Mike Norman!
Posted by WARREN MOSLER on June 6th, 2011
This entry was posted on Monday, June 6th, 2011 at 9:15 am and is filed under Currencies, Deficit, Government Spending, Inflation, Japan. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
June 6th, 2011 at 11:50 am
That was brilliant. Mike Norman is clearly a very strong speaker. He would be an excellent candidate to promote the MMT story. But it is sad that even Mike could not seem to convince the lady interviewer.
Too bad. She was cute.
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June 6th, 2011 at 11:52 am
FREAKING AWESOME!!!!
Mike Norman is THE MAN!!!!
Keep it up Mike and I’m so glad the networks put you on…it’s truly a great service to our country.
It really is INCREDIBLE that people don’t immediately hop on board this LOGIC when it’s presented to them…maybe people have become so mistrustful of anything good that they just attempt to destroy it immediately…even with false and faulty logic. Who the heck knows…
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June 6th, 2011 at 10:22 pm
If only he could balance it out with the option of lowering taxes instead of raising spending. The best way to get the MMT msg across is to leave the subjective parts (subjective to MMT) as a choice to the viewer.
There’s still room for all of the political debate, just try to get them to debate the right thing.
For me, I’d like to see gov spending as a percentage of GDP a little lower. I suspect that’s a relevant value that has some importance on the real productivity of a society. So that puts me on the lower taxes side. But when trying to convince people that “deficits per-se don’t matter”, I try to point out that all MMT is saying is that taxes are currently too high for the size of gov we are running (Warren’s phrase). But it makes no argument as to whether we should lower taxes or raise spending.
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Tom Hickey Reply:
June 6th, 2011 at 10:40 pm
@djp,
The no brainer for lowering spending is reducing military spending. The US is still geared up post-WWII for the Cold War and the Soviet Unon no longer exists, and both Russia and China have joined the world economy. The only reason that military spemding remains so high is because of the political power of the military-industrial-congressional complex.
Ike may have originally added “congressional,” but was persuaded to delete it. “” Geoffrey Perret, in his biography of Eisenhower, claims that a draft of the speech the phrase was “military-industrial-congressional complex”, indicating the essential role that the United States Congress plays in the propagation of the military industry, but that the third term was dropped from the final version to placate politicians.” This is disputed, however.source
Regardless, it is now clearly true, since the military-industrial complex is spread out over many congressional districts, making cuts very difficult politically.
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roger erickson Reply:
June 6th, 2011 at 11:32 pm
@Tom Hickey,
Yes, but the military-industrial complex has become an obvious national security liability.
Since rational strategy always trumps any amount of tactics, excessive focus on tactical weaponry is ultimately a distraction from the primary goal – contingency management. Weapons spending lobbies eventually crowd out operational coherence and strategy training.
The result is policy-capture by tacticians blind to context. That always = disaster waiting to happen, and large amounts of the DoD officer corp are beginning to vote with their feet on this issue.
see http://fabiusmaximus.wordpress.com/
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beowulf Reply:
June 7th, 2011 at 1:54 am
@Tom Hickey,
There is this bizarre yet widespread ideological blind spot that govt spending is always ineffective, unproductive and ill-advised… unless its military spending. Economists from Truman’s CEA chair Leon Keyserling to Reagan’s CEA chair Marty Feldstein have recognized that the only kind of Keynesian spending conservatives (Southern conservatives in particular) will go for is military Keynesianism. Eisenhower probably had the best idea, tie everything you can to “National Defense”. Congress wouldn’t fund Roosevelt’s 1944 “interregional highway” proposal (apparently because they saw the dark hand of the villain of the Grasshopper Lies Heavy behind it).
http://en.wikipedia.org/wiki/The_Man_in_the_High_Castle#Story-within-the-story
Mr. Gavin. What I am trying to get at: When did the interregional business take place? I understand that at one time [Rex] Tugwell had some idea in this interregional business. How was he hooked up with it?
Mr. Nat Patton (D-Tx.). He is hooked up with it now. That is what is wrong with it.
http://www.fhwa.dot.gov/infrastructure/naming.cfm
Freakin’ Rexford Tugwell, anyway President Eisenhower got Congress on board by calling it the “National Defense Highway System”. He got Congress to appropriate federal funding for university and K-12 education by calling his school bill, the “National Defense Education Act”. For what its worth, Eisenhower was probably correct too in his call (which Congress ignored) for universal military training– basically, inducting every able-bodied 18 year old male for Army Reserve training. Congress would be a little more selective about the wars they funded if it meant draftees had to fight them.
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Ed Rombach Reply:
June 7th, 2011 at 9:09 am
@beowulf,
QE-2 may be coming to an end this month, but I think there should be 3rd and fourth generation QE operations. Moreover, I think the program and perhaps the entire Fed should be moved over to the Pentagon and Department of Defense because it has proven to be such a powerful weapon.
As QE-2 kicked into gear commodity prices surged, especially for sensitive commodities like wheat and corn which had a huge impact on household budgets in North Africa and the Middle East.
Sharply rising food prices was the initial catalyst that triggered the protests and Jasmine revolutions in that region that toppled President Zine El Abidine Ben Ali of Tunisia, Mubarak in Egypt, has Gaddafi in Libya hunkered down in a bunker, President Ali Abdullah Saleh now gone from Yemen and in rehab, the al Khalifa kingdom in Bahrain struggling for purchase and Syrian President Bashar al-Assad nearing a tipping point.
All of this with the conventional US military barely firing a shot! Aside for Libya that is. OK, but all seriousness aside, I’m telling you that the Fed is a veritable Vunder Veapon!!!
The U.S. government could save hundreds of billions of dollars a year not to mention the lives of our fighting men and women by cutting back on conventional military spending and just let the Fed lead the charge.
Just think of it……. helicopter Ben commanding a squadron of Apache attack helicopters with QE3 hell fire missiles!
beowulf Reply:
June 7th, 2011 at 10:20 am
@beowulf,
I’m right with you Ed. Presidents Clinton and Bush II both addressed the California energy market fiasco a decade ago by exercising their broad powers under the Defense Production Act. Basically, if the President determines any economic activity is critical to national defense (Eisenhower-style!), the DPA allows him to unilaterally step into any market to block purchases by (whom he deems to be) hoarders and to buy and sell any commodity or material, with Uncle Sam’s unsolicited bid taking priority over any other contract (Title I). He can also make or guarantee loans, on whatever terms he chooses, to private parties.(DPA starts sect. 2061).
http://www.law.cornell.edu/uscode/html/uscode50a/usc_sup_05_50_10_sq5_20_sq1.html
I’ve commented here before that Hank Paulson could have used the DPA to fund the TARP bailout without needing Congress to vote on it. But there was one wrinkle that stood in Paulson’s way. The DPA is a blank check but must be reauthorized by Congress every few years. Alas, the day Lehman went toes up (Sept. 15 2008) was two weeks before the DPA’s 2003 re-authorization was to expire (Congress renewed it by the end of that month, but wouldn’t have if Bush and Paulson had used it bail out Wall Street).
Of course, Paulson and Geithner (still at NY Fed) wanted to avoid going to Congress by having the Fed governors step in earlier and harder with its FRA 13(3) extraordinary lending powers. Bernanke demurred, wishing Congress to jump off the bridge with him. That would have been the perfect time for the President and the Secretary to stomp on the Fed’s independent (of the Constitution) status once and for all. Paulson could have ordered the Fed to jump and then, by the terms of the FRA itself, pushed them off the bridge.
6. …wherever any power vested by this Act in the Board of Governors of the Federal Reserve System or the Federal reserve agent appears to conflict with the powers of the Secretary of the Treasury, such powers shall be exercised subject to the supervision and control of the Secretary.
http://www.federalreserve.gov/aboutthefed/section%2010.htm
beowulf Reply:
June 7th, 2011 at 10:55 am
To address your actual point Ed, the turmoil in the Middle East is due in no small part to Wikileaks (“WikiLeaks Hailed by Amnesty International as Arab Spring ‘Catalyst’”).
http://readersupportednews.org/news-section2/367-wikileaks/5929-wikileaks-hailed-by-amnesty-international-as-arab-spring-catalyst
Curious that the leaks advanced US goals even while Pentagon and the State Department were left with egg on their face. More curious still, there doesn’t appear to be any Wikileaks of documents classified “top secret” or any purloined from a certain govt agency that takes great joy in making the DoD and State look kind of dumb. Whether witting or not, I suspect Julian Assange has been doing the bidding of that govt office campus that sits next to Pat Buchanan’s house in McLean, Virginia. :o)
http://virtualglobetrotting.com/map/pat-buchanans-house/view/?service=2
kkken530 Reply:
June 9th, 2011 at 5:49 pm
@beowulf, Would they ?? It didn’t seem to stop them in Korea,or Viet Nam..
beowulf Reply:
June 9th, 2011 at 10:45 pm
@beowulf,
The draft was all but defunct when the Korean war started, less than 10,000 men were drafted in 1949. I don’t think its a coincidence that the more men the draft boards inducted, the lower Truman’ popularity fell (IIRC, 500,000 were drafted in 1952). Likewise the 1969 draft reforms (moving to birthday lottery and stripping out deferments) made Selective Service more equitable and the Vietnam war less popular. If we still had a draft lottery or universal military training, there’s no way we’d still be in Afghanistan 10 years later.
Ramanan Reply:
June 10th, 2011 at 1:12 am
@beowulf,
Have you seen this http://www.levyinstitute.org/news/?event=36 ? I went there :)
ESM Reply:
June 10th, 2011 at 10:13 am
@beowulf,
“For what its worth, Eisenhower was probably correct too in his call (which Congress ignored) for universal military training– basically, inducting every able-bodied 18 year old male for Army Reserve training.”
Horrible idea. Aside from the fact that the draft is essentially slavery, it is completely uneconomic. Ever heard of specialization? Allowing people to decide for themselves what’s best for them, based on their skills, goals, and opportunity cost?
And in modern times, a volunteer army is even more important. You need highly trained, highly motivated, experienced professionals to properly use the advanced techniques and weaponry of warfare. Not just cannon fodder like during the civil war (and even then it was of debatable efficacy).
“Congress would be a little more selective about the wars they funded if it meant draftees had to fight them.”
And you think that’s a good thing? I would hope that Congress takes into account the moral, economic, and strategic factors involved in declaring or funding a war, but I wouldn’t want them to base their decisions on the fact that some powerful, connected person is personally at risk, or that Cindy Sheehan has decided to harrass them. I would want them to be more objective and decide whether a particular war is a job that needs doing.
This idea of “shared sacrifice” when it comes to war is so naive. Is their shared sacrifice with firemen in fighting fires or policemen in catching criminals, or nurses in treating infectious diseases or cleaning bed pans in hospitals?
Tom Hickey Reply:
June 10th, 2011 at 11:56 am
@beowulf,
I am extremely uncomfortable with a professional military, not so much because a conscript force would make war far more unpopular, which it would, but because I see it as a threat to democracy, similar to an internal national security force — which the US is also putting in placefor the first time in history.
The next step in the name of greater efficiency is privatization, and the US are already embarking on this path. Professional militaries, and especially mercenary forces, don’t have a good record wrt to democracy.
Moreover, it is not the case that there is no profesional contingent at the heart of the military when conscription is used. There is always a professional core that conscription supplements.
I also think that national service should be a civic requirement, either in the military or some alternative like the National Guard, Peace Corps or AmeriCorps. Discipline is something that is inculcated, and traditionally national service has been the preferred path. It works to make people better citizens and improves future performance in life.
So I see the benefits outweighing the cost, even though I realize it would be highly unpopular with youth, who would see it as a waste of productive years. I don’t believe that this is true based on my own military experience.
selise Reply:
June 11th, 2011 at 8:12 am
@beowulf,
a conscript military, except in times of mass mobilization no longer prevents a professional military. the privatized military you mentioned is a growing professional military that does not serve, does not report through military ranks and to worse, is not bound by the UCMJ.
i suppose the combination of technology (see drones) and an out-of-control military budget have made it possible. but how the heck would conscription stop that? (for example what blackwater did during the nola disaster)
p.s. to tom: if national service — aka slavery — is instituted in this country, you’re going to loose a hell of a lot of social justice activists to fighting that one.
and where the heck is the evidence that the discipline of the military makes people better citizens or improves future performance (whatever that is) in life?
i’m glad you thought your military experience was a good one – for you. but to say it would be a universally good experience is, imo, to ignore that not everyone experiences life the way you do. and speaking for myself, if forced to choose, i’d choose jail.
Tom Hickey Reply:
June 11th, 2011 at 11:09 am
@beowulf,
selise, did you notice that I provided alternative service options. But I stand by my recommendation for conscription along with those other options for public service for those who are not inclined toward the military.
beowulf Reply:
June 11th, 2011 at 11:12 am
@beowulf,
This idea of “shared sacrifice” when it comes to war is so naive. Is their shared sacrifice with firemen in fighting fires or policemen in catching criminals, or nurses in treating infectious diseases or cleaning bed pans in hospitals?
Yes, yes and yes! Though in the last case, I suppose you have a point, better that Medicare pay for medical care than to wait for volunteers to step in.
Since the hue and cry of the parish constable,1 law enforcement agencies have employed civilian volunteers to assist them… In many instances, with insufficient funding for additional positions, police departments have sought alternatives, one being the employment of reserve officers. An estimated 400,000 or more currently serve in the United States.
http://www.reservecop.com/news/general-news/57-reserve-officers-a-valuable-resource?showall=1
There is no greater, longer-running expression of volunteerism in U.S. history than the volunteer fire service… Almost three-fourths of the nation’s 1.1. million firefighters are volunteers, and two-thirds of all fire departments are volunteer.
http://www.usatoday.com/news/nation/2005-11-06-volunteer-firefighters_x.htm
Mi>Services provided by Remote Area Medical® volunteers are intended for the uninsured, underinsured, unemployed, underemployed, and those who cannot afford to pay. Services are provided by volunteer doctors, nurses… and other trained health professionals.
http://www.ramusa.org/expeditions/2011/chicago2011.html
beowulf Reply:
June 11th, 2011 at 11:33 am
Selise,
That’s exactly the reaction that many many draftees (and their families) would have- countervailing powers! A war that’s not worth drafting for is not worth fighting for. A draft is far better way to fight wars than to hire mercenaries to do it. Like Machiavelli said:
Mercenaries… are useless and dangerous; and if one holds his state based on these arms, he will stand neither firm nor safe; for they are disunited, ambitious and without discipline, unfaithful, valiant before friends, cowardly before enemies; they have neither the fear of God nor fidelity to men… when arms have to be resorted to, either by a prince or a republic, then the prince ought to go in person and perform the duty of captain; the republic has to send its citizens…
http://www.constitution.org/mac/prince12.htm
Peter D Reply:
June 15th, 2011 at 5:41 pm
@beowulf, Tom and others,
If the idea of the draft is to reduce wars by making sure more people, including the politicians, have skin in the game, then I am afraid the evidence is against it. Here is from an article on WWI in the latest NY Review of Books (not free online at http://www.nybooks.com/articles/archives/2011/jun/23/hello-to-all-that/?page=2)
Other rationales could have more luck. Having served in the military myself, I am sympathetic to some extent to Tom’s argument, but I could be biased.
Tom Hickey Reply:
June 15th, 2011 at 6:59 pm
@beowulf,
Peter D, I don’t think that a draft is necessary to prevent wars. I do think that a citizen army that not entirely professional is a precaution against tyranny in light of history. It is also a civic good for a citizenry to understand war and to have the necessary discipline to engage in one, should it become necessary.
WARREN MOSLER Reply:
June 15th, 2011 at 8:37 pm
it also helps to be at full employment
selise Reply:
June 16th, 2011 at 8:16 am
beowulf,
“That’s exactly the reaction that many many draftees (and their families) would have- countervailing powers! A war that’s not worth drafting for is not worth fighting for.
in my book, a war that’s not worth killing innocents for is not worth fighting for. i fail to see how conscription is a better protection against unnecessary war than full employment and a volunteer military.
neither, however, deals with the very real issue of a privatized professional army not bound by the UCMJ or chain of command.
another problem with conscription, especially in our current political environment, is that it depends on being enforced fairly. when elite white collar crime is treated as seriously as poor inner-city crime (or petty crimes and even non-crimes by those who engage in political dissent).
we’ve got v real political issues about how we decide when and where to go to war, what kind of standing military and weapons systems we want, appropriate uses for national intelligence, and so on. conscription doesn’t make any of these political issues go away.
“did you notice that I provided alternative service options. But I stand by my recommendation for conscription along with those other options for public service for those who are not inclined toward the military.”
tom, yes, i did. i don’t object to service. i object to conscription and i object to you (or anyone else) telling me how and when i am to serve.
i also don’t object to you advising military (or other) service. i object to you recommending that i not have the choice to decide not to take your advice.
“Discipline is something that is inculcated, and traditionally national service has been the preferred path.”
ha! talk to me about discipline in the military when rape is no longer an issue for those who serve.
“It works to make people better citizens and improves future performance in life.”
still waiting for some evidence to back up this claim.
……………
fwiw, i’m not referring to mass mobilization. i don’t know what i think about that because of the free rider issue. also not sure how likely it is in an era when one bomb can wipe out a big city.
Tom Hickey Reply:
June 16th, 2011 at 1:23 pm
@beowulf,
“still waiting for some evidence to back up this claim.”
Don’t know about now, but back when, large corps recruited from the military.
WARREN MOSLER Reply:
June 7th, 2011 at 2:36 pm
I’ve discussed that with him. Yes, I’d like to see him say his preference is to increase spending and expand certain public sector activities, but that he recognizes tax cuts are an option if more private sector activity is desired.
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Unforgiven Reply:
June 8th, 2011 at 3:38 am
@WARREN MOSLER,
I say let the clock run out and then declare CONGRESS bankrupt.
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WARREN MOSLER Reply:
June 8th, 2011 at 8:24 am
or reclassify them as welfare recipients and throw them all out after 2 years?????
June 6th, 2011 at 11:00 pm
There is no solution for the US–or for the world. All the “positive thinking” you please will not change this one whit. All resistance is effectively dispersed and unfocussed. In any case, the money power is also the barre-of-the-gun power. It will last until it succumbs to its inherent illogic and limitations. Americans, with their absurd democratic mythology, have this unintelligent idea that “the people” can change things. The people can do nothing of the kind, since a collectivity is passive by definition. Change can come from above or from below, but never from the collectivity as such.
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Unforgiven Reply:
June 8th, 2011 at 3:25 am
@Frank,
Then where did Jiggles the Clown (Sarah Palin) come from? Didn’t “The People” change things about a bit in the French Revolution? There are too many variables to validate your claim. You state your point of view and then move people in and out of “the collective” to validate it.
Not to say that “Sheeple” don’t exist, but there’s more volatility there than you let on.
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June 7th, 2011 at 8:13 pm
Who is this Mike Norman guy? What makes him think people will be convinced by such an insignificant thing as the truth? The nerve!
Btw at least the Russian Television network is putting him on air. What’s it going to take for him to get on ABC?
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June 8th, 2011 at 2:14 am
Mike Norman is a fantastic speaker. Great video! Can’t wait for more! Thanks very much
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Unforgiven Reply:
June 8th, 2011 at 4:44 am
@Alex,
I wish he had that the debt ceiling is mainly a political tool.
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June 9th, 2011 at 10:12 pm
Very Good!
Yes it would’ve been nice if he had been able to explain what the “debt” actually is to shut her up!
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June 10th, 2011 at 7:28 am
This is the kind of thing that MMT’ers should be ripping into like crazy, en masse, and exposing the economic “analysis” there from all quarters for what it is:
http://mattrognlie.com/2011/06/07/there-has-never-been-a-money-multiplier/
The conclusion of the post may be right by accident, but the explanation is obviously wrong from a monetary operations perspective. It’s an absurd discussion of banking amongst internet monetarists of competing persuasions, each of them more wrong than the other.
Understanding monetary operations is an important platform for MMT policy work. While MMT policy orientation may be debated fairly at the right level of understanding, misunderstanding of this sort regarding prerequisite foundation stuff shouldn’t be. It should be trashed in merciless fashion.
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Ramanan Reply:
June 10th, 2011 at 11:48 am
@JKH,
Confused Scott Sumner there!
droppped you a comment on the Euro zone here:
http://moslereconomics.com/2011/05/02/more-on-ecb-funding-dependence-in-the-eurozone/comment-page-1/#comment-54457
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JKH Reply:
June 10th, 2011 at 12:50 pm
@Ramanan,
thanks, R.
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