Modern Monetary Theory

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sheldrake
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Re: Modern Monetary Theory

Post by sheldrake » Sat Sep 18, 2021 10:12 am

Woodchopper wrote:
Sat Sep 18, 2021 9:55 am
sheldrake wrote:
Sat Sep 18, 2021 9:31 am
plodder wrote:
Sat Sep 18, 2021 6:52 am
If the (small) amount of value added by these roles was mechanised I’m not sure my role shouldn’t become proportionately more easy as a result. It’s never been clear to me why mechanisation etc continually means people have to work harder, longer hours etc when the exact opposite should be true.
Because the economic benefit of the machines goes mainly to the customers of what they produce and to the machine's owners. If you do not own shares in machine-using companies, you are not fully in on the action.
Hitherto, when machines have been introduced throughout the economy the population has benefitted in aggregate* from the improved productivity. The money gets spread around (eg gets distributed to shareholders as dividends, spent by the newly rich, or paid in tax and then spent by government). Though, as you write, very profitable multinational corporations that pay little or no tax are a problem.




*See the above qualification.
Almost all of us count as customers of the machines and we benefit from goods and services that are cheaper than they would otherwise be. There's other direct value captured by shareholders as you note, but this isn't homogenous. The workless joy Plodder would like to get from the machines is basically dependent on building up enough passive income before official retirement age, and this is hard. It is achievable for more people than who perhaps realise it though, but it requires financial self education and a lot of frugality.

Rebalancing tax rates by stopping the current large-scale machine owners from evading vast amounts of tax and lowering ours would go some way to helping Plodder save his way to freedom. Because of who I work for this might mean my own pre-tax pay had to go down quite a bit, but I could live with it (and my own direct taxation might be reduced)

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Re: Modern Monetary Theory

Post by plodder » Sat Sep 18, 2021 10:20 am

Woodchopper wrote:
Sat Sep 18, 2021 9:55 am

Hitherto, when machines have been introduced throughout the economy the population has benefitted in aggregate* from the improved productivity. The money gets spread around (eg gets distributed to shareholders as dividends, spent by the newly rich, or paid in tax and then spent by government). Though, as you write, very profitable multinational corporations that pay little or no tax are a problem.

*See the above qualification.
Yes, sure but policy is always to spend the wealth created by the efficiency rather than save the wealth and allow everyone to slack off. This is the big con. We get ever cheaper and fancier widgets rather than more time.

Given the imperative and natural constraints imposed by the need for carbon reduction, solutions to resource exploitation, biodiversity loss etc it is clear that economists need to substantially up their game by finding ways for us to level off growth and halt the relentless march of work. We don’t need to do it and work is exacerbating all sorts of important social problems.

Work is part of the problem, not part of the solution.

sheldrake
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Re: Modern Monetary Theory

Post by sheldrake » Sat Sep 18, 2021 10:25 am

plodder wrote:
Sat Sep 18, 2021 10:20 am
Woodchopper wrote:
Sat Sep 18, 2021 9:55 am

Hitherto, when machines have been introduced throughout the economy the population has benefitted in aggregate* from the improved productivity. The money gets spread around (eg gets distributed to shareholders as dividends, spent by the newly rich, or paid in tax and then spent by government). Though, as you write, very profitable multinational corporations that pay little or no tax are a problem.

*See the above qualification.
Yes, sure but policy is always to spend the wealth created by the efficiency rather than save the wealth and allow everyone to slack off. This is the big con.
I'm not sure if it's a deliberate effort to keep people in b.llsh.t jobs. I have a book by David Graeber I still haven't got around to on this, but he did make the point in an interview that b.llsh.t jobs are just as prevalent in the private sector as the public; I agree. To me this suggests it's not a deliberate plan to 'keep people busy'; private companies have no economic incentive to do that. I think they're just a bit inefficient and genuinely believe those roles are needed.

A chunk of the savings made are passed on to you in cheaper goods (and if it was up to me other people would be paying more tax so you could pay less); it's within your power to invest those savings and get in on the benefit.

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Re: Modern Monetary Theory

Post by plodder » Sat Sep 18, 2021 10:34 am

It’s not a deliberate plan - it’s a failure of imagination for cultural reasons. We are trained from childhood that work is beneficial, but this has been to the detriment of time. It used to be that one adult in the family worked, and the other took care of what we would now call “social care”. Nowadays every adult is expected to work.

The efficiencies from cheaper widgets (and of course we can choose not to buy them - good luck being part of culture or society without them though) are at least in part offset by the inefficiencies inherent in dedicating such a huge proportion of our human capital into widget production and its associated service industries.

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Re: Modern Monetary Theory

Post by plodder » Sat Sep 18, 2021 10:51 am

To expand on this, it’s possible of course to monetise the value of “social care” just as it is possible to monetise the value of picking the kids up from school, spending quality time with family, enjoying an afternoon nap and learning something to degree-level purely for pleasure (perhaps English Literature or History). But no one does monetise these things and put them on the “lost opportunity” side of the scales. This isn’t a technical problem, it’s a cultural one. We are browbeating ourselves and chasing further efficiency without expanding the horizons of the debate will not provide solutions.

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Re: Modern Monetary Theory

Post by sheldrake » Sat Sep 18, 2021 10:59 am

plodder wrote:
Sat Sep 18, 2021 10:34 am
It’s not a deliberate plan - it’s a failure of imagination for cultural reasons. We are trained from childhood that work is beneficial, but this has been to the detriment of time. It used to be that one adult in the family worked, and the other took care of what we would now call “social care”. Nowadays every adult is expected to work.
People do have these habits, but we also all have economic self-interest. A private employer offering a salary (perhaps mistakenly) thinks they get a benefit in return from that work. They won't spend money they expect no return from just to see people being busy. I think that the reason two adults work now is that consumer expectations are bottomless and we're encouraged by a million nudges a day to consume; it's not that people love work it's that they're enslaved by their hunger for more shiny things.

This picture varies a bit by socioeconomics; in real terms working class wages have declined relative to housing etc.. people at or near minimum wage actually do need two incomes to have a 'working class' standard of living.

But the one 'middle class' household in a thousand who can actually discipline themselves to a 1930s standard of living can probably have one on a single income, it's just that very few people with those kind of jobs are actually willing to forgo owning multiple vehicles, regular foreign holidays, eating out, multiple TVs etc..
The efficiencies from cheaper widgets (and of course we can choose not to buy them - good luck being part of culture or society without them though) are at least in part offset by the inefficiencies inherent in dedicating such a huge proportion of our human capital into widget production and its associated service industries.
This assumes there's an opportunity cost and all of those widget makers have some great inner potential which is just suppressed by the daily grind. It could be true, but reality may be a lot more bleak than that. How can we tell?

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Re: Modern Monetary Theory

Post by plodder » Sat Sep 18, 2021 11:15 am

What you appear to be saying is that if people choose to adopt a 1950’s standard of living they can also have the time-perks of a 1950’s lifestyle. Ergo, there have been no efficiencies since the 1950s. This is clearly wrong.

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Re: Modern Monetary Theory

Post by plodder » Sat Sep 18, 2021 11:17 am

The issue of the employer not investing in things that won’t benefit the employer is obvious and categorises the failure of imagination. The problem is broader than employers and employees and their respective markets. It is about people and resources (including time).

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Re: Modern Monetary Theory

Post by plodder » Sat Sep 18, 2021 11:18 am

As per the old chestnut, if a problem is too big to solve, make it bigger.

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Re: Modern Monetary Theory

Post by sheldrake » Sat Sep 18, 2021 11:25 am

plodder wrote:
Sat Sep 18, 2021 11:15 am
What you appear to be saying is that if people choose to adopt a 1950’s standard of living they can also have the time-perks of a 1950’s lifestyle. Ergo, there have been no efficiencies since the 1950s. This is clearly wrong.
That's not what I'm saying. I'm saying that the efficiencies since the 1950s have not been shared homogenously. Google executives etc.. are doing just f.cking superbly out of it. Most people, not so much. If you want to grab a bigger share of them you need to invest in ownership of the means of production as well as being a consumer and employee. Tax reform to help you do that (of a kind that didn't involve crapping on the poor) would be very welcome in my view.

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Re: Modern Monetary Theory

Post by plodder » Sat Sep 18, 2021 11:59 am

well yes, of course, but that’s still within the paradigm that the efficiencies will be used to generate ever more plentiful widgets, which is a colossal waste of time and will not give the broader solutions we need to support an ageing demographic and to protect natural resources (for example). What we need to do is chill the f.ck out and rehumanise.

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Re: Modern Monetary Theory

Post by sheldrake » Sat Sep 18, 2021 12:41 pm

It's quite hard to chill out when you're weighed down by debt and dependent on the approval of managers at big corporations for your income. I would like to fix that in a way that doesn't involve funneling everything through public sector committees, as that comes with its own problems. I would rather put the money in people's hands as directly as possible. Having a stake in capitalism, as capitalists in addition to consumers and employees, would be better in my view.

This might mean the same amount of widgets with the profits dispersed more broadly. The other part of it involves unpicking the psychological conditioning that Bernays and his heirs have inflicted on the general public since the turn of the 20th century; I think that's broader in scope than an economic programme.

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Re: Modern Monetary Theory

Post by plodder » Sat Sep 18, 2021 2:27 pm

That’s exactly what “levelling off growth” would mean. This is in my first post on this topic in response to woodchopper. When I asked you on another thread to read what people said (as a practical exercise) I meant it. You have just spend an entire page pompously explaining to me what I said succinctly at the very start.

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Re: Modern Monetary Theory

Post by nezumi » Sat Sep 18, 2021 4:04 pm

Just to return briefly to the unproductive jobs issue, I work in a call centre. This is a hugely unproductive job, what's worse, I work in a sales role that could be easily handled by computer and frankly oughtn't to exist at all. However, at the same time, my actual valuable role isn't my job title - it's the conversations I have outside of that purpose because I'm the last person you speak to before you give up - those are the actual useful work I perform.

Call centres have been outsourced to cheaper labour for years now and although that particular tide has turned, it's difficult to hire the people who should be doing the job as opposed to the people you have actual access to. Wages are artificially depressed by placing call centres in deprived areas so they can only hire the few people with intelligence who haven't already moved to London. This is precisely why when you speak to a call centre, you can get one of three options: 1: cheerful, helpful and knowledgeable. 2: Not aware he works in a call centre or 3: India*. Sadly, I am reliably informed that number 1: can be quite rare.

It is precisely because wages have been depressed for this work that so little has been done to automate. I fear that the pressure to automate along with rising wages within the UK may push these companies to outsource more despite public sentiment. Now, companies that outsource abroad have a choice: whose job do they automate away? There will absolutely be a reduction in overall staffing but all we really have is consumer pressure to protect workers from these consequences.

What I am saying is that employment itself is artificially low** because employers have declined to automate what was already possible to automate where it's been traditionally easier to find cheaper staff. Best case scenario in these particular roles is that we've already taken the employment hit in advance by losing those jobs abroad. If automation plus consumer pressure means we stop importing some services like call centre work we protect our own economy better.

One of the advantages we hold as a country that outsources a lot of grunt work is that automating that work away would actually help us to rebalance our economy and stop pissing away our resources in terms of international trade.

Correct me if I'm wrong, but my fundamental assumption here is that services affect the balance of trade and that the balance of trade is a thing we're supposed to be concerned about despite the fact nobody's brought it up publically for at least 20 years.

Brief. Compared to my thoughts on the matter, definitely brief.

* Not my complaint, I have dealt with hundreds of Indian call centre reps and they've been helpful or useless in the same proportions as British reps. Customers complain. My complaints are simple 1: language barrier and 2: less money for me and 3: Isn't it bad for the economy when we import service work?

** While simultaneously being artificially inflated via zero-hours contracts, underemployment and sundry other massage schemes. Who said economics is complicated :D
Non fui. Fui. Non sum. Non curo.

sheldrake
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Re: Modern Monetary Theory

Post by sheldrake » Sat Sep 18, 2021 4:57 pm

plodder wrote:
Sat Sep 18, 2021 2:27 pm
That’s exactly what “levelling off growth” would mean. This is in my first post on this topic in response to woodchopper. When I asked you on another thread to read what people said (as a practical exercise) I meant it. You have just spend an entire page pompously explaining to me what I said succinctly at the very start.
The first post I see where you reply to woodchopper in this thread doesnt seem to address this at all (I do see a post about people working too much, and carbon). You are either thinking of another thread (I’m not going to read them all), or extremely bad at expressing what you mean. I’m not trying to stop people working or spending or owning stuff, I’m trying to decentralize the control so people dont feel quite so like serfs at the bottom of the labour market.

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Re: Modern Monetary Theory

Post by plodder » Sat Sep 18, 2021 6:29 pm

plodder wrote:
Sat Sep 18, 2021 10:20 am
Woodchopper wrote:
Sat Sep 18, 2021 9:55 am

Hitherto, when machines have been introduced throughout the economy the population has benefitted in aggregate* from the improved productivity. The money gets spread around (eg gets distributed to shareholders as dividends, spent by the newly rich, or paid in tax and then spent by government). Though, as you write, very profitable multinational corporations that pay little or no tax are a problem.

*See the above qualification.
Yes, sure but policy is always to spend the wealth created by the efficiency rather than save the wealth and allow everyone to slack off. This is the big con. We get ever cheaper and fancier widgets rather than more time.

Given the imperative and natural constraints imposed by the need for carbon reduction, solutions to resource exploitation, biodiversity loss etc it is clear that economists need to substantially up their game by finding ways for us to level off growth and halt the relentless march of work. We don’t need to do it and work is exacerbating all sorts of important social problems.

Work is part of the problem, not part of the solution.

sheldrake
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Re: Modern Monetary Theory

Post by sheldrake » Sat Sep 18, 2021 6:32 pm

I see it, its just doesnt seem to ve quite the same thing as far as I can tell. You seem to be talking about curtailing the culture of consumption as your main goal of the wished for new economics.

I think new economics can liberate people from some drudgery and open up their choices, but the craving too consume is a different kind of issue. A spiritual hole economics cant solve alone

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Re: Modern Monetary Theory

Post by plodder » Sat Sep 18, 2021 6:57 pm

I've been clear that it's the pursuit of growth that is the issue. Rebalancing wealth is pointless if it doesn't also consider sustainability of growth. Most of the things we value the most highly are not factored in to the pricing we currently trust to do our organising for us.

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Re: Modern Monetary Theory

Post by sheldrake » Sat Sep 18, 2021 9:21 pm

Yes I agree, I’m just not sure we can rely on prices for all the things we need for a society to be healthy and happy.

I think of economic systems are games designed to incentivise or discourage certain behaviour, but I dont think these games ever produce good behaviour if the people playing them have debased motives. Art, educational things, social rituals etc.. all have to play a part. I think western society has moved into a kind of moral vacuum where a lot of the old patterns for this stuff were deliberately abandoned, and it has effected the inner life of the people. Maybe there was good reason to, but I think we’re still waiting for a better replacement

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Re: Modern Monetary Theory

Post by plodder » Sat Sep 18, 2021 11:51 pm

Then we have a choice. We either attempt to price these intangibles (carbon, happiness, take your pick) or we f.ck off the free market experiment as a failure.

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Re: Modern Monetary Theory

Post by Millennie Al » Sun Sep 19, 2021 1:57 am

plodder wrote:
Sat Sep 18, 2021 10:51 am
To expand on this, it’s possible of course to monetise the value of “social care” just as it is possible to monetise the value of picking the kids up from school, spending quality time with family, enjoying an afternoon nap and learning something to degree-level purely for pleasure (perhaps English Literature or History). But no one does monetise these things and put them on the “lost opportunity” side of the scales. This isn’t a technical problem, it’s a cultural one. We are browbeating ourselves and chasing further efficiency without expanding the horizons of the debate will not provide solutions.
It's also partly a tax problem. If you do something yourself, that's a cost to you. If you prefer to pay someone else to do it, they (and possibly you) pay tax on that, so to get someone else to do something you have to pay more than if you did it yourself.

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Re: Modern Monetary Theory

Post by sheldrake » Sun Sep 19, 2021 7:13 am

plodder wrote:
Sat Sep 18, 2021 11:51 pm
Then we have a choice. We either attempt to price these intangibles (carbon, happiness, take your pick) or we f.ck off the free market experiment as a failure.
Couldnt it just be that the free market was okay, but not enough? Perhaps not everything should be treated as an economic problem.

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Re: Modern Monetary Theory

Post by Woodchopper » Sun Sep 19, 2021 8:34 am

Millennie Al wrote:
Sun Sep 19, 2021 1:57 am
plodder wrote:
Sat Sep 18, 2021 10:51 am
To expand on this, it’s possible of course to monetise the value of “social care” just as it is possible to monetise the value of picking the kids up from school, spending quality time with family, enjoying an afternoon nap and learning something to degree-level purely for pleasure (perhaps English Literature or History). But no one does monetise these things and put them on the “lost opportunity” side of the scales. This isn’t a technical problem, it’s a cultural one. We are browbeating ourselves and chasing further efficiency without expanding the horizons of the debate will not provide solutions.
It's also partly a tax problem. If you do something yourself, that's a cost to you. If you prefer to pay someone else to do it, they (and possibly you) pay tax on that, so to get someone else to do something you have to pay more than if you did it yourself.
Only if the other person is as efficient then you are. If they are much more efficient then its still a better use of time or money even after paying tax.

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Re: Modern Monetary Theory

Post by plodder » Sun Sep 19, 2021 8:54 am

sheldrake wrote:
Sun Sep 19, 2021 7:13 am
plodder wrote:
Sat Sep 18, 2021 11:51 pm
Then we have a choice. We either attempt to price these intangibles (carbon, happiness, take your pick) or we f.ck off the free market experiment as a failure.
Couldnt it just be that the free market was okay, but not enough? Perhaps not everything should be treated as an economic problem.
OMG YOU JUST INVENTED CENTRIST POLITICS

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Re: Modern Monetary Theory

Post by sheldrake » Sun Sep 19, 2021 10:19 am

plodder wrote:
Sun Sep 19, 2021 8:54 am
sheldrake wrote:
Sun Sep 19, 2021 7:13 am
plodder wrote:
Sat Sep 18, 2021 11:51 pm
Then we have a choice. We either attempt to price these intangibles (carbon, happiness, take your pick) or we f.ck off the free market experiment as a failure.
Couldnt it just be that the free market was okay, but not enough? Perhaps not everything should be treated as an economic problem.
OMG YOU JUST INVENTED CENTRIST POLITICS
Not necessarily. Perhaps a society with a very free market but within a culture where people were just kinder and less hungry for pointless tat ? There are a lot of alternatives I think

Point is that hunger for and endless supply of pointless crud might not best be solved by making the crud more expensive (price interventions are blunt instruments that can easily accidentally make food or winter heatinf more expensive for the poor, for example). Perhaps the solution lies in the culture and individual ideas of right and wrong?

Perhaps out of control consumerism is more like an addiction than a pricing problem?

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