of 48:21 legislation or i mean 48:22 a bill but it is a resolution 48:25 and she is getting it on the table and 48:28 she has come out in favor of a federally 48:31 funded 48:32 basically a public option in the labor 48:34 market right a federal job guarantee 48:37 where anyone who wants to work wants a 48:40 job and cannot find one anywhere else in 48:43 the economy has a right right to a good 48:47 paying job right a a job that pays well 48:51 we can debate 15 an hour but a living 48:55 wage job and benefits so a wage and 48:57 benefit package 48:59 that you always have as an alternative 49:03 to unemployment so you know i saw today 49:06 and i i was pretty busy and i didn't 49:08 really get a chance to watch the whole 49:09 thing but i saw that the daughter of 49:12 martin luther king jr and coretta scott 49:14 king 49:15 was retweeting and sharing a video that 49:18 congresswoman uh presley 49:20 put out where in her own words you know 49:23 she's laying out 49:25 the answer to your question which is 49:26 what makes this such a progressive 49:28 policy and so for people who maybe 49:31 haven't seen that yet you know go find 49:33 her twitter feed and watch this 49:35 incredible video i think it's about 49:36 three minutes long 49:38 but it's that arc of history you know 49:40 that martin luther king jr talked about 49:42 that that bends toward justice and this 49:46 resolution is her effort to 49:49 bend that arc toward justice so that you 49:52 know people who have nothing who have no 49:55 entry point in no way to support 49:58 themselves no way to to get a job and 50:01 and to survive 50:03 uh always have the security of knowing 50:07 that whatever else happens in their 50:09 lives 50:10 you know 50:11 you have a right at the end of the day 50:13 to a job that pays a decent wage and 50:16 comes with benefits and that's a very 50:18 different answer than you know the kind 50:20 of answer that a you know buttoned-up 50:23 economist might give about the benefits 50:26 of a program like this just you know in 50:28 terms of efficiency 50:31 making the labor market more liquid 50:33 allowing workers to transition in and 50:36 out of this program as some way of 50:40 better stabilizing the economic system 50:43 which it has those benefits as well but 50:45 there's also really important human and 50:48 moral side of 50:51 the job guarantee and that's that's 50:53 certainly what uh congresswoman presley 50:56 is leading with 50:58 and it's what we are campaigning for 50:59 including our 51:00 sustainable prosperity action group 51:03 in australia and greens and members of 51:05 the labour party right the way across 51:06 the country 51:08 as well and 51:10 stephanie covers the federal job 51:12 guarantee 51:13 proposal 51:14 and its role 51:15 as a 51:16 counter-cyclical stabilizer in modern 51:18 monetary theory 51:19 in her book and i also recommend pavlina 51:22 schneider's book the case for a job 51:25 guarantee which is a great read as well 51:27 and uh goes into some of these issues in 51:29 in a lot more detail too 51:31 oh yeah 51:32 probably almost any question that you 51:35 you or the people joining would have 51:38 about how the program would work and the 51:39 benefits you will find in her book and 51:42 she also has a website where she um has 51:45 created a nice faq frequently asked 51:48 questions and that that is just really 51:50 sharp because just any question that 51:52 pops into your head i'll bet you uh 51:55 she's got it there and and she's got an 51:57 answer to it so and pavlina was involved 52:00 in a successful 52:02 job guarantee style scheme in argentina 52:05 in the mid 2000s wasn't she which they 52:08 should never have removed actually she 52:10 left it 52:11 in place yeah 52:12 pavlina and uh matt forstadter who is a 52:17 fellow mmt economist and a professor at 52:19 the university of missouri in kansas 52:20 city 52:21 um i think both of them worked with 52:25 someone in the argentinian government in 52:28 the 52:29 ministry of labor to design and 52:32 implement a version 52:34 of a job guarantee program that was for 52:37 that was extremely meaningful and 52:39 successful to 52:41 people who 52:42 were able to take advantage of it while 52:44 it existed 52:45 yeah i recommend reading about clan 52:47 heifers in the book i might end my um 52:50 section 52:51 of 52:52 the event this evening just by 52:54 asking another question from a member of 52:56 the public from neil halliday 52:59 he points out that our central bank 53:00 governor philip lowe recently said at a 53:03 national press club event we don't do 53:05 mmt in australia 53:08 uh 53:09 was he right 53:11 and 53:12 how can we change his mind how can we 53:14 change his attitude 53:16 well okay so 53:17 on valentine's day 53:20 i tweeted you know that everybody does 53:22 this every valentine's day the roses or 53:24 red violets are blue and then you finish 53:26 this 53:29 phrase 53:30 i think i tweeted roses are red violets 53:33 are blue 53:34 mmt is a lens not something you do 53:37 so you know is he right no um because if 53:40 he's under the impression that mmt is 53:42 something you do and he's not doing it 53:44 then he already is revealing that he 53:46 doesn't understand 53:48 what mmt actually is it's a description 53:51 and i hate to break the news but we're 53:54 providing an accurate description 53:57 of what he actually does right what the 54:00 central bank does the mechanics of 54:02 government finance how the monetary 54:04 system works and the mechanics of 54:06 government finance and we're just trying 54:08 to tell the truth to people about 54:10 the nature of it all and how it works 54:13 and you know central bankers like to be 54:15 shrouded in this sort of veil of you 54:18 know secrecy and it's all supposed to be 54:21 sort of mysterious and we don't do that 54:23 and we don't uh but 54:25 frankly we're just 54:27 telling the people 54:29 how it works so 54:31 yeah he's mistaken and they really 54:32 should know better because his deputy 54:34 was at a talk you gave in 54:36 in sydney last year guy de bell 54:40 yeah you said that i mean i think i sat 54:42 next to him and we probably had some 54:45 small talk and i think if i remember 54:47 correctly 54:49 maybe he asked one question at the end 54:51 of some remarks that i gave but 54:54 um 54:54 i don't know how 54:56 much of an effort he's made to actually 54:57 engage with any of the scholarship so he 55:00 may be next in line to be the governor 55:02 so maybe we'll see 55:04 thanks very much stephanie i'll hand 55:06 over to gabrielle now 55:08 thank you both thank you thank you um 55:11 there are a lot of great questions 55:13 coming through from the chat but um if 55:16 you don't mind i'd like to um just bring 55:19 david shoebridge into the meeting which 55:21 i'll have to do by 55:23 uh finding him in the list and giving 55:25 him a co-host permission so if you don't 55:28 mind i'll just quickly do that because 55:29 he's got a question that he'd like to 55:31 put to us this event was really david's 55:34 idea 55:41 just oh sorry talk amongst yourselves 55:44 well i'm finding that i'll unmute myself 55:51 it's great thank you so much stephanie 55:53 for doing this we know how busy you've 55:55 been today and how busy you are 55:57 virtually all the time 55:59 you're absolutely wonderful and please 56:00 come back to adelaide 56:02 soon 56:03 i listen i would love to come back i 56:06 can't wait to come back thank you for 56:08 hosting this 56:14 go ahead david oh um oh thanks scott and 56:18 thanks for doing um all of the hard work 56:20 behind the scenes often not celebrated 56:22 enough stephanie um i'm really grateful 56:24 for you taking the time out i'm sure 56:26 you've got global demands and and i 56:29 particularly like the way you um dealt 56:31 with what often i see as a criticism a 56:33 criticism of mmt 56:35 is this sort of tribalism between a job 56:37 guarantee and mmt and 56:39 putting to bed that sort of false 56:41 dichotomy has been really useful but i 56:43 thought i'd just 56:44 bring it down to earth with the misery 56:46 that is australian politics um and so 56:50 for example i don't often do this but 56:52 and i blame gab for this she sent me 56:54 matt canavan's tweet that went out this 56:56 morning matt canavert is a a um 57:00 i'm trying to think of a polite way of 57:01 saying a right-wing nut job um in the 57:03 government at the moment senator as well 57:06 and a senator yeah senator thank you 57:07 steven he's a senator um government 57:10 senator and very pro resources very you 57:12 know right-wing he put this tweet out 57:15 so on the day it was revealed that 57:17 surging coal exports could add two 57:19 billion dollars to government revenues 57:21 we are promising to spend two billion 57:23 extra on the dole they're putting some 57:25 extra a tiny amount of extra money into 57:27 social security he then says this 57:29 if we don't have coal 57:31 we can't pay the bills 57:33 um stephanie what's your you're going to 57:36 comment in the moment you've got to do a 57:37 tweet in response to that um uh what's 57:40 your response 57:42 well i mean that he's just wrong right i 57:45 mean he's missing the fundamental point 57:48 here that we've just spent the better 57:50 part of an hour talking about which is 57:52 that governments that issue their own 57:54 currency can always afford to purchase 57:58 whatever is available and for sale in 58:01 their own currency 58:02 so there is no financial constraint if 58:05 you don't have 2 billion coming in uh 58:07 from some channel that doesn't deprive 58:10 you of the capacity to spend two billion 58:12 dollars whatever the government commits 58:15 the money will go out that's the reality 58:18 of the nature of the system the way it 58:21 is set up with the central bank and uh 58:23 and the federal government so you can 58:25 commit to the spending and you don't 58:28 need to rely on the rest of the world to 58:30 supply you with australian dollars 58:32 you're the issuer of the australian 58:34 currency 58:35 um 58:36 so 58:39 could i could i add something i mean 58:41 he's just talking about going from forty 58:43 dollars a day to forty three dollars a 58:45 day 58:46 to take people back out of poverty it 58:48 needs to go to seventy dollars 58:51 not only can they have another three 58:52 times a day 58:54 you build another thirty 58:56 it's it wouldn't be inflationary as 58:58 stephanie's just explained there's no 59:00 problem in funding it 59:02 and uh i don't believe that matt canavan 59:07 actually believes what he's saying here 59:09 hopefully not getting myself into too 59:10 much trouble it's just a political point 59:14 and every time we play into this notion 59:16 that mining billionaires pay for things 59:18 through their taxes 59:20 we actually reinforce 59:22 the arguments that um people like matt 59:24 cannon make even though they're 59:27 foolish arguments people 59:29 just hear them who are only half paying 59:30 attention to them to the media and they 59:33 perhaps don't catch on 59:36 what where he's coming from 59:39 he just wants to punish the unemployed i 59:40 mean we have the same conversation here 59:42 right at one point early on in the 59:45 coronavirus pandemic the federal 59:48 government did something truly 59:49 remarkable right they passed the cares 59:52 act which was then the major piece of 59:54 legislation 2.2 trillion dollar uh 59:57 spending package that included a top up 60:01 in unemployment insurance from the 60:03 federal government on top of what you 60:05 get at the state level if you get 60:06 anything uh an additional six hundred 60:09 dollars a week from the federal 60:10 government twenty four hundred dollars a 60:12 month 60:13 that was enough to pull so many people i 60:16 mean the the research that came after 60:18 the cares act suggests that that in 60:21 concert with some of the direct cash 60:22 payments helped to prevent 18 people 60:26 from going into poverty right lift 18 60:28 million people out of poverty so though 60:31 that kind of cash assistance income 60:35 support was a lifeline and then it 60:37 expired and then when we came back and 60:39 we got another package together the 60:41 republicans did this in december with 60:43 the democrats we had a bipartisan bill 60:46 in december of last year they cut it in 60:48 half so it went to 300 a week that is 60:52 going to expire mid-march so a few weeks 60:55 from now so this covid relief package 60:58 that president biden is trying to usher 61:00 through 61:01 is uh includes 400 a week so we went 61:04 from 600 61:06 cut down to 300 now we're talking about 61:08 taking it up to 400 but that number can 61:10 go it could be 600 again it could have 61:12 been but they didn't do that and so what 61:15 stephen you know i saw a tweet about 61:17 this how this has gone from something 61:20 fairly generous whittled down and then 61:23 up a little and now whittled down again 61:25 so 61:26 yeah you you can choose the 61:28 the amount of relief that you want to 61:31 provide to 61:33 you know support um 61:35 people in this in this crisis you can 61:37 pick the number 61:48 was there anything else david oh sorry i 61:50 i thought i had i i was going to hand 61:52 over to the rest no look i mean we've 61:54 had almost exactly the same debate here 61:56 about the level of support for um 61:59 uh 62:00 we called it job keeper so so businesses 62:04 were given money um that they could they 62:06 were meant to but not required to 62:08 redirect to wages to keep people on the 62:10 books during the recession from the 62:12 caused by the contraction from covert 62:15 and then job seeker which was basically 62:17 an unemployment benefit 62:20 that job seeker benefit 62:22 as well as the job keeper benefit is 62:24 just about to be pulled from the economy 62:27 in about a month's time and 62:30 i think we're probably going to see a 62:31 significant amount of hardship caused at 62:33 that moment 62:35 um stephanie can you 62:37 can you give us some analysis about you 62:39 know a useful way to talk about that 62:41 um 62:42 and a useful way to respond to what i 62:44 think is going to be a sort of wave of 62:46 pain and and poverty 62:50 i mean i can tell you that what the 62:52 experience was here when we allowed the 62:55 relief the income support to expire 62:57 prematurely when we didn't stay 63:00 committed and continue those payments 63:03 what happened is we went from pulling 18 63:05 million people out of poverty by summer 63:08 when the income support started to 63:10 disappear 8 million people fell back 63:12 into poverty by september 63:14 so you know that seems to me to be about 63:18 as good an example 63:20 as i could offer you in terms of you 63:22 know knowing exactly what the outcome is 63:25 likely to be you can pull millions of 63:27 people out of poverty with the income 63:29 support and if you cut it off they will 63:32 fall back into poverty uh it it's just 63:35 sort of that simple you know and it's a 63:37 choice just it's just a simple choice do 63:40 you want to extend the income support 63:43 and keep people whole or largely you 63:46 know replace lost income and avoid the 63:49 long-term bouts i mean we talk a lot 63:51 here people like jerome powell talk a 63:53 lot about scarring effects and the 63:55 longer term damage that's done 63:57 when you know people become detached 64:00 from their employers remain unemployed 64:02 for long periods of time become 64:04 unemployable 64:06 and it's much harder to you know fully 64:08 restart the economy and get a robust 64:11 recovery underway 64:12 probably like we do you know we have 64:14 this uneven bifurcated sort of recovery 64:18 people describe it as a k-shaped 64:19 recovery and we don't want a k-shaped 64:22 recovery we want that bottom leg lifted 64:26 up and we can do that with the kinds of 64:28 you know uh programs uh income support 64:32 and and the fiscal support you just have 64:35 to put it in place and commit to 64:38 keeping it in place for as long as 64:40 necessary the problems are in trying to 64:43 figure out you know which date on the 64:45 calendar is the right date to cut off 64:46 the support and that's what we continue 64:49 to do with our legislation and that's 64:50 why we have to keep coming back again 64:52 and again if we could get you know 64:54 better automatic trigger stabilizers in 64:58 the legislation where the payments 65:00 continue for as long as the economy 65:03 remains weak and people need the support 65:07 and you know then it's a one-off pass a 65:09 bill 65:11 have those 65:12 income support payments continue and 65:15 then have them taper off as the labor 65:18 market shows evidence that you know 65:20 people are returning to work and the 65:22 support is not necessary 65:25 yeah i think that task of convincing 65:27 people that um you know poverty is a 65:29 political choice it's just fundamentally 65:31 a political choice this is part of the 65:33 work we need to do on the left of 65:34 politics 65:36 but it's these i mean that was a very 65:39 persuasive macroeconomic assessment but 65:42 i would have thought from an equity 65:43 point of view 65:44 um that those payments should never be 65:46 ceased 65:48 but that perhaps put a trigger in them 65:50 so that as people move into employment 65:52 take up a job guarantee that's when 65:54 those payments transfer across oh hey if 65:56 you're allowing me to put a job 65:58 guarantee in place then that's 65:59 absolutely the trigger that that then 66:02 becomes the program that right sizes the 66:07 spending right as long as the economy is 66:09 weak and people remain job well not 66:11 jobless they're employed but they're not 66:13 employed in private sector uh the 66:16 program supports them and as the economy 66:18 recovers and gains strength and people 66:20 are hired out of the program the 66:23 spending on the program is automatically 66:25 um you know adjusting to changing 66:28 economic conditions but yeah you're 66:30 you're absolutely right with a job 66:32 guarantee in place you're 66:34 the the hard the hard work is done the 66:37 heavy lifting is now automated 66:40 yeah that's the policy setting that sort 66:42 of um um automatically it's sort of like 66:45 a super keynesian policy setting that 66:47 addresses the micro the macro and the 66:50 micro economic issues you know address 66:52 and it addresses the dysfunction in the 66:54 politics where you have to keep waiting 66:56 for in our case congress or parliament 66:59 to come back with another bill and how 67:01 many weeks are we going to extend this 67:03 time or months 67:05 it takes all the guesswork out 67:07 thanks 67:08 you're welcome very much david 67:11 i just thought um i might uh quickly 67:15 just as a response to david's original 67:17 um question which was about a tweet from 67:20 our resources man 67:21 minister matt canavan 67:23 i also found this on twitter from rohan 67:25 grey i'm not sure if you've seen this 67:27 one but i'll read the tweet out because 67:29 it kind of appeals to me as someone 67:31 who's in the activist 67:33 space 67:34 rohan says it's tempting for the left to 67:37 lean into the taxpayer money trope 67:39 because it ostensibly strengthens the 67:41 argument for redistributive taxation 67:44 and then he says but it's a trap and 67:46 ultimately leads to one place only the 67:49 politics of scarcity exclusion 67:51 xenophobia and white supremacy 67:54 would you 67:55 he's good yeah he's good 67:58 exactly 67:59 every word 68:00 yeah every word of it yeah because it's 68:02 you're in an austerity frame what you're 68:04 saying when you do what he just said and 68:07 advise not to do 68:09 you know i sometimes said 68:11 you know you're in an unless and until 68:13 world 68:14 i'm not going to be able to feed this 68:16 hungry kid i'm not going to be able to 68:18 support this jobless prayer i'm not 68:19 going to be able to do unless and until 68:22 i'm successful in putting up this new 68:25 tax or you know coming up with the 68:27 revenue to do that so you're picking two 68:30 fights and you got to win both of those 68:32 fights and you're holding hostage 68:35 a progressive agenda or even a humane 68:37 agenda that is held hostage unless you 68:41 can collect all the votes that are 68:42 needed to push up the tax to generate 68:45 the revenue so that you can pretend that 68:47 you found the money that allows you to 68:49 pay for something and and what happens 68:52 99 times out of 100 is that you don't 68:55 win both fights you don't get the votes 68:57 and therefore you don't get the tax 68:59 revenue and therefore the spending 69:00 doesn't happen and that means people 69:03 just stay in misery right and it's 69:05 gratuitous because you could you could 69:07 address problems without you know that 69:11 secondary and unnecessary fight you can 69:13 get there in a more direct way alleviate 69:16 human suffering in the now 69:18 um but if you if you are committed to 69:20 not 69:21 addressing problems unless and until 69:25 you can peel off a few bucks from the 69:28 billionaire class then 69:30 there's a pretty good chance that you're 69:32 going to be stuck with just you know 69:34 crumbling infrastructure poverty 69:36 homelessness and all the rest of it 69:39 yeah and of course the most marginalized 69:41 people are the ones 69:42 who are going to suffer the most from 69:44 the effects of climate change and 69:46 austerity and they're often well 69:49 they're they're the people who are also 69:52 um 69:53 from you know different they're 69:55 immigrants or migrants or 69:58 traditional owners or um indigenous 70:00 people here in australia 70:02 already we can see that happening it's 70:04 really stark so i think the racism 70:06 aspect of it is really important that we 70:08 acknowledge and work on 70:12 couldn't agree more 70:15 there's um there's a bunch of questions 70:17 that i picked up from earlier on in the 70:20 session 70:21 shall i throw a few of those in and um 70:24 then we might also towards the end that 70:27 another one of our um 70:29 uh greens politicians here in south 70:30 australia tammy franks is on on the call 70:33 and she has helped us put this webinar 70:35 together so we might give her co-host as 70:39 well in a few minutes and she could ask 70:41 a question she says no rush but we will 70:44 get to you tammy 70:45 um so just back from because there's 70:48 at least a hundred great questions in 70:50 there and we won't have time for all of 70:51 them i'm very sorry um but back a fair 70:54 way james asked what um what have you 70:58 been using as an alternate metaphor 71:00 to government as household 71:04 do you have any suggestions for how we 71:06 might change that metaphor 71:09 i mean i 71:11 i just tend to say currency is sure um 71:15 uh i use yeah never use taxpayer dollars 71:19 or taxpayer money i say public money or 71:21 federal dollars 71:23 more and more politicians at least here 71:26 in the us are starting to to do that to 71:28 get more careful about the language you 71:30 ever notice that 71:32 the the phrase taxpayer money is usually 71:36 invoked when you're trying to 71:39 spotlight 71:40 something that you don't like so 71:42 democrats will say taxpayer money when 71:45 they're talking about the pentagon 71:47 budget and defense spending how the 71:49 taxpayer because that right gets you 71:51 right 71:52 republicans say taxpayer money when 71:54 they're talking about you know welfare 71:57 programs or something oh taxpayers are 71:59 supporting these welfare programs but um 72:02 no you just it's our money it's our 72:04 money it's public money and 72:07 the 72:07 government is where it comes from you 72:10 know i use the power of the purse so i 72:12 say 72:13 uh government has the power of the purse 72:15 that's what makes them unlike a 72:16 household they have the power of the 72:18 purse i think i read in your book as 72:20 well that you use the metaphor of like 72:22 um 72:23 a football match or you know where the 72:26 one team is scoring 72:29 and um will you know will the referee 72:31 run out of points no if a team keeps 72:33 scoring points they just keep adding 72:35 points to the score yeah we sometimes 72:38 just use the phrase the government is 72:40 the score keeper for the dollar so you 72:42 know that does drive home the point that 72:45 the point that it really is about you 72:48 know 72:49 just think of the government as standing 72:51 on the outside of some giant excel 72:54 spreadsheet where all of us are a cell 72:57 you know there are columns and all of 72:58 our names are there and they can click a 73:00 button and the numbers in our cell can 73:02 go up they spend 73:04 dollars into our account the numbers can 73:06 go down if they tax dollars out of our 73:09 account but they're sort of standing on 73:11 the outside as they have this unique 73:14 capacity the rest of us don't have to 73:16 change the numbers up and down 73:18 um 73:19 so the score keeper right 73:22 aussies will get that 73:24 yeah 73:25 um there's another question about um 73:29 what are some good ways that people like 73:32 the people here on this call for example 73:34 what are some ways that we can start 73:36 getting the message out what are some 73:37 ways that have been effective 73:39 for people that you know of 73:44 you i know one way that's effective 73:46 you've done it that's definitely kelton 73:48 here for about 10 days 73:50 we were all over the media 73:54 yeah have stephen hale 73:56 organize a calendar of events for you 73:59 and fill it up for 10 days and always 74:01 come back to can we do one more can i 74:04 just add one more thing um 74:07 no i mean you know we have now after all 74:09 these years we do have a deep bench in 74:12 the early years there were a smaller 74:14 number of economists who were trying to 74:16 put these ideas out and i mean after a 74:18 quarter of a century 74:20 their 74:21 the ranks have grown and it's not just 74:23 economists anymore you have legal 74:24 scholars and historians and um you know 74:28 philosopher there there are and that's 74:30 just in academia and then you have you 74:32 know journalists who have you know come 74:36 very much on board and are sympathetic 74:38 and that's powerful when people in you 74:41 know posit with positions of influence 74:44 and a megaphone um can also start 74:47 improving the discourse just in the way 74:49 that they conduct interviews and the 74:51 things that they talk about the way they 74:53 talk and then there are you know 74:55 activists and um and 74:58 thought leaders and other like there's 74:59 just this huge community now and it's 75:02 everyone doing 75:04 their what you know contributing in 75:06 their own ways that's 75:08 created that tailwind that's i think 75:11 really brought us in the last couple of 75:13 years so much the ball has moved so far 75:16 down the field because of you know the 75:18 efforts of so many different people 75:20 people in the uk with podcasts i mean i 75:22 can't imagine the work that people do 75:24 curating 75:25 articles and maintaining websites where 75:28 you can go to get 75:29 you know a collection like steven said 75:32 get in touch with me and i'll send you 75:33 all the mmt scholarship well there are 75:36 people out there who you know work very 75:39 hard to maintain a library of resources 75:42 to make these things available so 75:45 you you can help in ways 75:48 big and small you know 75:50 one one of the small but hopefully 75:53 um helpful ways that that we things that 75:56 we'll be doing here in adelaide this 75:57 year our volunteers who many of you who 76:00 you met when you came over for our 76:02 conference uh we are training 76:05 to deliver 76:07 short talks on mmt to public to the 76:10 public so we're going to be going around 76:11 to like local 76:13 rotary groups and 76:16 university of the third age wherever we 76:18 can get a speaking gig public radio 76:21 we're going to train up a bunch of 76:22 people and start we've got slides 76:25 prepared 76:26 you can even that's awesome from our 76:28 website if you want awesome so you know 76:30 i've been in touch with someone who 76:33 reached out to me 76:35 four or five months ago and he went 76:37 through a program this was you know kind 76:40 of in a way 76:41 well it's like what you're describing he 76:44 did it because al gore organized 76:47 something and al gore said we need the 76:49 population to understand 76:52 that humans are contributing to global 76:56 warming that that climate change is you 76:58 know a result of you know actions that 77:01 we take right human uh action and so he 77:04 brought together i think thousands of 77:07 people and trained them and in a sense 77:09 kind of certified them and then sent 77:11 them off to become 77:14 you know a 77:15 messengers in in this effort to to shape 77:19 and change the public's understanding of 77:22 what was happening and it sounds a lot 77:24 like what you're describing you know a 77:26 couple of days ago i got an email from 77:29 a woman 77:30 that i have a i i met years ago and she 77:33 sent me an email and she had a 77:35 photograph and she was asking if i would 77:37 give her permission to use the picture 77:40 in um an advertising that she was going 77:43 to do about public talks that she so 77:45 here i am in the picture with this gal 77:47 and this guy from who knows how many 77:50 years ago but she's going out in her 77:53 community and giving talks on mmt and 77:56 she wanted to know if it would be okay 77:57 to use the picture i said of course you 77:59 know go for it and good luck and i i'm 78:02 sure it's going to be great but people 78:03 are you know 78:05 amazing what people are out there doing 78:08 quietly and behind the scenes and and 78:11 publicly people are pouring in a lot of 78:14 their energy to 78:16 try to you know be part of 78:19 getting us to a better place um 78:23 amazing 78:24 absolutely and i think we can all help 78:26 each other to communicate well and to 78:29 communicate with compassion and kindness 78:32 even to people that we don't agree with 78:34 and that's how we in the argument 78:36 yeah that's such a good i'm glad you 78:39 said that because you know you could get 78:41 very impassioned and it is often 78:43 frustrating to hear people you know 78:45 espousing these myths but everybody 78:48 hasn't arrived i once didn't know you 78:50 know i didn't always have this 78:52 understanding of things so i was once 78:55 as confused and probably worried about 78:58 deficits as anybody else so 79:00 take a sympathetic approach and meet 79:02 people where they are and and try to 79:05 help bring them along 79:07 [Music] 79:16 you
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