 Hello everyone, I have a fantastic guest for you today. I'm here with Steve Grumbine who is the founder of real progressives And he's also the host of the MMT podcast macro and cheese and also He's a co-host of the new and touchables the PCOR files And he is here today to educate me as well as all of you about the fundamentals of modern monetary theory Steve Thank you so much for coming on the program. Thanks Mike. I'm glad I could be here. This has been a long time coming For those of you who don't know we tried to do This interview before and there were so many technical difficulties that we had to basically nuke the entire thing So Steve, I'm so thankful that we can finally do this and I have so much to ask you So first of all, I think that my viewers know about modern monetary theory, but for those who aren't to wear What's the easiest explanation explanation that you can give? What is modern monetary theory? so modern monetary theory is a lens of macroeconomics in general it is the way it is today. It doesn't need to be implemented It doesn't need to be accepted your acceptance or lack thereof is doesn't make this any less more valid It is the blueprint of how federal finance works in the United States and really it represents a free-floating sovereign fiat currency That's non convertible not pegged to gold. You can't force redeem it by gold and and this goes for countries all around the world Australia UK Japan China Russia and a number of other ones not the European Union But definitely the United States and what it does is it says hey listen, you know The pieces of paper are the least important thing when it comes to this the question really comes to Resources do we have the real resources to to handle whatever it is that we want to spend money on as a nation and The bottom line is that modern monetary theorizes that a nation that creates its own currency Can not go broke on debts denominated and its own currency Pretty straightforward It's the bank. It is the creator of the dollar and the thing that really really made it stick for me Was that the dollar for the United States is really a unit of measure. It's like an inch or a pound You can't run out of inches and you can't run out of pounds and then the next question is is that you know Where do points come from at a baseball game or a hockey game or a football game? Where do those points come from and where do they go when you add them up and put them on when the games over? Where do they go when you're done? They're just there right you you keystroke them in They're really a unit of measure for how many points you've scored in that game Well, the dollar is the same thing in in terms of the United States and around the world What it does is allows us to have a legal arrangement the US has the patent if you will on the US dollar It is farmed that out to the Fed to kind of be its central bank It was a spoken into existence by Congress in 1913 and it has been the subject of every possible conspiracy under the Sun for the last out of forever So really what you've got is a blueprint for how federal finance works. It's an operations manual and it describes Perfectly how federal finance actually works most of what we see today It by Congress and by our newspapers and our other media outlets is A lot of fiction a lot of stuff that was taught in school incorrectly Beginning with you know, how money even comes to be and most of the people think that the United States government has to borrow money from China It has to borrow money from some nefarious bank of the Rothschilds and all the other crazy stuff that goes around out there And in reality is that when Congress spends money when it authorizes spending, okay? President signs a bill into law they send that over to the Federal Reserve who then in fact keystrokes with you know They're little fingers on a keyboard Dollars into the Treasury's accounts the Treasury then spends those dollars into Existence that it didn't exist before didn't come from your tax dollars and that brings us to the next big thing that MMT talks about Which is the role of taxation we have what they call a tax driven economy It's not that taxes actually pay for anything because taxes are functionally deleted when they're received What taxes do is they provide the magnet that keeps the circuit going by having an obligation payable only in the nation's unit of account You have a situation in an obligation that causes us to require to get those pieces of paper those There's dollars and so we have to find a way to get those dollars right and so the government uses that as a way of provisioning itself This goes back to the day of Kings and stuff like that where a king would say hey I want to build an aqueduct. I want to build a coliseum I want to have a standing army and go to the people in the town and say hey I'd like to build this thing will you come help me and guys like no I'm I'm out here picking potatoes, and I'm having fun with my kids, and I'm fishing I'm not interested in doing that and he goes well I'll give you this gold coin and the guy says well I'm not really interested in the gold coin what I'm gonna do with your gold coin. He says good point He says I tell you what this coin with my face on it. You have to pay ten of these to keep your house Oh shoot. Well, how do I get those coins funny? You should ask that. I want to build a coliseum I want to build an aqueduct. I want to build a standing army whatever and so that's the story of that state money And it's been going on since the day of Caesar's render under Caesar, right? It Caesar didn't need the money. He already had the money just like the United States doesn't need the money He doesn't need your tax dollar to spend It requires your tax dollar to stave off inflation to to create different behaviors to modify behaviors and to incentivize or disincentivize certain behaviors That's kind of the net net of modern monetary theory Basically says we don't have a budgetary constraint that matters other than a fictional one we put on it We have an inflationary constraint and it depends how much inflation do we want in the economy? And maybe we want a little maybe one a little bit less it just depends and that's how you would do your tax base That's how you would do interest rates to be able to adjust to accommodate inflation concerns That's a long story, but that's that's it in a nutshell No, and that's that's a really I think excellent summary And the reason why this is so important for those who don't already understand is because the implications of this are absolutely world-changing if we actually Acknowledge money for what it is and have a realistic view of the way that money works as a country Then there's no excuses anymore. There's no more questions of how do we pay for Medicare for all or Are there enough rich people to tax in order to do policies x y and z? The money is already there. It's just a matter of we're not Doing what we need to do to take care of our people and once you understand the way that money works Through the lens of modern monetary theory Then it actually makes sense and you know the united states we've kind of been stuck on what has been known as voodoo economics for decades now trickle down economics And all of this I I think we're on the cusp of a paradigm shift I don't necessarily know that a lot of politicians will embrace modern monetary theory But it's certainly become more popular and I know that the book the deficit myth By uh Stephanie kelton. I just started reading that so I've always had you know an understanding and knowledge of Uh the deficit myth, but after reading her book or at least most of her book Now i'm a true believer and now it's just a matter of actually learning how to talk about it in a way that Makes it catch on because really and ultimately at the end of the day, you know, what normal americans Believe or don't believe doesn't matter. It's what the government actually does So my question to you is how do we actually push politicians? To accept modern monetary theory republicans have functionally Done modern monetary theory when they're in power. Is that is that correct? So how do we get the left to do it? well, you know Great questions and great great observation the republicans have been the kings of modern monetary theory since ronald reagan ronald reagan was the i mean I hate to sound anything positive about reagan here. Okay, but let me just say for for if if bombs were food Ronnie was the best progressive of them all, you know, but they were He he understood that we could spend spend spend on the military Okay, and this was a way to functionally make the economy boom And and this is why during the reagan era the economy did boom for a long time And we hadn't gotten to the point yet where it started getting under clinton and obama and even w You know where where you see the radical income inequality. It started under reagan definitely was like steroids under reagan for sure But but the deal was is that people regular people hadn't gotten pinched yet There was a lot of people. Yes, there was a lot of poor people There was a lot of people that were cut out of the reagan economy But because of the timing you realize we left the gold standard in 72. We went through jerald ford. We went through Four years of carter and then the reagan revolution began and he went through a recession at first And and they didn't quite figure it out because they had the valker Thing going on in the 70s the oil shocks all the other crazy stuff to dig out of But once they started really really investing in the cold war Okay, this is real money going through the economy. It doesn't matter whether it's good. It's bad Don't even moralize it at the moment. Just think about it in terms of stocks and flows Reagan had the thing going screaming high. It's just booming so flash forward And what you've got now is a situation where The average republican knows when a republican administration is going on that deficits don't really matter not in the way We think they do and so they do all the tax cuts for their friends all the rich get richer Etc, but then when the democrats take over They and you when you talk to these folks It's like you want to just give them a hug because it's like they're so wrong But they have the right they think they're doing right, you know, I mean they're like Well, we got to we got to be responsible now that the republicans are out We've got to fix what they messed up and so they start jacking taxes up They start, you know trying to pay down the deficit, which is not even a thing But they try and do all these things to be responsible We got to pay down the debt and and so far and you look at obama obama was the king Are you telling us to eat our peas and you know, he bet what he didn't even put a trillion dollars out during the global fight Are the great financial crisis? I mean he was a stingy right wing austerean with a democrat name, right? Um, but the fact is is that as long as democrats believe that they are the adults in the room And that they have to be the fiscally responsible ones and stuff You're never going to see that so in my mind the way to really get to the politicians and the way to get To to the broad masses is to influence the influencers and a guy named delman coats is famous for he actually talked to ice cube Who is now an mmt guy? So we've got no kidding starting to wake up, right? Us little guys we get to go for a big fish like you Trying to get you to see mmt and and so from my vantage point watching you guys get it is my You know, it's my win. I get the victories when I see you guys doing the lights go on This is so exciting to see you with that book in your hands and to see you interested in talking about this stuff Because we haven't received a lot of love from the that upper crust of the alternative media sphere And in you said to me offline a lot of people just don't know how to even frame it into their conversations They don't know how to answer questions that this naturally brings up because it fundamentally changes the entire battlefield If everybody's fighting we need to raise taxes to pay for stuff It's a price of living in civilized society And the other guys just you know, we got to cut taxes for the rich and stop You just hate the you're just lazy and back and forth the same same silly pitch battle goes on But once you realize Literally everything they said both sides is just bullshit It totally you can pull back and you could say well, wait a minute Republicans I get it. You want to lower taxes? I do too. Hey Democrats, we get it You want to have robust social spending on the people? Hey, we do too. So hey, guess what guys? We can do both Hey, you guys hate, you know immigrants. Why do you hate immigrants because you're afraid they're taking your jobs You're afraid they're taking your lunch. You're afraid of all these things. It's beer based But guess what we we can pay people to have a federal job guarantee and every one of those people coming in the door instead of Calling them a mooch or calling whatever. Hey, here is a federal job with a living wage with benefits You name it and it's not taking anything from you or your children. Wow, what a change, right? So I think that getting guys like you To to be involved in this to get it and then take it to your constituency like what we're doing right now This is huge and those politicians there are people that are in power that listen to you Mike And they hear the stuff and and it's an opportunity to change them through through your wonderful platform And that's that's how I hope to get there I really hope so I think they are though. I mean, I've seen evidence I mean a lot of these people that were growing up in the burning movement Then turned around and started running for office That's true And so now these people that we knew and loved on social media are now suddenly making laws So they then they grew up listening to mike figurito and the humanist report and they grew up listening to kyle Kalinsky and they grew up listening to all of our other friends out there jimmy adore and You know all the other folks that are in this space So it is an opportunity unlike any other to really bypass the rich to bypass the Power brokers in the mainstream media and fundamentally change the world from the grassroots up And that's what we mm tiers are trying to do and you're being a part of that It's great. I think that's our I think that's the path forward create a bunch of activists and make it happen Yeah, it's really the first step and you know For me the question that that I think about is because this really it does seem like a paradigm shift in the way that we think about money And and governance and whatnot Um, are there any politicians? That you're aware of that actually embrace modern monetary theory I know that stephanie kelton was an advisor to bernie sanders on his campaign trail But I don't know that bernie actually subscribes to modern monetary theory So is there anyone in congress that you're aware of that supports modern monetary theory besides republicans who inadvertently support it Just by their actions, but don't embrace the theory itself because you know, they wouldn't Absolutely. Well, I can tell you right now There is a metric ton of these folks out there that are being advised by mm tiers today Rashida to leave has put out two or three bills bam, bam, bam that are Literally mmt using number once you put the abc out act out there, which was the um The digital payments to give people pandemic payments You know on the card didn't pass of course, but she wrote that Now you've got iana pressley putting forward a federal job guarantee You've got yes. So yes, you know an aoc was brought into the fold I mean there's pictures of her out there sitting at a dinner table with You know some of the modern money network folks and stephanie kelton on one side and pavelina cheneva on the other And so aoc is definitely aware and involved with mmt I would say that jane sanders and larry sanders are down with mmt And I would say that bernie has every step along the way from his time at the senate budget committee chair With him being the minority he brought stephanie in there He brought stephanie in on his first campaign and he brought her in on his second campaign And she was part of sanders institute. I would say bernie is knows mmt I would say that he has been doing this for 50 years and he's probably not up for changing his language I think that there's a lot of people out there that find this to be challenging that have written a lot of books That they'd have to go on an apology tour to explain away The things that they said were wrong So I think that bernie's contribution here is giving access to people like stephanie kelton like randall rey and others Who are really advising a huge huge cadre of new congressional? People and and even senators, you know, I know rokhana has been exposed to it. I know There's We would like to see tulsi gabard who she didn't I don't know what happened with her something weird happened But she never got it But you know, there are quite a few of them that are starting to really get it and it's very encouraging It's incredibly encouraging right, right I also wanted to ask you because this is something that Is easy to dismiss if you don't understand it and there are criticisms of mmt that I was hoping that you could speak to um And it really the main critique that I hear about mmt Is that this is going to lead to inflation if you overspend that will lead to inflation So what do you think is the easiest rebuttal to that argument? So the easiest rebuttal is is that our economy is a bathtub Okay, the bottom the drain is taxes the spigot is the spending So when we're we never just keep printing money, that's uh relic from the gold standard. First of all, we don't print money anymore It's all digital, but second of all The tax drains out of the bathtub. That's the deletion process money keeps getting spent into the economy Money keeps getting deleted from the economy So that's the standard answer right bottom line is that we don't in fact We're way overtaxed for the very limited subset of programs and services that we receive We are so overtaxed for what we actually receive. It's not funny So there's that The other thing is is that why do you suppose that we never hear a peep one about inflation when we bomb Around the world when we do tax cuts. We never ever hear this But yet this right wing thinking creeps in and says, hey, what about inflation? You're going to give somebody food? Hey, what about inflation? Alan Greenspan and paul ryan you remember that guy the cool guy with a red hat and the muscles, you know I love those pictures still cracks so good He he he tried to take greenspan the task now greenspan is probably the biggest jerk on the planet Next to paul ryan, maybe right, but but greenspan and he was sparring over social security And and paul ryan was trying to say wouldn't it be better? Wouldn't it be more solvent if we privatize social security? And alan greenspan goes, you know, I don't know if it would make it more solvent Because we can spend as much money as we want to there's no constraint whatsoever As long as we have the real resources to create the economy For the people that now have this money as long as there is goods and services to buy for example In new york city if you were to try and rent an apartment it would be through the roof Why because people are squatting on those properties There is limited access and they've premiumed it out the wazoo So they have literally made it so that it's impossible to get housing in new york Places like that where you've got a scarce resource like housing So that's the question if we want to give houses to all in new york city We either a have to build a lot more houses to be able to do that Or b we have to realize that the real resource constraint of the amount of houses there Just isn't adequate to meet the demand. So this is an mmt truism It's about resourcing the bill not the dollars the dollars are irrelevant, you know To pay for something is is not a thing. We can do it anything The real issue is do we have the real resources? So the inflation thing is The most talked about thing in mmt land within mmt ears Because we recognize an inflation constraint and the way we look at that is usually do we have real Full employment in other words if we actually pass a federal job guarantee And all of our slack labor is bought up And you know that right now we manage inflation by keeping like five percent of the people unemployed forcibly unemployed It's naru. It's the fed's way of making sure You know inflation doesn't happen And if you remember aoc took Jerome pal to task about the philips curve, which is It's one of these fake models that economists do to baffle us with bs And she said, you know, you've been using this philips curve here and quite frankly, none of it plays out as you said He's like, you know what? I think our model's a little outdated. She gives you think I mean So this is kind of it's starting to happen. You're starting to see it And so the average person has been so infiltrated by libertarian ayn randy in thinking From milton freedman and the old 70s thing of oh my god, if we print more money, there's going to be hyper inflation They always point to zimbabwe. They always point to argentina. They always point to venezuela. They always point to By mar republic. All right, so let's just for grins and giggles knock them down one by one real fast Okay, so the hyper inflation hyper envelope, you know at ventilators. They always get caught up on these things zimbabwe Mugabe had taken all the farmland from the colonizers and gave it back to the people Okay, the colonizers went ahead and burned the crops down and they also had issues with the people not knowing how to farm very well So their productive capacity their real resources for zimbabwe were completely obliterated They had food sovereignty one day the next day they did not have food sovereignty So that meant they needed to buy things with foreign foreign goods that they couldn't use zimbabwe's money for Okay, so the you had very very scarce amount of food And really you couldn't have printed enough money for people to eat. They were desperate So this is what happened in zimbabwe. Okay radical shock to the supply chain You go up to weimar the treaty of versi was brutal I mean, they were brutal and the french being french They wanted to make sure that they were being paid in french francs and the germans were sitting there having german reichmarks, right? so debt in a foreign currency remember i started this out saying a country can never go broke on debt Denominated in its own currency. Well the treaty of versi said now you're going to pay it in french francs That's number one. There was also a strike in the industrial sector. Okay, so they they literally killed the production And so now you've got a supply shock debt denominated in a foreign currency and wild amounts of corruption obviously the nazis Let's be fair that whole period of time was a pretty rough period of time So that's what happened to weimar, you know, you had the the world war one and all the ramifications of the treaty of versi You go down to venezuela and and what you've got is once again another situation where you've got a single commodity And their dollar is pegged instead of to gold. It's pegged to the u.s. Dollar their Currency is pegged to ours. So not only were they ripe for messing with you know, this is the thing Whenever you peg something to anything you peg it to gold peg it You can screw with the the the commodity or whatever it is that you are tying your currency to And if it depreciates now all of a sudden your ability to pay off your debts is eliminated You can't pay your foreign debts anymore And so they had a single commodity in fuel and in crude not even refined oil crude Okay, and the salities screwed with them So you have them screwing with the price of barrels of oil Which depreciated their ability to be able to pay their debts The only thing that they could have used was their oil supply So once again had nothing you notice I haven't said anything about printing money yet, right? Not one single thing has been hyperinflation is not a monetary phenomenon It is simply not it is always corruption. It's always some sort of a supply shock It's always some sort of natural disaster or debt denominated in a foreign currency And so you can go through this each step along the way and it's going to always be something like that It's never going to be an issue of printing money So for folks listening, please trust me take this one to bed. You don't want to talk about it again Walk away and call it a win, you know But regular inflation though, which is what most people cry about but they don't really understand Is a rise in all prices. It's not a rise in my one thing or the other however If you have a a real resource like petroleum product and it's short You make plastics you make lubricants You make all sorts of things you cooking supplies you name it Fuel for vehicles fuel for airplanes fuel for buses trains you name it So all of a sudden a rise in price of fuel Will create a rise in price in those things that require fuel or petroleum products to make So this is how you could get widespread Heightened I'm just using this as an example of a common commodity that could really create an inflationary situation But this is not what they talk about. They don't know about printing money It's got nothing to do with printing money once again so printing money is You know usually happens after the fact with these things and so What you also hear and this is something to be thought of this is important to think about You know back to the paul rye and alan greenspan thing It's like can you create an economy Where the real goods and services that people want are available for them, right? So you're not having shortages of things, right? So hypothetically we go ahead and we give people medicare for all Well medicare eliminates a lot of noise around there's a lot of economic activity that makes up all that denial of service That goes on there's a lot of people getting paychecks to deny you service and my goodness. You don't want to eat their job away, right? well Medicare for all is actually a deflationary deflationary Service why because it's efficient and so now you've gotten rid of all these different revenue streams that you're thinking of when you're thinking about the medical services in the medical system And now it's efficient So efficiency means less money spent which means the economy is going to require You're losing jobs a lot of jobs will be gone if you don't have a federal job guarantee or a just transition to move them into other fields and Shebang you've got a situation now where if you don't have enough doctors nurses gurneys hospitals Whatever Now you could have a rise in prices over there You could have a shortage of the real resources So it's I don't think you would have that because you have all these people that will be losing their jobs It'd be desperate to fill jobs up to to fulfill the you know medicare for all but You know, that's that's the other side of that game I don't know. I hope I answered your question I think that that was a phenomenal answer It totally makes sense and you have such a good grasp of the theory and the material and all of these concrete examples That I think that your advocacy is is so important for it Just to kind of further hammer down The concept of modern monetary theory. So could you explain the differences? I mean you kind of alluded to it But with the united states modern monetary theory is applicable here because we have our own currency as is the case with Japan the uk But why wouldn't this apply to the european union france? For example, because they use the euro what specifically makes that different so the currency user Is the people that can't create the currency themselves the currency You know issuer is the one that creates it. Well in europe they have the european central bank the ecb And they have the troika they have basically have this Uh system that is not state owned so france can't just print money or Spend money into existence and they've got percentages. I mean i'm gonna butcher this so forgive me my friends in the uk Let's say they have a five percent threshold for deficit spending in any of these states Well, all of these countries are like delaware texas. They're like main That's it once they gave up their own currency They in essence became like california or one of these other states in the united states In the united states every state here has a balanced budget for the state the state must run a balanced budget Now they may invest in bonds and stuff like that to carry them through ebbs and flows that might short the pension funds and so forth But at the end of the day, they cannot generate currency on their own They could create a complementary currency. They could do a number of things, but they could not Create the u.s. Dollar out of thin air only the federal government can do that Which is why you don't want to see states trying to do medicare for all and so forth because it Let's say california gets away with it because they got a big economy and they can absorb it Well, try that in mississippi try that in alabama try that in main try try that in pennsylvania I mean most of them will not be able to do that So if you have any kinds of ebbs and flows at all if you have any kind of shock Like a natural disaster or something like that and let's see you have a pandemic The only way you could afford this is through the federal government. Well, let's go back across the pond for a minute If you have an issue like in greece greece is a net Importer greece is not a net exporter So if you think about all their money is leaving the country to go buy goods and services and because they are no longer on Their own drachma. They're now on the euro They can't deficit spend enough to make up for their net importer position Germany on the other hand is a major net exporter And so they get all that money coming and they make the great cars. They got the ottoman They got all these cool things they bring a lot of money into the country And so they are able to make a robust social infrastructure. They're able to do all sorts of stuff They're living levita loco while down in greece. Those people are really really struggling France is struggling. Italy is struggling. All the southern european countries are struggling. Spain is struggling. You name it And so it really is which ones are the net importers? Which one are the net exporters? And they're reliant on that european central bank. Well, I interviewed a guy recently It's talking about this new plan called fiscal money where they provide these tax credits To people that it's like an alternative currency of sorts Like a receipt that they give to the bank and they have small markup and the bank absorbs the The negative equity set of speak and that's a way of bypassing the ecb's strict rules I butchered that a little bit, but for anybody out there that knows what i'm talking about That's the mmt friends out there in europe. You know what i'm talking about I'm probably not the sharpest on this particular segment of it But suffice it to say none of these Countries can actually print their own money anymore. That's why the uk Stayed with the the pound sterling. They knew that they needed to be able to print their own money, so to speak Okay, and so they didn't want to give up monetary sovereignty You know, they didn't want to have you know forget the brexit stuff for just a minute It's just really about the currency because brexit wasn't really about the currency because the uk never was on the euro That was really about open borders. That was really about jobs coming and going And if you go back and you remember what i said about the federal job guarantee If they had a federal job guarantee in the uk They wouldn't have been worried about foreigners coming into their country and taking those jobs because that would have been Absorbed no problem. So just something to think about there But that's really what the deal is is that they lost their ability to spend money into existence when they need it And so now they are heavily relying on taxes. They're heavily relying on investments and the market and everything else It controls their existence unlike in the us We are freed from the constraints of the market the bond vigilantes can go to hell We can do anything we want to do. In fact, we could even lower the interest rate to zero And stop worrying about selling bonds altogether We don't want to do that because bonds are like ubi for the rich and that that's really all it is So anyway, I don't know if I answered your question That makes sense and even though you just thoroughly debunked this notion that mmt theorists want to print money In other words in short basically You know, if you don't have your own sovereign currency, you can't make the money printer go burr in in a in a Go ahead No, I was just going to say it's I think it's important to understand That it's there's something called sectoral balances. Okay, and this is this is going to get a little wonky So follow me here. Okay If we split the economy into three segments We go internal debt private debt We've got public debt and then we've got rest of world Okay, so rest of world we call the trade balance a trade balance of payments on the trade side Okay, private debt would be all the stuff you've made your Citizens absorb in the economy like student debt Their car payment their house payment all that stuff the the level of private debt And so you look at this is like an ecu on your on your stereo The look and see where the private debt level is look and see where the public debt level is And look and see what the trade balance is if we have a net trade Deficit, okay, I'll say 500,000. That's 500,000 that has left the economy and gone around the world And somehow or another that 500 Say 500 billion Has to be made up somehow or another Okay, and so this is where a federal government could spend money to offset that trade deficit to keep the economy humming so that there's imports don't have a real negative aspect on the the economy because Really at the end of the day, you're giving them pieces of paper for real resources, right? And so this is a really big thing. So if you're looking at these You know, you could have predicted the great financial crisis You could have seen the private debt through the roof You could have seen the public debt down and you could have seen the trading balance and you would have known right off the bat In fact, that's how mm tiers were able to predict this and nobody listened back then they they used the The sectoral balances approach to viewing the economy and it and it showed So if you think about it like that The only thing it doesn't matter is that public debt public debt is a misnomer. It's just the net money supply That's all it is. So if you delete the debt or you get rid of the debt you get rid of the money supply basically So that every time we've tried to pay down the debt What we've ended up doing is created a massive recession a depression horrible things have happened. So this is More fuel for the fodder we can keep talking about but I just wanted to throw that out there for you If I didn't totally confuse things by doing that No, no, everything you're saying it Totally makes sense and as you explain this to me and I get a better grasp of mmT in the material It's almost like this frustration builds because You explain all this and you think wow. So another world actually is possible and it's really easy So the question is why why don't we have medicare for all? Why don't we have a federal jobs guarantee and it's because This isn't you know An economic theory that enough people adhere to in dc. Certainly joe biden He's an austerion. So I mean, you know lost cause there, but here's what I want to ask of you In terms of how leftists should approach mmT I'm trying to work it into my usual political analysis But it's kind of like I'm on this one rhythm where You know the the standard things that we say is leftist is well We need we need to tax the rich and we don't need to tax the rich Do I want to tax the rich because I do want to punish them contrary to what others might say? Yeah, I want them to pay but that's not actually what we need to do in order to invest In social safety nets and public programs So is there any advice that you can give to kind of just casually work this into conversations? You know medicare for all cancelling student loan debt. How do we as leftist particularly political commentators? How do we talk about this in a way that's more easy to digest that might You know pick someone's interest enough to where they go and pick up a book Or they you know start watching macro and cheese with you What do you think is is the gateway because I want to radicalize people as much as possible And I want to get more effective at the way I speak about this. So what would you say to that? It's kind of a big broad question. This is a great one though. I love this question So, you know, I started off years ago saying federal taxes don't fund spending It's a bumper sticker. You can fit it on a bumper sticker, right? And people's heads were exploding when I said that But the thing was is that it made them think and we got the talking, right? If you decouple spending from taxation, we can have two totally different conversations We want taxes to be strong enough To make sure that the dollar has the right level of buying power, right? We want to make sure that the dollar has whatever we want whether we want a hard dollar We want a really strong dollar or whether we want a weak dollar and we may want it for different reasons. Okay Um, so taxes are really about inflation control, but they're also and this is hugely important They're also about making life more fair and balanced because income inequality in a nation like this Is a toxic Mess it's a virus that destroys democracy. Okay, so if you think about it like that You tax the rich because they're too damn rich You tax the rich because it's the right thing to do you tax the rich because most of their ill gotten gains are ill gotten gains You don't make that kind of money without stepping over people and trampling them and quite frankly milking off of their labor, okay, and and so there's a good rational reason to tax the rich But don't do it because you think you're going to pay for a program Don't eliminate the military budget because you think we need to save money here to spend money there Eliminate the military budget because you have a fundamental moral Decision that you don't want to blow up people around the world Or maybe you want to release those real resources that are tied up in the military and redeploy those real not the money The money is irrelevant. It's the real resources, right? So when we talk about the left, you know and and being a socialist, right? You know, you can talk a little bit about marxian theory and you could start talking about labor theory of value And you can get into some of the stuff In and of itself you have to understand the material conditions of the day and understand where we are It doesn't matter whether you want a socialist utopia whether I want one right now or not The fact is we are in a capitalist environment So how do we either a revolt and flip the tables and make it a socialist country which you can clearly see We don't have the appetite for unfortunately people talk, but they don't have it I promise you that we are not there yet in our arc the arc of revolution has not struck yet Unfortunately, I think you're right there. I wish I wish I wasn't because I'd be a more radicalized by the minute I mean, I'm reading some heavy-duty stuff too and it makes it hard to talk in today's because it's so yuck Right, it makes it even yuckier But If you think about it from a leftist perspective You know that your goal is to make life better for people Your goal is to right now. We have an existential crisis with the environment. Okay It doesn't matter whether we want a socialist utopia or whether we want to have a you know go Crazy and go full ayn ran at the end of the day people will die. There will be Migrants, you know coming we're going to climate migrants climate immigrants people that are moving away from the coastal areas or Severe drought you name it Tsunamis hitting their towns you name it and these people are going to be moving around because hey The place that they once were where there was food and water and and toilets and everything else is no longer there It's underwater So you're going to have that and imagine if india starts migrating into pakistan and starts You know all these wars and things like that. So this is a real thing It's coming and it's it's not something that we get to say. Well, I don't believe that or not. It's going to happen It's happening now. You watch it happen. So it's my hope that has left us we realize that our goal is to find a way to Create public policy while we're fighting for a revolution outside the process But we create spending in such a way that we leverage the power of the public purse To affect climate change to affect these things and read Read configure society for a sustainable world and a federal job guarantee with a just transition eliminating oil based employment and call all these dirty jobs eliminate them and then move those folks into You know mobilize them like a Marshall plan almost to to get them out To literally serve in the environmental salvation that we need to go through I think there's a tremendous opportunity there for the left to fundamentally change society With a somewhat of a revolution But you said something a little bit ago that I want to touch on I think it's really important You asked why why don't we do these why it's not just that they don't believe in modern monetary theory If you go back and you if you've ever read Howard zinn and the people's history of the united states Howard zinn clearly shows that like for example the war of independence in the united states was not a You know a workers revolt. This was a bougie You know the wealthy landowners didn't want to pay money back to england They wanted to be free to be rich here because they saw all the vast resources at their disposal And they had all these slaves and they had all these people that are willing to work for them You know Bottom line is that was not a revolution for the people that was not an independence That was rich people being rich people and using poor people for fodder And and so you ask why we don't have these things this because from day one Capital has sought to oppress the people and use us as labor use us as whatever it is that they want And so the more secure we are the less likely we are to take the crumbs they throw at us And we all of a sudden have freedom We have decisions that we can make that are different than what they want us to make And so the reason they don't want us to be secure They don't want us comfortable is because if unstable You know citizen is going to be a much more pliable much more willing to accept whatever they throw at you I mean if you think about how many people do you know have actually said I want to work at Google and I want to do this thing or I want to work at this company I want to do this no you apply for a hundred jobs in whichever one calls you back you take right? That's that's the world we live in and it sucks But if you actually could choose if you had a choice you might choose something very different Then what you do you I might have been a school teacher instead of trying to be an it guy You know what I mean? I might have been a bunch of things had I had the freedom to really choose But the pay of a school teacher is not nearly enough to provide for and you know when you got stars in your eyes Because they pump capitalism into your brain you got to succeed you got to be the maker You got to keep going going going you make very very different decisions that are no longer rooted In things that maybe would have made you happy like me being a history teacher. What a geek I could have been right You know open my own games workshop and play dungeons dragons or something you know crazy You know whatever man I mean you do things differently because capital drives you and that's why these things are not happening Because every time the government does for you it's something that wall street can't provide you at cost They can't profit off of it anymore So that profit motive and you ask yourself How do the rich measure themselves by the distance between them and the next guy beneath them? And that right there is why they don't want you to have this stuff because how else will they feel superior? MMT allows us to make the rich irrelevant and do it anyway without them I think though the problem is is that we don't understand power dynamics We haven't studied theory We haven't studied history and because of that so much of the stuff we do We think it's the first time somebody's ever thought of it and if all you got to do is look at the french revolution Go watch the Haitian revolution go watch each of these steps throughout the process And you realize that this whole arc to get freedom to get What you need it's a struggle There is no way around it and people aren't ready for struggle. And so this is where we're at unfortunately Yeah, steve you are blowing my mind right now Um, I've got to ask you so we're kind of seeing a lot more people become radicalized socialism is actually Thankfully increasing in popularity and you see people say Read marks read marks and then oftentimes they'll order Capital and it'll be like that thick. I'm exaggerating a little bit for it's not small too Yeah, yeah, so, you know, I always recommend them, you know get the the marks angles reader Get a professor richard wolf summary of marks. It's called understanding marks And these are kind of like my go-tos my my socials bibles if you will do you have an mmt bible because I think that this honestly is part of Radicalization of the left mmt has to be part of it alongside with socialism I think it's the companion economic theory To the socialist world that we all we all want If you could like simplify it and say everyone watching this if you're intrigued Pick up a book. What would you say would be the best book for them? Right, so I would say that the three books are a you've got the one on your wall right there The deficit myth is absolutely must read it is I would agree It is an airline you're sitting there waiting for your plane or you're in the bathroom kind of read Okay, it is not a deep thing, but you don't need to be deep. You just need to the country can do these things That's really the end of the day. That's really all you do need to know Right that way you don't want to eat your peas if you don't want them you freaking know they can That's that's what that book will give you is is an insight into the overall the overview It's not the be all end all but it's more than enough for the average person It's a great entry point for someone like me. I will recommend that well I would say, you know, I read Warren Mosler's book seven deadly innocent frauds You can get it for free You can actually go to our website at realprogressives.org and we have a pdf type version of it, but It's it's just a great great book. It's super simple But if you really want to start understanding the power dynamics, you need to understand the neoliberal Fight the the fight of neoliberalism that started, you know, basically back in the Milton Friedman era and the mount Pellerin society and You know, all the other things that have happened from the 60s up to present and this mad push For privatization Has fundamentally changed how we view everything Milton Friedman and valker when they basically said that You know, if you print money, we're going to have inflation has made every single person on the planet terrified of inflation Okay, and so as long as these kind of neoliberal things exist and are that go on You know recanted if you will are unfought back against I mean look at every single thing Your friends and my friends and the alternative media even say, I mean, we are plagued with neoliberalism Even when we're doing it. We don't even realize it. I watched a Roseanne show when it first came back on the air First episode very first episode and I only watched it out of a curiosity fact because I hated her Right, but I watched this one episode and the very first episode her and her sister are fighting about jill stein And and they're fighting about medicare for all and she's like, you know Something the only thing wrong with socialism is eventually you run out of other people's money Ha, ha, ha when you realize that that's complete bullshit because the taxpayer myth The idea of the taxpayer dollar is the biggest racist Frickin disgusting line that the left continues to use like a cudgel That's why I want my hard-earned tax dollars paid for israel. I don't want my hard-earned tax You know and this is what roseanne. It's baked in this neoliberal thinking is baked into our churches It's baked into our sitcoms. It's baked into our children's stories everything. It neoliberalism is everywhere And so you're eradicating that mindset eradicating that space And starting to change it back to the public purpose and stuff like that is really important So that's why I like bill mitchell. He has got a book called reclaiming the state And some people complain about it because it's it is a bit about nationalizing Understanding the nation state and how its exertion of its ability as the currency issuer can fundamentally change everything within that nation state Okay, but it talks about the history of neoliberalism. It talks about all the lies and stuff that are going on even to this day You know the the miss the the idea that Somehow or another, you know deficits today are going to be carried on the backs of our children tomorrow. It's a crock It's bullshit. It's a lie And and so hit this book reclaiming the state to me was a really really fantastic book Mitchell and fozzy wrote it And I would also say there's probably about 40 other books that I could recommend But I can't recommend enough understanding theory and history To go along so you understand How we have been divided every step along the way every time blacks and whites have tried to unite in class struggle The the powers that be have thrown a wedge issue out there. They've given the The poor white people a nickel more than the poor black people to create space It's always been a divide and conquer strategy Identity politics has been used as a weapon. It has not been used as a weapon for the people that need it It's been used as a weapon by the power elite to keep us from uniting And unfortunately this continues to happen. So liberal politics tends to focus on identity Whereas socialism tends to focus on class And I think that because of the two we have to find a way to have an intersectional movement that understands the role of power Understands a role of history understands the plight of these minority communities and communities that have been ravaged by capital And then also understand the mmt angle. You can't have them without the other I mean, otherwise you just end up with what republicans do And and and I think it's important to have that understanding of class and understanding of money you put it together and we can change the world Yeah, I think that that is beautifully put this does have to be intersectional It has to be looking out for marginalized communities and also acknowledging the class differences But realizing what can be done knowing modern monetary theory Yeah, it's just it's a new world if you understand it and it's funny that you bring up the Neoliberalism that is kind of baked into everything including popular culture I even find myself saying it to where I'll be talking on the show about how hey, like, you know We're getting our tax dollars extracted before we even see our paychecks So I wanted to pay for something like medicare for all I wanted to not go to killing children in in yem and in war And so it really it is going to take a lot of deprogramming because when it comes to neoliberalism and and just Capitalism or broadly speaking it really controls every single aspect of our lives And once you realize the way that it controls Everything about us, you know from the minute we get up to the time we go to bed Then you kind of can start that deprogramming process But I think that modern monetary theory is a little bit different in the sense that If we knew the way that money Works then we would understand the impact that it could have on us if that makes sense It's a huge thing. You know, we talked before the show I wanted to talk for everybody to hear this because I think this is a very important point Neoliberalism wants us to have more money to spend because it wants us to keep capitalism alive It wants us to go and buy some random thing You know some impulse buy it wants us to go on a binge on amazon It wants us to you know Just start buying things on these discount pop-up ads that show up on facebook and other things They want us to buy buy buy. That's how capitalism thrives And so throwing cash at the problem is decidedly neoliberal And so when you think about The ubi, which is the sweetheart of a lot of silicon valley folks The uberization of our society, right the the subsidization of shit wages This is the neoliberal Trojan horse to dismantle the entire social safety net, okay And it goes down if you look at reparations even take reparations as a ubi of sorts. It's not it's deserved. It's earned Okay, but if you look at reparations reparations is far more than just Cash reparations is a substantive change to society cash is a part of it But it's also fundamentally making the systems and structures that support people To be equitable, right? It's about bringing up people that have been left behind and bringing them up to where they should be Not giving them a handout, okay And so when you think about the ubi, which has gotten popular because of andrew yang and scott santons and other folks It is literally just throwing cash at the problem. It doesn't change anything In fact, the rontier class is begging for The ubi because the ubi will ensure that they just it's a pastor. Here's your money for rent Why not provide people with housing as a right? Why not provide people with debt relief? Why not get rid of student debt instead of here? We'll give you a thousand dollars a month towards your student debt I I want my health care for free I don't want to be debt ridden and all that throwing money at this thing does is temporarily Provide some minimal relief But then everything rises up because they know what slack is in the economy and the prices rise to meet that And so unless your ubi is constantly rising, okay, and it's enough to really pay for your needs You are going to be a subsidized wage hound for some uberization of our society and to me it is probably the single most horrific thing that has come through the door as kind of like the Um, you know, it's like the the silver bullet to all fixing all poverty. It's a crock, right? Give people a federal job guarantee a guaranteed wage paid by the feds administered by your local community We want local communities thriving again. Think of everything going on in your local community that is not funded right now Think about the beautification arts kids are no longer getting to take band class or going to gym It's everything is trimmed down to the bone, right? We have an opportunity there to fundamentally change how we view work We can pay moms to stay at home. We are dads even, you know, it doesn't have to be gender specific And all those women out there that have stayed in bad marriages their whole life terrified of What it would be like to leave because they've got a brutal husband that has beaten them or whatever They have freedom. So this is an mmt course staples. The federal job guarantee is baked into The thing because you know the tax creates the first unemployed person if you remember my story of the king Okay, so mmt provides a solution to that with the federal job guarantee If we're going to put a tax on it, we're going to provide you with a way to pay the tax because capital and and private business They have a decided urge to not hire you they wouldn't hire as few people as possible It's not in their bottom line best interest to have full employment So there's no way the private sector would ever provide full employment It was going to require the federal government to step in But the ubi is so sexy because it sounds like it is this cure-all and all it really is Is one more excuse for libertarian minded people to destroy the social safety net It doesn't matter whether you would do that. It matters that that has been a 50-year plan of the libertarians Going back to Milton Friedman, and it's probably even further back than that So this is why I said history is such an important thing and understanding theory because just throwing cash even mlk He's wrongly pinned as the guy who wanted ubi Martin Luther king jr wanted a federal job guarantee and he wanted a guaranteed minimum income for people that could not work For whatever reason could not work. It was not a universal give it to everybody thing Because what that is is status quo if you literally raise everything all you're doing is providing money you have fundamentally changed absolutely nothing and and It's a shame, but i'm hoping people will wake up to this I've written an article out there that ubi is neoliberalism On steroids basically you got pavlina chernova who has written the book the case for a job guarantee And she breaks down these things in her book. It's all out there You just have to ask yourself Do I want to be held prey to the private sector and their profit motive or would I rather the federal government Who can pay any bill it needs to to be the one that carries those basic needs forward not cash And I think that if you think about it like that Providing people's basic needs as a right it eradicates Generational poverty it eradicates all the structures that keep people down I think it's a fundamental game changer and I think that we need to start thinking about basic need guarantees and not cash Yeah, I totally agree with that actually and as you learn more and more about modern monetary theory I think that these things kind of become evident because you can you can take a policy that is on its face seemingly progressive But again We need structural changes and the only catalyst for that is modern monetary theory We can't actually fundamentally reshape society with one policy like UBI So steve you've given us so much. Um, is there any lasting words that you want to say before we close? Yeah, please by all means Focus folks on our you know the current situation with the teachers in arkansas right now They're they're right now fighting in the supreme court against uh big wall street interests Because their pension fund got screwed up during the great financial crisis and there's a lot going on right now with extreme control fraud that is Blinding us from the possibilities of what we could do with mmt It's the root cause the fraud the control fraud our entire government is in bed With wall street right now and and unless we dislodge that unless we start making real Substantive change by one person each one teach one weaponizing knowledge They're going to continue to do that. And so we have a podcast with all the experts on it called Well, you you raised it up the new untouchables the bakora files We also have macro and cheese which you can find on our website at realprogressives.org under media Both of these are in my opinion. It's not me. I mean, yes, I'm in it But it's really about the experts that I bring on and the conversations we pull through Please do check it out. It's not infotainment. This is weaponized knowledge And I hope that you know people take a look at it listen to it and um and spread it around It's really important. Well, thank you so much. Steve. It has been a pleasure I appreciate the time that you've taken this time and the last time where we tried to film But we couldn't because my computer decided to just implode. I really appreciate it You're going to be my designated mmt guy if you're cool with that and I will continue to reach out Thank you so much. I really appreciate it, Mike