In the notorious election of 1800 Aaron Burr rose to the highest position of trust he would ever hold in the United States Government, Vice President, thwarted only by Thomas Jefferson in his aspirations.

Publicly, Burr remained quiet, and refused to surrender the presidency to Jefferson, the great enemy of the Federalists. Rumors circulated that Burr and a faction of Federalists were encouraging Republican representatives to vote for him, blocking Jefferson’s election in the House. However, solid evidence of such a conspiracy was lacking and historians generally gave Burr the benefit of the doubt. In 2011, however, historian Thomas Baker discovered a previously unknown letter from William P. Van Ness to Edward Livingston, two leading Democratic-Republicans in New York. Van Ness was very close to Burr—serving as his second in the later duel with Hamilton. As a leading Democratic-Republican, Van Ness secretly supported the Federalist plan to elect Burr as president and tried to get Livingston to join. Livingston apparently agreed at first, then reversed himself. Baker argues that Burr probably supported the Van Ness plan: “There is a compelling pattern of circumstantial evidence, much of it newly discovered, that strongly suggests Aaron Burr did exactly that as part of a stealth campaign to compass the presidency for himself.” The attempt did not work, due partly to Livingston’s reversal, but more to Hamilton’s energetic opposition to Burr. Jefferson was elected president, and Burr vice president.

Nice guy. Makes Dick Cheney seem a piker. Later, he went on to do this-

After Burr left the Vice-Presidency at the end of his term in 1805, he journeyed to the Western frontier, areas west of the Allegheny Mountains and down the Ohio River Valley eventually reaching the lands acquired in the Louisiana Purchase. Burr had leased 40,000 acres (16,000 ha) of land—known as the Bastrop Tract—along the Ouachita River, in Louisiana, from the Spanish government. Starting in Pittsburgh and then proceeding to Beaver, Pennsylvania, and Wheeling, Virginia, and onward he drummed up support for his plans.

His most important contact was General James Wilkinson, Commander-in-Chief of the U.S. Army at New Orleans and Governor of the Louisiana Territory. Others included Harman Blennerhassett, who offered the use of his private island for training and outfitting Burr’s expedition. Wilkinson would later prove to be a bad choice.

Burr saw war with Spain as a distinct possibility. In case of a war declaration, Andrew Jackson stood ready to help Burr, who would be in position to immediately join in. Burr’s expedition of about eighty men carried modest arms for hunting, and no materiel was ever revealed, even when Blennerhassett Island was seized by Ohio militia. His “conspiracy”, he always avowed, was that if he settled there with a large group of (armed) “farmers” and war broke out, he would have an army with which to fight and claim land for himself, thus recouping his fortunes. However, the 1819 Adams–Onís Treaty secured Florida for the United States without a fight, and war in Texas did not occur until 1836, the year Burr died.

After a near-incident with Spanish forces at Natchitoches, Wilkinson decided he could best serve his conflicting interests by betraying Burr’s plans to President Jefferson and to his Spanish paymasters. Jefferson issued an order for Burr’s arrest, declaring him a traitor before any indictment. Burr read this in a newspaper in the Territory of Orleans on January 10, 1807. Jefferson’s warrant put Federal agents on his trail. Burr twice turned himself in to the Federal authorities. Two judges found his actions legal and released him.

Jefferson’s warrant, however, followed Burr, who fled toward Spanish Florida. He was intercepted at Wakefield, in Mississippi Territory (now in the state of Alabama), on February 19, 1807. He was confined to Fort Stoddert after being arrested on charges of treason.

Burr’s secret correspondence with Anthony Merry and the Marquis of Casa Yrujo, the British and Spanish ministers at Washington, was eventually revealed. He had tried to secure money and to conceal his true designs, which was to help Mexico overthrow Spanish power in the Southwest. Burr intended to found a dynasty in what would have become former Mexican territory. This was a misdemeanor, based on the Neutrality Act of 1794, which Congress passed to block filibuster expeditions against US neighbors, such as those of George Rogers Clark and William Blount. Jefferson, however, sought the highest charges against Burr.

In 1807, Burr was brought to trial on a charge of treason before the United States Circuit court at Richmond, Virginia. His defense lawyers included Edmund Randolph, John Wickham, Luther Martin, and Benjamin Gaines Botts. Burr had been arraigned four times for treason before a grand jury indicted him. The only physical evidence presented to the Grand Jury was Wilkinson’s so-called letter from Burr, which proposed the idea of stealing land in the Louisiana Purchase. During the Jury’s examination, the court discovered that the letter was written in Wilkinson’s own handwriting. He said he had made a copy because he had lost the original. The Grand Jury threw the letter out as evidence, and the news made a laughingstock of the general for the rest of the proceedings.

Umm… yeah. Pretty clearly treason though we were not technically in a State of War. I’ll tell you it takes a lot of slime to make Alexander Hamilton look sympathetic.

Anyway, Impeachment. Off the table according to Nancy but that position is harder and harder to hold. Tom Steyer on January 28th, 2019-

Dems feel growing pressure on impeachment
By Mike Lillis, The Hill
03/02/19

Speaker Nancy Pelosi (D-Calif.) has confronted the question since the earliest days of Trump’s White House tenure, hoping to discourage any talk of ousting the president so long as the effort remains strictly partisan.

But a group of liberals in her ranks have pressed on, introducing articles of impeachment while threatening additional floor votes on the legislation. And this week’s explosive testimony by Trump’s former personal attorney, who lodged a string of allegations that the president broke numerous laws before and since he took office, has only fueled the impeachment push — and complicated efforts by Democratic leaders to prevent debate over the volatile “I” word from cascading into an intraparty free-for-all.

Appearing before the House Oversight and Reform Committee, Michael Cohen told lawmakers that Trump had a direct hand in distributing hush money payments to a porn star during the 2016 campaign — payments that would violate campaign finance laws — and also steered an unsuccessful effort to expand his business empire in Russia even as he was seeking the White House.

Rep. Steve Cohen (D-Tenn.), who introduced articles of impeachment in the last Congress, told The New York Times after the hearing that impeachment “is almost going to be impossible not to deal with.”

Rep. Rashida Tlaib (D-Mich.), another impeachment supporter, told MSNBC that Congress has a constitutional responsibility to check Trump’s business dealings because “this is not going to be our last CEO” in the White House. And impeachment advocates off of Capitol Hill are pointing to Michael Cohen’s testimony as just the latest — and perhaps most damning — evidence that Trump is unfit for office.

“Do I think the hearing made a difference? One-hundred percent,” said Tom Steyer, the billionaire environmentalist who is spending millions of dollars on a grass-roots impeachment campaign. “Because we now have public evidence confirming what we’ve been saying about the president’s crimes, corruption and cover-ups. And now we’ve got it on the record in front of the American people.

“The question now is, what do you want to do about it?”

Pelosi, joined by other top Democrats, sought to put the brakes on the impeachment talk following the hearing, noting the “divisive” nature of the issue and arguing the need to see more evidence of presidential wrongdoing before taking a step as momentous as ousting the president.

“Let us see what the facts are, what the law is, and what the behavior is of the president,” she told reporters Thursday.

Umm… yeah. Let’s not wait for 212 years to make up our minds though.

It hasn’t really changed much. About 2 to 21 days after you’re exposed you basically decompose into a puddle of vomit, diarrhea, and goo from internal and external bleeding following fever, sore throat, muscular pain, rash, and headaches. It has a 50% fatality rate.

So you would think people would be happy for whatever help they could get.

Think again.

Why Doctors Without Borders Is Suspending Work In The Ebola Epicenter In Congo
by Nurith Aizenman, NPR
March 1, 2019

The aid group Doctors without Borders is suspending its work in the epicenter of the Ebola outbreak in the Democratic Republic of Congo. The move comes after two separate attacks on its treatment centers there. The organization says, at best, it will be weeks before it returns.

“When I send my teams I need to be sure that they are going to come back alive,” says Emmanuelle Massart, the on-the-ground emergency coordinator for Doctors Without Borders in the region. “The attacks were really, really violent.”

The first took place last Sunday night.

“It started around ten o’clock,” says Massart.

Somewhere between 20 to 100 men converged on the group’s treatment center in a rural suburb called Katwa.

“They started to throw stones. And then they started to put part of the center on fire – where we had all the logistical and water and sanitation equipment. And then … the triage center and the cars.”

After about 15 minutes the attackers scattered. But the center was already in ruins.

The next attack was on Wednesday night — at a treatment center seven miles away, in a city called Butembo. This time the assailants were even more brazen.

“They used a car to ram the gate,” says Massart. “There were men inside. They divide in different teams. They start to destroy things. They start shooting. So the police arrive and they start shooting at each other.”

The gun battle lasted about 30 minutes. One officer was killed.

At the time, there were several dozen patients at the center who were suspected or confirmed to have Ebola. Many of them just picked up and ran.

Massart arrived on the scene soon after and says everyone was traumatized. His colleagues told him, “You are afraid for your life. You feel completely helpless.”
…
Massart says despite this dire prognosis, Doctors Without Borders will not return until it can be sure there will be no more attacks.

Requesting protection from the Congolese police or military or even United Nations peacekeepers is not an option, he says.

“It’s a general principle of Doctors Without Borders that if you accept the protection of one side you will be the target of the other,” he says.

Instead, the group maintains that the best way to stay safe is to make sure you win the support of the community. “Normally, the population understands that you are doing something good for them, so they will protect you,” he says.

And while it’s not yet clear who the assailants were in the two attacks, Massart says the larger takeaway is clear. In Katwa and Butembo, “there is a level of mistrust that we have to correct very, very quickly.”

He adds that it’s not surprising. Katwa and Butembo are in an isolated, impoverished area with a history of armed conflict that’s made people wary of — and sometimes even hostile to — outsiders.

Add to this the fact that Ebola is a disease that has never reached this region before and that at first blush doesn’t seem all that different from more familiar diseases.

“At the beginning you will have the same symptoms as malaria or typhoid fever – things that the communities are used to dealing with. So Ebola is seen as a disease like the other ones, and they don’t see why we should put people in treatment centers.”

After all, malaria can be deadly too. But they have never been foreign medical workers insisting that as soon as a family member shows signs of it you need to send them off to a bunch of strangers in plastic suits.

This mistrust has serious consequences beyond the attacks. Because people don’t come forward for treatment, a very high number are dying of Ebola in their communities. And at that end stage of the disease, they are at their most contagious.

And while Doctors Without Borders and other groups have done some work educating communities about Ebola, it clearly has not been sufficient, says Massart. In particular, “we should have involved the community in the decision making.”

For instance, he says, instead of simply erecting the Ebola treatment center in a location chosen by the government, “we should have gone to the community and said, ‘Where do you think we should put it?’ ”

The failure to consult the local population seems surprising given that Doctors Without Borders has a long history of treating Ebola in areas where there’s been community resistance. And the Katwa center was opened in January, long after numerous episodes of violent resistance in earlier hot spots of this very outbreak.

Massart says part of the problem is that there are so many different groups involved in the response – and each one handles different aspects.

“We are very known for patient care, and that’s where we have been put,” he says.

And in Katwa, “there were other people that were in charge of community engagement and communication. So we didn’t do it ourselves because it was supposed to be done and done well [by others.] But unfortunately it was not.”

Now he says, Doctors Without Borders is rethinking its role. The group will continue to provide patient care in other less violent areas of the outbreak.

But in Katwa and Butembo, he wonders: “Is patient care where we will have the biggest impact? Or should we put more forces in community engagement?”

I can’t say enough about the good and important work MSF does and this kind of reaction only serves to underscore how much they rely on goodwill and co-operation. Recently they’ve been forced to shut down operation of several ships tasked with rescuing refugees in the Mediterranean and before that were subjected to U.S. Military attacks in Afghanistan and Yemen.

I thought we were above “No Quarter” warfare. Evidently killing Doctors and Patients on their deathbeds is now on the table.

It’s a crying shame and I don’t know what to do about it other than draw your attention.

Because that’s just what you want to hear about during CPac.

First of all Socialism is not about Modern Monetary Theory and MMT is not about Socialism. Socialism is about how you spend State Resources and MMT is about what State Resources are.

Unlimited except by your imagination incidentally, the same as any fiat money including Yap Island Stones, Gold, and Bananas. Gold does not rot in 3 days and stink up your warehouse (you are trading futures, right? Someone else’s problem) nor is it subject to random viruses (then again, someone else’s problem. Only has a shelf life of 3 days anyway.). Yap Island Stones are rarer and more difficult to produce.

Bitcoin anyone?

Anyway Jacobin is normally a respectable left, left source but they crossed the wrong Randall Wray with this piece-

Modern Monetary Theory Isn’t Helping
By Doug Henwood, Jacobin
February 2019

Now that policies made famous by Bernie Sanders, like Medicare for All and free college, and newer ones like the Green New Deal, are infiltrating the political mainstream, advocates are always faced with the question: “how would you pay for them?” Although there are good answers to “this question” that could even be shrunk down to a TV-friendly length and vocabulary, they’re not always forthcoming. Even self-described socialists seem to have a hard time saying the word “taxes.” How lovely would it be if you could just dismiss the question as an irrelevant distraction?

Conveniently, there’s an economic doctrine that allows you to do just that: Modern Monetary Theory (MMT). Newly elected Rep. Alexandria Ocasio-Cortez is at least MMT-curious, and it’s all over Marxist reading groups and Democratic Socialists of America chapters. It’s even seeping into the business press — Bloomberg’s Joe Weisenthal is friendly to the doctrine. James Wilson of the New York Times tweeted recently, “The speed with which young activists on both left and right are migrating toward MMT is going to have a profound effect on US politics in the 2020s and 2030s.”

While adherents strenuously profess that MMT is subtler and more complex than this, its main selling point is that governments need not tax or borrow in order to spend — they can just create money out of thin air. A few computer keystrokes and everyone gets health insurance, student debt disappears, and we can save the climate too, without all that messy class conflict.

Umm… on my own hook all of that is true actually, “governments need not tax or borrow in order to spend — they can just create money out of thin air. A few computer keystrokes and everyone gets health insurance, student debt disappears, and we can save the climate too.”

Yeah. Too much money shows up as Inflation and you can tolerate quite a lot of that provided wages and benefits rise in sync.

The rest of it is crap that only gets worse, this part is where Randy Wray started smoldering a bit I think-

Two founding documents of MMT both came out in 1998: Wray’s book Understanding Modern Money and Kelton’s paper “Can Taxes and Bonds Finance Government Spending?” Both argue for several points that remain central to MMT today: governments designate the one official currency for a country by accepting only that unit for the payment of taxes. And a “monetarily sovereign” government — the United States is one, Greece isn’t (because of the euro), Brazil’s status is ambiguous (since it issues its own currency but has nowhere near the power or autonomy of the US) — can issue that currency without limit. As Wray put it, “The government does not ‘need’ the ‘public’s money’ in order to spend; rather the public needs the ‘government’s money’ in order to pay taxes. Once this is understood, it becomes clear that neither taxes nor government bonds ‘finance’ government spending.” You might be wondering where income earned on the job fits into all of this, but the world of production doesn’t play a large role in the theory.

But having tempted us into thinking that taxes were dispensable, Wray pulls a bait and switch. Since there is a risk that too much government spending would spark inflation, the government might need to cool things down, meaning create a recession — though Wray shies away from using the word — by raising taxes. Taxes, MMT holds, should be used as tools of economic management, but must never be thought of as “funding” government. To think that would be to indulge in an orthodox superstition.

Kelton’s paper foreshadowed what would become a trademark of MMT writing: detailed accounting exercises designed to show what happens, mechanically speaking, when the government spends money. These are mobilized to ask “why should the government take from the private sector the money . . . that it alone is capable of creating? . . . Indeed, the entire process of taxing and spending must, as a matter of logic, have begun with the government first creating (and spending) new government money.” Government is as a God, giving economic life through spending: until it spends, we have no money. Taxes and borrowing are merely means to manage the level of reserves in the banking system.

Much of the MMT literature is an elaboration of the arithmetic of bank reserves, the money banks set aside as a backstop against a run, in the form of cash in the vault or deposits held at the central bank. Reserve accounting is important if you’re a financial economist or a central banker, but it’s of limited relevance to anyone concerned with big-picture economic questions. Absent from Kelton’s paper, Wray’s book, and much of the subsequent MMT literature, is any sense of what money means in the private economy, where workers labor and capitalists profit from their toil and compete with each other to maximize that profit, a complex network of social relations mediated by money.

There is more but it’s fatuous garbage. “Get to know your family again. Make love to your wife. Write that novel you got kicking around in your head. You know, the one about the intrepid Washington reporter with the courage to stand up to the administration? You know, fiction!”

What money means is exactly defined by “a complex network of social relations mediated by money (in this sense any agreed on item of symbolic value, say an Ur Cow Token because they’re easier to carry around than Gold or Bananas or Yap Island Stones)”. If you work at all with bottom line accounting (not that I do, I’m a Lion Tamer!) you realize that income is income and inflated valuations mere speculation, not that you can’t make money playing the ponies. Reserve accounting is important if you’re a financial economist or a central banker! It has a direct impact on all sorts of areas of your economy like growth, wealth distribution, Interest Rates and ROI.

Randy’s response-

Response to Doug Henwood’s Trolling in Jacobin
by L. Randall Wray, New Economic Perspectives
February 25, 2019

Doug Henwood has posted up at Jacobin an MMT critique that amounts to little more than a character assassination. It is what I’d expect of him in his reincarnation as a Neoliberal critic of progressive thought. (https://www.jacobinmag.com/2019/02/modern-monetary-theory-isnt-helping). It adopts all the usual troll methodology: guilt by association, taking statements out of context, and paraphrasing (wrongly) without citation.

According to Henwood, MMT is tainted by Warren Mosler’s experience as a hedge fund manager. Beardsley Ruml (father of tax withholding and chairman of the NYFed, who argued correctly that “taxes for revenue are obsolete”) is dismissed because he was chair of Macy’s (and Director of the NYFed — Macy’s still has a director on the NYFed) and because he argued that the corporate tax is a bad tax (his main arguments were later advanced by Musgrave & Musgrave, the textbook on public finance, by Hyman Minsky, and by me in the second edition of my Primer).

Oh, Ruml must not know anything about either taxes or central banking because he was a corporate stooge. Never mind that he was a New Dealer who helped to organize the New Deal plans for projects all over the country. And a PhD who authored several books and who was the Dean of Social Sciences at the University of Chicago. He must be an ignoramus when it comes to taxes and central banking because he does not adopt Henwood’s belief that the sovereign government of the United States must rely on the taxes that come from corporations and rich folk. Such is the depth of Henwood’s argument against MMT. It amounts to little more than a series of baseless ad hominem attacks.

I used to respect Henwood in his earlier role as editor of the Left Business Observer and indeed we enjoyed a good relationship, often corresponding on progressive issues. He disappeared from the scene some decades ago and I thought he had died. However, he reappeared recently as a troll arguing in blog commentary against MMT. His rants were largely incoherent and as we say in economics, orthogonal to anything MMT actually says. He has apparently suffered the fate of many aging Marxists—after years of fighting the good fight against capitalism they realize they’ve accomplished little and decide to instead engage the progressives on the argument that all is hopeless.

Apparently, Jacobin assigned to him the task of destroying MMT. My name is mentioned 17 times in Henwood’s article — I think that is more than anyone else. The magazine is publishing the attack without any offer of a response. That is quite typical when it comes to diatribes against MMT — dating all the way back to my first book in 1998 (Understanding Modern Money — the first academic book on MMT. The editor of the main Post Keynesian journal published a critique of the book— by Perry Mehrling, someone with no Post Keynesian credentials – without giving me an opportunity to respond in the same issue, and then declined to even let me have a response in a later issue. This is the way academics has dealt with MMT from the beginning—any critique, no matter how groundless, will be featured and no response will be allowed.). And so it goes.

As Jacobin did not give me a chance to respond, I’m penning this for NEP. These are my responses and none of the other MMTers Henwood has trolled in his piece should be implicated. I’m sure that all of them—Kelton, Tcherneva, Mosler, Tymoigne, Fullwiler, Dantas, Galbraith, and Mitchell—can defend themselves ably and with more nuance and respect than I can. Me, I detest trolls and I cannot hide my distaste.

In any event, here are some of the topics I would address if I had been given a chance to respond.

1. According to Henwood, Wray does not discuss the role of private money (and financial institutions) in the private economy. Henwood claims “absent” from Wray’s work “is any sense of what money means in the private economy”. In fact, My 1990 book (Money and Credit in Capitalist Economies” is one of the foundational books in the endogenous money literature (that Henwood discusses favorably). My work before and after that book has focused on the private financial sector and includes hundreds of articles, chapters, and books on the topic—including a book co-authored with Tymoigne on the global financial crisis (The Rise and Fall of Money Manager Capitalism, Routledge 2014), and a recent book on Minsky’s approach to finance (Why Minsky Matters, Princeton, 2015). I’d wager that there are vanishingly few authors who have written more on the private banking system than me, and along with Bill Black, few who have taken such a critical perspective of private banking as practiced.
2. In one place, Henwood seems to backtrack a bit, writing “Wray, who once wrote a book on the topic, now dismisses endogenous money as a “trivial advance” next to MMT”. Yes, I do argue that in retrospect the endogenous money literature is trivial for several reasons. First, the modern endogenous money research (that began seriously around 1980) largely just recovered the pre-Friedmanian views that were common in the 1920s (and that were never lost in the UK); second the endogenous money approach was rather quickly adopted by heterodoxy; and third all the central banks of the rich, developed countries have also adopted the endogenous money approach. The policy recommendation that comes out of it is to direct central banks to target interest rates, not reserves or money supply. Central banks had usually adopted interest rates, anyway, outside of the relatively brief Monetarist experiment that began under Chairman Volcker—and although it is true that mainstream economists had taught that central banks could choose money targets, they recognized that if both the IS and LM curves are stable, choosing a money target is formally equivalent to choosing an interest rate target. By contrast, we have been pushing the MMT approach to fiscal finance since the early 1990s and it still remains highly controversial—and still attracts the same comments from trolls and others, like Bill Gates and Austin Goolsby who both recently announced “that’s crazy!”. Why? Because the implications of understanding fiscal finance are huge. By comparison, the implications of endogenous money are trivial — which is why it was relatively easy to get the theory adopted.
3. Wray supposedly “shies away from” discussing use of tax increases to counter inflationary pressures. While I am (and MMT in general is) skeptical of use of discretionary tax hikes to fight inflation, we strongly support progressive income taxes that will automatically rise in a boom. MMT also supports use of a JG to cause government spending to rise countercyclically (rising in a downturn as workers are shed from the private sector and falling in an expansion). Together, these can help to stabilize spending and income at the aggregate level. We also argue that the countercyclical swings of employment in the JG pool can act as a bufferstock to help stabilize wages. If there were a prolonged stretch of inflation we would—of course—recommend pro-actively raising taxes and/or reducing spending. We’ve been very clear on this. Our argument has always been that a JG and progressive tax system help to stabilize aggregate demand, wages, and prices but if that is not sufficient, government still has at its disposal the usual methods of fighting inflation—everything except using unemployment (since austerity will not increase unemployment but will instead increase employment in the JG).
4. According to Henwood “Wray has said MMT is compatible with a libertarian, small government view of the world”. Yes, the descriptive part of MMT accurately describes how sovereign currency systems work, and such knowledge can be used by Austrians or Marxists to better understand the world they want to change. MMT proponents, however, are mostly progressives, who are not content with merely explaining the world but more importantly want to radically change it. Hence, we do have policy proposals—proposals that I expect both Austrians and Marxist will hate, such as the JG. As I’ve written before, it is strange that the far right and far left come together in favoring unemployment over employment in a JG. One of those strange but true alliances against progressive policy. Austrians oppose the JG on the basis that it expands the role of government; some of the Left opposes it because the JG ameliorates suffering, presumably reducing recruits for the coming revolution.
5. Henwood: “Wray’s explanation of the Weimar hyperinflation, one of the most dazzling of all time, is odd. The deficits, Wray explained in his book, were caused by the inflation, not the other way round.” Yes, that is true; Henwood adopts the Monetarist explanation that “too much money” causes inflation. He confuses causation and correlation. Severe supply constraints can push up prices, increasing the amount of money that needs to be created both publicly and privately to finance purchases. Tax revenues fall behind spending so a deficit opens up as spending tries to keep pace with inflation. The money stock is a residual and it will grow rapidly with hyperinflation. That does not mean it is the cause. Mitchell has closely examined the hyperinflation cases from the MMT perspective; the argument is not at all odd and has the advantage that it is fact-based, unlike Henwood’s Monetarist linking of money and inflation that has been so thoroughly discredited that even central bankers have dropped it.
6. Henwood proclaims: “MMTers like Mitchell and Wray write as if borrowing abroad is just a bad choice, and not something forced on subordinate economies” and then goes on to argue that Mosler is “wrong” when he says that Turkey can buy capital equipment in its own currency (lira). Henwood does not understand foreign exchange markets—anyone (including Henwood) can exchange Turkish Lira for either dollars or euros in foreign exchange markets—including at airport counters around the world. Turkey can exchange lira for dollars to pay for imports of capital. (Might that affect exchange rates? Possibly. That is why floating the currency is important.) Nor does MMT argue that “borrowing abroad” is a “bad choice”—if that means issuing domestic currency debt held by foreigners. What we argue is that issuing debt in a foreign currency is a bad choice for any country that can issue its own currency. I’d go even further and argue that any country with its own currency should prohibit its government from issuing debt in a foreign currency, or from guaranteeing any such debt issued by its domestic firms. However, if private entities want to issue debt in foreign currencies, I do not necessarily advocate preventing that. What about the special case of a country that issues a currency that cannot be exchanged in forex markets (remember, Henwood wrongly proclaimed that Turkey is such a country—here I’m not talking about Turkey or any of the other many countries which do have currencies listed in forex markets; for a list of exchange rates of the 150 or so convertible currencies from the Aruban Florin to the Zambian Kwach, go here: https://www.oanda.com/currency/converter/)? I think it is most likely a mistake to issue debt in a foreign currency unless there is an identified source of the forex that will be needed to service the debt (for example, dedicated forex earned from exports). If you cannot exchange your currency in forex markets, and cannot earn forex, your best bet is international charity. Indebtedness in foreign currency will be a disaster.
7. Henwood claims: “MMTers will sometimes say they want to tax the rich because they’re too rich, but Wray said at a recent conference that he sees no point in framing the issue as taxing the rich to expand public services — presumably because government doesn’t need to tax to spend” and has “has written that taxing the rich is “a fool’s errand” because of their political power”. The first part of that is correct—we do not need to tax the rich in order to expand public services. The second is dishonest reporting. He does not include a citation but what I actually argued is that trying to reduce inequality using taxes is not likely to be successful—because the rich influence the tax code and get exemptions. Like Rick Wolff, I argue for “predistribution”—prevent the growth of excessive income and wealth by controlling payments of high salaries in the first place. Eliminate the practices that lead to inequality—such as huge compensation for top management of public companies. I do like high taxes on high income and high wealth. I have argued they should be set so high as to be confiscatory. Not at a marginal income tax rate of 70%, but at 99%. Or even 125%. Or 1000%. Take it all. I am not confident that the effective tax rate will ever be that high—due to the exemptions the rich will write into the code—but we that doesn’t mean we shouldn’t aspire for better. It is amusing that Henwood refers to the barriers of “political power” when it suits his purpose (for example when he talks about the political infeasibility of the job guarantee) but objects if I notice that it is politically difficult to tax rich folks. All I’m arguing is that a) we don’t need tax money to pay for the programs we want, and b) high tax rates on the rich, alone, will not be sufficient in our struggle to reduce inequality.
8. He writes “Tymoigne and Wray’s response to Palley barely addressed any of his substantive points” and Henwood objects to our mention of a video where Palley argued against the job guarantee because if poor people in South Africa got jobs they’d want food and that might increase imports and even cause inflation. First, we responded to Palley’s critiques in 43 different places in that paper, including responding in detail to nine long quotes where we let him speak for himself (unlike Henwood, who loosely—often wrongly—paraphrases our arguments, often with no citations at all). The video is not an outlier—it is Palley’s often repeated position. Given a choice, Palley prefers low inflation over jobs and income for the poor. He is perhaps the only Post Keynesian who still uses the ISLM framework augmented by a Phillips Curve. (For those who don’t know what that framework is, it is the “bastardized” version of Keynesian economics that helped open the door to Neoliberalism.) I have been at meetings where Palley urged the AFL-CIO to forget about arguing for full employment because of the danger of inflation. That was not in 1974 or even in 1979 when there actually was some inflation. No, it was a generation later. Like the Neoliberals, Palley is still fighting the inflation battle decades after the danger disappeared. Henwood is free to defend that Neoliberal position if he likes, but it is disingenuous to criticize us for linking to a video where Palley makes his own case for the position he is well-known to hold.

Henwood and Jacobin align themselves against the new wave of activists who have embraced MMT and the Job Guarantee as integral to the Green New Deal program. These new progressives want to tax rich people, too, not because Uncle Sam needs the money but because the rich are too rich.

Henwood wants us to believe that Government needs inequality. We’ve got to cater to the rich. They get to veto our progressive policies. If there weren’t rich folk, we’d never be able to afford a New Deal. We only get the policies they are willing to fund. If we actually did tax away their riches, government would go broke.

As Kelton puts it, people like Henwood think money grows on rich people.

For far too long left-leaning Democrats have had a close symbiotic relationship with the rich. They’ve needed the “good” rich folk, like George Soros, Bill Gates, Warren Buffet, Bob Rubin, to fund their think tanks and political campaigns. The centrist Clinton wing, has repaid the generosity of Wall Street’s neoliberals with deregulation that allowed the CEOs to shovel money to themselves, vastly increasing inequality and their own power. And they in turn rewarded Hillary—who by her own account accepted whatever money they would throw in her direction.

Today’s progressives won’t fall into that trap. “How ya gonna pay for it?” Through a budget authorization. Uncle Sam can afford it without the help of the rich.

And, by the way, they’re going to tax you anyway, because you’ve got too much—too much income, too much wealth, too much power. What will we do with the tax revenue? Burn it. Uncle Sam doesn’t need your money.

In reality, taxes just lead to debits to bank accounts. We’ll just knock 3 or 5 zeros off the accounts of the rich. Of course, double entry bookkeeping means we also need to knock zeros off the debts held by the rich — so we’ll wipe zeros off the student loan debts, the mortgage debts, the auto loan debts, and the credit card debts of American households. Yes, debt cancellation, too.

The new breed of progressive politician— represented by Bernie and Alexandria— doesn’t need corporate funding, either. And they certainly don’t need Henwood’s scolding.

Look, it’s not like the South didn’t always have Agricultural Slavery because they always did, originally in the Tobacco, Indigo, and Sugar Cane Trade. It’s equally useless to pretend that despite some exceptions the burden of this labor fell overwhelmingly on Kidnapped Black Africans and later by breeding their descendants like cattle.

It is what it is. Part of this grand fabric we call ‘Murika.

But, you know, Pipe Weed, Purple Shirts, and Rum (Why is there never any Rum? Oh, that’s why.) is not enough to make you hyper wealthy. It’s certainly not Gold Mines in Mexico and Silver Mines in Peru. And so Slavery was an atavistic curiosity like street legal Automatic Rifles.

Eli Whitney changed all that.

Gin in this case has nothing to do with an aromatic liquor infused with Juniper Berries (to which I’m just as allergic as Bell Peppers) and other herbs. It’s short for Engine.

If you’ve ever handled raw cotton you’ll know that it looks like a burst milkweed with a coconut husk. Crack that off and you’re rewarded with a bundle of fiber and seeds you have to clean and straighten before it’s worth a damn thing. Lots of Labor, even slave, for not much market because it was too damn expensive.

Should this sound like a problem that can be solved with engineering and industrialization then you would be like minded with Eli, Nutmegger through and through (Nutmegger in this context meaning someone who will trade Slaves for Rum all day long AND sell you a piece of wood and call it Nutmeg) of New Haven Connecticut, a luminous symbol of our State virtue just like Benedict Arnold.

I had a whole year of this crap.

Anyway, Whitney’s great contribution to Slavery in the United States was to make it mega-profitable. Get a bunch of Slaves. Have them pick hundreds of pounds a day. Pour it in a hopper. Grind, grind, grind. Bundle and ship it.

To be fair most of this was processed in Mill Towns in New England and the Factories linger next to their ponds in picturesque repurposing. It takes a keen eye to see where the water powered belts which ran the looms used to be.

But there was also the foreign trade, raw or finished and let’s face it- Cotton is a whole lot less itchy than Wool (though a Wool economy is more sustainable). It is no exaggeration to say that at the outbreak of the Crusade Against Slavery about 2 thirds of the total wealth of the United States was in human chattel property or Industries based on Slave Labor.

So it was a Class War too.

Do I think it was out of line for Pam Northam to hand around a Cotton Boll and ask people to imagine what life would be like as a Slave? Not really, and not even if an Eighth Grader (that’s a Junior in a Junior High system, 6 – 3 – 3, 14 years old) is offended somehow.

This is reality. This is History. Denial does not help.

Better you should really understand it. Though I saw it many years ago (somewhat earlier in my education than this student) I remember it to this day and I feel the experience taught me a lot, both about Economics (Connecticut, New England, and New York were totally complicit- all those Mansions built on the “China” Trade?), and about the thoroughly miserable and harsh conditions Slaves had to suffer.

Then again, Ben Franklin White. There are levels I am incapable of grasping.