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Beowulf is an MR guy. Not MMT.
Lars,why don't you enlighten us and explain the fundamental differnce between MMT and MMR.
y,The difference is purely alphabetical. Start at MMT and take two steps backwards :)
Don't spoil it. I want to hear what Lars has to say.
btw Lars, I believe beowulf first put forward the "$1 billion dollar platinum coin" idea back in 2010.
From what I can gather - there are many differences, but the most glaring is that MR says money comes from banks in a system where the government has chosen to outsource all money creation to private banks. Whereas MMT states that bank money is not the real money, but a tax credit or something like that. Basically, MR says banks "rule" money and MMT says the state "rules" money. It also seems they don't use the idea of taxes destroy money and spending creates money. They say the government has designated itself as a user of bank money, by choice. Cullen Roche wrote a very long description of the differences, but I can't seem to find it.
I asked Cullen early last year, when in it's formative stages, if MR was significantly different from MMT and he told me no. Now Cullen claims that the two are very different. I'm not sure that he's adequately explained what he means by very different. He did say that many MMTers have been very rude to him, which I think has him overreacting and killing the message along with the messenger.BTW, when Beowulf came up with the TPC idea he was working under the MMT rubric, I believe.
"MR says money comes from banks" MMT says that too."...in a system where the government has chosen to outsource all money creation to private banks".That's just Rochean rhetoric. It doesn't actually mean anything at all. "Chosen to outsource"?"Whereas MMT states that bank money is not the real money"Bank deposits are a promise to pay base money. That's just a fact. That doesn't mean that bank deposits aren't a form of money (or a "money-thing") in themselves. "... but a tax credit or something like that".Warren Mosler argues that money issued by the government is basically a "tax credit". "Basically, MR says banks "rule" money"What does that even mean? It's just more rhetoric."...and MMT says the state "rules" money".I don't think any MMT economist has actually used those words.
Why don't you ask Roche rather than perpetually knifing the guy in the back like you do? He's pretty responsive to questions and gives a lot of his time to trying to help people understand the monetary system. Maybe you could ask him these questions rather than attacking him once every few days? You sound like jilted lover complaining about the guy you used to date who has since moved on. Why don't you work it out with him?
"Why don't you ask Roche"If you put forward an argument he doesn't like you get shouted down and after a while your comments get deleted."perpetually knifing the guy in the back like you do?"You put forward the Rochean "MR view" and I criticized it. How is that the same thing as knifing someone in the back?
In a sense, I can kind of understand that. Cullen Roche is as familiar with MMT as anyone. He's done the reading, written about it, talked to the primary sources. I might go so far as to say there's nothing anyone can tell him about MMT he doesn't already know.Equipped with that knowledge, he made a choice to reject it and brand it as politically motivated obfuscation to push the state to center stage. Or some such, it's a little nebulous. A stance embedded to the degree that anything that rhymes with an MMT argument or, possibly anything with the letter T in it is seen as per se trolling.No one's going to dislodge him from his position with an MMT argument so it's pointless to make the attempt in comments.
We tend to think of money as "what is in the bank", "in the pocket," or "under the mattress," that is, cash or bank deposits. Cash is clearly "from the government," but money in the bank is just a number on a spreadsheet at the bank recording a loan that the customer made to the bank either to be paid on demand or in a specific time frame. Most people consider money's chief function to be a medium of exchange, that is, something spendable, and entries on a bank's spread sheet are not spendable in themselves. They must first be converted to either cash by withdrawal at a window or settled by check or electronic deposit, which are a call on a loan to the bank. The bank guarantees settlement in the government's payments system, even though the transaction might be settled through netting.
I was introduced to MMT through PragCap and Cullen was very knowledgeable about it. I watched as he seemed to recoil from the job guarantee when Randy Wray wrote some articles saying the JG was an integral part of MMT. Cullen then seemed to decide that productivity was more important than full employment and the government as employer of last resort was a bad idea. It looked like a lot of his objection to the ELR was based mostly on government involvement. I stopped reading PragCap at about that time since I had found more MMT blogs and didn't want to spend time with his diversion. From a distance it appears that he developed his MR paradigm to be something different from MMT because he has a resistance to government involvement in the job market.
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