Patricia Profile picture
Jul 23, 2018 13 tweets 3 min read Twitter logo Read on Twitter
I hear a few ppl say that #MMT applies only to the USA & not the U.K. I don’t know where this comes from, but they’ve made up so much stuff about MMT that I’m not surprised about this. so lets clarify some things:

1) MMT applies to all nations that have a fiat currency & r monetarily sovereign.

2) the UK has a Fiat currency. So does the US, Australia, Japan, and many others. This means their currencies r not pegged to gold or any other currency or commodity.

3) these countries are also monetarily sovereign. That means that their national govts are the monopoly issuer of the currency.

4) in all these nations, commercial banks also create money through credit. But this is not the same as “currency”, which is a net asset to us.

5) in a nutshell, #MMT says that govt, as the sole issuer of the currency, can buy anything that is for sale in its own currency, and can always fulfil its liabilities denominated in that currency (Never goes bankrupt).

6) Thus the limit of Govt spending is not dictated by the availability of currency (which is infinite) but by the availability goods and labour for sale in said currency (inflation).

7) this means there’s no need to “balance the budget” ever.

8)in monetarily sovereign nations, central banks have often been given some independence w regards to some monetary policy, but they cannot say “NO” to parliament when it comes to fiscal policy. When govt buys something the BOE has to credit the accounts >
of those ppl it is buying it from, Be it labour/goods/services.

9) the Eurozone as a whole is monetarily sovereign. BUT each member state within it is not. However, member states are made responsible for fiscal policy within their nations. This doesn’t work well
& is the source of many of the troubles of the EZ.

10) MMT is simply description of how these currencies work. MMTers tend to support certain policies, like a job guarantee, But these are part of a separate prescriptive aspect of MMT. >
11) Since I’ve been campaigning on raising awareness on MMT I’ve met MMT economists from The US, UK and Australia. And come across many counter arguments:

Some are :
- that MMTers want to print money and turn countries into Zimbabwe.
- that MMT only works in closed economies.
- that central banks are private entities not under control of govt (not true).
- that it’s better that people don’t know the reality of money, so that they don’t ask the govt to spend too much.
- that investors wouldn’t like it.

All these issues have been debunked over and over again in many papers.

12) ultimately MMT makes orthodox economists nervous bc it trashes much of their work of the last 4 decades.

13) MMT makes right wingers nervous bc it gives hope to many who were until now told that “there is no alternative”

to the current economic order & that “balancing the budget” comes before the needs of the nation.

14) Despite this, #MMT isn’t inherently LW or RW. But if ppl knew MMT, RW politicians would no longer be able to hide their ideology behind the lie that money is scarce. It’s not.

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More from @PatriciaNPino

Aug 21, 2018
Greece was never bailed out. They bailed out German & French banks, who held Greek debt. This stabilized Germany & Frances economies post crisis, while the Greek ppl were punished w severe cuts and forced to run a fiscal surplus. They never saw the money.
The bailout allowed Germany & French Govts 2 keep political face in their countries (They had lost control of banks lending in the run up to the crisis), While presenting Greece as lazy & irresponsible.

They also promoted the narrative that they were “saving” Greece.
The Greek were forced to accept the terms of the bailout with threats of closure of banks, immediate cut of subsidies,etc. When ElectedGovts didn’t comply, They replaced them.

Hundreds/thousands have died & Greece’s public assets have been pillaged by profit hungry corporations
Read 4 tweets
Aug 7, 2018
Today’s Economic tips:

“The Market” does not set yields on Govt “debt”. Govt does.

Govt issues “debt” & offers whatever interest rate it wants to pay for it.

The purpose of issuing “debt” is not to fund Govt spending. Is to offer savings accounts to the private sector.

“Debt” (bonds) don’t have to be issued every time we run a deficit. Govt can choose not to.

There is no reason why issuing bonds corresponding to a deficit would be more or less inflationary than not doing so.

Can we now stop being scared of the “Govt Debt” bogeyman?
Interest on Govt bonds is not paid for with taxes. It’s paid for with newly created money & constitute a relatively ‘small’ additional income to the private sector (Think pensioners investing in bonds).
Read 4 tweets
Jul 30, 2018
The European Union was never about left wing cooperation.
It really bothers me how disingenuous ppl seem to be about the contents of the Maastricht agreement which founded the EU as we know it today. It was a full-fat neoliberal treaty designed to embed austerity in Europe.
Read 9 tweets
Jul 28, 2018
“I expect crocodile tears to be shed in Brussels over our fire victims, and similarly hypocritical posturing by the Greek government. But I do not expect any reversal of the organized misanthropy afflicting Greece just because nearly 100 people died in a single day.”
This is not the first horror story related to the brutal cuts imposed by the Troyka, which created a recession in Greece comparable to that if the Great Depression.

Anyone in my TL would do well to read Yanis book “Adults in the room” to understand the true extent of what the EU is capable of.

And then you might understand why some of us suspect foul play on the side of the EU in Brexit negotiations.
Read 4 tweets
Jul 26, 2018
A note on why I support leave:

When I signed up to the Labour movement, I signed up to fight Austerity.

Why? Because I consider it to be a fundamental aspect of that destructive ideology called “neoliberalism”, >
Which is behind the social injustices, the destruction of the environment & the erosion of democracy that has brought much the western world to the edge of global demise.

But I wrongly assumed those beside me where interested in the wider battle. >
And would not make exceptions for the EU.

Austerity, neoliberalism is bad anywhere. We cannot as a nation prop up entities who support it.

& if that entity imposes it undemocratically upon nations & regardless of what the ppl might want, then that entity has to b dismantled.>
Read 5 tweets

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