by L. Randall Wray, New Economic Perspectives
Editor’s note: This is the conclusion of a seven-part series. The links to the previous six parts are found at the end of this article.
The monetary system is a wonderful creation. It allows for individual choice while giving government access to resources needed to allow it work for us to achieve a just society.
The monetary system spurs entrepreneurial initiative. It finances, organizes, and distributes much of the nation’s output. It is one of the primary mechanisms used by government to accomplish the public purpose.
There could be a better way to organize production and distribution. There could be a better way to allocate resources between public and private. There could be a better way to induce the private to serve not only its own interest but also the public interest. But if so, we have not yet seen it—at least not since the end of tribal society, and I’m not sure I want to go back there.
Until that better system comes along, we need a progressive meme for the monetary system we’ve got. Progressives have been in retreat for the past three or four decades. Yes, they’ve won some battles—mostly in the social sphere. They’ve lost almost all economic battles, however. At least some of those losses are due to adoption of the wrong meme for money.
We need to recognize that the monetary system is important. It is not merely—or even mainly—used to lubricate exchange of goods and services. From its origins, the monetary system has played an important role in pursuit of the public interest. It also is used in pursuit of the private interest. And it is—especially in recent years—used by a rapacious elite of Wall Street insiders in their own selfish interests.
To be sure, the monetary system cannot and should not do everything. While capitalism tends to extend the monetary sphere into an ever larger proportion of our social provisioning processes (“the economy”) that can be carried much too far. There are areas that need to be kept off-limits, including many functions within the purview of government.
We pay our judges and lawyers but we do not want them to sell judgments to the highest bidder.
We let our candidates for higher office accept campaign funds but we do not want them to sell themselves to contributors.
As we push this progressive meme we acknowledge that we deserve a better government than what we’ve got—and what we’ve had even when at its best. Many of those in government serve private interests, not the public interest. They’ve been bought and paid for.
The monetary system provides the power to do good, and the power to do bad is the other side of the coin. Still, even a largely bought and incompetent government (remember “Heckuva Job, Brownie”—in charge of President Bush’s rescue of New Orleans after Katrina?) is better than no government.
Even the highly suspect bail-out of Wall Street in the aftermath of the Global Financial Crisis was better than no policy response at all.
A better government can serve us better (compare the Obama administration’s handling of Sandy to Bush’s handling of Katrina). Perfection is hard to achieve, but not necessary to attain some success.
Good is not the enemy of perfection.
We have a better chance of getting a better government if we choose a better framing. We need better memes for our economics. As Robert Heilbroner told me (while declining to write a blurb for my 1998 book): money is the scariest topic there is, and your book is going to scare the hell out of the reader. He was right. We need to stop scaring their readers.
I know from nearly a quarter century of experience that the framing and memes used by those of us who have developed MMT on the shoulders of giants (mostly, Post Keynesians and Institutionalists) that we need better framing.
It isn’t enough to be right.
More generally, progressives need to drop the conservative framing; they need immunization against the conservative meme viruses.
They need a new meme for money. I don’t pretend to have found the right one(s). But I hope to have contributed to the initiation of a discussion.
The Previous Parts in This Series
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