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Hi all, Read the attached and weep. The post is a crash course in MMT partially in the context of the UK, including recent developments. If you wish to understand how the national economic system really works then read this. Ignore those New Keynesians like Wren-Lewis and Krugman. They aren't worth your time. But MMT is. And the data corroborate MMT. The data do not corroborate the mainstream narrative. You can find data set analyses in the first version of the textbook that Mitchell has just published. A more extended and advanced version will be published in the summer, hopefully. I am attaching the post because I included what I felt were comments that either added points or clarified aspects of Bill's post, leaving others out. You can read them or ignore them as you choose. The author of the blog post is Bill Mitchell, one of the world's foremost heterodox macroeconomists and a cofounder of MMT, Modern Monetary Theory. I am distinguishing between macroeconomics, the economics of the nation-state, and microeconomics, the economics of the household and the firm, because they require different mind sets and skills. While McDonnell may possess the latter, he does not possess the former. I have met and spoken with John McDonnell and feel that he is a decent man. The problem is that he is out of his depth. The Labour Party are once again austerity-lite. If any of you saw the Andrew Marr show when McDonnel and Osborne were on, you would have seen that what they were saying were not that far apart, indeed, not much different from what Balls would have said. While one of the commenters said that were Labour to win the next election, it would be more of the same, I do not believe that to be the case. It would be similar but not so Draconian, or so I currently believe. Today's Budget may not be too spectacular because Osborne does not wish to do anything to screw up his buddy's referendum. Rawnsley, in Sunday's Observer, reported that Cameron said of himself that "I am 50% politician and 50% human". Osborne is apparently 90% politician and 10% human. Rawnsley contends that some senior figures in the Tory party doubt whether Osborne is even 10% human, that is, not much more than a robot. Be that as it may, while today's Budget may be unspectacular, we still have the summer Spending Review to look forward to. Of course, the political landscape may have altered somewhat by then. Let me end with a quote from Keynes from a 1933 radio broadcast with J C Stamp. "Look after the unemployment and the Budget will look after itself". What this means is that the budget should never in itself be a subject of economic policy, though it may be a subject of political policy. The level of unemployment should be the subject of economic policy, and in our day other aspects of government activity such as the welfare state and the NHS, neither of which either existed or were sufficiently developed in Keynes' time. This means, as you will see if you read the post, that the level of government debt should never be dealt with directly as an aspect of government policy. There are a number of reasons for this, and the post will spell them out for you, I hope. Good luck to you all, Larry Dr L Brownstein [Alt-e: [log in to unmask]] ****************************************************** Please note that if you press the 'Reply' button your message will go only to the sender of this message. If you want to reply to the whole list, use your mailer's 'Reply-to-All' button to send your message automatically to [log in to unmask] Disclaimer: The messages sent to this list are the views of the sender and cannot be assumed to be representative of the range of views held by subscribers to the Radical Statistics Group. To find out more about Radical Statistics and its aims and activities and read current and past issues of our newsletter you are invited to visit our web site www.radstats.org.uk. *******************************************************