Mitchell’s laws: Reduced money growth never stimulates economic growth. To survive long term, a monetarily non-sovereign government must have a positive balance of payments. Economic austerity causes civil disorder. Those, who do not understand the differences between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.
Science buffs probably enjoyed reading the many articles appearing recently in newspapers and magazines all over the world, exemplified by today’s editorial:
Was Einstein wrong?
The latest in a long line of challengers (to Einstein): scientists at the European Organization for Nuclear Research (CERN). Last week they startled physicists around the world – and a few nonphysicists, too – by declaring they had recorded subatomic particles called neutrinos treveling saster than the speed of light. . .
. . . A cornerstone of Einsteinian theory is that nothing can travel faster than the speed of light, about 186,000 miles a second. . . .
“It would be amazing, everyone would be jumping up and down like crazy,” Cal Tech theoretical physicist Sean Carrol told us. “It would certainly be the most surprising discovery in the last 100 years.”
Reality check: The CERN experimenters are probably wrong.
This editorial goes on about how unlikely this speculative finding is, but despite this low probability, the editorial warrants a full 1/3 page space in a major market newspaper, the – you guessed it – Chicago Tribune.
The point of this blog post: A one-time, low probability, almost-sure-to-be-found-wrong finding, by one group of scientists is given prominent space, while a high probability, almost-sure-to-be-found correct, decades-long finding by dozens of respected scientists worldwide is never given even a mention in the same paper. I’m talking about Modern Monetary Theory / Monetary Sovereignty.
Why the difference?
Is it because the Tribune’s editors, and like minded editorial writers, realize they know nothing about physics, and so will print anything that physicists send around? Is it that the editors have no solid beliefs or background in physics, and don’t want to look like idiots by disagreeing with physicists?
Contrast physics with economics: The editors know economics, or believe they do. After all, economics is just money – spending, saving, earning, borrowing, owing, paying, investing, losing. While the Tribune editors know nothing about neutrinos, they surely know everything about dollars. So while they will accept almost anything the physicists say about neutrinos, the editors will accept nothing about money that differs from what they already know.
So that’s it? That’s why news about a complex, unknowable (to the editors) subject receives the respect news about a familiar subject doesn’t. Right?
No, I don’t think so. I think the real problem is the Tribune’s and virtually all newspapers’ editors have too much, as the saying goes, “skin in the game.” Before 1971, the end of the gold standard, they spoke of the need to reduce deficits, and never changed after 1971. They have preached the same “debt-is-a-ticking-time-bomb” sermon since at least 1940, and are so committed they cannot bring themselves to admit to the world they have been wrong, wrong, wrong. Even worse than admitting you’ve been wrong is admitting your errors have forced politicians to pursue schemes damaging to America.
If Monetary Sovereignty just were counter-intuitive, I suspect curiosity would drive the editors to look at the data. They are, after all, newspaper people, accustomed to seeking out hidden facts and bringing them to their readers. That is their world. It’s why they delight in writing editorials about neutrinos.
But they don’t seek the unfamiliar facts about our economy. They turn away. They close their eyes. They scream “Na, na, na, I can’t hear you,” and that only could mean, “I don’t want to hear you.” In the Chicago Tribune’s case, even the man who is President, Publisher and CEO has his hands clapped tightly over his ears.
Throughout history, it always has been hard to convince honored doctors their favorite treatment has been killing people. Call it the Semmelweis syndrome.
Rodger Malcolm Mitchell
No nation can tax itself into prosperity, nor grow without money growth. Monetary Sovereignty: Cutting federal deficits to grow the economy is like applying leeches to cure anemia. The key equation in economics: Federal Deficits – Net Imports = Net Private Savings