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And so we reach the conclusion I pointed out a decade back

MMT makes no difference at all:

In the work that I am doing I am presuming that the government is seeking to create full employment. I am also presuming that it will do so by meeting the demand for government services on which most of the population are dependent, meaning that more must be spent upon them.

As a consequence, whilst additional tax will not fund additional services, extra tax revenues will be necessary if those services are to be supplied. This, as a consequence, requires that those potential additional sources of tax revenue that might be used to achieve this purpose be identified, and identifying and quantifying those additional taxes is what I am working on.

Before MMT. Lefties wanted a large government high tax country.

After MMT – lefties want a large government high tax country.

The difference is? Nowt, obviously.

Smurf wants Richard Burgon deciding how much your pocket money may be.

He’s also wrong even in theory. Tax is to reduce the inflation form the lots of spending:

From there, the work explores the theoretical reasons why raising additional tax from those with higher incomes and wealth would be appropriate at this moment, even if it was simply for the purpose of redistributing the overall current tax due.

Doesn’t work. Inflation is caused by people spending money. As even Spud will point out the rich can maintain their spending in the face of higher taxation – they will just save less. Therefore taxing the rich does not reduce aggregate spending – nor inflation.

My editors will begin to look at what I have written on this project in the next week, and I hope that thereafter parts of the report will be published in stages on this blog over the weeks to come so that it can have a form of peer review here before the work is finalised.

Bet the peer review won’t mention that.

20 thoughts on “And so we reach the conclusion I pointed out a decade back”

  1. Smurf wants Richard Burgon deciding how much your pocket money may be.

    Which is as infantilising as it sounds. Money itself isn’t power, but control of money certainly is.

  2. “ additional tax will not fund additional services, extra tax revenues will be necessary if those services are to be supplied”
    Extra taxes don’t fund additional services, but we need to tax more anyway, to supply these extra services. Man’s a certain.

  3. The peer review be moderated by spud in his usual way – only pilgrim slight wanker and other arse lickers may comment

  4. Dennis, Neither Retired Nor From Wandsworth

    Only in the world of Richard Murphy does peer review mean “read and/or commented on by anyone who happens to show up at my blog”. Although it does mesh well with the level of intellectual/academic rigor Murphy brings to anything he writes.

  5. I had to block Burgon and Nadia Whittombe from my Instagram timeline. I think my IQ dropped a little every time I read one of their posts and I decided that I would get better mental stimulation and cogent arguments from cat videos.

    Schumpeter wanted a wealth tax in Austria in 1919, because the country was flat broke. He knew that it would only be a one off, because thereafter the rich would hide their dosh. I guess we’d call it a windfall tax. The govt blocked it and printed money instead.

  6. rigor Murphy

    Is that the condition of all Spuds ideas once they’ve been killed by proper peer review?

  7. In conclusion it’s really on a par with ‘Pope is catholic’.

    He needs to confiscate wealth from anyone he deems ‘undeserving’ so it can be reallocated. Hardly news and obviously has failed (largely) whenever it has been tried. Why let history get in the way of a good wheeze – especially one that seems to attract funding?

    Perhaps one of the clearest proofs there is of how deep seated inflation has become is that there’s people willing to pay for research from Richard Murphy.

  8. Bloke in North Dorset

    “ My editors ”

    Poor sods. If I was capable of such a job you couldn’t pay me enough to do it. Given his inability to accept graciously any criticism I imagine he’ll challenge vigorously every minor correction.

    Come to think of it, isn’t he a world class editor?

  9. Tim is correct here, and Richard Murphy is absolutely clueless.

    As an aside, this idea of using taxes to release resources, which taxing the rich does not do, is not unique to MMT. Matthew Yglesias gets it, as this quote shows:

    I do see the view, from a standpoint of abstract cosmic justice, that it’s annoying to see someone like Elon Musk or Jeff Bezos get so rich without contributing more to the Treasury. So there is a case for taxing wealth or unrealized capital gains or at a minimum changing the stepped-up basis rule. But fundamentally, I do think there are profound reasons why things like VAT and payroll taxes are the workhorses of European welfare states. Musk is not employing 10,000 butlers who can be taxed away and turned into preschool teachers. Inducing him to liquidate financial assets and fork over the proceeds does not generate any real resources that are available for new use. What a Nordic-style tax system does is broadly constrain consumption in order to free up resources for more extensive consumption of health, education, and other social goods.

  10. Makes sense I guess.

    If you can create trillions of dollars at the click of a Central Bank mouse, what’s the point of doing the reverse with the billions of Messrs Bezos and Musk?

    It doesn’t magically create additional resources out of thin air, just alters the numbers in the memory of those Central Bank computers.

    It is not, in any real sense, reality.

  11. Benjamin Butterworth (contender for ‘most annoying little brat’ on the telly award, along with Jones. O) was telling us that as the house you bought for £30,000 50 years ago is now worth £000,000’s and you didn’t “earn it”, the state should take it away from you and your family via inheritance tax.
    Why can’t these cunts accept ‘It’s not your fucking money so fuck off’!

    Taking money from someone who does not want it taken from them and spending it on the things you want is theft, pure and simple. It may be legal, but it is still theft.

  12. Addolff

    The late Peter Bauer (sadly dead for nearly two decades) was almost the ‘anti Richard Murphy’. If Murphy is arguably the most ignorant commentator ever to post in cyberspace Bauer was a fountain of knowledge and wisdom.

    His observation was that ‘unearned income’ was an absurd notion, with income being allocated according to recipients resources and that income from sources like property and shares reflected decisions made in the past and was no more or less ‘earned’ than any other income. He was highly critical of welfare expenditure and redistribution in general, making the observation that while children receive pocket money, adults manage incomes.

    It would have been highly entertaining to see him debate either Butterworth or the truly appalling Owen Jones (Possibly the only being more evil than Murphy)

    Couldn’t dissent from your assessment on their ideology. It is theft, pure and simple.

  13. Assuming you think the state needs some income (to pay for defence of the realm) then taxation of some form is required.

    Personally, taking it from the dead seems to be one of the least worst options. It’s not like there isn’t opportunity to give it away in advance anyway.

  14. “It’s not like there isn’t opportunity to give it away in advance anyway.”

    Other than the fact that you might be using it, that is. Not everybody dies of old age in their ’90s.

  15. Assuming you think the state needs some income (to pay for defence of the realm) then taxation of some form is required.

    No, there are other means of raising money than theft.

    For example, the state might provide services that people are willing to pay for. Of course, pigs might fly too…

  16. Mr Toad, but they aren’t taking it from the dead. They are taking it from those the dead wished to give it to. Intestate is a different thing.
    And give it away not long enough before leaving this mortal coil and they’ll still tax it.

    Quite happy for the state to take my money to provide defence and those ‘services’ I agree to but not happy for them to spunk it on their or their mates favourite projects.

    And this: Further down the list comes China – handed £48million of UK taxpayer money – a fact former Tory leader Sir Iain Duncan Smith described as “bizarre”. The aid watchdog said the largest share of this, some £6million, was used in partnership with the Premier League to “deliver new and more inclusive participation” in football.

  17. Addolf: Yes, they *ARE* taking it from the dead. A dead person’s estate outlasts them, and it is the dead person’s estate that pays death taxes. *NOT* the beneficies. The beneficiaries get what’s left after all the estate’s debts are paid.

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