Home > Main > Trillion Dollar Coin: A Rant

Trillion Dollar Coin: A Rant

November 23, 2011

This is from a conversation held in the world of bits and bytes…

Hi All:

Every kid in the United States would be talking about a Trillion Dollar Coin if they knew about it.

We can sell a Trillion Dollar Coin.  The coin is 100% pure sizzle. MMT is the steak. We can’t sell “operational realities of crediting the Treasury account at the Federal Reserve”.  I almost fell asleep typing that sentence it is so boring.
I’ve worked for a while in a business where marketing was important – and the copywriters would be drooling over something as juicy as a Trillion Dollar Coin.
MMT is one of the great ideas in economics – and people in this group created it. It’s a certain path to higher human prosperity. I’m humbled to be involved in this discussion.
But this idea still needs to be sold to people. MMT is not easy to understand.
I’d imagine you’ve all had tough times getting the point across – even to highly intelligent people. I know I have.  I had a JPL rocket scientist – literally a rocket scientist – say to me “I have no idea what you are talking about” when I explained how MMT works. How many professional economists can’t understand it? Nick Rowe, anyone?

Here is what we know about The Coin:

1. Everybody on the planet would be talking about the Trillion Dollar Coin. It’s a Trillion Dollar Coin, for godsakes!  It’s exciting.  People would have an opinion about it, they would talk about it, they would debate it, they have fist-fights about it.

People would take vacations to see it if it was ever displayed.
Just mentioning would force economists and pundits to talk about it, debate it, discredit it, support it, ridicule it, endorse it. This is an idea that captivates the mind and forces people to consider it.
2. Many, many people embraced the coin in the month of July. MMT got more traction in just a few weeks than years of working on getting out the message.  That’s because people can understand the idea of the Coin.
3. Even people who don’t like MMT supported the coin. To us, it’s an obvious contradiction and impossible to support the Coin and not MMT.
But this isn’t obvious to most people.
Paul Krugman, Brad Delong and Scott Sumner don’t like MMT – but they supported the coin. These are people who have ranted against MMT as being fundamentally flawed.
Here’s Brad Delong:
These are extremely smart, professional economists. It took the coin for them to support of the main ideas of MMT, because it came in a version they can understand.
4.  Hyperinflation!!!   I’d love to have Cullen Roche on CNBC every week debating how the Trillion Dollar Coin doesn’t cause hyperinflation.
I’d love to see Cullen and Marshall and Mike and Warren being called onto Bloomberg TV to talk about the Trillion Dollar coin. Remember, any proposal is going to get smeared with hyperinflation no matter what gets proposed. The Germans are willing to blow up the world rather than face 3% inflation.
5.  Here’s a classic from George Carlin: “Just think of how stupid the average person is, and then realize half of them are even stupider!”
Warren designs supercars in his spare time! When he isn’t busy revolutionizing economics or running for Senate, he’s patenting new race car engine designs.
We need people who aren’t PHD’s in economics to understand what needs to be done in 1 sentence.
“Make a Trillion Dollar Coin and use it to pay down a bit of the government’s debt.”
The coin is an easy way to understand what’s happening. They can visualize a coin. They can’t visualize
“”operational realities of crediting the Treasury account at the Federal Reserve” even though it’s the exact same thing.
It’s not the optimal operational arrangement, no. But it’s something my mom and dad can understand in single sentence. They might not agree with it, but they would at least debate it.
And in a democracy, that’s what we want.  We want the ideas of MMT to be part of the debate after Thanksgiving dinner.
I look at this as an opportunity to take an idea (MMT) that’s going to raise the standard of living for nearly everybody and have it be seriously considered by millions of people in the United States. It just needs a vehicle to have it easily understood.
You can be assured someone like Ron Paul is thinking and talking to people about doing something like the coin, with people who are also quite intelligent. It’s a matter of time before somebody else proposes something similar, but with horrible and punitive twists.
I’d like to remind you that part of politics is being memorable. Barack Obama didn’t get elected president by being a boring guy, and Bill Clinton is famous for dominating every room he steps into.
We’re still talking about the mythical “Welfare Queen” decades later, and “Supply Side Economics” still has supporters. Everyone here knows a “Flat Tax” does literally nothing to simplify the tax code, but it still has millions of supporters who see it as “a way to simplify the tax code.”
The next phrase like this could be “Trillion Dollar Coin”.  Once this idea is out there, people would talk about it for decades, and keep talking about it.
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  1. November 23, 2011 at 9:46 am

    Facebooked and tweeted. Love this rant. Think how much more exciting it would be if the President Minted the $60 T coin and then made a sppech like the one in this piece: http://bit.ly/mYHtuu See also: http://bit.ly/piKijG http://bit.ly/qTGJEb and http://bit.ly/qyxvzB

  2. November 23, 2011 at 4:13 pm

    Facebooked and tweeted (thanks for the idea, Joe)…

  3. bill
    November 24, 2011 at 1:04 am

    the trillion dollar coin solves a non problem; the federal deficit. the problem is private sector debt, real resource constraints, real economic distortions (costs of medical care and higher education, and housing, all due to government induced and backed borrowing), and a financial sector monstrosity spawned by the government-banking cartel. political corruption, control of public policy by private interests, gaming the system, these are the real problems.

    how on earth is having the government retire a part of the federal debt a solution to the problems mentioned above? coin or no coin, paying off the debt with keystrokes isn’t palpable to the ruling class/elite/opinion makers… call it what you will.

    the powers that be desire the dismantling of an american middle class. all of the policies pursued by the elites of both parties, broadly called globalism, effect this outcome. you can’t solve a problem with logic or ideas when the problem isn’t considered a problem but a goal.

    and good luck bypassing the academic and economic elites and bringing your ideas to teh people. it is via teh people that our present system was brought about. er, they’re fscking stupid and therefore will be fleeced and manipulated by the asocial elite of our “proposition nation.” the elite which in no way identifies with the “people” it oversees and governs.

    MMT is entirely true. in every other way, it is retarded. in other words, it is factually correct description of how a sovereign state with a public purpose might run an economy if it wanted to. but every other assumption made by MMT advocates is utterly naive. namely, the political reality of america’s rulers and is populace.

    • December 1, 2011 at 7:58 pm

      Bill, I agree with the last part of your reply above in part, though not with the idea that MMT people are naive politically. A lot of MMT writing isn’t aimed at politician, but at opinion-leaders. What I really don’t agree with however is this part.

      “the trillion dollar coin solves a non problem; the federal deficit.”

      This is right, if one views the deficit as a solvency problem, because there’s no such thing for the US. But if you view the deficit/debt BS, as a political problem, then PPCS can solve that problem because it eliminates the debt subject to the limit, and therefore erases the whole political issue cluster surrounding the debt. The Austerians will then have to re-tool to develop compelling rationalizations about why we cannot solutions to real problems

      “The problem is private sector debt, real resource constraints, real economic distortions (costs of medical care and higher education, and housing, all due to government induced and backed borrowing), and a financial sector monstrosity spawned by the government-banking cartel. political corruption, control of public policy by private interests, gaming the system, these are the real problems.”

      I don’t think MMTers would disagree with this at all as a general statement of the real problems.

      “how on earth is having the government retire a part of the federal debt a solution to the problems mentioned above? coin or no coin, paying off the debt with keystrokes isn’t palpable to the ruling class/elite/opinion makers… call it what you will.”

      Since paying off most or all of the debt kills “austerity” as a political problem, it frees up legislators to focus on the real problems. It removes a tremendous distraction. It gets Barack Obama, Alan Simpson, Erskine Bowles, Alice Rivlin, Peter Peterson, Ben Nelson, Max Baucus, Paul Ryan and numerous others in both Houses of Congress and other areas of the Government to shut up and pass jobs programs, close the productivity gap, create a first class educational system, pass Medicare for All, and do all the other things that we should be doing and can, in fact, afford to do.

      I suspect you’ll say that I expect far too much from mere demonstration by the Government of the fact that it cannot and is not running out of the Money which it is the ultimate source of. But I’m not expecting anything to arise from this demonstration alone, but rather from the politics and messaging that can flow from it. The demonstration is a game-changer. With it progressives can ignore those who say we cannot afford this or that. They will no longer have to demonstrate their financial responsibility by agreeing, first of all, that the deficit is a problem, and then saying but … x, y, and z. They will be able to say instead, we need to do x, y, and z because here are the likely results of these measures. So, the political debate will be entirely different, and it is that transformation that can help us solve the real problems we face.

  4. Clonal Antibody
    November 24, 2011 at 11:27 am

    Bill,

    You raise some good points. But much may be learned from Red Ted’s life – the documentary so kindly posted by Senexx – History of Job Guarantees in Australia

    The videos are below, and as Senexx says “Part IV is particularly relevant particularly to those promoting the MMT paradigm”

    Austerity was all the rage — until the need for austerity suddenly disappeared. No money to be had today – but tomorrow no limit to how much money can be spent!

    No money available to alleviate human misery, but all the money that can be spent is available to preserve the powers that be!

  5. November 26, 2011 at 11:09 am

    Thanks Clonal (and Bill)…

    • Clonal Antibody
      November 26, 2011 at 3:05 pm

      Dan,

      The US was more fortunate than Australia in its politics of the 30’s. Roosevelt was hated by the bankers, but had sufficient power to make the necessary changes, and it took over fifty years for the bankers to regain the upper hand. But they did, because the general public became complacent and fragmented and was brain washed over time, and we are on the verge of loosing all that was gained.

    • Clonal Antibody
      November 26, 2011 at 3:06 pm

      One more

  1. November 26, 2011 at 2:45 pm
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