On Apr 22, 2011, at 9:33 AM, Max Sawicky wrote: > Re: the SS 1%, the thing people miss is that it never jumps on you all at > once. > It builds up imperceptibly over the next 30 years. > > http://www.socialsecurity.gov/OACT/TR/2010/VI_OASDHI_GDP.html#159076 > > (Table VI.F4) > > So the adjustment for any year to year period is much less than a percent of > GDP.
Yes, I know this stuff very well - been writing about it for 15 years. But you see the circus in Washington now. Could you imagine what a fight over something like the equivalent of $140 billion a year would look like? > As for MMT, I understand it as boiling down to the point that a sovereign > nation cannot default on debts in its own currency, so the issue is really > the inflationary threat from monetizing the debt and the Fed's ability to > deal with it when and to the extent appropriate. What's modern or even theoretical about that? Marx wrote in the Grundrisse: "The notes with which it [the central bank] discounts the bills of exchange of this public are at present nothing more than drafts on gold and silver. In our hypothetical case, they would be drafts on the nation's stock of products and on its directly employable labour force: the former is limited, the latter can be increased only within very positive limits and in certain amounts of time. The printing press, on the other hand, is inexhaustible and works like a stroke of magic." Money is valuable because it's a claim on goods and services (including labor). If you print money in excess of that, then you've got a problem. MMT seems to be an effort to evade those constraints - that for a gov to spend money it has to take it from someone or it's just playing inflationary games. I don't get how the Fed could print money to pay off Treasury paper and then "deal with" the inflationary consequences - wouldn't that be undoing what it had just done? Doug _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
