Fiscal sustainability: post hoc Mitchell notes

So, these are my notes on the first fiscal sustainability counter-conference of the day, on Bill Mitchell's talk.  I took them in hierarchical form in a text file because I couldn't get to this (IMO execrable, but whatever) TypePad app until I figured out how to use the GWU wireless.

• Arrived a little late, still caught most of Bill Mitchell's talk.
  • Mostly about deficit terrorism, why households are not the same as gov'ts.
  • Public purpose: maximizing employment.
    • Governments: render private sector expectations in line with full employment.
    • Therefore budget deficits are necessary in some cases and should be included in defn of sustainability (not everyone can run deficits.
    • Government voluntary constraints that pretend that we're in the gold standard.
    • A sovereign gov't can spend whatever it wants [really?] being a currency monopoly.
      • Can only buy what's available for sale, as well.
      • Unemployment is a sign that there is no real resource constraint (gov't can always buy).
    • The number that appears as the price of labour is not a cost
      • Costs are only relevant at full employment[?].
    • Ratio of X [gov't/deficits] to GDP is a bogus measure.
    • Long-term pressures: intergenerational debate---about real resources, not currency.
    • Current account deficit is not relevant? Somewhat flippant dismissal.
    • NO sovereign debt problem.
    • We need a new macroeconomic narrative. Reorient against financial matters and for the real economy.
  • Panel
    • Randy Wray: Discussion of the gov't efficiency to solve problems.
      • Insofar as there is unemployment, the most efficient employer is the gov't.
    • Auerback: media absurdities, missed this
    • Mosler: More media absurdities: does gov't have to tighten like private sector.
    • Kelton: If gov't runs surplus, the rest of society runs into deficit.
    • Cherneva: same with debt. If gov't pays down debt, private sector loses bond assets.
  • Q&A
    • Someone mentions inflation.
      • 70s inflation was caused by OPEC, not monetary policy.
    • How to sell counter-intuitive MMT ideas to public.
    • How to deal with voluntary and involuntary constraints: going to China is unnecessary.
    • Mitchell told us that he has sacrificed journal articles for his blog.
    • Oooh, Edward Harrison is here: dealing with the big government talking point. What do we want the gov't to do? Emphasize "public deficit == private surplus" talking point.
      • Political decision: what do we want to do with our money? MMT orthogonal to this.
    • Kelton: Japan's recent expansion/recession cycle. Recessions happen when deficits cut.
      • Re: politics. Hope when people understand they'll make the right choices. [increasingly dubious...]

Next up, the Kelton talk which I also took down locally on my machine (second talk of the day).

Comments

[almostinfamous]

bill mitchell's website is a lot of fun!