Thursday, July 18, 2019

The Truly Entitled

We hear a lot about MMT lately, and I will assume that readers understand the concept well enough that it doesn't need to be explained in detail here. But there are certain worrisome ideas about MMT that are being propagandized into the broader mainstream consciousness. One such idea is that it is a political tool of left leaning Socialist progressives. The other is that it's purely theoretical and never yet been "unleashed" - only talked about in heated debates between left and right wing political factions.

Neither of these ideas could be further from the truth.

But first ... let's acknowledge the core concept of these three words: "Modern Monetary Theory". It can be summed up with another three words: "Debt Doesn't Matter". Yes, my friends, you can read volumes about MMT and in the end, what is distilled from all the academic argument and theory involved is that debt doesn't matter (in terms of currency hyperinflation). And the lesson of 2008 lends credence to this view.

Now, the way in which MMT is demonized by the conservative right is to claim that our US political system has been infiltrated by un-American Marxist welfare state-ists who want to rob the middle class's hard earned dollars and give them away to illegal immigrants who will watch free Netflix in their underwear all day, then screw all night to make babies for more free meal tickets. Hold that thought for now, because this idea does bother some people - just not the ones (or for the reasons) you may think.

But the trick here is that our progressive welfare state doesn't actually take the middle class's earned money and hand it over as entitlements. It just prints up all this free money, making the earned money worthless. Most everyone gets this narrative - it's played to death. But again, the lesson of 2008 keeps chipping away at this notion of "making the middle class's earned money worthless" - because here we are 11 years later and it "kinda hasn't". It just pisses earners off to see the same money they earn given away (if only they realized who it's really given to, and how much).

Hopefully, we can begin to understand the truth of these matters. MMT has been in practice for decades (long before 2008). But ... it's not the little people who are the recipients of this free money. It's the generational wealth dynasties and preferred shareholders of the systemic banks who are the benefactors. Listen to Jim Rickards from about the 16:00 mark below:

Yes, the FED could issue 4 trillion in unsterilized dollars to bail out the derivative banking system without creating hyperinflation, so why not issue another 4 trillion to accomplish the Green New Deal? Why not? Because it is the confidence of the ruling class that matters, not the confidence of the little people.

You see, this system in which the ruling class is on "systemic welfare" and the working class is left with dollars that are "harder to earn and keep" ... this is the system which the ruling class supports. Change MMT to place the needy on welfare and leave the rich to create nothing less than real, socially responsible, material wealth (instead of fraud - backed by bailouts) and the system will be sacrificed in another Great Depression. The rich can endure the transition to a new system which again places them on welfare (at the expense of working classes).

The families illustrated this stalemate to the world in 2008. Does no one remember this? The system was to be sacrificed if the debts of ruling class systemic banks were not salvaged. And it was not 4 trillion, it was 23 trillion on the books (and more off).

This my friends is MMT. It is no theory, and again, it has been in practice for decades. And it is never used for the purpose of shoring up income equality, it is used EXCLUSIVELY to increase income INEQUALITY. So in effect, MMT will NEVER be anything more than a theory for its "left leaning Socialist progressive" proponents. Rather, it is a practical tool for the ruling classes to increase wealth and power at the expense of the working class tax base.

As such, MMT and Corporatism go hand in hand, as they have for generations in one form or another. And hopefully, with this better appreciation of MMT, the little people can truly understand who is entitled, and what it means to be.


  1. Well, on one hand - buy hard assets is the no brainer option, on the other, some hard assets i.e. land, real estate or even business can be taxed to death. Gold? Well, Sir, I have no gold, not since unfortunate boat accident.

    1. Currencies are also taxed to death, through inflation. But only for the little people. The banking class can outrun inflation because it's debts are too big to fail.

      Therefore, their money is free.

      Another word for this?

  2. I'm surprised some of that free money insn't invested in some wealth-producing infrastructure to keep the masses placated. Especially the middle-class with their potentially dangerous amount of leisure time and consequent education. To get this close to a shortage of bread and circuses, the people in power must have a high confidence in their hedges, or there must not be anyone truly in power.

    1. The people in power have high confidence that their "bail us out or civilization collapses into the stone age" hedge will work. It did in 2008 and will likely continue working until the system collapses regardless through lack of foreign support.

  3. Hmm, but as society becomes more informed, their hedge loses credence.

    Anon, I think your hunch is correct. Policy is not entirely disseminated top-down, there are indeed competing forces at play and no one actor or class truly rules over all. At least that is my opinion, and I think it somewhat goes that of this blog's (as much I like it).

    I suggest you check out David Ronfeldt's Tribes, Institutions, Markets, Networks framework to give you an idea how power is restructuring.

    1. Human nature rules over all. Perhaps overstating the obvious, and not a social class. But the ruling classes do represent competing forces which simply exploit human nature, while also being subject to it. Is there intelligent design behind the old adage of "the rich get richer and the poor get poorer"? That adage seems to be progressing quite well according to Piketty (and others). Coincidence or design?
      As power increases, the distinction between the two becomes blurred.

      Few among us see the continuation of modern society as being held against the classes (middle, becoming increasingly strained) as a form of organized extortion. Yet it is the collapse of our money system that was at risk in 2008. One needs only to recall the protracted lunacy of Hank Paulson.

      Today, this "collapse" of the Western dominated international monetary and financial system resembles more of a central bank controlled demolition, as foreign support for dollarism is gradually withdrawn.

      Generational wealth pivots accordingly. Again, more sideways than top down, though positions do change as the dominos fall.

  4. Anybody catch Scurci's latest on Goldseek? Sounded very FOFOAish.

  5. Thank you for the interesting perspective on MMT. I have understood that we have socialism for the elites, and austerity for everyone else, but your take on this was enlighting.

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