I’ll be at Zuccotti Park, northeast park corner near their library area at 1pm on Saturday.
All invited to drop by!
We came down the day before – my wife loves going to the city anyway, so it wasn’t a wasted trip. I just missed Warren at the park, and we hightailed it out of there – had a pretty harrowing drive back to Boston, but made it in one piece. Crazy, crazy weather.
RyanVMarkov Reply:October 30th, 2011 at 12:39 pm
You missed Warren maybe by 3 minutes only. :-(
Myself + wife + two daughters actually braved the weather! It started not too bad – just some snow, but by the time we parked downtown it was nasty. Yet, we actually made it to the park, all wet and cold, having come that far. Did not find Warren, as we already suspected would be the case. But it turned all for the better – by the time we got back home in the Bronx, our street had numerous fallen trees and huge branches, including one where our car used to be parked.
Apparently the fact that the snow arrived so early when the trees are still full of leaves is what caused the problem – the snow weight on the leaves is too much for the branches to bear. The branches kept falling while we ducked our way into the house!! Crazy..
Was heading in to NYC despite weather, but LIRR cancelled my train. Next time also.
Planned to go to NYC to see OWS and Warren, but the weather is forecasted to be really bad. Cannot risk the trip, unfortunately. Next time, I hope.
WARREN MOSLER Reply:October 29th, 2011 at 6:44 pm
It was seriously negative weather!
RyanVMarkov Reply:October 29th, 2011 at 8:05 pm
The weather was brutal! :-(
Inspired by above comments:
Change the Game
Change the Frame
How is that a fallacy of composition? If the market won’t pay $8 per hour but the govt mandates that as a minimum, the govt is preventing a clearing level from being reached.
WARREN MOSLER Reply:
clearing level? when the currency itself is a (govt) monopoly?
I really don’t understand this argument. I think that in a simplified gov, where perhaps all that gov did was to have a tax (and you might even need a flat tax for the argument) on income and provided a fixed wage for menial inane labor (say, carrying bricks back and forth) the conclusion would be that the value of the dollar is tied to an hour of labor – and so it would be incorrect to say that the labor markets can’t clear because the min wage is too high.
But in our world, it is not at all clear that the value of the dollar is being set by the minimum wage. The gov is far too involved in other markets. I’ll go back to an earlier toy example. Imagine a world of 100,000 people. The gov employs 30,000 at some specific wage, and offers a minimum wage job as well that employs 10. Which wage matters as to setting the value of the dollar? I would claim it’s likely not the minimum wage – if the natural ratio of the value of the two jobs is different than the ratio of the wages, then it’s quite possible that the labor market isn’t clearing properly.
What am I missing?
WARREN MOSLER Reply:October 29th, 2011 at 6:09 pm
You are missing the difference between spending on a price constrained basis vs a quantity constrained basis
In Stabilizing an Unstable Economy, as I recall, Hyman Minsky postulates that capitalist markets in a closed domestic economy do not clear because prices of goods and services are marked up over the wage bill. In aggregate if workers save from wages and must be paid less than the price of output they produce, so the markup can support profits and payments on debt, then the only way workers can clear the market is to borrow. In aggregate then the behavior of capitalists in a market economy will leave people and other resources unemployed. If the government is roughly the same size as the investment sector then it may be possible to develop automatic stabilizers, using spend and tax policies, to stabilize the unstable economy and operate closer to full employment. The problem is that fiscal policy with automatic stabilizers is more of a technical control system problem that needs to be recognized politically, develop some experimental solutions that generate experience on the matter, and then keep politics out of the operation if a workable solution emerges. It is much easier to see that Fed should control the Fed funds rate rather than Congress due to the political problem interfering with a technical solution, then it is for Congress to authorize automatic fiscal operations, and the design of proper fiscal operations is harder than setting interest rates because too much spending at full employment will cause inflation and too little spending or too much taxes will cause unemployment.
My main concern with MMT is that while it is functionally correct, many of the more subjective policies that Warren and others have suggested are completely out of touch with mainstream America. In order for MMT to get a fair hearing, you can’t be considered radical. Going to visit the OWS protesters is a bad idea. Suggesting jobs for everyone at $8 per hour is a bad idea if the goal is to be taken seriously. I focus on tax cuts because you can get some well respected mainstream economists to agree that they’re needed. MMT will not be adopted as science in its entirety. It will be piece by piece. Start with tax cuts.
Peter D Reply:October 27th, 2011 at 9:59 pm
Oh, Vanya, who exactly appointed you a speaker for “mainstream America”? I am calling bullshit on this. From where I sit there is nothing too extreme about $8/hr jobs.
Ivan Reply:October 27th, 2011 at 10:15 pm
Ok Peter. You really think the country is ready to embrace a big government jobs program???
Gary Reply:October 27th, 2011 at 11:07 pm
it depends what you mean by “country”.
According to poll results that Bill Mitchell wrote about today – over 60% of respondents stated that creating jobs is the highest priority.
However, for “free market” ideologists it would be a sacrilege. So most of media and at least half of Congress would probably have seizures if they heard something like that.
Peter D Reply:October 27th, 2011 at 11:56 pm
First, apologies for the tone of the original comment – I got upset and got carried away.
About the govt program – it really depends on how you market it. Call it something like “work for welfare” or, I don’t know, hire some good marketeers, and explain that this is instead of people sitting on their butts getting money in unemployment for doing nothing, you’d actually make them work for the benefit of the society. People don’t like then others get money for nothing, but most also understand that you cannot just cut people loose in the current environment. So, this is a win-win, if you know how to market it.
Trixie Reply:October 28th, 2011 at 12:27 am
No, this country does not have an appetite for a large government jobs program. Surely, we are all aware of the rumors regarding the socialist/marxist in the White House? The existence of FOX news? The hyperventilation about the massive debt and deficits? That the majority of the population was not in favor of raising the debt ceiling because it was handing Obama a $2.4B blank check? That current GOP candidates STILL use this as a talking point and no one calls them out on their blatant display of ignorance regarding the basics of how our government works?
But Peter is right. Dems need to learn how to “message” things. I mean, I couldn’t even tell you the name of Obama’s health care plan. Affordable Healthcare Reform Progress Act? I don’t KNOW. So what do we get? Obamacare. On every bumper sticker. This is where the GOP excels. And reversing their momentum will no doubt be an uphill battle.
beowulf Reply:October 28th, 2011 at 2:45 pm
I agree with Peter D, a jobs guarantee should be framed as a replacement for welfare. Conservative writer Peter Ferrera has proposed just such a system. I’ll note Ferrera is amazingly out of paradigm on everything else. His new book is called “”America’s Ticking Bankruptcy Bomb” and has back cover blurbs from Newt Gingrich, Grover Norquist and the inevitable Art Laffer.
suppose all aid to the able bodied was in the form of an offer to work. Report to your local welfare office before 9 am and you are guaranteed a work assignment somewhere paying the minimum wage for a day’s work. A private job assignment would be the top priority. If you need more money come back tomorrow. If you have children with no one to care for them, bring them with you and they will receive free day care… If you work a minimum number of hours you get a Medicaid voucher that will purchase basic private health insurance. If you work for a continued period establishing a regular work history, you would be eligible for new housing assistance focused on help in purchasing your own home… These workers would continue to receive the EITC and child tax credits…
The government could even reduce administrative costs to a minimum under this system. There would be no need to maintain and investigate eligibility requirements. If Warren Buffett wants to show up for a work assignment before 9 am, no big deal. Most importantly, this new system would effectively eliminate real poverty in America. Everyone would have a place to go where they could get an assured job and an assured income of $25,000 to $30,000 per year [once you tally up value of minimum wage, EITC, daycare, health insurance, housing assistance].
Trixie Reply:October 28th, 2011 at 5:49 pm
Cool. We should do a test run! Say oh, I don’t know…off the top of my head…large-scale infrastructure programs! You know, take the unemployed construction worker (with a zero bid private sector price tag on his head) receiving welfare benefits and put him to work on our country’s crumbling infrastructure. Maybe even be proactive with some high-speed rail initiatives. Just for fun.
Why these programs are not already in place, I will never understand. ELR? Not a chance without significantly reshaping the debates.
WARREN MOSLER Reply:October 29th, 2011 at 6:41 pm
The problem is they all believe the deficit myths
beowulf Reply:October 29th, 2011 at 1:18 am
Two different animals, large scale infrastructure projects are bid out by state DOTs or the Army Corps of Engineers to contractors who hire their own workforce. They’re capital intensive projects that don’t employ all that many people for the money involved and since Davis-Bacon law requires them to pay union scale, they never have any trouble hiring experienced craftsmen. An ELR program would be less capital intensive and would have to accommodate workers of varied work experience and skills. In New Deal terms, its the difference between Public Works Administration (PWA) and Works Progress Administration (WPA). And yes, they could have chosen less confusing agency names. :o)
The PWA should not be confused with its great rival the Works Progress Administration (WPA), though both were part of the New Deal. The WPA, headed by Harry Hopkins, engaged in smaller projects in close cooperation with local governments–such as building a city hall or sewers or sidewalks. The PWA projects were much larger in scope, such as giant dams. The WPA hired only people on relief who were paid directly by the federal government. The PWA gave contracts to private firms who did all the hiring on the private sector job market. The WPA also had youth programs (the NYA), projects for women, and arts projects that the PWA did not have.
Trixie Reply:October 29th, 2011 at 2:17 am
This ELR? MMT aside, how do you pay for it? Remember, in the real world, the prevailing sentiment is that we’re broke.
WARREN MOSLER Reply:October 29th, 2011 at 6:46 pm
Won’t happen until mmt is undertood
WARREN MOSLER Reply:October 29th, 2011 at 6:11 pm
My $8 hr transition job proposal would need fewer people than an unemployed buffer stock
Art Reply:October 28th, 2011 at 3:40 pm
Ned Phelps is hardly a Democrat, let alone a radical socialist:
And the WPA, CCC and other New Deal employment programs *worked*. WW2 was the ultimate full-employment program (unfortunately).
What’s radical is the widespread and unexamined belief that full employment should not be a fundamental objective of a democratic, capitalist system.
Go get ‘em. Understanding how money works and how it relates to productivity is key, absolutely fundamental to having a decently run society. Dispel the myths that are destroying us. Godspeed!
Well, I was going to Philly that weekend, and already bought a bus ticket, but prices are pretty reasonable to reroute with a flight to NYC…
Warren, do you think you’ll have a bit of time to chat MMT and related things?
WARREN MOSLER Reply:October 27th, 2011 at 11:15 am
wh10 Reply:October 28th, 2011 at 11:20 am
Can’t make it work, so don’t hold out for me :\
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Warren B. Mosler