Hi Chris. In this podcast you again (rightly) laid into Boris Johnson and how he literally has no ideology and follows policies which would possibly benefit him by keeping him in power. But having listened to many of your podcasts with Jim and also your contributions to Eamon Dunphy's podcast, I do often wonder why you don't lay into the UK political opposition to Johnson more often also. After all if people are to not vote for Johnson, then the opposition should be held up to scrutiny, and when people don't vote for the alternative surely they should get a roasting too in order to try to make them get their act together as an alternative to Johnson.
Additionally, you said that the Conservatives and conservative media is trying to create an us and them narrative at the moment and yes I think that is ongoing. But hasn’t that nearly always been the way? Hasn’t it always been that the Conservatives were toffs and an elite who were trying to control (wouldn’t that be an us and them). In the noughties, The Conservatives were “The Nasty Party” who were all Oxbridge educated elites. Yes the narrative tables have been turned now, but having watched politics for decades, it is renowned as a deep down and dirty activity – publicity and narrative wise, and as you correctly said – there is now an attempt to hoist the elite badge upon the Labour Party in England – but hasn’t the attempt to badge or slander political parties always been there?
given all the debates that are cranking up now about how (or if!) we should “pay” for the cost of the pandemic, and what we see the US/EU/IMF doing and saying about using stimulus to “build back better”, could you maybe do an episode critiquing MMT and whether our DoF in Ireland is captive to a wrongheaded “tax and spend” orthodoxy that treats the economy like a big household?
My understanding of MMT is that it is actually tries to remind us that the government budget constraint is different from that facing a household. Govt can tax, borrow or print the money it spends. Households do not have the money printing option. MMT is, to my knowledge, never written down as a formal model in the way that most other economic theories are specified. So it's hard to approve or critique a theory that is mathematically imprecise and verbally vague (as I see it). Perhaps this is simplistic, but MMT advocates say 'spend until inflation arrives'. Where spending is sometimes financed by borrowing, sometimes by the printing press, sometimes by both. As I said, it's vague.
Whether or not they formally believe in MMT, the Fed seems to be following MMT's policy prescriptions - inflation has arrived and they are bringing forward their expectations of monetary tightening (via interest rate rises).
Inflation has arrived, to the US if not elsewhere. Nobody knows where the peak is, or how long it will last. The debate is over whether that peak and/or duration will be a 'problem' that leads to a rise in interest rates that threatens growth or even causes a recession. Like the early 1980s.
The economic policy experiment being conducted in the US has a strong political element running through its core - something that has not attracted enough attention. Namely, that this is the last chance to head off Trumpism, to stem the populist wave.
If economic growth doesn't lift enough boats, doesn't do something about inequality, doesn't solve the income and wealth distribution problems facing the US, the political consequences are obvious: the return of Trump, or somebody even worse. It's a big call. Biden is contributing to this experiment with his clear determination to spend as much as he can, to boost the economy as much as he can.
Europe is not participating in this experiment. There will, in my view be a return to monetary and fiscal orthodoxy at the earliest opportunity. the UK is in the vanguard of this, led by long-standing Treasury orthodoxy. Keynes railed against this but it has lived a lot longer than he did.
So, a great policy contrast. The results will be visible soon but it will take a few years before we can fully assess. Whatever the outcome, great change will result. Not least either the end of populism or its onward march.
Hi Chris. In this podcast you again (rightly) laid into Boris Johnson and how he literally has no ideology and follows policies which would possibly benefit him by keeping him in power. But having listened to many of your podcasts with Jim and also your contributions to Eamon Dunphy's podcast, I do often wonder why you don't lay into the UK political opposition to Johnson more often also. After all if people are to not vote for Johnson, then the opposition should be held up to scrutiny, and when people don't vote for the alternative surely they should get a roasting too in order to try to make them get their act together as an alternative to Johnson.
Additionally, you said that the Conservatives and conservative media is trying to create an us and them narrative at the moment and yes I think that is ongoing. But hasn’t that nearly always been the way? Hasn’t it always been that the Conservatives were toffs and an elite who were trying to control (wouldn’t that be an us and them). In the noughties, The Conservatives were “The Nasty Party” who were all Oxbridge educated elites. Yes the narrative tables have been turned now, but having watched politics for decades, it is renowned as a deep down and dirty activity – publicity and narrative wise, and as you correctly said – there is now an attempt to hoist the elite badge upon the Labour Party in England – but hasn’t the attempt to badge or slander political parties always been there?
given all the debates that are cranking up now about how (or if!) we should “pay” for the cost of the pandemic, and what we see the US/EU/IMF doing and saying about using stimulus to “build back better”, could you maybe do an episode critiquing MMT and whether our DoF in Ireland is captive to a wrongheaded “tax and spend” orthodoxy that treats the economy like a big household?
My understanding of MMT is that it is actually tries to remind us that the government budget constraint is different from that facing a household. Govt can tax, borrow or print the money it spends. Households do not have the money printing option. MMT is, to my knowledge, never written down as a formal model in the way that most other economic theories are specified. So it's hard to approve or critique a theory that is mathematically imprecise and verbally vague (as I see it). Perhaps this is simplistic, but MMT advocates say 'spend until inflation arrives'. Where spending is sometimes financed by borrowing, sometimes by the printing press, sometimes by both. As I said, it's vague.
Whether or not they formally believe in MMT, the Fed seems to be following MMT's policy prescriptions - inflation has arrived and they are bringing forward their expectations of monetary tightening (via interest rate rises).
Inflation has arrived, to the US if not elsewhere. Nobody knows where the peak is, or how long it will last. The debate is over whether that peak and/or duration will be a 'problem' that leads to a rise in interest rates that threatens growth or even causes a recession. Like the early 1980s.
The economic policy experiment being conducted in the US has a strong political element running through its core - something that has not attracted enough attention. Namely, that this is the last chance to head off Trumpism, to stem the populist wave.
If economic growth doesn't lift enough boats, doesn't do something about inequality, doesn't solve the income and wealth distribution problems facing the US, the political consequences are obvious: the return of Trump, or somebody even worse. It's a big call. Biden is contributing to this experiment with his clear determination to spend as much as he can, to boost the economy as much as he can.
Europe is not participating in this experiment. There will, in my view be a return to monetary and fiscal orthodoxy at the earliest opportunity. the UK is in the vanguard of this, led by long-standing Treasury orthodoxy. Keynes railed against this but it has lived a lot longer than he did.
So, a great policy contrast. The results will be visible soon but it will take a few years before we can fully assess. Whatever the outcome, great change will result. Not least either the end of populism or its onward march.