For me the biggest insight regarding #MMT isn't that taxes aren't needed prior to spending but that bonds are for monetary policy not fiscal. The big scary borrowing everyone hammers on about so much is nothing more than savings opportunities with an interest rate set by the BoE.
This realisation opens up important discussions about whether these savings opportunities are being provided on a fair and equitable basis, or indeed, whether they should exist at all in this format given the misinterpretation of their function.
Whilst eliminating interest on government "debt" may well be desirable, it would also eliminate safe savings opportunities for those in the private sector. For me personally, if a ZIRP were to be implemented then an offer should be made for individual savers. This may be in the
Form of a regular pensions savings account for each citizen, criteria based savings for the financial sector and fund managers, and perhaps a baby bond program to alleviate at least some elements of inequality and social mobility.
By restructuring private savings and
By restructuring private savings and
Reframing them as the obvious savings opportunities they are we accomplish two important things.
1. Remove the political tool of fearmongering the national debt and interest payments.
2. Create a counter conditioning narrative so that people can start to view the debt positively
1. Remove the political tool of fearmongering the national debt and interest payments.
2. Create a counter conditioning narrative so that people can start to view the debt positively
Point 2 is incredibly important in order to shift public consciousness and vaccinate future generations against committing grave errors in the name of "reducing the debt burden". It would also allow a positive emotional attachment to be made to the national savings figures.
This would be akin to the emotional attachment some of us in the UK feel towards NI and taxes for services such as the NHS as we feel we have a stake in the game because of them, incidentally this is one of the reasons many deem the NHS "ours" more than say public land/services.
