What is Modern Monetary Theory (MMT)?

“This game is a practical demonstration of the present system of land-grabbing with all its usual outcomes and consequences, as it contains all the elements of success and failure in the real world, with the object being the same that the human race in general seems to have, ie, the accumulation of wealth.” Elizabeth ‘Lizzie’ Magie, 1903, creator of the ‘Landlord’s Game’ (the predecessor of the ‘Monopoly’ game).

What is Modern Monetary Theory (MMT)? Well, like most people, if you’ve played ‘Monopoly’, then you’re already familiar with the core concepts of MMT, and you are already an ‘MMTer’.

MMT is a currency analysis, it describes how our federal gov’t creates fiat money. The federal gov’t, the issuer of fiat dollars, creates money the same way as the Monopoly game does.

The Monopoly game rules were written around the same time when President FDR initiated our country’s switch from gold-backed dollars into fiat dollars (ending the gold standard era). As per the Monopoly game rules, “The Monopoly Bank never goes broke, if the Monopoly Bank runs out of money, the Monopoly Bank may issue as much as needed by writing on any ordinary paper.” Which is the same as our federal gov’t today, the federal gov’t, the issuer of fiat dollars, is the same as the Monopoly Bank. The federal gov’t (the Monopoly bank) simply prints “$1”, “$5”, “$10”, “$20″, $50” and “$100” on pieces of paper, or the more prevalent, most modern way, they just tap them into electronic existence with a keyboard.

In addition, there is absolutely no mention in the Monopoly game rules about the Monopoly Bank going into ‘debt’ when it creates the Monopoly Money; nor is there any mention whatsoever in the rules about the Monopoly Bank having to ‘borrow’ Monopoly Money. Which is the same as our federal gov’t today, or any monetary sovereign issuing their own non-convertible, free-floating, fiat currency. Anyone who says otherwise doesn’t understand the rules. Anyone who has played Monopoly and does understand the rules easily grasps that rather than ‘borrowing’ or going into ‘debt’ like a household that needs to balance its budget and maintain prosperity; the Bank (the issuer) is merely supplying the Players (the users) with more needed currency to balance the Game and widen prosperity.

Unlike the Monopoly Players (the users of Monopoly money), the federal gov’t (the issuer), is not going to ‘run out’ of its own Monopoly Money. No Monopoly game that you ever played ever ended because the Monopoly Bank ran out of Monopoly Money. The Monopoly game only ended for Monopoly Players (households like you & me), when WE ran out of money.

In 1903, Elizabeth ‘Lizzie’ Magie, a bold and progressive woman, created two sets of rules for her ‘Landlord’s Game’: An anti-monopolist set, in which all were rewarded when wealth was created (to pay homage to Lizzie’s political hero, economist Henry George); and a monopolist set in which the goal was to crush opponents (to highlight the contradictions between the opposing ideologies).

Three decades later it was the cutthroat version that players preferred. Her monopolist version eventually caught on with a community of Quakers in Atlantic City, who customized it with the names of local neighborhoods, and in 1932 it found its way to Charles Darrow.

The next year, in 1933, FDR began the process of ending the gold standard era of ‘sound money’ and replacing it with fiat currency. Darrow dusted off Elizabeth Magie’s patent, created another game based off her monopolist version, and incorporated the monetary concepts of modern fiat currency in the rules of the game.

When Darrow’s ‘Monopoly’ game started to take off in the mid-1930s, Parker Brothers bought up the rights to his game plus all other related games created by Elizabeth Magie. However, Elizabeth Magie got nowhere near what Charles Darrow got (for the patent to the ‘Landlord’s Game’ and two other game ideas of hers, Lizzie reportedly received $500 — and no royalties). Lizzie, who felt cheated and became distraught, was afterwards quoted in The Washington Post saying, “There is nothing new under the sun.”

To this day Hasbro (a Parker Brothers subsidiary), still downplays Magie’s status. Hasbro credits the official Monopoly game produced and played today to Charles Darrow, and on Hasbro’s website, a timeline of the game’s history begins in 1935.

“The Monopoly case opens the question of who should get credit for an invention, and how. Most people know about the Wright brothers (who filed their patent on the same day as Lizzie Magie), but don’t recall the other aviators who also sought to fly. The adage that success has many fathers rings true, but says nothing of success’s mothers. Like Lizzie’s original innovative board, circular and never-ending, the balance between winners and losers is constantly in flux.”

Happy Mother’s Day

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SOURCE:  https://www.theguardian.com/lifeandstyle/2015/apr/11/secret-history-monopoly-capitalist-game-leftwing-origins

 

 

#FAKEMMTERS

Beardsley Ruml, the guy that wrote ‘Taxes For Revenue Are Obsolete’ in 1946 which is quoted by every single ‘prescription’ MMT ‘academic’ from Pavlina Tcherneva to Bill Mitchell, also said this: “The corporation income tax must go, taxes on corporation profits have three principal consequences and all of them are bad.” As chairman of the Federal Reserve in New York, Mr. Ruml insisted that the case for ending the corporate tax was overwhelming. “It is evil…it should be abolished,” he said.

Which begs the question: Why don’t the same MMT ‘scholars’ that love to quote Beardsley Ruml, ever mention that, or ever give the current administration any credit for dropping the corporate tax rate to 21% from 35% which Beardsley Ruml would have approved of (?)

Why don’t MMTers that want a reduction of payroll taxes for the working class, ever give the current administration any credit for the Tax Cuts and Jobs Act that lowered individual income tax rates (?)

Why don’t MMTers that want to raise the standard deduction, ever give the current administration any credit for doubling the standard deduction to 24K for a household (?)

Why don’t MMTers that want to address wealth inequality, ever give the current administration any credit for pinching the rich with a 10K cap on State and Local Tax (SALT) deductions (?)

Why don’t MMTers that want the federal gov’t to deficit spend more, ever give the current administration any credit for substantially growing the deficits now projected to top $1 trillion by 2020 (?)

Why don’t MMTers that know that we won’t default because we can always print the money, who gave then-candidate Trump credit for saying “We won’t default because we can always print the money”, then turn against any MMTer who suggested we call him an ‘MMT candidate'(?)

Why were most MMTers saying that we should have the federal gov’t spend $500B creating non-competitive ‘jobs’ in a Job Guarantee (JG) program, right now, in a labor skills shortage, during The Longest Private Sector Jobs Growth In US History, with record-breaking-low unemployment rates, the lowest jobless claims in 50 years, or in other words, IN THE HEALTHIEST JOBS MARKET IN DECADES? Why do these MMTers prefer that the unemployed become permanent* sharecroppers on a modern-day plantation (a soviet-style Job Gulag which is a UBI with a forced-work requirement) instead of as potential shareholders on a capitalist launchpad (?) (*Dr. Bill Mitchell actually said, quote, “Even if that person stays in that Job Guarantee position forever and no private employer would ever take them on…Huge success”, unquote)

Why didn’t these same MMTers not give the current administration any credit after a White House executive order calling for a federal JOBS TRAINING program, or more specifically, a ‘Training for the Jobs of Tomorrow’ initiative to tackle the challenges posed to the workforce (?)

Why didn’t these same MMTers not give the current administration any credit when 23 companies and associations signed a pledge at the White House on July 19, 2018 committing to expand apprenticeships, to train, re-train and ‘upskill’ more than 3.8 million American students and current workers for new jobs and rewarding careers (?)

Why didn’t these same MMTers not give the current administration any credit after the Perkins Career and Technical Education Act, providing more than $1 billion each year to states for vocational and career-focused education programs, tailored toward secondary and post-secondary students, that will help employers fill the high-skill jobs of tomorrow, was signed into law on July 31, 2018 (?)

The answer is…

…because mommy picked the wrong cereal brand on November 9, 2016, they’ve since ignored the Facts, Math & Data and have become #FAKEMMTERS (!)

Fake MMTers have been promoting their political ideologies with empty promises of guaranteed ‘jobs’ and more free ‘ponies’ (in exchange for votes) under the guise of promoting pure MMT (under the guise of ‘economics’).

Each and every day, it is getting more obvious that, unlike the current (MMT) administration, these #FAKEMMTers are now only interested in pandering to problems (pandering to their choirs) instead of actually solving problems (instead of actually helping them).

 

P.S. Those fists are not up in the air, those fists are going back & forth in a #learnmmt group circle jerk. Those folks need to get out of that cult while they can (and #UNLEARNFAKEMMT).

 

P.S.S. On 09/09/2018 Mike Norman got ‘woke’ (better late than never): “Deficit spending balloons to $980B. Where are all the MMT gods cheering this (?) The largest nominal deficit since 2009 and the largest as a percentage of GDP since 2012. The MMT gods should be cheering this. They’re not. Weird.” —Mike Norman Economics

Thanks for reading,

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