I Can Has Shared Sacrifice?

By lambert strether of Corrente

The whole bloody mess — “shared sacrifice” (Obama; heh) / austerity / “Throw Grandma from the Fiscal Cliff” — is so appalling, and so dispiriting, that there’s only one way forward:

Do it for the lulz.

Because if there’s any form of infrastructure that America can still build, it’s the Internet meme. So, dear readers, do feel free to viralize this JPG of “shared sacrifice” on your social media of choice, including the mail that you send to hundreds of your family and friends, your elected representatives, your blogs, etc., or vote it up. (To be clear on the trope: The “sacrifice” is the hearts of the American people, ripped from their chests and “shared” by the priests of the political class, who lift them to the sky where the invisible austerity Gods live: the 1%. Then the priests throw the bodies down the steps of the pyramids which represent, I would think, the banks, the Fed, and any of the other large white buildings in Washington, DC.)

* * *

[See update below.]

That’s really all I have to say, but since nobody else chewed Bernie Sanders’ ankles for drinking the “shared sacrifice” Kool-Aid and proving himself unworthy of the name “Socialist,” I will. It’s hard work, but somebody’s got to do it. Here’s an excerpt from a highly praised speech letter that Sanders recently made wrote; I’ve added some helpful interpretive material in brackets:

Everyone [who is anyone] understands that over the long-term we have got to reduce the deficit [except not]- a deficit that was caused mainly by Wall Street greed, tax breaks for the rich, two wars, and a prescription drug program written by the drug and insurance companies [unlike ObamaCare. Not]. It is absolutely imperative, however, that as we go forward [in the midst of a never-ending recession] with deficit reduction we completely reject the Republican approach that demands savage cuts [so mild cuts are OK?] in desperately-needed programs [but other program are fair game?] for working families, the elderly, the sick, our children and the poor [even if Obama’s self-conceived mandate is for “the middle class”*, i.e., not working families, not millions of elders, not at least 25% of our children, and most certainly not millions of the poor or the the 17.4% of the working population that is disemployed] while not asking the wealthiest among us to contribute one penny [so cuts are OK if taxes on the wealthiest are raised? Yes. Such a deal!].

Mr. President, please listen to the overwhelming majority of the American people who believe [not] that deficit reduction must be about shared sacrifice. The wealthiest Americans and the most profitable corporations in this country must pay their fair share [whatever that means]. At least 50 percent [why not 100 percent?] of any deficit reduction package must come from revenue raised [the United States, as the sovereign issuer of its own currnecy, is not revenue constrained and cannot be forced to default] by ending tax breaks for the wealthy and eliminating tax loopholes that benefit large, profitable corporations and Wall Street financial institutions. A sensible deficit reduction package must also include significant cuts [yeah, let’s start by scuttling a few aircraft carriers] to unnecessary and wasteful Pentagon spending [there’s some other kind?].

So, did you hear Bernie Sanders, Socialist firebrand, the second coming of Eugene V. Debs, calling for “Not one penny of cuts?” No, me neither.

In practice, in the world where sausage is made, the position crypto-Democrat Sanders has staked out is indistinguishable from Obama’s: The wealthy are to pay more in taxes and the rest of us will get even worse social insurance. But all the players know this deal is bogus; no matter that the wealthy are supposed to pay “a little more” (Obama) or some “pennies” (Saunders), their only real costs will be the accountants they hire to avoid or evade what isn’t even real money to them; but the costs will be very real to us, and will come out of our hides. The wealthy may suffer a twinge as they lose a little “self-actualization” at the tippy top of Maslow’s pyramid, but the rest of will suffer real pain at the base: Loss of health, loss of food, loss of resources. Luxuries at the margin are not a fair trade for necessities paid for by social insurance. The sacrifice may be shared, alright, but not equally, because it cannot be.**

Here is what the baseline should be: “Not one penny of cuts to Social Security, Medicare, Medicaid, or any other social insurance program, and any savings to be paid out as benefits.” Hear that from Bernie? Any Democrats? Didn’t think so.

We have already sacrificed, whether through the loss of our jobs, our health, our homes, our net worth, or from real wages being flattened for the last forty years, or from paying some well-fed smiling usury-stinking weasel their cut on the deal every time we turn around. The proper amount of additional sacrifice for us is, precisely and exactly, zero.

And while we’re at it, the age for Social Security eligibility should be lowered, to 60, so that some of us oldsters who are planning to work ’til we drop can get out of the work force, and maybe more young people can get jobs. And while we’re at it, Social Security benefits should be age neutral. None of this “I’ve got mine” stuff; that benefits get worse the younger you get is a sham and a travesty and a policy a political class with an smidgeon of human decency would never have put into place (even if the sainted Tip O’Neil and the sainted Ronald Reagan cut the first such deal, back in the day, and people of my age let him get away with it).

C’mon, Bernie. Socialist? As much a socialist as Obama’s a socialist. Or a Kenyan, for that matter. Go on. Prove me wrong!

NOTE * To be fair, Obama’s self-conceived mandate includes “families that are working hard to try to get into the middle class.” Never mind what “working hard” means — the Victorians, too, distinguished between the deserving and the undeserving poor, after all. But not all rational actors want to be “middle class,” since the passport to credentials involves massive debt. Others, “try” as they may, will not make it. Under the bus with them!

NOTE ** Everybody’s got to have skin in the game. So you can sell one of your kidneys, and I’ll sell one of my yachts!

UPDATE 3:25AM Perhaps I need to release my incisors from this portion of Bernie’s website and re-fasten them on his latest speech and, more importantly, on today’s presser (hat tip AH and GC in mail for links). It is true — and it’s good that it’s true — that the “shared sacrifice” verbiage has been removed. That does not mean, however, that a sacrifice will not be performed.

First, I want to set the policy baseline. Je répète:

“Not one penny of cuts to Social Security, Medicare, Medicaid, or any other social insurance program, and any savings to be paid out as benefits.”

Careful wording here. Note especially no cuts to “any other social insurance program.” AFAIK, and I’d love to be wrong, the anti-austerity efforts are silo-ed: Social Security, Medicaid, Medicare. But money’s fungible: It doesn’t help my household budget (which is not like a governments) if Medicaid isn’t cut, but food stamps or unemployment insurance or home heating oil aid or school lunches are cut. All the money comes out of the same small pile. The Democrats — and Sanders, too, oddly for a socialist — are defending programs. But what they ought to be defending is households.

Note also “savings to be paid out as benefits.” If the administration’s minions at OMB come up with more efficient ways to deliver services — or, more likely, new ways to game the formulas — that should not mean that the program budget is cut. Rather, the newly available money should be passed on to households.

That is the policy baseline. Now for the historical baseline. The Democrats, and especially “progressive” Democrats, have a long history of fine words. But fine words butter no parsnips, and the history of Democratic betrayal is long. (Obama took back his fine words that he would filibuster on FISA reform, and voted for the bill, thereby retroactively legalizing Bush’s program of warrantless surveillance, in July 2008, presaging his Bushian view of executive powers.) Here are some fine words from Bernie’s speech (video; rough transcript AH):

SANDERS: So we are going to demand — and that’s what this election was about – you know what? Every now and then elections have consequences. WE WON. (applause, hurray’s).

Except. Does anybody remember 2009, when the Democrats “WON” and had the House, the Senate, the Presidency, and an overwhelming mandate for “hope and change”? And what were the “consequences” of that election? Well, on Obama’s signature domestic initiative, he betrayed the “progressive” public option advocates, who themselves betrayed the single payer advocates (more). Interpreting the words of Democrats and quasi-Democrats through a hermeneutic of suspicion isn’t driven by fear or projection, but reason and experience. And how does a weaker election result with a smaller electorate bring a stronger policy outcome?

Credit due, Bernie’s speech ditches “shared sacrifice,” so I’ll temporarily exempt Bernie — but not the rest of official Washington, a wholly owned subsidiary of Peter Peterson — until we have a policy outcome. Not bad:

That is we’re going to send a loud message to the leadership in the House, Senate and President Obama; do not cut Social Security, do not cut Medicare, do not cut Medicaid, do not cut … (applause). Deficit reduction is a serious issue but it must be done in a way that is fair – We must not balance the budget on the backs of the elderly, the sick, the children or the poor.

Or the workers, who go unmentioned — a curious omission for a socialist — but put that aside. Notice that Sanders doesn’t meet the policy baseline: No cuts to social insurance programs. Again, money’s fungible in the household budget, so households need to be protected, not programs.

But that was a speech for the camera in the Senate chamber. Let’s look at Bernie on the same day before the camera insiders watch: C-SPAN. I had to make this transcript because C-SPAN’s CC-based tool is so horrible, so any inaccuracies are mine:

C-SPAN: Senator Sanders, let’s talk about entitlement programs that you advocated for and fought for: Is there room to negoiate on the eligibility age of Medicare, or Social Security? Where can you negotiate on those?

SANDERS: Let me just back up for a second and I hope every knows that when we talk about going over the cliff it’s a ten year process, and I want everybody to be clear that if by December 31 an agreement is not reached, that does not mean that an agreement could not be reached in January or Feburary, which would make unnecessary many of the terrible cuts people have talked about.

In terms of Social Security, Medicare, and Medicaid, let me say the following: The first point to be made, and I am very happy that Senate Majority leader Harry Reid has recently made this point, and ironically enough back in the 1980s President Ronald Reagan made this point: Social Security, right now, has not contributed one nickel to the deficit, because as everybody knows, it’s funded independently by the payroll tax, the 6.2% that workers put in, the full amount that employers put in. When people talk aout deficit reduction, we have a serious problem, but Social Security has nothing to do with that. Today, the Social Security Trust Fund, a $2.70 trillion surplus, can pay out every benefit owed to every eligible American for the next 21 years. Our goal is to make Social Securty solvent for the next 75 years, so we have wprk to do, but Social Security, in my view, should not [sic] be removed from this discussion. I was glad that Harry Reid made that point. I hope the President agrees wth that.

In terms of Medicare and Medicaid, what we should be clear about is that in the so-called ObamaCare Affordable Care Act, we extended the life of Medicare by over ten years. I think we have got to do more In America right now, we are the only nation in the industrialized world that does not gaurantee health care for all people as a right, which is why I am an advocate of a single payer/Medicare for All system. I hope the system of Vermont will lead the country in that direction The bottom line is our system today including Medicare, is a wasteful, too bureaucratic. We can make efficiencies in it, but at a time when seniors are struggling right now with their health care bills, I will not support cuts in the benefits for people on Medicare. For example, one way to save money in Medicare is that when we passed the Medicare Prescription Drug Part D program, the Democrats insisted on language that said Medicare could not negotiate drug prices with the pharmaceutical industry. The result of that is in many instances, Medicare is paying higher prices for the drugs than the Veterans Administration or the Department of Defense. That is absurd. If we do that, we can save Medicare substantial suns of money. In terms of Medicaid, we are in the middle of a horrendous recession. We have 50 million people today who have no health insurance, and to say that we are just going to willy nilly deny millions of kids health insurance by removing Medicaid from them just does not make sense of me. My point is that right now, we have an incredibly unequal distribution of wealth and income in this country. People on top are doing phenomneally well. As Warren Buffet reminds us, their effective tax rate is quite low. I think that by asking the wealthiest people to start paying their fair share of taxes, by ending enormous loopholes within corporate tax law, by taking a hard look at defense spending, in which we’re spending three times as much as we did in 1997, the other wast that exists in Federal programs, we can move to deficit reduction in a serious way without attacking the needs of middle income or working families. [phew]

Well, one sees that Bernie does indeed have a talent for the filibuster!

But did Bernie ever answer the question? Well, no. No, he didn’t. And I don’t live evasion when simple and clear answers are available and easy. To me, it looks like the “No cuts… No cuts…. No cuts!” on the Senate floor went the way of Biden’s “flat out guarantee.” Surely, the simple answer should come readily to hand? “There’s nothing to negotiate. There will be no cuts.” Note also that in all of the left-inflected bafflegab, there’s no promise that there will be no cuts to social insurance, which is the baseline. Note further that in the midst of a “horrendous” recession, Sanders still wants to funnel savings to the deficit, and not households! Why?

For the rest of it — and it’s late, and I can’t parse any more transcripts tonight or tomorrow — Sanders does not challenge the importance of the deficit, and does not point out that the “fiscal cliff” is a wholly political construct. You can’t win a battle of ideas by adopting your enemy’s terms! And that’s before we get to the central misconception in the entire debate: That taxes “fund” spending…

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About Lambert Strether

Readers, I have had a correspondent characterize my views as realistic cynical. Let me briefly explain them. I believe in universal programs that provide concrete material benefits, especially to the working class. Medicare for All is the prime example, but tuition-free college and a Post Office Bank also fall under this heading. So do a Jobs Guarantee and a Debt Jubilee. Clearly, neither liberal Democrats nor conservative Republicans can deliver on such programs, because the two are different flavors of neoliberalism (“Because markets”). I don’t much care about the “ism” that delivers the benefits, although whichever one does have to put common humanity first, as opposed to markets. Could be a second FDR saving capitalism, democratic socialism leashing and collaring it, or communism razing it. I don’t much care, as long as the benefits are delivered. To me, the key issue — and this is why Medicare for All is always first with me — is the tens of thousands of excess “deaths from despair,” as described by the Case-Deaton study, and other recent studies. That enormous body count makes Medicare for All, at the very least, a moral and strategic imperative. And that level of suffering and organic damage makes the concerns of identity politics — even the worthy fight to help the refugees Bush, Obama, and Clinton’s wars created — bright shiny objects by comparison. Hence my frustration with the news flow — currently in my view the swirling intersection of two, separate Shock Doctrine campaigns, one by the Administration, and the other by out-of-power liberals and their allies in the State and in the press — a news flow that constantly forces me to focus on matters that I regard as of secondary importance to the excess deaths. What kind of political economy is it that halts or even reverses the increases in life expectancy that civilized societies have achieved? I am also very hopeful that the continuing destruction of both party establishments will open the space for voices supporting programs similar to those I have listed; let’s call such voices “the left.” Volatility creates opportunity, especially if the Democrat establishment, which puts markets first and opposes all such programs, isn’t allowed to get back into the saddle. Eyes on the prize! I love the tactical level, and secretly love even the horse race, since I’ve been blogging about it daily for fourteen years, but everything I write has this perspective at the back of it.


  1. Malmo

    I heard some bloke on Meet The Press claiming we ALL need to take our castor oil. Even the poor, I suppose. We’ll these sicko’s need to understand that the 99% have already consumed gallons of castor oil the past four years. They can all go straight to hell. What us 99%’ers need is honey, and lots of it. I don’t want to sacrafice even one penny, especially given the fact there’s absolutley no need to given how our montary system functions. The more I think on this the more I’m beginning to relaize this country is populated by sadomasochists or just plain sadists, the latter of which reside in high places.

    1. alex

      The 0.01% and their supporters have already consumed plenty of castor oil, judging from the resultant effluent.

          1. alex

            Interesting historical note. Would Dulcolax or Microlax work better these days? How about a good old-fashioned dysentery infection? Somehow castor oil hasn’t caught on as a symbol of fascism in quite the same way as jackboots or black uniforms. Bottom line: there’s such a thing as reading too much into a quip.

        1. rhelonegunman

          Do you mean the endless wars (1+ trillion for iraq… Not sure how much for afhanistan let alone the world police), tax welfare for transnationals, no or little tax on any and all hedgies, let alone the bush ‘stimulus’ (still waiting) tax cuts as part of his ‘mandate’ after a more narrow victory than Obama’s (but no mandate for him!) and when that admin said ‘deficits don’t matter – Reagan proved that’

          Remember: we’re ony in debt and poor when a democrat is in office.

    1. LAS

      This may be beyond the intend of the original posting but I have to say …

      If there is one thing the Bible illustrates time and again, it is the corruptibility of the human heart, so willing to worship the popular, expedient gods of the day at the expense of the living God (and the wonders of creation). If not those who persecuted Daniel, than it was those who persecuted Elijah or those who constructed a tower of Babel to deify their own skills or those who fashioned a golden calf even while Moses was recieving the tablets of law. On and on.

      After so many years of being tested, there is nothing to disprove the bible’s protrayal of the human spiritual condition. To quibble about how it treats cosmology (scientifically inferior) is to miss the point of what the inferior cosmology conveys about human spiritual condition. The inferior cosmology presented is a warning to technocracy, science and education that it is still outside the realm of the holy, sealed in a vault that doesn’t reach the holy by itself. Within the vault, human imagination and skills hoist up new false gods which we are ever attracted to worship.

      We worship, kill the worshiped king and then clasp a new king. I think it was Joseph Campbell who wrote about this process and how it seems to exist in every anthropology or ethnology.

      1. citalopram

        The Bible does a wonderful job of illustrating god-sanctioned genocide too.

        Anyway, back to the topic at hand.

        1. rotter

          The only “genocide” in the Bible was the flood, which was also Earth sactioned, and may be due for a repeat, all due to our “sins”.

          1. skippy

            And we took all his cities at that time, and utterly destroyed the men, and the women, and the little ones, of every city, we left none to remain. Deuteronomy 2:34

            And we utterly destroyed them, … utterly destroying the men, women, and children, of every city. Deuteronomy 3:6

            And when the LORD thy God shall deliver them before thee; thou shalt smite them, and utterly destroy them; thou shalt make no covenant with them, nor shew mercy unto them. Deuteronomy 7:2

            And thou shalt consume all the people which the LORD thy God shall deliver thee; thine eye shall have no pity upon them. Deuteronomy 7:16

            Thou shalt surely smite the inhabitants of that city with the edge of the sword, destroying it utterly, and all that is therein, and the cattle thereof, with the edge of the sword. Deuteronomy 13:15

            But of the cities of these people, which the LORD thy God doth give thee for an inheritance, thou shalt save alive nothing that breatheth. Deuteronomy 20:16-17

            And they utterly destroyed all that was in the city, both man and woman, young and old, and ox, and sheep, and ass, with the edge of the sword. Joshua 6:21

            So smote all the country … he left none remaining, but utterly destroyed all that breathed, as the LORD God of Israel commanded. Joshua 10:40

            Thus saith the LORD of hosts … go and smite Amalek, and utterly destroy all that they have, and spare them not; but slay both man and woman, infant and suckling, ox and sheep, camel and ass. 1 Samuel 15:2-3

            Skippy… Natural disasters (cough the universe doing its thing and people being there at the same time and place), are not a form of Earth “sactioned” activity nor Genocide, both are intent-less. Although the above biblical devotions are intent with forethought. Redcurrant in many foundation myths, that put – the devout – above it all… eh.

            PS. Genocide is a modern term, where in the past it was killing the evil worshipers of what ever stripe.

      2. Aquifer

        It always seemed to me that the WS bull was merely the golden calf grown up … so any “true believer” would not only give WS a wide berth, but prefer that it be dismantled altogether which, IMO, is a pretty damn good idea …

        1. Wendy Alison Nora

          I had the exact same thought, the Wall Street Bull represents the Golden Calf, when I saw it for the first time. The imagery was stronger the second time I saw it. Interestingly, when taking a taxi to the federal courthouse in Manhattan and giving its location, the taxi drivers always referred to the area as “that’s where the bull is.”

  2. CallMePessimistic

    Once again, all of this is flying into some fairly significant political headwinds.

    1. The idea that government budgets are just like household budgets is firmly and intuitively entrenched among the masses. Arguments to the contrary usually fall on deaf ears when they’re heard at all, and usually dismissed as “liberal propaganda” then. Expecting uneducated and thoroughly propagandized working class people to grasp the subtleties of MMT is simply too much to expect.

    2. The young have been convinced that the gig is up and that they’re not gonna have a social safety net in any case. Therefore cut it all now and screw the current “fat cats” who are cashing at their expense, even as their current and future job prospects are so very dim and debt levels so very high.

    3. The Big Lie machine that the GOP cranked up so successfully in 1980 is humming right along still, and now with the aid of willing democrats too. It seems the political class has already reached a consensus on the matter, regardless of what the masses may or may not think.

    4. With the War on Terror now more aptly named The Perpetual War of Terror, we are always merely another Shock Doctrine event away from scaring everybody silly, which is to say reestablishing subservience among the flock for whatever economic doctrine the corporate fascists have in mind. We no longer have an elected government per se, we have a corporate appointed, self-enriching, governing board of directors. Government capture efforts begun decades ago are now complete and paying off handsomely for those on the inside. For the rest of us, we have all the political throw weight as the minimum wage dock hands at any major corporation. Less than zero.

    1. ambrit

      Dear CMP;
      As to your Point 4, the Oakland Occupy dock ‘actions’ showed just how powerful those underpaid dock workers are. Cut off the flow of ‘cheap’ goods from overseas, and the rest comes tumbling after. Not to worry though, the social turmoils the PRC and the Asian Production Zone (anyone remember Imperial Japans’ Co-Prosperity Sphere?,) are now entering as their nascent ‘middle class’ wakes to its power, will bring long overdue wage and price readjustments. (Read that as the Asians finally starting to get their fair share.)

      1. Susan the other

        Which is why Hugh Hendry laments the death spiral of mercantilism. And also why our perpetual war machine is now the engine of our economy, totally. It’s so damn nuts it’s not funny anymore – I can’t even watch Colbert.

      2. PunchNRun


        I have learned to be wary of silver bullet scenarios, they are seductive but take us for a ride to nowhere. If all we do is wait for “it” to happen, we leave intact the status quo, and make some people very happy. From what I have seen, the next end of the world will be the first.

        I think more positive action is needed.

    2. different clue

      Well then, don’t waste their time with stuff like MMT.

      Ask them why they shouldn’t get the Social Security they have spent their whole worklives paying for. ” I PAID for this entitlement!” Say things like “sacrifice starts at the top.” Other things like that. See if that goes further than abstruse discussions of MMT and stuff.

    3. cripes

      @calmepessimistic: precisely. Which is why i am sick of hearing that voters are to blare for the current fusterclick. Citizens have zero input, most don’t know shit fromm shinola and are too scared to ask the right questions.

    4. ian

      Regarding point 1: nor is it completely *unlike* a household budget in the sense that there has to be some limit beyond which you can’t print and spend your way out of budget problems. Folks can argue about exactly where that limit is, but that doesn’t mean it doesn’t exist.

      1. rob

        actually, it IS wholly unlike a household budget.There is actually no debt limit. There may have been debt levels in the past, but that doesn’t positively mean anything about the future…..other than to get into semantic arguements about absolutes… the household analogy is so far off, it has no use. and it is a dangerous perception for a people to imagine. there is no future reality,just possible realities.

  3. Tiger

    How can you anyone be pro-MMT and environmentalist at the same time? MMT seems to say resource consumption shouldn’t matter. How does MMT apply to the economy of 10000 years ago? MMT seems to assume a fiat system. Fiat money is modern. Fiat IS the problem.

    We need a HEMT not a MMT. History emcompassing monetary theory.
    Imagine if, prior to 700 B.C., the force exerted ona an object, and it’s mass, had no bearing on its acceleration. Than f=ma wouldn’t be valid. That’s MMT.

    In the blog post it says:
    “Our leadership is so used to thinking in terms of the gold standard”?

    That is *almost* true, except that it has nothing to do with reality on the ground! Do you follow lawmaker interviews? Gold standard is NOT what they have on their mind! They have benanke on their mind. MMT Is HERE ALREADY! The cat food discourse out there was until recently the exception not the rule.

    MMT says we don’t need to budget like a family.
    Really? So… We don’t have a planet with finite resources?

    Those are my thoughts… Expressed with vigor but maybe I need a better MMT tutorial.

    1. Tiger

      Let me be clear, I am opposed to fat cats corrupting politicians and taking my resources. But does that mean we have to invent an economic theory that is a patchwork of sense and nonsense and relies on a modern system that is itself the problem?

      1. Jefemt

        Tiger, great point. I often ponder how much less resource waste and abuse would occur if it were not for leverage and borrowing. The debt and wealth, both, are instruments that represent value, but really are only hypothecates (paper) and have no value other than faith and credit. If and when we either cast the FIAT MMT away, or it falls apart, that will be an ugly day of music-stopped-grab-your-hard-goods-of-universal value. From the Oil Patch

      2. MontanaMaven

        Check out the American Monetary Institute. http://www.monetary.org/
        One of its founders, Stephen Zarlenga, a historian and not an economist who worked in finance, wrote a wonderful book called “The Lost Science of Money”. Aristotle came up with the idea that money is an abstract social contract based in law. It is not debt. It is not a commodity. Then this idea was lost for hundreds of years.
        And the American Monetary people do come from a moral standpoint. They are not neutral. They believe a monetary system must benefit the people and the planet first. Very similar to David Graeber believing that we need to put the nurturing of people and the planet first and the making of stuff for the people second. Right now that is reversed.

        1. Yves Smith


          Aargh, this is coming up when I don’t have time to deal with it properly.

          I know a bottom line with no explanation is not very satisfying, but that is gonna have to do for now. The AMI folks are all wet. Seriously seriously misguided. Parts of what they present are accurate, but other stuff is completely wrong, and their argument is also rife with internal contractions.

          1. rob

            I too would like to see the difference between the AMI approach, which is enumerated in the kucinich bill HR2990;and MMT theory.
            As far as I know, the MMT groups don’t have any specifically implementable plans.,like the kucinich bill does.But some of the major sticking points, like WHO has the ability to create money. and their stance on fractional reserve banking are just two points that seem to make their “theory” ,not workable……,in the sense it wouldn’t address some of our systemic flaws.
            but as a relative novice, I would really like to see a post about this…..
            thank you

          2. Hypothetical_Taxpayer

            aquifer and rob

            Here’s what AMI has to say about MMT.(hint: it’s a kernel of truth deep fried in shit)

            I don’t really buy into the soddomy plan (Soddy – Chicago Plan -AMI) either. It has nice curb appeal repealing fractional banking, but then under the hood there seem to be some problems too, like it may still bankrupt banks by accident, where we really need it to happen on purpose.

            Then both MMT and AMI believe that our pious USG would never abuse their control of the money system, which makes me break down into uncontrollable fits of laughter, alternating with crocodile tears.


    2. diptherio

      You need a better tutorial, no offense.

      MMT describes the way that our monetary system actually functions and makes some suggestions for how that system might be used to increase social welfare (like a Job Guarantee, for instance) for humans.

      Since MMT is simply a description of reality, of course it is “already here.” The problem is that it’s being used for the benefit of a few rich bankers while the rest of us are told “the money’s all gone!”

      As for the environmental angle, it is up to us to decide what to do with our resources and knowlege/skills/talents. This is true whether you accept the validity of MMT or not. All MMT points out is that there is no financial constraint on what a sovereign currency issuer can purchase (so long as it’s for sale in its currency). It doesn’t say that we should use this capability to put a Ford Expenditure SUV in every drive-way, or to fund mountaintop removal or deforestation of the Amazon. Whether or not we do those things is a political and ethical question (not to mention rational), which can only be determined by political and ethical discourse.

      Understanding how our financial system actually operates at the macro level is one thing. Determining for what purpose that system should be harnessed, and what things it should not be used to accomplish, is as important as understanding the nuts and bolts.

      MMTers are like auto-mechanics. They can tell you how your car actually functions, how the mechanisms work, etc., but they can’t tell you which direction you should be driving in.

      1. sleepy

        Yes, MMT is policy neutral insofar as it relates to other than fiscal matters.

        That sovereign government is not fiscal-restrained is a fact. What to do with government expenditures–massive fracking or tarsand extraction v. a marshall plan on clean, renewable energy–is a political, policy question.

        Great video for understanding MMT:


        1. Susan the other

          But I no longer believe that story – that the political/fiscal administration of this nation is separate from the monetary. It is all political. So it is all fiscal. And we never fail to get the short end of the stick. Even when they come crawling back to us, we act like they are doing us a favor.

          1. sleepy

            I said that MMT is policy neutral insofar as it says that government is not revenue restricted. MMT doesn’t advocate what the government should fund via deficit financing.

            A government recognizing MMT could freely spend money on bombing the rest of the world if it wanted to. Or, it could provide free post-secondary education to everyone.

            All via deficit financing. What to spend the money on is a policy choice.

          2. Hypothetical_Taxpayer

            MMTers say the USG can spend on bombing the world AND social programs.

            Seems Russia is disagreeing and just parked a soviet destroyer off the coast of Gaza.

            This will sooner or later lead to the call for more defense spending, unless MAD fails, of course.

            Go figure.

          3. Aquifer

            sleepy, I agree with Sto – fiscal policy IS a political statement – we can choose our policy – so which one should we choose? i can see scenarios in which it might be a good idea to be “fiscally restrained”. As I said elsewhere, methinks we should thoroughly think through (the ole TTT routine so often neglected ..) the implications of a policy before we wholeheartedly adopt it …

          4. diptherio

            Yes, fiscal and monetary policy, and the details of how these policies are carried out, are entirely political. What isn’t political? The fire-wall between fiscal and monetary policy (i.e. between the Treasury and the Fed) is also political: it exists for political reasons. The Fed is not allowed to directly purchase debt from the Treasury, but there is no technical reason why this must be so. It just happens to be the law. If the Fed could purchase T-bills directly from Treasury, it would be obvious to everyone that the gov’t cannot go bankrupt and doesn’t need to fund expenditures with taxes or spending.

            Of course, once it is accepted that the gov’t can, in fact, buy anything it wants to without worrying about financing in the normal sense, people start to worry about out-of-control spending. But, but, they say, then they’ll just spend more money on war!

            But I ask you, does the government ever have a problem finding more money for wars and killing machines? MMT or no, the Military-Industrial complex will continue to thrive and will remain flush with funds. But if we don’t figure out how our monetary and fiscal systems work in a hurry, we’ll get all the wars and none of the social security.

    3. rob

      that sounds like a lot of mumbo jumbo….
      f=ma? laws of physics have nothing to do with money.it is as wrong to eqate laws of physics with economic theory as to eqate gov’t spending with houshold budgets…it is just completely wrong.not even in the same ballpark…
      historical monetary theory? sure…. that would mean to look at all the versions of commerce/money and parse them out to not only where we are, but where we need to go.historically, everything that was done had no real basis… it was just the prevailing law.What is the difference between the gold standard and fiat money?both are just arbitrary means of denominating money.A basic question is value.What is it?value changes over time….there is no static amout of gold, there was no lack of inflation under the gold standard…these are all institutions of men…nothing more.
      10,000 years ago….whether you used cocoa beans, or gold or cows….you were dealing with those around you.It was a fiat currency…
      aristotle, was the one who said that money is a social contract.that was before 700ad. the modern commodity indexed currencies, namely gold…came into fashion for those who made the rules..lets not uphold myths of money.
      While I don’t subscribe to the MMT theory of money,I do think that the US gov’t should be the sole entity who ought to create US money. And that money ought to be and is a fiat currency.. the problem today is that the US gov’t doesn’t create money. Our currency is a fiat currency that is created by the federal reserve. the people of the us use that currency, and pay to borrow it.the debt created by borrowing that money from the federal reserve, is the problem.
      not MMT, but the Kucinich bill “the NEED ACT”, hr2990 /last congress…is a real plan…that has been modeled, it has been studied.An IMF modeler, kumhoff has put out a paper dealing with this new “chicago plan”, after the original chicago plan that was created by economists during the depression,to remedy the same problem we have today, as was the problem that caused the depression by the same federal reserve.If you want to discuss the history of money, the american monetary institute and stephen zarlenga has a good book/treatise on the history of money…going back to aristotle….and dealing with all the myths since then…
      But I do agree that there is no unlimited resource, and to waste them is a sin.the perversion of wall st, is fueled by the perverted banking system and who it chooses to supply with nearly free money, which is predicated on models of infinite growth, implying infinate resources which is obviously an affront to nature itself, and is killing the planet, and we will surely follow…but those issues are seperate from money. If we tackle our money system, wall st will be reigned in….their golden goose will be cooked…

    4. Gordon

      The way I understand MMT is that society needs some medium that is universally accepted in final settlement of all transactions. That is the essential job that money does.

      It could be gold or silver but these are commodities subject to fluctuations of their own for reasons quite unconnected with the economy’s need for money. Just imagine if the US were on the gold standard now; the Chinese would have sucked up all the US currency supply leaving the economy strangled. So the best solution is a token with no intrinsic value guaranteed by society as a whole through the agency of govenment – hence fiat money. It’s not new either as it goes back to the ancient world.

      So, government can issue as much fiat as it wants/needs. Most progressives seem to stop here, slavering over the thought of unlimited spending. Not so. Government can, it’s true, issue any number of tokens but there are only limited amounts of things to actually buy with them and even less things WORTH buying in the sense that it adds to useful infrastructure or whatever. If government spends its tokens on useless ornamentation it’s merely adding to overheads.

      If the government prints too many it will merely devalue it’s own tokens (though not necessarily immediately) and cause inflation. To maintain the purchasing power of its tokens, government must call in and cancel a proportion each year. It’s what we call tax. If the government doesn’t call in enough tax it’s net printing new tokens and deficit spending. Ideally the number of tokens actually circulating at any moment would change only in line with economic growth.

      But there is a problem. The issuance of new tokens has been privatized to the banks. So they can create unlimited money (actually credit on their ledgers which is the form most money now takes) and pocket the seigniorage – the difference between the value and the cost of the money created.

      Since ledger entries are virtually cost-free the banks are strongly incentivized to create as much credit as possible. The constraints are that they first must persuade someone to take the credit and the regulators must look the other way. A combination of fraud and neoliberal regulation-busting provided the perfect seed-bed.

      Naturally, this couldn’t end well. In particular the banks ended up with assets on their books (the loans they had made) which corresponded to nothing much in the real world, partly because of simple fraud, partly because too many loans were unpayable and the assets (houses, malls etc) securing them had nothing like the market value they were supposed to have. Also the real economy of main street suffered because the financial sector was far to busy to pay attention to its needs.

      What is a politically well-connected bank to do in such circumstances? Why obviously persuade captured politicians to swop their dud loan assets for the newly minted government fiat which represents a generalised claim on all assets in the country so allowing them to replace worthless collateral with good collateral.

      But if John Smith owns, say, one trillionth of the total money in the US – and hence one trillionth of the US economy – by reason of the cash he had saved he will, when the banks are eventually made whole, own only, say, one hundred trillionth – so the banks’ money creation will have diluted him to 1% of his former wealth.

      I’ve never yet seen MMT well explained so I hope the above is roughly right. At any rate it does enable a narrative of how things screwed up to be constructed.

      1. EconCCX

        I’ve never yet seen MMT well explained so I hope the above is roughly right. @Gordon

        Great job Gordon. Your analysis is roughly right. And as such, it’s contrary to MMT’s.

        MMT founders on the ratio between “public” and private money creation. It proposes to give the USG just one “spend” of newly created Central Bank money, money created via the sale of coins or bonds to FedBank. That money immediately augments private bank reserves, fueling speculation, Ponzi lending, and capture of the infrastructure at some spectacular multiple of its face amount. Again, the ratio is the problem, and it persists for any amount of base money. Adding to base money, as MMT proposes, makes the financialization of the economy that much worse. It briefly enables the nonbank public to go deeper into debt, with misplaced confidence. Interest then accrues and compounds; and every payment to a bank destroys commercial bank money, directly or indirectly. To repay debts, the public must borrow anew, unto jubilee or foreclosure.

        MMT fails to recognize Wall St. as the true money sovereign, as money is presently constituted.

        This is not an argument for austerity, which would be catastrophic, but for forms of money backed by performance obligations that are not recursive. For money that cannot be leveraged, that delivers its value through performance by the issuer. Service-backed money, using digital Forever stamps to pay FedEx, for example.

        1. Yves Smith

          No, you don’t have this right.

          Credit is not money. Anyone can create credit. A bar tab is credit. It has nothing to do with Wall Street per se.

          And you don’t have the platinum coin bit right. What you are mouthing has so little relationship to MMT I don’t even know where to begin in debunking it.

        2. EconCCX

          Credit is not money. Anyone can create credit. A bar tab is credit. It has nothing to do with Wall Street per se. @Yves

          When you, or I, or Apple Computer have dollars in a checking account, do we have Reserves? We do not. We have a bank’s private debt to us. As it’s a checking account, the bank will pay any portion of that debt to whomever we designate. So it is the bank’s own debt itself that circulates as the overwhelming preponderance of our money.

          A bar tab doesn’t circulate as money, even if it’s made to “bearer.” But consider what happens when a customer uses a credit card at a bar. Against documentation provided by the bar, Barfly’s Bank conveys Reserves — Central Bank money — to Barkeep’s Bank. Barkeep’s Bank owns those reserves in their entirety, but in compensation augments the Bar’s checking account by that amount, less a substantial fee. Note that aggregate Reserves are a wash; Barfly’s Bank has less while Barkeep’s Bank has more. But a federally guaranteed medium of exchange has been added to the Bar’s account at Barkeep’s. New commercial bank money has been created as a bank “deposit”, M1 has gone up, and the money created is entirely separate from the credit initially provided to the barfly.

          In fact, the commercial bank money in circulation is in proportion to the amounts bank customers have borrowed, whether as mortgages, student loans, or credit card bar tabs. Repayment destroys commercial bank money, because it extinguishes the banks liability to the customer. And the circulating medium of exchange with it. Interest destroys that money, principal repayment does, and fees do. In amounts far greater than the money created.

          Hence an economy in perpetual and ever-deepening debt to global finance. Which MMT proposes to address by…conveying even more reserves to commercial banks.

          I’d refer NC readers to a remarkably clear and informative publication by the BIS Committee on Payment and Settlement Systems.

          The role of central bank money in payment systems (BIS 2003)

          From the Forword:

          Contemporary monetary systems are based on the mutually reinforcing roles of central bank money and commercial bank monies. What makes a currency unique in character and distinct from other currencies is that its different forms (central bank money and commercial bank monies) are used interchangeably by the public in making payments, not least because they are convertible at par. Central bank money plays a key role in payment arrangements, as it has proved safe and efficient to have a central reference of value with which all other forms of the currency maintain this par convertibility.

          From the Introduction:

          In pursuit of its task, the central bank issues its own liabilities for use as money (central bank money).

          But the central bank is not the only issuer of money in an economy. The multiplicity both of issuers of money and of payment mechanisms is a common feature in all developed economies. Commercial banks are the other primary issuers, their liabilities (ie commercial bank money) representing in fact most of the stock of money. A healthy, competitive commercial banking market is seen as an essential element of an efficient and effective economy.

          Thus central bank and commercial bank money coexist in a modern economy. Confidence in commercial bank money lies in the ability of commercial banks to convert their sight liabilities into the money of another commercial bank and/or into central bank money upon demand of their clients. In turn, confidence in central bank money rests in the ability of the central bank to maintain the value of the stock of currency as a whole (ie not only of the small portion it issues directly), or its inverse, to maintain price stability.

          Money therefore represents an obligation of different issuers…Yet the perception of the public is such that it uses the various forms of money interchangeably so long as they are denominated in the same currency. Two factors explain this: first, the existence of a form of money (central bank money) which has the support of public authorities and, second, convertibility of other monies into central bank money at par value. The combination of these two factors gives rise to the currency’s single character, the certainty that “one dollar is one dollar”, whatever form it takes (whether central or commercial bank money). (BIS 2003)

          The bottom line is leverage. At today’s minuscule reserve ratios, the USG is a bit player in money creation, MMT’s assertions notwithstanding.

          1. Yves Smith

            Go look at the history of the US. The equivalent of “bar tabs” were money, notes issued by various banks.

            I never said anything about reserves. Any time a loan is issued, it produces a related deposit. Those deposits are in the payment system. Both deposits (up to a certain level) and the payments system itself (daily settlement via Fedwire) depends critically on central bank backstopping. The reserves are not the critical feature of this system, it’s the backstopping, deposit insurance, the discount window, etc. Was the (depending on how you measured it) $11 trillion to $27 trillion in support given to the US financial system during the crisis, only $750 billion of which was the TARP, unimportant?

          2. EconCCX

            Go look at the history of the US. The equivalent of “bar tabs” were money, notes issued by various banks. @Yves

            OK, I’d like a referee for this one. Earlier, you invoked bar tabs:

            Credit is not money. Anyone can create credit. A bar tab is credit. It has nothing to do with Wall Street per se.

            I challenged that bar tabs do not circulate as money. And here you’re replying that bank notes did, and bestowing upon bar tabs a false rhetorical equivalence.

            That’s circular reasoning. If you’d invoked bank notes in the first place, it would not have supported your point that anyone can create credit. Bank IOUs circulated as money, and not anyone could create them. In two ways different from bar tabs.

            As for the rest, hell yeah. You’re right in all of it. But I don’t think it squares with MMT.

            MMT argues that net financial assets are created dollar for dollar through sovereign deficits. And you’re describing how governments and the quasi-government backstop — your excellent word — circulating media of exchange that government did not create, and that payments to banks destroy. Cartelized, privately-issued commercial bank money.

            So which is the money of MMT’s supposed sovereign monopoly? Coins, reserves, T-Bills…or FDIC-insured and FedBank-backstopped private checkable bank debt?

    5. JEHR

      Some resources are finite (coal, oil, minerals, iron ore, etc.) and some are renewable (trees, grass, water, air, fishing, animals, etc.) Resources also refer to people’s physical and mental abilities.

      We are going to have to learn to husband the finite things until they are eventually used up; then we will have to husband the infinite resources most carefully and we do that through our physical and mental capabilities.

      If, however, we use up both the finite and the infinite resources, then our physical and mental capabilities will have nothing with which to work.

      I have read MMT and it covers how money actually works in the present economy. I think Steve Keen is working on an environmental component for the theory which will be applicable to future economies.

      1. They didn't leave me a choice

        Actually to be precise, iron and other metals along with all other matter are in fact “renewable”, at least in the sense that they can be recycled with energy into new forms more usable for humans. We can never run out of anything except maybe fissionables, but recombining the matter back into usable things is an entirely different proposition and a problem of energy.

      2. jrs

        What we really need though is not another *purely* economic theory, but a plan for how to turn an economy requiring infinite growth into one compatable with a finite planet. THAT is the political economic theorizing we need most. Because present trends only mean the destruction of everything of that sustains well, human life on earth.

  4. jennifer hill

    A little to hard on Bernie dude. You might want to make some other cretin the subject of your musings. He is old and worn down from the beltway bubble. And I am not of the school that we should eat our own as a means of change. Mostly I am in favor of making the current paradigm irrelevant, the less we depend on corporate finance and goods the more we can participate in structures that reflect our shared values. Sharing is one of our values.

    1. Paul Tioxon

      A little hard would be an understatement. Especially since BS founded the “DEFENDING SOCIAL SECURITY CAUCUS” in Congress. But Lambert in his zeal to take more of an offensive posture, The Lombardi Gambit, should still be taken in the spirit it is given, if not all of the substance. He’s not the charts and graph and data set portion of this site. But both Bernie and Lambert believe in bloody hand visuals.

      If you can click of the following link, I believe you can find a common cause with both Bernie and Lambert in clearly stating that Social Security and Medicare and Medicaid having nothing to do with deficits and politicians should keep their hands off of those programs. And while Lambert wants to lower the age of retirement, I would additionally, in alliance with Bernie say to tax the 1% the 2% and whoever else is up there by closing the tax loophole that makes FICA the most regressive tax of all time by limiting the income to be taxed to the first, for 2013, $113,700 of earned income. All income, dividends, interest, capital gains, profits and rents should be included. After all, corporations are people and should be entitled to their entitlement check as well in their old age. Provided they are not liquidated before 65 years of continuous operation.

      Less denouncing, more fighting back by linking up with others fighting the same battle.


      1. lambert strether

        Nobody who’s advocating any form of cuts to any social insurance program whatever is “on my side.”

        I’m not getting herded into any kind of veal pen where I’m colluding with members of the political class of whatever stripe to get myself, and others like me, thrown under the bus. Enough is enough.

        And of course somebody staked out the left end of the Ocerton Window, because that’s how these things are done; and it turned out to be Bernie.

        Well, the left end of the Overton Window is not acceptable to me or any others of the many classes of citizen that I listed. “Not one penny of cuts” is the baseline, and I don’t think Social Security should be “defended” at all; I think it should be expanded. But “defense” with some classes of citizen thrown under the bus is the end game here; when your putative friends, like Sanders, buy into a Pete Peterson meme like “shared sacrifice” that should tell you the fix is in.

        NOTE On taxes: As MMT understands, and Sanders, along with the political class, do not, is that taxing the rich does not fund Social Security. The two issues are completely orthogonal. I think the rich should be taxed so they don’t buy up the political system with their loose cash, and to prevent the formation of an aristocracy based on inherited wealth — but so far as I can tell, nobody’s making that case. As far as the real operations of the money system, signing Sander’s petition is like signing a petition in favor of the theory of phlogiston, or possibly phrenology.

        1. Susan the other

          That Congress and Obama are blatantly fudging the facts is evidence. Prima facie evidence of politics pulling the wool over our eyes. They are pretending that SS & Medicare are a proper trade-off for a tiny extra tax on the rich. Not! Social Security is totally removed from “the budget.” Whatever in god’s name “the budget” even is. It might be a good idea to define the stupid thing. I can’t beat Lambert’s words:

          “We have already sacrificed whether thru the loss of jobs, our health, our homes, our net worth, or from real wages being flattened for the last 40 years or from paying some well-fed smiling usury-stinking weasel their cut on the deal every time we turn around. The proper amount of additional sacrifice for us is, precisely and exactly, zero.”

        2. liberal

          Nobody who’s advocating any form of cuts to any social insurance program whatever is “on my side.”

          Depends on how you define “cuts,” doesn’t it?

          Suppose the parts of Medicare that pay for drugs were to take advantage of the government’s near-monopsony power and force pharma to offer big discounts. That’s a “cut”, but not a cut.

          Or suppose Medicare and Medicaid ceased paying for tests and treatments for which there’s no evidence of substantial improvement in some reasonable measure of outcome (years lived, years lived weighted by quality, etc).

          1. Aquifer

            Your second to last paragraph, OK – your last paragraph – be a little careful with that one – what, or should i say whose, measure would you use?

        3. Paul Tioxon

          Touchy touchy. You must just like to argue, even with someone who is agreeing with you. Getting rid of the income cap on FICA is too important to ignore as anything other than an expansion of the program. It is a demand that I am making. It can lower the retire age and increase the benefit. I also am demanding, instead of truncated Part A B D etc, Medicare with no copay, but 100% health care coverage for doctors, hospitals, drugs, dental, eye glasses, hear aids, and physical therapy equipment, medical devices, etc.

          What, you want to see my resume to see if I am pure enough to be any club you would want to join? This is just one battle. We happen to be on the same side now. Maybe others, most likely. But don’t get so carried away with yourself. It was a cute cartoon. It’s just that I would like to see something of consequence come out of the election other than a smug sense of satisfaction that I know what is really going on. I want to effect policy, not just be right. We are probably going to lose this fight, not because we don’t know who is scoring higher on the uber-rad index, but because we are not powerful enough to win. The only thing I am resigned to is demanding more out of the social security program, which means the income cap “tax loop hole” has to be eliminated and the retire age should be lowered and the health care needs no out of pocket costs and be totally comprehensive.

          If you spent more time looking for allies instead of smacking people around, we might have something to celebrate other than the personal markers in our PRIVATE lives. I would like to see a lot of people come together and extract a PUBLIC policy win from this second term. Right now, that means, no fiscal cliff excuse to take a deal to get the republicans to agree to closing a tax loophole with the democrats taking a meat axe or a scalpel or one even a penny from Social Security, Medicare or Medicaid as the quid pro quo. That is not even necessary. It is a fabrication. Unemployment is the most important policy issue to be addressed and a 2nd large scale stimulus is what is required. Not a defusing of the IMAGINARY “ticking time bomb” of fiscal conservatives.

        1. Aquifer

          Yo! I thought he supported that in the Sen ….

          Wasn’t he the one, though, that pushed the revelation of to whom and how much TARP handed out?

          1. Yves Smith

            Who got TARP was always public. You might be thinking of who got Fed loans. Sanders put forward the sellout on a full audit of the Fed, which was an “audit” of what happened during the bailout period. But even then that wasn’t complete, recall the Bloomberg FOIAs of who the recipients were, which the Fed wanted to keep secret.

          2. Aquifer

            YS – Thanx for the clarification – I guess i tended to lump the elements of the whole bailout mess together – as if the loans were, in essence, a “gift” in the same way TARP funds were – as in “banks got bailed out, we got sold out”

            Shucks, I always rather liked Bernie – oh well, another one bites the dust …

        2. Benedict@Large

          And note: Both Randy Wray and Stephie Kelton are members ofr Bernie’s Fed committee, so it’s not like Bernie has no access to MMT. Add to the above two Jamoe Galbraith, who is also a member of said committee.

          If Bernie Sanders isn’t aware of MMT principles, it’s not because he has no access to them. It’s because he isn’t listening.

        3. Ms G

          @ Aquifer — Here’s a write-up of Bernie’s walking back his initial demand for full Fed audits, and ending up arm-in-arm, no less, with Senator Chris Water-Down-Special Dodd. http://fdlaction.firedoglake.com/2010/05/06/bernie-sanders-changes-audit-the-fed-amendment-dodd-now-cosponsor/

          Yves is referring to the $16 TRILLION in fri***n’ Fed loans that the documents FOIA’d by Bloomberg revealed.

          I’m not sure if the $16 Trillion loans are the same money that was gushing at the spigot of the “Fed 0% Facility” though … anybody know if these are one and the same?

          1. Aquifer

            Thanx – I obviously wasn’t paying as close attention as i should have been –

            It is always interesting (infuriating) to me how the “possible” is sold as “preferable” to the “necessary” wherein us little folks are told not only that we must “take what we can get”, we must be grateful for it and be ashamed to ask for more, though more is what we need, while the upper crusties are persistently not only allowed to “get what they can take”, but are encouraged, nay, practically begged, to do so, even though it is considerably more than what THEY need … and this is all “sold” as the wonderful art of “compromise” which is what is to be sought, uber alles, in our political discourse –

            So, we need a REAL audit of the Fed – but, this is “the best we can get” … oh barf – maybe that’s what we ought to do now – first laugh then barf ….

          2. Ms G

            “full Fed audit” should be “plenary powers in Congress to audit all Fed books and operations.”

            @ Aquifer. The distinction between TARP and the secretive bailouts is critical. (A) because the sums involved in the secret bailouts dwarfed TARP, and (B) because they were secretive for good reason — they demonstrate that Fed and the Bank mafia fully acknowledge and take great personal advantage from MMT, viz.: Fed can create money (e.g. $16 TRILLION) out of thin air and distribute it — the fact that banks rather than you, me, Lambert, Yves and the rest of us 99%ers were not given access to these funds is the great scandal. And also the Great Moment of Revelation in re. There Is No Fiscal Cliff.

            Actually, we should all start putting the $16 Trillion Geithner handout into the discussions and debates we have with everyone we know to give a real simple example of how there’s plenty ‘o money lying around (in dormant state).

            What I still don’t get is that we are not hearing Huge Howls from “the people” (beyond a few blogs!) that taxing banks and non-wage income at least at Eisenhower levels is the real TINA in this debate.

          3. Aquifer

            Could you indulge me a wee bit more –

            TARP was a “gift”. the 16 trillion or so were “loans”, is that correct? Is there any functional difference in this case? TARP doesn’t have to be repaid, but the loans do?

    2. diptherio

      “And I am not of the school that we should eat our own as a means of change.”–jh

      Question: Do you consider Obama, Pelosi, Reid, Baucus, et al. to be “our own?”

      The fact that Sanders has been around so damn long and is on his way out means that now, more than ever, he should be speaking truth to power, not spreading more propaganda about “shared sacrifice.”

  5. leftover

    Re: Bernie…
    Did Bernie ever prove himself to be worthy of the name Socialist?
    I don’t think so. Opportunist? Yes. Unprincipled? Sure. Socialist? No.

  6. Jagger

    Wow, Man, did we read the same Sanders speech???? I would suggest rereading Bernie Sanders speech and concentrate on his actual words (without inserting your own words for his). He said 50% in additional revenue from the rich and corporations. He said 50% in cuts to military spending. He said not one cut in the social safety net. Makes perfect sense to me. Of course, considering no one else in power is saying this other than Bernie Sanders, it is a complete pipedream. But at least someone is saying it.

    You need to reread Sanders actual speech and not insert your own words for his. It might make more sense.

    1. Lambert Strether Post author

      I’m not “inserting my words.” I’m annotating the speech [like this]; square brackets are the convention fo that. The original text is fully exposed, and what I write is 100% visible, agree or disagree.

      1. abelenkpe

        I disagree. You are projecting your fears on the speech. Which is why I hate your writing. You really need to step back from the edge. But you’re right that there should be not one penny cut from Social Security, Medicare or any social program for that matter. There are enormous cuts that can be made to defense spending.

        1. Yves Smith

          Lambert is not wrong, and you are way out of line.

          Anyone who supports the idea that we need to cut deficits now is part of the problem. They are simply helping sharpen the axe for Social Security and Medicare cuts. There is absolutely no way military spending will be cut in any way, except maybe screwing vets on pensions and the quality of care in VA hospitals.

        2. Lambert Strether Post author

          Well, it’s a big Internet, so you are in the happy position of being able to go find writers you don’t hate to read.

          Howver, if you think that the process of annotation doesn’t involve concentrating on actual words, then you haven’t done much of it.

          As for “projecting my fears,” yeah, I mean, after the crash of 2008, what could go wrong? Fifty lashes with a wet noodle for lambert….

          1. MontanaMaven

            I personally loved the annotation and made me laugh out loud which, frankly, I need right now. Because, yes, we have a right to fear what these awful corrupt people are up to. If you are not a bit afraid, you aren’t paying attention.

  7. jsmith

    I’ve stated it here before and will state it again.

    There is no need to discourse with these war criminal scum on their level of lies and horsesh!t about ANYTHING especially the “fiscal cliff” and other assorted BS.

    A campaign of screaming STFU or laughing in the face of every single politician and media pundit when they attempt to “serioiusly” discuss the “serious issues” should begin immediately.

    Intelligent people have to begin to realize that you cannot debate/argue/reason with any of the inhuman aholes who are part of the machine – they have framed the “debate” so that they will always win.

    You are really not doing any good spending time honoring their points, rebutting their “analysis” or picking apart their op-eds.

    You actually are doing the exact opposite in further lending credence and legitimacy to a sophisticated propaganda system that keeps you enchained with the false feeling of “participating”.

    Thanks for keeping the “debate” going, etc….

    Better spend your time getting your friends and family members to turn off the sh!tbox and start handing them literature to read or pointing them to websites which discuss reality.

    The American public is so thoroughly brainwashed that they can’t even tell that they are literally being stolen from right now and unless we begin to delegitimize the entire facade of “governance” and “discourse” in this country there is going to be no relief.

    Here’s a depiction of America on T-Day 2012 from a real socialist POV:


    1. jsmith

      More on “socialist” Bernie Sanders:


      In the case of Sanders, the 68-year-old former anti-war protester made his peace with US capitalism long ago. First elected mayor of Burlington, Vermont in 1981, under the slogan, “Burlington not for sale,” Sanders quickly established close ties with prominent Republicans and big business interests in the city. Tenants associations opposed his plans for the development of the waterfront district, arguing that he was acting on behalf of luxury housing and hotel developers who were trying to gentrify working class neighborhoods.

      In 1990 he won the first of eight terms in the US House of Representatives. Over the next 16 years the so-called “independent” voted with the Democrats 98 percent of the time, including support for Bill Clinton’s war against Serbia in 1999, the congressional resolution authorizing Bush to launch war against any country after the September 11, 2001 attacks and for every appropriation bill to fund the wars in Iraq and Afghanistan.

      For this reason, his 2005-06 race for US Senator received the backing and financial support of the Democratic Party establishment, including New York Senator Chuck Schumer and Barack Obama who traveled to Vermont to personally campaign for Sanders, who appeared on the Democratic Party’s primary ballot.

        1. JEHR

          Yes, I too am saddened by the fraility of the human being that is Sanders. He looks so worn out from his work and I feel he has a good heart. We all go wrong sometimes.

          1. Aquifer

            I don’t really know what motivates Bernie, but it must be/have been rather hard to be a lone ranger on so much for so long. i rather noticed that with Ted Kennedy – as the years wore on he compromised more and more (e.g. accepting ACA) – i suspect as mortality begins to close in one would like something to show for all that passion – even if that something is a pale shadow of its former self … Anyone who has been involved in a “long haul” of anything knows you can get pretty tired and worn out ….

            I’m sure there are a lot of folks who will point out Kennedy’s many flaws – but my point is not to praise Kennedy, or Sanders, but to point out that perhaps the human frailty consists in needing SOMETHING to show for our work …

            What is needed are a LOT of folks who hold out – providing real leverage such that something CAN be done without compromise …

  8. steelhead23

    Hey Yves, I’m four-square for deficit reduction and would approach the issue through sovereign coinage, effectively trading deficits for inflation. But I have no idea how this would fit within the MMT theory that public deficits facilitate private savings. Has anyone in the MMT camp considered how the theory might work within a system of sovereign coinage?

    1. rob

      I don’t know that MMT has anything worked out for anything. (obviously,because I haven’t seeen it DOESN’T mean it doesn’t exist)but,,,,
      something along similar lines to MMT is the kucinich bill “the need act”HR2990/last congress…this is the new version of the “chicago Plan”from the thirties…there is also an IMF economist ,kumhoff,who has a new paper out revvising the chicago plan to fit in todays world… this group of ideas, from the chicago plan(old and new), kucinichs “need act”, along with work from the american monetary institute, and others… seems to me to be where the MMT rubber hits the road…as far as the US treasury being the issuer of currency, as opposed to banks,shadow banks,etc who now create our money.

    2. Lambert Strether Post author

      I think you’re referring to the coin seignorage concept, which actually made through gatekeepers like Yglesias into official discourse. I believe (not an MMT techie) that there is no “trade” between debt and inflation because inflation happens when the real economy is at the limits of its productive capacity, and we are so far from that point it’s ludicrous.

      There’s a lot of material out there on coin seignorage, so here’s one.

      1. steelhead23

        Thanks Lambert. I hope you and Yves understand that we proles find the logic of MMT as undeniable as we find some of its conclusions very hard to reconcile with our own experience (cognitive dissonance writ large). I merely want monetary and fiscal policies that are entirely in the public interest – and the current system is anything but. Ideology seems less important than intention.

    3. Yves Smith


      If you are for MMT, you are not for deficit reduction. The coin is merely a way to get around the false constraint of the deficit ceiling. I’m time constrained today, so can’t take you through the long form, but we’ve had a zillion posts on this, as has New Economic Perspectives and LetsGetItDone at Corrente.

  9. Ms G

    I’m not sure that the link in the lead post is to the transcript of the speech that Bernie Sanders gave on November 15, 2012. Here is the link to the live video. Unfortunately I haven’t been able to track down a transcript yet. I didn’t hear “shared sacrifice” in this speech. The theme of the speech is “hands off Social Security and Medicare and Medicaid” and “we must not balance the budget on the backs of the elderly, the sick, the poor, the children …”


    1. Aquifer

      The link is to the full letter posted on Sanders’ website – a letter he is “sending” to Obama and wants folks to sign their name to – I gotta admit, i could not sign that letter, could you?

      IMO, it does rather suck, and if Bernie could write one more in line with “NO CUTS”, then he might have more on board – as it is, i don’t think anyone should sign that letter – it IS a capitulation I don’t think we should be party to …

      1. Ms G

        No, I definitely would *not* sign the linked petition caving to “shared sacrifice” and throwing us all under the bus.

        I’m confused now, though. Here’s Sanders’s “letter to voters” (my paraphrase) asking them to sign the (a?) petition even though the actual petition is not linked to this cover letter/entreaty. And if you read this letter, he doesn’t mention “shared sacrifice” anywhere — in fact, he ends the letter with asking voters to “join us in opposing any benefit cuts to” SSI/Medicare/Medicaid. Link here: http://www.sanders.senate.gov/petition/?uid=cc9bfb45-9836-4c1d-a24d-6db690f73458

        So it seems that Sanders is deliberately concealing the “shared sacrifice” plan in the cover letter asking people to sign his “shared sacrifice” petition. That would qualify as High Sleaze and a sure sign that he’s stabbing his purported constitutents in the back while asking them for support.

        (Note. The other place Sanders did *not*mention anything about “shared sacrifice” was the speech he gave (see link in my previous post upthread). Is this a pattern, where he’s pretending to demand “no cuts” whilst already wedded to “shared sacrifice”?)

        1. Aquifer

          Well now this gets “curiouser and curiouser” – looks like there are 2 “items” that Bernie has available to sign – one a “letter” to the Pres in which he says we, in essence, agree to the “sacrifice” as long as it’s shared, and a petition that says, in essence, “No Cuts” – have i got that right, as in correct?

          If that is the case – maybe we should sign the petition and pointedly refuse to sign the letter – letting Bernie, as well, know that this “shared sacrifice” BS is indeed BS and that he, BS, should not be promoting THIS BS ….

    2. Lambert Strether Post author

      My bad bad bad. I had revised the link text to read that it was a letter and then somehow lost it in a vampire shift revision. It is a letter, on Sanders’ site, and I go to to change the text of the post to what I thought it read when I signed off.

  10. diptherio

    Rather than mic check public meetings, from now on I think Occupy should just stage laugh-ins. Every time some politician says “everybody knows we have to balance the budget,” or, “social security is going bankrupt,” or some such nonsense, everyone should start giggling. Laughing is contagious, you know, and comes off as much less shrill and self-righteous than standing up and trying to shout somebody down. Also, you won’t get kicked out by security as fast.

  11. alex

    “I can” is not going to be immediately recognizable to most people. How about “budget ‘compromise'” (with “compromise” in quotes). Also, label the victims and the priestly class according to modern names. Where is Thomas Nast when you need him?

  12. JTFaraday

    re: Conor Friedersdorf’s linked review of Chris Hayes’ book on inequality

    I thought these two fellows put forth a decent rehashing of 1990s conventional wisdom on the need to address “inequality”– and it was nice to actually see liberals acknowledging that credentialing can’t be the economic cure all they always seem to think it is given its role in generating and legitimizing hierarchy in the first place– but it was sort of MIA on today’s whirling dervish death spiral of looting financial elites and chicken hawk militarists.

    “Taken to its absolute extreme, a commitment to equality of outcomes is summed up by the Maoist adage, “The tall stalk gets cut down.””

    Well, be that as it may, no Maoist ever cut down Conor Friedersdorf’s stalk, so I wouldn’t worry about it too much if I were him.

  13. alex

    The annotated Sanders speech is part of the circular firing squad. He is being criticized for insufficient ideological zeal.

    over the long-term we have got to reduce the deficit [except not]

    Except not? Bernie shows insufficient zeal for certain MMT prescriptions? Is an unquestioning belief in them a requirement for passing the ideological purity test? Will the true believers please tell me how much money you can print under the current circumstances without causing high inflation? No serious MMT proponent believes it’s without limit. And please describe the specific approach to controlling inflation when conditions change. According to MMT you can tax the money out of the system and then burn it. Does anyone think that will ever happen?

    A sensible deficit reduction package must also include significant cuts [yeah, let’s start by scuttling a few aircraft carriers] to unnecessary and wasteful Pentagon spending [there’s some other kind?].

    And even though the first target Bernie suggests is Pentagon spending, he apparently lacked the backbone and ideological zeal to say that all Pentagon spending is wasteful. Care to mention which major countries have no military spending? Canada, Australia, Sweden? Oops, no.

    Since Bernie didn’t show sufficient zeal, let’s dump him in the same category as McConnell. Aim at the caucus member directly opposite you, aim and fire. Make sure to aim well, as due to recent military spending cuts you are only allotted one round.

    1. Lambert Strether Post author

      It’s a policy issue. The baseline is pretty clear. Let me restate it:

      Not one penny of cuts, and any savings to be passed through as benefits.

      Do you have a problem with that? If so, what is it? If not, why shouldn’t people who advocate poor policy be called out on it?

      NOTE ‘Circular firing squad” is a shopworn trope deployed by Democratic operatives to get their putative constitents to accept policies that are not in their interests and do not accord with their values. I’m not playing any more. Why are you?

      1. alex

        Do you have a problem with that?

        Yes. SocSec shouldn’t be touched, but Medicare/Medicaid are a whole different matter. Why not bargain on drug prices? Part D was a giveaway to Big Pharma. Shouldn’t we correct that? How about accounting for the fact that, depending on location, getting the same quality of results in a population with the same health problems varies wildly in cost. Americans are simultaneously over-treated and under-treated.

        ‘Circular firing squad” is a shopworn trope

        That explains my poor grade in Creative Writing. Nevertheless an idea is separate from it’s expression. Your notion that it’s “deployed by Democratic operatives to get their putative constitents to accept policies that are not in their interests” is sometimes true, but hardly an argument that it’s true in this case.

        You’re spending energy, photons and electrons criticizing someone whose positions are closer to mine (and I suspect yours) than almost anyone else in the senate. He ain’t perfect? Yeah, probably why I stopped believing in heroes at the ago of 10. I’ll still take a Bernie over a Barack any day. Give us a Senate with Bernie and 50 clones and we can talk about improvements in his positions. Meanwhile, we’re in such a target rich environment that I’ll go for the easier targets.

        1. Aquifer

          Hmmm – seems to me he covered that as “any savings to be passed through as benefits” in other words, it may, in fact, be useful, even advisable, to make changes in the program – in order to make it better and more inclusive – but not in order to cut monies out of it – cut the fat from the corps’ and other providers’ take and put that into more, better benefits for more folks …

          But what these “changes” are being used for and indeed sold as, are a way to implement the “sacrifices” necessary to “balance our budget – in which case these “changes” will result in fewer, poorer benefits …

          There is change, and there is change … and the trick is figuring out which one we can “believe” in …

    2. Benedict@Large

      Bernie shows insufficient zeal for certain MMT prescriptions?

      MMT is descriptive, not prescriptive. MMT doesn’t suggest that deficits are unimportant; it demonstrates that the entire concept of a deficit in a fiat economy is meaningless. Deficits imply that taxes fund spending, and they do not.

      Sorry if you haven’t gotten that far in the literature.

      1. alex

        MMT is descriptive, not prescriptive.

        But MMT proponents offer prescriptions based on the ramifications of their theory. I didn’t think that point required much of an intuitive leap.

        Amongst the prescriptions is that in the right circumstances the government can print money without causing excess inflation. I’ve no doubt that’s true up to a limit, and serious MMT’ers do say there’s a limit. But what’s the limit? Perhaps with your expertise in MMT you could answer my original questions. I’ve asked them scores of times, but have yet to get an answer other than hand-waving platitudes. Specifically, as previously:

        how much money you can print under the current circumstances without causing high inflation? No serious MMT proponent believes it’s without limit. And please describe the specific approach to controlling inflation when conditions change. According to MMT you can tax the money out of the system and then burn it. Does anyone think that will ever happen?

      2. JTFaraday

        No, you’re not going to put that over here. Those identifying themselves with the “MMT” label have indeed put forward policy proposal(s) which they in turn insist are “not separable” from those monetary ideas referred to as “MMT.”

        Part of the problem is that their definition of “MMT” slides around around between “that monetary system which we currently have” and the “new and improved ‘MMT'” that includes their policy prescription(s), ie., “fairy tale MMT.”

        It seems to me that if they want to reconstruct that “monetary system which we currently have”– in essence, the “deficits don’t matter” war economy of Dick Cheney and the “deficits don’t matter” bailout economy of Wall Street–into one that better serves the public interest, then they are going to have to distinguish between that monetary system and the one they would propose. And they could start by calling these two political-economic regimes by different names.

        As it stands, their errors of omission have them in full support of that war and bailout economy, with the addition of the cheesy labor policy agenda that you are so eager to deny, which is an unhelpful and almost certainly authoritarian add-on in this context to say the least.

  14. Yonatan

    In the later period of Anglo-Saxon England (mid 8th – mid 11th century AD), laws were introduced by kings relating to integrity of the money supply. If any money lender was found guilty of debasing the currency, his right hand was chopped off and nailed above the door of his changing house.

    Reinstating these laws would be equally effective and less bloody.

    1. different clue

      Oh . . . now I see where NaCap already linked to this link in the previous entry. Uhh . . . never mind.

    2. Aquifer

      From the link –

      “The only reason propaganda is used is to make people agree to do something their common sense and wisdom otherwise tell them is brain dead stupid, like getting into a land war in Asia or voting for a less than one full term senator who came out of nowhere with bucket loads of cash.”

      Can’t argue with that – :)

  15. wbgonne

    Speaking of LULZ, how is everyone enjoying the Kabuki Theater production of the “Great Betrayal” so far? We are now in Act II, where the GOP Congresscritters boldly and bravely renounce Grover Norquist’s no-taxes-evah vow in the name of COMPROMISE! This sets the stage for “reciprocation” (it’s only fair, after all). And, as a preview of the next thrilling development in the Great Betrayal, in Act III we will watch in wonder as Obama the Great “reluctantly” offers up the American social safety net and sacrifices the Middle Class on the later of austerity, all in the name of . . . . [you guessed it, I’ll bet] . . . COMPROMISE!

    So pop open a can of tuna-flavored catfood and enjoy the immolation!

  16. b.

    I’d offer an old trope of mine in support. “No to incumbents.” All of them. No exceptions. Equally simple, equally necessary.

    On a side note, reading Silber quoting Nichols quoting Feingold is the equivalent of a Pratchett moment – the world is flat, and it is milquetoast all the way down, with the past hammered into pretty 2-color pictures on the cardboard box packaging.

    Floyd’s response to the anointed jester in the House That Dibgy Built, on the other hand, is well worth reading.

  17. steve from virginia

    It’s hard to know where to go with this stuff. Are you people reading comic books?

    Don’t listen to the economists! Left-wing or right-wing, monetarists or bankers, salt-water or fresh-water … they are all idiots.

    – This is not the 1930’s (the outcome of massive, decades’ long urban migrations in the Western nations along with class warfare).

    – The problem now is the loss of real capital which has been wasted for 200 years, nothing of value has been gained in exchange for it except abstract ‘wealth’ markers for a handful of gangsters. (The only capital that remains largely intact since the beginnings of modernity is gold and real-property meets-and-bounds. THAT’S IT!)

    – US economy monetizes waste, it cannot be revived (no affordable capital to waste) nor can it be reformed (waste is waste). The outcome of the current dynamic is bankruptcy leading to complete collapse. The permanent loss of capital is … problematic AND self-amplifying, (IE, crude oil, fertilizer elements, topsoil fertility, fresh water access, global waste-carrying capacity) any efforts to retrieve the capital will fail because there is no affordable capital to retrieve. Any temporary successes will accelerate capital depletion: failure is by itself failure any successes are also failure.

    Keep in mind all capital that is wasted is GONE FOREVER as in 50 – 450 million years forever. That gallon of gas you wasted in that car this morning driving to work will never be available to anyone again in any concievable future … for any purpose.

    And you suckers are worried about austerity? It’s here! We’re in it, there is no escape, it is the 2d Law of Thermodyamics … a Terminator like in the movies: “It can’t be bargained with. It can’t be reasoned with. It doesn’t feel pity, or remorse, or fear. And it absolutely will not stop, ever, until you are dead.”

    Get real, time is running out

    1. different clue

      Get real yourself.

      This is about stopping the upper class from grabbing all the wealth and leaving us with all the austerity. Social Security/Medicare/Medicaide is their chosen battlefield for now in The Last Ripoff. Its worth stopping them now.

      We’ll have years to get real in the meantime about resource depletion austerity. Right now I’m concerned about making sure that “austerity starts at the top”. And in the long run, if a shrinking ecosystem shrinks my survival benefits to zero I will just live with that, as long as the looter class gets zero of my benefits in the meantime.

      1. jrs

        So long as we have this economy it makes no sense that the rich should steal it all, so yes. However this economy is fundementally unsustainable as well. We dont’ have years, giant storms are drowing our major cities, shellfish are becoming unable to develop shells, we don’t have years.

  18. Seal

    I seems crazy to me which cuts to make-not make. IT’S ALL GOING TO GET CUT.

    Sure. Maybe I’m just a nattering nabob of negativism BUT the US will suffer mightily as it reverts to a much lower standard of living. The American Empire is OVER. The US dollar is worth about 0.25 or less. The DJ-30 will = the price of gold in US dollars!

  19. Benedict@Large

    The sacrifice may be shared, alright, but not equally, because it cannot be.**

    This is actually a false construct, as it only looks at one side of the equation. The rich may share equally in the sacrifice, however we define that, but ostensibly they do so with the expectation of reaping the benefits of a better future economy. What does grandma get for her sacrifice?

    So how can there ever be an equivalence between the sacrifices of the rich and grandma? Grandma gets NOTHING. The rich at least get to make a bet that they themselves set the terms of.

  20. wbgonne

    Shared sacrifice in the Great Betrayal. So let me get this straight: the banksters (that is, the “savvy businessmen”), steal all the money, crash the economy, and leave a huge crater where all the money they stole used to be. And now the American People must endure “shared sacrifice” to replenish what the banksters (ahem, the “savvy businessman”) just stole.

    This is a bit like a bank heist where the authorities politely ask the bank robbers to give back just a little of the money they stole while the banks’ customers are required to pay the rest. Actually, the Great Betrayal is EXACTLY like that.

    How about this Obama? How about those people who have benefited mightily over the past 30 years by manipulating and deceiving — you know, your pals, the “savvy businessmen” — pay recompense and reparations for the damage they have done to our economy? Why don’t you leave the Middle Class and the Poor alone, Obama? The Rich stole the money: get it back from them. Leave the American People alone, you big bully.

    1. Ms G

      Wbgonne: Well, and concisely, said. My sentiments exactly. Now if only Sanders and the rest of the Congressional Milquetoasts would copy and paste your comments, the terms of the “debate” might actually start approaching reality.

      We need you as the People’s Speechwriting Group!

  21. wbgonne

    Speaking of LULZ, how is everyone enjoying the Kabuki Theater production of the “Great Betrayal” so far? We are now in Act II, where the GOP Congresscritters boldly and bravely renounce Grover Norquist’s no-taxes-evah vow in the name of COMPROMISE! This sets the stage for “reciprocation” (it’s only fair, after all). And, as a preview of the next thrilling development in the Great Betrayal, in Act III we will watch in wonder as Obama the Great “reluctantly” offers up the American social safety net and sacrifices the Middle Class on the altar of austerity, all in the name of . . . . [I’ll bet you guessed it] . . . COMPROMISE!

    So pop open a can of tuna-flavored catfood and enjoy the immolation!

  22. run75441


    You can say it so much simpler than the the above:

    “The people who put you back in office are ‘not for sale.'” Cut defense spending 50%. Since the Chin Dynasty, no nation who has outspent GDP growth consistently at the expense of domestic productivity has ever remained a Tier One nation.

    Break the backs of the Norquist pledges in the corner they have backed themselves into by not negotiating. After January 1st; lets see who will not vot fro middle and lower income tax breasks.

    Leave SS, Medicare, Medicaid, SCHPS, Education alone and enhance them for the future. Pay back the TF and promote better healthcare.

    Force the marginal increase in federal incomes for the 1% through Congress and increase taxes for the other 2%. Use revenues to stimulate domestic productivity.

    Create meaningful jobs by stimulatimthe domestic economy utilizing the gained revenues from taxes and cuts.

    If you are going to create a civilian review board, choose from the middle lower income brackets for input to it.

    Pretty much the text of my letter to Obama after wearing out Stabenow and Levin (who boasts of minute cuts to defense). It is a good post and sometimes I do not know how to answer you Lambert. You remind of my friend doodahman (old song). Peace . ..

    1. wbgonne

      “Pretty much the text of my letter to Obama after wearing out Stabenow and Levin (who boasts of minute cuts to defense).”

      If you expect to have better luck with Obama, well, you really haven’t been paying attention. Obama is an Evil Genius, not a dupe. Obama knows exactly what he is doing and he has done precisely what he wants since election day 08. I’d wager that Obama’s only real regret from his first term is that the Tea Party sabotaged his Great Betrayal last time. That’s why Obama is making damn sure he cuts the social safety net immediately this time around. Rest assured that Obama fully intends to fulfill his dream of becoming the White Ronald Reagan.

      1. run75441


        Either he or one of the cohorts responds.you can sit here and bitch all you want; but unless you go to print directly to the source, no one will ever read you.

  23. Jim

    “Lambert: 12:16 p.m.”

    “I’m not getting herded into any kind of veal pen where I’m colluding with members of the political class of whatever stripe to get myself and others like me thrown under the bus. Enough is Enough.”

    Members of our contemporary political class, Democratic and Republican, Right and Left, are part of a managerial formation now operating in total collusion with the plutocracy yet exercising power in our name and supposedly for our interests.

    The liberal/progressive side of this managerial formation was once able (during the Great Depression of the 1930s) to present itself as a legitimate, enlightened army of professionals, experts and administrators who were willing to use the State apparatus to regulate capitalism and to try and introduce a bit of social justice into a society threatened by severe economic inequality.

    Today this same liberal/progressive administrative formation can only maintain (among a shrinking portion of its base) the rhetorical pretense of exercising a just power in the name of those who cannot take care of themselves.

    It seems to me, that now, the potential collusion “with this political class of whatever stripe” may become a consequence of advocating policy positions, which, even if implemented successfully (not giving them one cent of our present social safety net) still maintains the continuation of this corrupt left/right bureaucratic apparatus serving the plutocracy, without challenging directly their structure of power (such as calling for its dismantling along with a movement to direct democracy on a local and regional level).

    Without a political vision which moves beyond an outmoded social democratic model—reintegration into our corrupt status-quo seems almost inevitable.

    1. jrs

      Social democracy sometimes kinda seems to work elsewhere, but I think it only works where there is a real threat from below and when there are less barriers to such threats. When your threats are general strikes and so on, as many countries have now, social democracy stands a chance. All such strikes are of course entirely illegal in the U.S.

      In the 1930’s there was a real threat, countries were going full on communist, there were real workers movements and socialists movements and anarchists movements and all of it about. Now, half or more (many Republicans but also all the Obamabots as well?) of the population is convinced cutting the social safety net is great, there are no workers or unions movements worth speaking about barely. And we get plutocracy forever and ever.

  24. James F Traynor

    Screw it! Kill the rich. With a suitable monument to the collateral innocent at a later date.

    1. psychohistorian

      While some are probably deserving the ultimate solution is to change the social rules about inheritance and accumulated private ownership of property so that the global inherited rich can never exist again.

    2. Dreamer

      Yes, a billionaire a day…the mind boggles. It would be no more immoral than the present system, which has capital punishment for the poor.

  25. Hugh

    The best description of Bernie Sanders I ever came across was as a “serial caver”. You have to understand how the game is played. Sanders is a rotating hero/Trojan horse for liberals. He makes a few progressive statements but within a context that largely concedes the dominant neoliberal line, whether this is Obamacare, the Fed, or the Great Betrayal. His function is not to concentrate progressive energies but to disperse and divert them, to make sure they never coalesce into a creditable opposition. Republicans have similar Trojan horses who play to their various constituencies.

    One of the funniest episodes involving Sanders was a much hyped personal filibuster he staged on the Senate floor. What made it such a joke was that he had arranged it with the Senate leadership in advance, and it took place on a Friday when the Senate had no business going on and when in fact many Senators had already gone home for the weekend. It was rather like proclaiming that you are willing to take on a whole football team, working out with the coaches a day when there will be no practice and the players have all gone home, and then showing up saying you’re ready for a fight. It was all a sham, an empty gesture, the kind of thing Sanders excels at.

  26. Propertius

    If the PTB really believe that the deficit is a crisis worthy of draconian remedies, why haven’t they proposed a modest (say 1%) tax on derivative trades? That should produce enough revenue to not only run a sizable surplus, but to pay off this oh-so-horrid national debt in a very few years. All without any increase in either individual or corporate income taxes or any spending cuts at all.

  27. rotter

    dynamite post and the best analogy ive heard yet “i sell one of my kidneys you sell one of your yachts”..Thats litterally true.

  28. Lambert Strether Post author

    3:25AM — I went through the Sanders speech and a same-day CPSAN interview, and added an update to the post. But I need to go to bed, so I’ll go through comments tomorrow.

    1. psychohistorian

      Lambert, keep up the good work.

      What struck me about reading your rant, the update and the comments is the lack of perception about how rigged the social discourse is by the media. That is what makes the media so insidious and effective, they control the narrative.

      I am not saying BS ever tried to talk outside the narrative. I am just saying that it can’t be done with the rich owning the media and controlling the narrative.

      When Yves starts showing up on the Sunday talk shows, I will believe the narrative has changed. Until then, we are (generously speaking) the 0.015 and GROWING!

      And look at how internally cohesive we NC folk are…..grin

  29. Tim

    It is ironic that everybody here is mad at the conservatives for what’s going on. A simplistic way of managing our nation would expose what is being railed on here.

    The reality is the modern world has been created too complicated which has made it ripe for being ripped off. So when I hear MMT is great it’s just too complicated for the minnons, I role my eyes. It is too complicated to not be taken advantage of. I will go farther to say that QE IS MMT to our corrupted elite. It’s all you MMT wishers are ever going to get. This stealth tax (currency depreciation) with heaviest weight on the poor that is used to fill banker’s pockets by the back door.

    Simplification of our government and rules and regulations will expose the truth about where our national resources are really coming from and where they are going, for all to see so fruitful negotiations about who owes what and who gets what can happen.

    So again, I find it ironic that a conservative simplistic mindset would be the beginning of the solution to the liberal’s problem that the conservatives want to cut entitlements and social services.

    The definition of a broken system is one that can no longer fix it’s own problems. We’ve been there for a while haven’t we?

  30. Marsha

    Our Medicare Monthly payment for 2013 just went up to $700/month. We’re going to have to get sick just so we feel as if we’re getting something for the $8400/year that we’re paying for basic health insurance. Oh, and add our supplemental policy and we’re paying $12,000/year for insurance.

    Can’t wait for the cuts to come so they can start “means-testing” Medicare and we pay more for even less.

  31. ess emm

    More fiscal cliff nonsense on Rachel Maddow tonight.

    In the middle of her railing against Republicans on the debt ceiling she said that S&P’s lowering of the US’s credit rating actually resulted in the US having higher borrowing costs.

    Then she said because of Republican intransigence on the debt ceiling Obama should figure out some way to unilaterally take over the appropriation process. Constitution be damned, apparently.

    Rachel Maddow has lost her freaking mind.

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