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RT America’s Lee Camp Raises Questions about Starmer’s Connection to British Deep State

Mike’s put up a number of pieces discussing and criticising Starmer’s demand that Labour MPs abstain on the wretched ‘Spycops’ bill. If passed, this would allow members of the police and security services to commit serious offences while undercover. Twenty Labour MPs initially defied him and voted against it, with several resigning in protest from the shadow cabinet. The Labour whips’ office has also broken party protocol to issue written reprimands to the rebels. If they defy party discipline, they will face a reprimand period of six months, which will be extended to twelve if they continue to break the whip. These letters have also been shared with the parliamentary committee, a group of backbench MPs elected by the parliamentary Labour party and currently dominated by the right. This committee will decide whether or not to inform the rebel MPs’ constituency parties and the NEC. The information could then be considered if an MP seeks reselection in preparation for a general election. As one MP has said, it’s intimidation, pure and simple. And a number of those MPs, who received the letters, are talking to union officials.

See: https://voxpoliticalonline.com/2020/10/17/starmers-tory-supporting-crackdown-on-his-own-party-makes-him-a-danger-to-people-with-disabilities/

Starmer’s conduct shouldn’t really be a surprise. He’s a Blairite, and Blair’s tenure of the Labour leadership was marked by control freakery as he centralised power around himself and his faction away from the party’s ordinary members and grassroots. But Starmer is also very much an establishment figure. He was, after all, the director of public prosecutions. In this video below, comedian and presenter Lee Camp raises important and very provocative questions about Starmer’s connections to the British establishment and the deep state. Camp’s the presenter of a number of shows on RT America, which are deeply critical of the corporate establishment, and American militarism and imperialism. The video’s from their programme, Moment of Clarity. The questions asked about Starmer are those posed by Mac Kennard in an article in The Gray Zone. RT is owned by the Russian state, as it points out on the blurbs for its videos on YouTube. Putin is an authoritarian thug and kleptocrat, who has opposition journalists, politicos, activists and businessmen beaten and killed. But that doesn’t mean that RT’s programmes exposing and criticising western capitalism and imperialism and the corrupt activities and policies of our governments aren’t accurate and justified.

Camp begins the video by explaining how there was a comparable battle in the Labour party over Jeremy Corbyn’s leadership as there was in the American Democrat party over Bernie Sanders’ candidacy for the presidency. Just as Sanders was opposed by the Democrats’ corporate leadership and smeared as a Communist in a neo-McCarthyite witch hunt, so Jeremy Corbyn – a real progressive – was opposed by the corporatists in the Labour party. He was subjected to the same smears, as well as accusations of anti-Semitism because he supported Palestine. Camp states that there are leaked texts showing that leading figures in the Labour party were actively working to undermine him. Jeremy Corbyn has now gone and been replaced by Keir Starmer, about whom Kennard asks the following questions:

1. why did he meet the head of MI5 for drinks a year after his decision not to prosecute the intelligence agency for its role in torture?

Camp uses the term ‘deep state’ for the secret services, and realises that some of his viewers may be uncomfortable with the term because of its use by Trump. He tries to reassure them that the deep state, and the term itself, existed long before Trump. It’s just something the Orange Generalissimo has latched onto. Camp’s not wrong – the term was used for the network of covert intelligence and state law enforcement and security services long before Trump was elected. Lobster has been using the term for years in its articles exposing their grubby activities. More controversially, Camp believes that the deep state was responsible for the assassinations of JFK, RFK and MLK. JFK was supposedly assassinated because he was about to divulge publicly the deep state’s nefarious activities. This is obviously controversial because the JFK assassination is one of the classic conspiracy theories, and one that many critics of the British and American secret states don’t believe in. It may actually be that JFK really was killed by Lee Harvey Oswald, a lone gunman. But Camp’s belief in this conspiracy theory doesn’t on its own disqualify his other allegations and criticisms about the secret state.

2. When and why did Starmer join the Trilateral Commission?

The Trilateral Commission was set up in 1973 by elite banker David Rockefeller as a discussion group to foster greater cooperation between Japan, the US and western Europe. According to Camp, it was really founded to roll back the advances of the hippy era as the corporate elite were horrified that ordinary people were being heard by governments instead of big businessmen. They looked back to the days when President Truman could listen to a couple of businessmen and no-one else. The Commission published a paper, ‘The Crisis of Democracy’, which claimed that democracy was in crisis because too many people were being heard. Ordinary people were making demands and getting them acted upon. This, the Commission decided, was anti-business. They made a series of recommendations themselves, which have since been implemented. These included the demand that the media should be aligned with business interests. Camp states that this doesn’t mean that there is uniformity of opinion amongst the mainstream media. The various media outlets do disagree with each other over policies and politicians. But it does mean that if the media decides that a story doesn’t fit with business interests, it doesn’t get published. The Commission also wanted the universities purged of left-wing progressives. The Commission’s members including such shining examples of humanity and decency as Henry Kissinger and the former director general of US National Intelligence, John Negroponte.

3. What did Starmer discuss with US attorney general Eric Holder when he met him on November 9th, 2011 in Washington D.C.?

Starmer was the director of public prosecutions at the time, and met not just Holder, but also five others from the Department of Justice. This was at the same time the Swedes were trying to extradite Julian Assange of Wikileaks infamy. Except that further leaked documents have shown that the Swedes were prepared to drop the case. But Britain wanted him extradited and tried, and successfully put pressure on the Swedes to do just that.

4. Why did Starmer develop such a close relationship with the Times newspaper?

Starmer held social gatherings with the Times’ staff, which is remarkable, as Camp points out, because it’s owned by Rupert Murdoch like Fox News in America.

Camp goes on to conclude that, at the very least, this all shows that Starmer is very much a member of the corporate establishment, and that the deep state has been working to assure that same corporate elite that he’s safe, just as they worked to reassure Wall Street about Obama. At the time Obama had only been senator for a couple of years, but nevertheless he succeeded in getting a meeting with a former treasury secretary. But now the corporate establishment in the Democrats and the Labour party has won. Jeremy Corbyn has been ousted and replaced with Starmer, while Sanders can’t even get a platform with the Democrats. This is because the Democrats have surrendered the platform to the Republicans because Trump contradicts himself so much they just can’t follow him.

While these are just questions and speculation, they do strongly indicate that Starmer is very much part of the establishment and has their interests at heart, not those of the traditional Labour party. His closeness to the Times shows just why he was willing to write articles for the Tory press behind paywalls. His role in the British state’s attempt to extradite Julian Assange and meetings with Holder also show why Starmer’s so determined not to oppose the ‘spycops’ bill. He is very much part of the British state establishment, and sees it has his role and duty to protect it and its secrets, and not the British public from the secret state.

As for the Trilateral Commission, they’re at the heart of any number of dodgy conspiracy theories, including those claiming that the American government has made covert pacts with evil aliens from Zeta Reticuli. However, as Camp says, his membership of the Commission does indeed show that he is very much a member of the global corporate elite. An elite that wanted to reduce democracy in order to promote the interests of big business.

As a corporate, establishment figure, Starmer very definitely should not be the head of a party founded to represent and defend ordinary people against exploitation and deprivation by business and the state. Dissatisfaction with his leadership inside the Labour party is growing. Hopefully it won’t be too long before he’s ousted in his turn, and the leadership taken by someone who genuinely represents the party, its history and its real mission to work for Britain’s working people.

Belfield Bashes BBC Diversity in Name of White Working Class

A days or so ago, internet radio host and Youtuber Alex Belfield posted yet another video tearing into the Beeb. He’s a man of the right, who regularly attacks immigration, Black Lives Matter, forced diversity and ‘wokeness’ – what used to be called ‘political correctness’ not so long ago. He’s posted videos supporting actor Laurence Fox and his ‘Reclaim’ party, though now Fox is being sued by people he’s called ‘paedophiles’ on Twitter, and a small charity which works with disadvantaged working class young people in Manchester over the name. They’re also called ‘Reclaim’, and obviously really don’t want to have it, or their charity, associated with Fox’s outfit.

Belfield himself is also a bitter critic of the BBC and very definitely wants it defunded, if not actually wiped out altogether. He’s got some kind of personal feud with the Corporation. He was one of their presenters, but seems to have been in some kind of trouble for which m’learned friends are now involved. This seems also to have involved Jeremy Vine, as he’s posted a series of videos attacking him.

Class Attitudes at the Beeb and the Favouring of Ethnic Minorities

Belfield believes that he was looked down upon at the Beeb because of his class origins. He was a working class lad from a pit village, and this did not sit easily with the other members of the corporation, whom he lambasts as rich ex-public schoolboys, who all read the Guardian, wear chinos, sip lattes and hold lefty views and sneer at ordinary people like him. He’s also criticised June Sarpong, the head of diverse creativity at the Beeb, for demanding that there should be more Black and Asian figures in front of the camera. His view is that, according to official stats, BAME performers and presenters are already slightly overrepresent at the Beeb. The proportion of BAME actors, presenters and broadcasters at the Corporation is 15 per cent. But Blacks, Asians and other ethnic minorities only constitute 13 per cent of the British population. The real problem, according to him, is that Blacks and other ethnic minorities aren’t properly represented in the Beeb hierarchy and management.

At the same time, he rails against the Beeb lefties because White working class boys are the least privileged group in society. They underperform other demographic groups in school and jobs. At the same time, automatic ‘positive discrimination’ is not appropriate for all ethnic minorities. Indians and Chinese outperform Whites, have better jobs and higher salaries. They do not need extra help from the state, which should be target at those groups that really need it.

I think he has a point, but as with everything the right says, it’s not the whole point and more often than not its articulated with the ulterior motive of depriving everyone of state aid even when they genuinely need it. I believe he’s correct when he states that at present Britain’s minority ethnic population is 13 per cent of the total. I can also remember Private Eye attacking an anti-racist organisation for the same thing June Sarpong’s done: demanding even more representation of BAME people in excess of their real numbers as a percentage of the population.

Possible Reasons for Sarpong’s Call for More Diversity in Excess of True BAME Population Numbers

In Sarpong’s case, I think there are a number of reasons for it. The first is that she is herself Black, and seems to have automatically assumed that in this issue Blacks and Asians are suffering racial discrimination. Everyone wants the best for people like them, and so she wants more to be done for Blacks and ethnic minorities. I also think self-interest may also be involved. She’s head of Diverse Creativity, but if she admits that Blacks and Asians are already well-represented on our TV screens, then she’s contradicted some of the need for her post. And I also believe that much of it is due to the metropolitan media bubble. London, as the capital, has a very large Black, Asian and ethnic minority population. It’s well over a third, and I think it may be just under half. Black activists like Sarpong and White liberals see the high BAME population of London and automatically assume that the rest of the country must be the same. Some Black performers have described their shock on visiting parts of the country where there are very few peoples of ethnic minority background. Nearly a decade ago, the late actor and comedian Felix Dexter was a guest on an edition of the News Quiz from Scotland. Dexter, who was Black, expressed his surprise at going through some areas of Scotland where there was hardly another Black face to be seen. Which reminded me at the time of the stereotypical comments of White British explorers that they were going through regions of Africa or wherever which no White man had seen before. I doubt very much that this observation would go down at all well with racially sensitive Black activists and militantly anti-racist Whites, but it is there. I think Sarpong, and those like her, have assumed that everywhere else in Britain must be like London, and so demand the same proportion of Black stars.

All Broadcasters Dominated by Middle Class Public School Boys and Girls, Not Just Beeb

At the same time, White working class are the most underprivileged part of the population. This has been reported not just in the parts of the press you’d expect it, like the Heil, but also allegedly liberal papers like the I. The Heil has also published official statistics showing that Indians and Chinese also outperform everyone else in education and work.

I’ve also little doubt he’s correct about the lack of working class people in the Beeb, and that it’s dominated by public school boys and girls, who look down upon on peeps from more modest backgrounds. But I think that’s common throughout broadcasting. Terry Christian, whose Manc tones graced the ’90s Channel 4 yoof programme, The Word, apparently describes how he was driven mad by much the same attitude there. He was the only working class lad amongst a group of people, who all went to Winchester public school. Which no doubt explains why he wanted public schoolboys put in Room 101 when he appeared on it all those years ago.

And here’s where we get to what is not being said: how many of the staff and the performers on the other, private networks come from working or lower middle class backgrounds. How many of the faces you see on Sky and who work behind the scenes are lads and lasses who went to state comprehensives, and whose parents worked as factory workers, bus drivers, cleaners, dustmen and so on. Very few, I expect. But Belfield deliberately avoids mentioning it. Because as a right-winger he hates the BBC for its ostensible ethic of impartiality and wants it to be replaced by private networks that can feed the British public the equivalent of Fox News. Like the Times would like to do with its new channel, Times News or whatever it is, which will present news with what they claim will be an objective slant against the ‘woke’, ‘wet’ BBC. Well, the Times ain’t be a source of objective news since the departure of the late Harold Evans as editor at the end of the ’70s, so this is especially risible.

White Working Class Despised Not By Labour or Democrat Left, But Blairite and Clintonite Neocons

As for the concern for White, working class boys, I think he’s right that a certain section of the left does look down on the working class. But this isn’t the Labour left. It’s the neoliberal, corporatist right of the Democrats in America and the Labour party. There’s a very interesting book, Confronting the New Conservatism, which attacks the Neo-Conservatives and particularly their warmongering and the illegal war in Iraq. It’s mostly written from a left-wing perspective, but some of those interviewed are traditional Conservatives. One of these is a female American colonel, who bitterly attacks Bush’s grotty administration as a bunch of chickenhawks who never served in the armed forces and hated and forced out experienced senior military staff, who knew far more about the Middle East and told them directly that they were wrong. The book argues that both American parties, Republicans and Democrats, have been infected with the Neocon virus. Part of this is the bilateral support by the White middle class for affirmative action policies, provided they don’t affect their children.

Right-wing Pseudo-Feminist Attacks on Bernie Sanders and Jeremy Corbyn Shows Contempt for Working Class

You can see that in the sociological origins of the Blairites. They’re very middle class, very public school. They support affirmative action policies for women and ethnic minorities, but really don’t have any time for the working class as a whole. And especially not working class men. One of the claims that was used to attack Jeremy Corbyn over here and the awesome Bernie Sanders in America was that, somehow, they were misogynist anti-feminists. Remember all the furore about ‘Bernie Bros’ and their attacks on Hillary Clinton? This was despite Sanders’ strong support for feminist groups and his appearance as an ‘honorary woman’ at feminist rallies. Because of his support for an expanded welfare system and Medicare for All, Sanders supports policies that would benefit blue collar and lower middle class workers far more than Clinton. She was a member of the corporate elite. She has done things that have benefited women and children, but in general she supports the grotty neoliberal, corporatism that are impoverishing working folks for the benefit of the very rich.

The I and the Groaniad launched the self-same attack on Corbyn. He was a male chauvinist, who would drag the party back to the days of old Labour when it was under the patriarchal control of the trade unions. I don’t believe for a single minute that Corbyn could ever be remotely properly described as any kind of misogynist. As a member of the Labour left, which was attacked in the ’80s for its support for Black, gay, and women’s rights, I think he’s the complete opposite. As for the trade unions, I don’t doubt that they were male dominated. The strongest unions were those in mining and heavy industry, which are traditionally male jobs. Women tend to work in the service industries, which are often poorly unionised. This is because employees in those sectors are in a weaker position regarding employers. But this isn’t an argument for weakening the unions. Rather it’s an argument for strengthening them so that they can enrol and protect women workers. My mother was a teacher, and I remember that during the teachers’ strike of the 1980s banners appeared with the slogan ‘A Woman’s Place Is In Her Union’. Too right. Feminism isn’t just for middle class Thatcherite girls.

Tories Claiming To Support White Working Class In Order to Exploit Them and Destroy Welfare State Even Further

The Tories have always attack the Labour party on behalf of disadvantaged Whites. The Daily Heil ran stories from the 1980s onwards, for example, denouncing various Labour councils for giving priority for council housing to non-White immigrants. But this conveniently omits the facts that the reason there was a shortage of council housing was because of the Tories: Thatcher had sold it off, and passed legislation forbidding councils from building any more. The Tories make a great show of standing up for the White working class because of their patriotism and traditional values. By which they mean the type of working class Conservatives on whom Johnny Speight based the monstrous Alf Garnet in Til Death Us Do Part. These were people, who lived in dingy homes with cracked windows, for whom the Tories had done absolutely nothing but who somehow lionised them.

Only Labour Left Really Standing Up for Working Class Whites, as Concerned for All Working People

The people who are really standing up for the White working class are the Labour left, people like Richard Burgon and in Bristol, mayor Marvin Rees. They’re standing up for the White working class as part of their mission to defend all working Brits regardless of race and colour, Black, Asian, White or whatever. Marvin Rees is Black, but he’s Bristol through and through and has said that he intends to stand up for the White working class as well as underprivileged BAME peeps. He has said that he wants more Bristolians to know about the city’s past as a major centre of the slave trade, but he doesn’t want to demonise the White working class, because they didn’t profit from it. They also suffered, according to him. Clearly he supports Black pride, but he also genuinely support the White working class and is reaching out to them.

Blairites and Tories Exactly Same in Contempt for White Working Class

But you will not hear about these initiatives, especially from the Corbynite left, from the lamestream media or the Tories. Because it contradicts their narrative that the Labour party is racist towards White working class folks. And they have a point when it comes to the Blairites, who are geared towards picking up middle class, Tory swing voters and have ignored or scorned their working class base. Their view of what counts as correct left-wing activism is feminism and anti-racism. Both of which have their place, but they concentrate on them while going along with the Tory destruction of the economy and British industry in the name of market forces, the privatisation of the NHS, because private enterprise is always better, and the dismantlement of the welfare state and workers’ rights, because the poor, the starving, the disabled and the unemployed are scroungers who could get a proper job if only they were properly incentivised. It’s the same view of the working class the Tories hold, except that they cynically exploit the petty jealousies and vindictiveness of sections of the working class to hold them down, while all the while claiming that it’s Labour’s fault. They’re cynically exploiting White working class resentment in order to maintain the British class system and the power and authority of the traditional ruling elites. All the while risible declaring that they’re not elite at all. As Tweezer did so with her cabinet, who were almost public school educated millionaires to a man and woman.

Don’t believe right-wing shills like Alex Belfield. The Tories despise ordinary working people. The only people who are really serious about doing anything for working people – including White working people – are the true Labour centrists. People like Richard Corbyn, Dawn Butler, and the other Corbynites.

Why Are Our Victims so Uncooperative?

Published by Anonymous (not verified) on Thu, 03/09/2020 - 4:24pm in

On Super Tuesday, the Democratic National Committee and President Obama carefully coordinated the replacement of Bernie Sanders by Joe Biden as the Democratic frontrunner for president. The new progressives would be upset but didn’t care because they figured progressives would have to vote for Biden no matter what. Now that that’s not the case, they are upset that their plan is not working.

Good Thing the Nominee Isn’t a Socialist

Published by Anonymous (not verified) on Wed, 26/08/2020 - 4:07pm in

Earlier this year when Bernie Sanders was in the lead for the Democratic presidential nomination, his centrist opponents said that he would be a bad standardbearer because the Republicans would call him a socialist. Now Joe Biden, anything but a socialist, is being targeted just the same way as though he had been Bernie Sanders.

Virtual Convention Day Two

Published by Anonymous (not verified) on Thu, 20/08/2020 - 12:54am in

Susan B. Anthony gets pardoned, the DNC stays on "we the people" message and the post office controversy rolls on. Continue reading

The post Virtual Convention Day Two appeared first on BillMoyers.com.

Joe Biden’s Vice Presidential Pick is…ZZZZZ

Published by Anonymous (not verified) on Wed, 12/08/2020 - 6:06am in

Why Democrats don't like Joe Lieberman - CNNPolitics

Added 6 pm Eastern 8/11/20: Well, that turned out to be true.

Most years, the Super Bowl is a dud. Yet the hype machine keeps pulling in new suckers.

            The quadrennial announcement of the Democratic nomination for vice president features an identical Lucy, Charlie Brown and the football dynamic: lots of hype followed by deadly disappointment. And there’s never been more hype than this year.

            Not that Joe Biden’s pick isn’t important. If he wins, he will be the oldest person to take the oath of office by a full eight years. (He’ll be 78. Trump, the second oldest, was 70 in 2017.) Even by the standards that the 70s are the new 60s, Joe Biden’s 70s look more like 80s or 90s. His choice has to satisfy several competing constituencies: women, Blacks, and the progressive voters he desperately needs to show up November 3rd instead of sitting on their hands as they did last time.

            But past performance almost always being a reliable indicator of near-future returns, Democrats should prepare for a Super Bowl-like fiesta of deep disappointment.

            Last cycle’s brutal primaries prompted speculation that Hillary Clinton might unify the party by giving Bernie Sanders the VP nod. She chose Tim Kaine. (Political pundits jammed phone and text messaging with: “who?”) She told Charlie Rose she loved that Kaine described himself as “too boring.”

Clinton thought Kaine’s dullness would provide balance. Voters considered it redundant. “‘Safe,’” observed Politico, “seems to be Kaine’s middle name.” In the year of Trump, safe was anything but.

            That’s often the case.

            I was traveling through Central Asia when a hotel employee informed me that Al Gore had announced that Connecticut senator Joe Lieberman would be his running mate to go up against Bush-Cheney in 2000. I assumed my Uzbek host was part of some weird post-Soviet gaslighting campaign. How could Gore do anything so stupid?

The mists of time and the Florida recount fiasco have blurred the fact that, like Clinton 16 years later, Gore needed a progressive to balance his record as a Third Way centrist. Inexplicably, both at the time and today, clueless Democratic pollsters somehow convinced themselves that what he really needed to do was distance himself from Bill Clinton—the president under whom he’d served for eight years and who was enjoying improving poll numbers. They also thought the conservative Lieberman’s “moral rectitude” in being the first Democrat to condemn Bill Clinton for the Monica Lewinsky scandal would appeal to left-leaning Ralph Nader voters.

            Lieberman opposed affirmative action and gay marriage. He supported every major military intervention, including, at first, Vietnam.

            Nader kept his progressive votes.

            The first rule of picking a veep is do no harm. The second is to remember the lesson of Bill Clinton/Al Gore 1992, when Democrats won with a pair of centrists of similar age and temperament from neighboring states: geographical ticket balancing as an art peaked out when JFK tapped LBJ.

            As tensions mount between voters dominated by the populist progressive left and party leaders who manipulate the Democrats’ primary process to favor corporate centrists like Obama, Clinton and Biden, however, the case for ideological balance seems stronger than ever. Surely Hillary Clinton must wake up in the middle of the night wondering if relegating Bernie Sanders to number 39 on her list of running mates was the best decision she ever made.

            By that standard Elizabeth Warren ought to be keeping her phone by the window in her house with the best reception. She would be an interesting choice: both more intelligent and intellectual than her boss, white (OK, white and Native American) in the year of Black Lives Matter, someone disgruntled progressives would have a hard time justifying as the target of a voter boycott.

            Of the women floating around on Biden’s supposed short list, Warren would surprise. She would exceed expectations. She might unify the party.

            I don’t think she stands much of a chance.

            Boring usually gets the nod.

(Ted Rall (Twitter: @tedrall), the political cartoonist, columnist and graphic novelist, is the author of the biography “Political Suicide: The Fight for the Soul of the Democratic Party.” You can support Ted’s hard-hitting political cartoons and columns and see his work first by sponsoring his work on Patreon.)

Just Like Covid-19, Racial Justice Is a Climate Story

Published by Anonymous (not verified) on Mon, 29/06/2020 - 10:20pm in

To Sunrise Movement cofounder Varshini Prakash and her fellow activists, the fight for a livable planet and the fight against racial injustice are the very same fight. Continue reading

The post Just Like Covid-19, Racial Justice Is a Climate Story appeared first on BillMoyers.com.

If We Don’t Have Democracy, What The Hell Do We Have?

Published by Anonymous (not verified) on Fri, 19/06/2020 - 2:09am in

Is the 2020 election already stolen? Can we steal it back? (Yes and hell yes!) Why were 17 million Americans purged from the voter rolls between 2014 and 2016? And why aren’t our elected officials screaming to high heaven about all these vanished voters? What’s a provisional ballot? What’s a residual vote? Do we have a functioning democracy? And should we be more worried about ... READ MORE

Modern Monetary Theory: Coming Your Way Soon (Unless Big Changes Are Made)

Published by Anonymous (not verified) on Sat, 10/08/2019 - 12:26am in

Published in the Nikkei Asian Review 6/8/2019

Japanese leaders have, in the past, often railed against public criticism of their policies by overseas economists. Never before, though, have they issued strongly worded rebuttals of foreign praise. Yet this is what happened when Professor Stephanie Kelton of Stony Brook University voiced her approval of government economic policy during her recent visit to Japan.

Professor Kelton is an advocate of Modern Monetary Theory, known as MMT, a heretical challenger to mainstream economics which maintains that the only constraint on public spending is inflation. In fact, the theory goes, there is no need for government spending to be financed by bond issuance at all. The central bank can simply create as much money as it likes until inflation becomes a problem.

 Professor Kelton in Japan
Professor Kelton in Japan

Many supporters of MMT view Japan’s “Abenomics” as a case study that bolsters their argument. And that is exactly why the Japanese establishment has reacted as if being accused of membership in some wacky religious cult.

Finance Minister Taro Aso called MMT “an extreme and dangerous idea that weakens fiscal discipline” and Bank of Japan Governor Haruhiko Kuroda expressed “no sympathy whatsoever” with the theory.

The reaction amongst mainstream economists overseas has been similarly hostile. According to Larry Summers, MMT is “the voodoo economics of our time.” Kenneth Rogoff calls it a threat “to the entire global financial system.” Even Bill Gates dismissed it as “crazy talk.”

The nay-sayers’ main beef appears to be the risk of hyper-inflation as experienced by several Latin-American and African countries. MMT-ers riposte that such criticism caricatures their approach. Indeed, theoretically it could be compatible with inflation targeting as practiced in most developed countries today.

Professor Kelton is a former advisor to Bernie Sanders, the veteran left-winger once more seeking nomination as Democratic Party presidential candidate. A much younger radical American politician, Alexandria Ocasia-Cortez, has also shown strong interest in MMT. The theory has obvious attractions for the left because it seems to offer the prospect of limitless and costless public spending. In fact, though, it is closely linked to the “helicopter money” proposed by free-market enthusiast Milton Friedman as a cure for deflation.

Such money need not be spent by the government. It could be simply mailed to citizens to spend as they like.

Indeed, there is another potential recruit to the MMT cause on the other side of the American political spectrum. In “Fear: Trump in the White House”, author Bob Woodward recounts an argument between Trump and Gary Cohn, Treasury Secretary at the time. Trump suggests issuing a large amount of bonds to take advantage of historically low interest rates. Cohn slams the idea of breaching the politically-created “debt ceiling” as being harmful to US growth. Trump replies “Just run the presses – print money.” Woodward takes this as evidence of Trump’s ignorance. In fact, the president was probably referencing the latest economic theory.

Happier times - President Trump with Gary Cohn Happier times – President Trump with Gary Cohn

In many fields of intellectual enquiry, what was once heresy is now orthodoxy. Economics is no exception. The last time a paradigm shift occurred in macro-economic policy was in the 1970s, when monetarism, which placed emphasis on control of the quantity of money, displaced the post-war Keynesian consensus, which viewed fiscal policy as the key determinant of demand.

At the time, monetarism was a controversial fringe movement with little support amongst mainstream academics and policy-makers, but it seemed to offer a solution to a serious real world problem that the Keynesians had not anticipated and could not explain – the co-existence of high inflation and high unemployment.

A similarly puzzling phenomenon is visible in today’s world – this time the co-existence of low unemployment and low or no inflation (and likewise wage growth) in many developed countries. As in the 1970s, the Phillips curve, which purports to establish a reliable relationship between employment and inflation, has gone missing. And just as the monetarists brought in a radical new approach, now we have the MMT-ers advocating unfunded fiscal expansion.

Does the Japanese experience validate MMT, as Professor Kelton implied? Perhaps. It certainly raises serious doubts about the “fiscal discipline,” strongly advocated by Kenneth Rogoff, Christine Lagarde and many other experts and policy-makers since the global financial crisis of 2008. For Japan has been running large fiscal deficits for the past twenty years and has consequently amassed a Mount Fuji-sized pile of outstanding government debt, equivalent to 230% of Japanese GDP. Far from triggering a bond market rebellion and soaring interest rates, as doomsters consistently predicted, Japanese interest rates have fallen to vanishing point.

Since the start of Abenomics in 2013, the story gets even more interesting. Thanks to the quantitative easing programme of bond purchases introduced by Bank of Japan Governor Kuroda, some 40% of all outstanding Japanese government bonds now sit on the BoJ balance sheet. In other words, one arm of government owes a vast sum of money to another arm of government – which means that no debtor-creditor relationship exists. Despite the strident disclaimers of the Japanese authorities, this is not far removed from the world of MMT.

Happier days - President Trump with Gary Cohn

Having said that, the major cause of Japan’s public deficits was not fiscal expansion, but the collapse in tax revenues that happened during the two “lost decades.” In the first year of Abenomics, the government did increase public spending and the economy rebounded and inflationary expectations soared accordingly. Since then, however, fiscal policy was tightened. With one unnecessary and counter-productive tax hike being followed by another this autumn, it is no surprise that inflationary expectations have collapsed.

Before the global financial crisis, Japan’s rock bottom interest rates appeared to be a bizarre and unique phenomenon. No longer. Now there are over twelve trillion dollars of negative yielding bonds in the world, including some corporate bonds. In many countries the stimulatory effect of lower interest rates has already passed the point of exhaustion, raising the question of what governments will do to counter the next recession.

What the markets are asking them to do is clear – take advantage of these unprecedentedly low interest rates to issue boatloads of bonds and pump money into their economies. The Austrian government has just launched a tranche of its 100 year bond at an interest rate of 1.2%. Judging by the comparative yields of their 30 year bonds, Japan could probably borrow one hundred year money for less than 1%.

Instead of raising taxes on consumption and damaging growth, it could be investing in infrastructure, clean energy and fertility incentives that would increase the expected population and revive sadly depopulated regions.

Not every country is in the same position as Japan, which is the world’s largest creditor nation and has been clocking up current account surpluses since the early 1980s. But it is fairly clear that in many countries a combination of monetary easing and fiscal expansion, as well as tax reform (not hikes), is required to revive growth. If mainstream politicians and technocrats do not rise to the challenge, then the populists will fill the gap.

That could be dangerous because MMT has so far little to say about the varying financial conditions of different countries and the magnitudes of stimulus that are required for the remedy to work. It is all too easy to imagine countries that are, unlike Japan, already under-saving and over- consuming going too far – and ending up with out-of-control inflation.

They Came From Everywhere

Published by Anonymous (not verified) on Thu, 01/08/2019 - 3:01am in

Last night, my wife Laura organized a terrific debate watch party for Bernie Sanders supporters at a local bar. About 40 to 50 people showed up.

The best part of it was that while most people were firm Bernie supporters, a fair number were not. They were Bernie-curious, but undecided. They came because of friends, girlfriends, boyfriends, and so on, who brought them there. So it felt like a base-expanding moment.

Even better, I had an interesting conversation with one woman, who is a definite Bernie supporter, and her boyfriend, who is less certain about Bernie. They’re both nurses. Her parents immigrated from China about 30 years ago. She lives in Sheepshead Bay. So she told me she identifies with Bernie at that level: Bernie and she are both children of immigrants who grew up in Brooklyn. Her boyfriend likes Bernie because he, the boyfriend, has a ton of student debt. She likes Bernie because he’s got new ideas, she said.

It all made me think of that opening line in Vivian Gornick’s Romance of American Communism: They came from everywhere.

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