I saw an interesting discussion in the comments of my recent post on Sumner and what I see as his bid for CB independence. Edward-a normal, and I find quite intelligent-commentator at Sumner's left a few comments. Which is welcome-I really don't want to take potshots, I want to engage, however for whatever reason, Sumner doesn't like to engage me.
My regular commentator Greg had some things to say as well in response to Edward. First Edward:
"Greg,"
"What do monetary experts have to do with economics Scott? I thought money was a neutral veil? We dont even need money to understand economics according to all of Nick Rowes quaint little stories. Money is just another good. If its just another good why cant homo economicus figure out how to use it since we are so rational and create totally efficient markets?"
"??????? MONEY IS A NEUTRAL VEIL IN THE LONG RUN."
"The people out there who simply read Keynes as "govt big spending advocate always" just love Scott."
"This is slightly true. I like Scott because he favors stimulus in a depressed economy, but on other issues he's a pragmatic libertarian, not part of the nutty Ted Cruz, Rand Paul Ron Paul Crowd."
My regular commentator Greg had some things to say as well in response to Edward. First Edward:
"Greg,"
"What do monetary experts have to do with economics Scott? I thought money was a neutral veil? We dont even need money to understand economics according to all of Nick Rowes quaint little stories. Money is just another good. If its just another good why cant homo economicus figure out how to use it since we are so rational and create totally efficient markets?"
"??????? MONEY IS A NEUTRAL VEIL IN THE LONG RUN."
"The people out there who simply read Keynes as "govt big spending advocate always" just love Scott."
"This is slightly true. I like Scott because he favors stimulus in a depressed economy, but on other issues he's a pragmatic libertarian, not part of the nutty Ted Cruz, Rand Paul Ron Paul Crowd."
http://diaryofarepublicanhater.blogspot.com/2013/10/central-bank-independence-and-scott.html
"NO ITS NOT"
"The long run is just a succession of short runs. There is nothing neutral about it. That gets repeated as if its a self evident or firmly proven point, which its not."
"He may favor stimulus, but he doesn't seem to figure out how to get it from monetary policy, unless the Fed goes fiscal and starts handing out 1000$ bills for bags of dirt."
"And I'm not so sure about the pragmatic part. Pragmatists don't claim to have figured out once and for all beyond a shadow of a doubt that fiscal policy has no positive affect. He has that belief but he hasn't proven anything. And pragmatists don't scoff at criticisms of policy suggestions (like NGDP futures) by people who do those things for a living! Scotts an ivory tower academic with no real world experience. Everything he's learned was from someone else. His goals are not anything but political."
Greg retorts:
"MONEY IS A NEUTRAL VEIL IN THE LONG RUN."
"NO ITS NOT"
"The long run is just a succession of short runs. There is nothing neutral about it. That gets repeated as if its a self evident or firmly proven point, which its not."
"He may favor stimulus, but he doesn't seem to figure out how to get it from monetary policy, unless the Fed goes fiscal and starts handing out 1000$ bills for bags of dirt."
"And I'm not so sure about the pragmatic part. Pragmatists don't claim to have figured out once and for all beyond a shadow of a doubt that fiscal policy has no positive affect. He has that belief but he hasn't proven anything. And pragmatists don't scoff at criticisms of policy suggestions (like NGDP futures) by people who do those things for a living! Scotts an ivory tower academic with no real world experience. Everything he's learned was from someone else. His goals are not anything but political."
Again, I've tried to believe the best in Scott, but he's made it very difficult for me to do so. One problem is personal of course-he has no interest in engaging me. I'm not the only one either. I notice that he used to try to engage the MMTers but has given up. Is this because he's decided that it's hopeless getting through to them or because he knows he won't get the better of the argument.
http://diaryofarepublicanhater.blogspot.com/2012/07/scott-sumner-scott-fullwiler-grudge.html
http://www.themoneyillusion.com/?p=10238
http://www.themoneyillusion.com/?p=10238
In the above link Sumner argued that you can't explain the price level without QTM and since-he asserted-they rejected the QTM their monetary theory must be wrong. Of course, you would have to also establish:
1. They don't believe in the QTM
2. The QTM is right.
Of course, Sumner just presumes the QTM is right and calls it a day. In any case, at least back then he would try to engage. He has since quit doing that and has gotten a lot more hypersensitive to criticism since I've notice. For the record, when I said that to him he agreed.
http://diaryofarepublicanhater.blogspot.com/2013/05/scott-sumner-has-now-written-2001-posts.html
"Mike Sax, Yes, I’ve gotten more frustrated and testy over time. Partly due to seeing the same comments over and over again, and partly because I’m increasingly busy–too busy. But I agree that is a fault on my part."
http://www.themoneyillusion.com/?p=21140#comment-247360
The reason for these same comments is because the commentators in question obviously don't feel it answered them satisfactorily.
So I tend to think that Greg is right-that while Sumner claims that what we need are for enlightened monetary technocrats to run monetary policy while standing aloof from any political influence or agenda. in reality his whole agenda is totally political.
I can't see his belief in the zero fiscal multiplier as anything but political which is why I sometimes refer to him as a 'Republican.' He doesn't like this as he likes to present himself as being above politics but if you follow his prescriptions you find that the Republicans are basically right if you believe him. This is a point Morgan Warstler makes again and again. Notice too while many like Edward say that Sumner is 180 degrees from a Ted Cruz, Morgan loves Ted Cruz and he loves Sumner.
So some ideas-and I think monetary offset is one-are not nearly as 'neutral' or 'pragmatic' as they appear.
Another such idea is the doctrine of states rights. First of all, SR just has a terrible history-it was used to justify slavery in the 19th century and segregation in the 20th. It's usually function has been to aid and abet political reactionaries. Today, because of their failures at the national level-which are only going to get worse as they've learned nothing-the Republicans have been doubling down at the state level over the last 4 years.
We've seen anti labor laws, anti voting laws, anti female laws-rolling back abortion and birth control access. I call them anti female because their impact is not just about abortion. When Red state after red state shuts down 3/4 of the abortion clinics in the state note that these clinics don't only do abortions but offer a myriad of other healthcare and gynecological services.
We've seen many states really flouting federal law in perusing these reactionary policies. In the latest, we see a number of states ignoring that DOMA has been struck down by the SJC and that DADT has been outlawed. Chuck Hagel very eloquently took on states rights circa 2013 the other day in a speech at the anti Defamation League.
"Defence Secretary Chuck Hagel has criticised nine US states for refusing to issue identity cards to same-sex spouses and said he expected the adjutants general for the state militias to comply with lawful directions and Pentagon policy."
"Hagel said the Defense Department moved to begin issuing identity cards to the spouses in same-sex couples following a Supreme Court ruling this year that cleared the way for them to receive the same work-related benefits given to heterosexual couples."
http://diaryofarepublicanhater.blogspot.com/2013/05/scott-sumner-has-now-written-2001-posts.html
"Mike Sax, Yes, I’ve gotten more frustrated and testy over time. Partly due to seeing the same comments over and over again, and partly because I’m increasingly busy–too busy. But I agree that is a fault on my part."
http://www.themoneyillusion.com/?p=21140#comment-247360
The reason for these same comments is because the commentators in question obviously don't feel it answered them satisfactorily.
So I tend to think that Greg is right-that while Sumner claims that what we need are for enlightened monetary technocrats to run monetary policy while standing aloof from any political influence or agenda. in reality his whole agenda is totally political.
I can't see his belief in the zero fiscal multiplier as anything but political which is why I sometimes refer to him as a 'Republican.' He doesn't like this as he likes to present himself as being above politics but if you follow his prescriptions you find that the Republicans are basically right if you believe him. This is a point Morgan Warstler makes again and again. Notice too while many like Edward say that Sumner is 180 degrees from a Ted Cruz, Morgan loves Ted Cruz and he loves Sumner.
So some ideas-and I think monetary offset is one-are not nearly as 'neutral' or 'pragmatic' as they appear.
Another such idea is the doctrine of states rights. First of all, SR just has a terrible history-it was used to justify slavery in the 19th century and segregation in the 20th. It's usually function has been to aid and abet political reactionaries. Today, because of their failures at the national level-which are only going to get worse as they've learned nothing-the Republicans have been doubling down at the state level over the last 4 years.
We've seen anti labor laws, anti voting laws, anti female laws-rolling back abortion and birth control access. I call them anti female because their impact is not just about abortion. When Red state after red state shuts down 3/4 of the abortion clinics in the state note that these clinics don't only do abortions but offer a myriad of other healthcare and gynecological services.
We've seen many states really flouting federal law in perusing these reactionary policies. In the latest, we see a number of states ignoring that DOMA has been struck down by the SJC and that DADT has been outlawed. Chuck Hagel very eloquently took on states rights circa 2013 the other day in a speech at the anti Defamation League.
"Defence Secretary Chuck Hagel has criticised nine US states for refusing to issue identity cards to same-sex spouses and said he expected the adjutants general for the state militias to comply with lawful directions and Pentagon policy."
"Hagel said the Defense Department moved to begin issuing identity cards to the spouses in same-sex couples following a Supreme Court ruling this year that cleared the way for them to receive the same work-related benefits given to heterosexual couples."
"Several states are refusing to issue these IDs to same-sex spouses at National Guard facilities," Hagel told the Anti-Defamation League. "Not only does this violate the states' obligations under federal law, their actions have created hardship and inequality."
"Refusal to issue the cards at state militia facilities means couples may have to travel long distances to federal bases to obtain the cards there, Hagel told the centennial dinner of the Anti-Defamation League."
"This is wrong. It causes division among the ranks, and it furthers prejudice, which DoD (Defense Department) has fought to extinguish," Hagel told the group in remarks honouring his predecessor, Leon Panetta.
Mr. Hagel made two things very clear. These states are in noncompliance with federal law. He will make sure they do comply. This is the 2013 version of when Dwight Eisenhower sent troops to Little Rock in 1957. That thankfully won't be necessary this time but compliance will be enforced.
Hagel told the ADL he had directed General Frank Grass, the National Guard chief, to meet with adjutants general from the nine states to deal with the issue.
"The adjutants general will be expected to comply with both lawful direction and DoD policy, in line with the practices of 45 other states and jurisdictions," Hagel said.
What do monetary offset and states rights have in common? For one thing, they are both conservative ideas and while belief in one may not seem to necessitate belief in the other many, most conservatives do. Indeed, I don't think you'll find many who believe in states rights who do believe that fiscal policy is a good way to stimulate growth during a recession.
More to the point, both ideas claim to be pragmatic, intellectual arguments, yet both clearly have a an unacknowledged political agenda.
P.S. I agree with Edward that the negative income tax is worth looking at. I notice though that no Republicans discuss today like they did in the 70s-so how's it going to get passed? I just recently ordered a book about the very interesting experience of New Jersey and the negative income tax.
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