Hence, the Richard Murphy Question: If governments create the money that sustains our economies, and if we have the real resources to provide security, care and a livable future free from fear, why do we continue to organise society as if we cannot afford to do so?
Because we do not share Spud’s priorities? Because to allow spud to design society would be a disaster?
Because Spud, despite acknowledging in his podcast conversations that resources are limited, proposes, ahem, solutions that are all predicted on them not being limited. In other words, because he’s fucking loopy.
BTW, I didn’t listen to that podcast; he told us he said.
He is oblivious to the fact that whilst the supply of money could be near infinite the consumption of goods and services available to buy with that money can not be greater than production.
If governments create the money that sustains our economies,
The actual money is created in commerce. Those bits of government paper? Useful if they don’t fuck about with them too much. But hardly essential.
Again, this is him saying different things for different audiences. We’ve all been there when he explained how banks – private banks! – create money “out of thin air2. I personally attempted to get him to set out the accounting entries for that (happy days). having done that though, he’ll turn around and say that government, just government, “creates money”.
Keir Starmer is a straighter talker than Murphy.
Isn’t it: bank creates money so its ledger goes -ve so it then goes to another bank that lends it some money so it can be flat at 3pm. This goes on and on up the chain until they eventually realise they’re £10 short so they go to the top and the top prints a bit. It’s a very ‘efficient’ system. Murphy shorthand is ‘private banks creates money money because the government allows them to’.
What’s the High Street like in Ely? Mine looks like a third world bombsite. Does this look like a rich country? Will that be fixed by printing increasingly worthless pieces of paper?
Ely has its moments – the Cathedral with its Octagon, Cromwell’s House – but it’s a rather depressed Fen town.
Ah, but our host tells us importing everything and paying for it by selling off our sh*t to foreigners makes us wealthier, so ignore the evidence of your lying eyes, and luxuriate in the wealth that comes from a society that makes nothing and consumes a lot paid for by other peoples money. Just take care to avoid the potholes while luxuriating, you might break a leg in one. Also don’t fall in the river, its full of literal sh*t, courtesy of those foreigners who own everything now.
Because the answer to the two IFs are
1) it doesn’t
2) we don’t have those real resources and we would have even less of them with central planning
Also, we should of course do less “organisation of society”
My 9-year has a better understanding of the world
This is genuinely hilarious:
Why have I included myself in this series, writing about my own work as a third party?
Because you are mentally unbalanced and facing an increasingly desperate financial situation and increasing irrelevance?
There are several reasons for doing so.
Firstly, this series, as it transpired, refers to the work of 50 people who have influenced my thinking over the 50-year period since I went to university to study economics. It is in that context that it is relevant, I think, to note where that thinking has led.
That someone can have professed to have studied a subject for half a decade and be so ignorant of its basic precepts would be something most people would probably not be keen to advertise!!
Secondly, several commentators, including my old friend John Christensen, with whom I have worked for almost 25 years now and whose own work is referred to in this series, suggested that it would be incomplete unless I did so. I have accepted their suggestion that I do something that would not have occurred to me. I do, then, continue in the style I have used for all others included here.
Well at least he is mentioning someone (admittedly another person whose corpus of work illustrates a complete lack of fundamental economic knowledge) by name, rather than those famous ‘conversations with people’ that didn’t occur
“… went to university to study economics…”
Did he? Can he still get a refund?
On a previous occasion he said he chose not to attend the econmics lectures, so his ignorance is his own fault, not that of the lecturers’, so he is not entitled to a refund.
I think the superb new commentator Iceman nails it and I’d like his 9 year old’s assessment (unvarnished) of Murphy’s output.
‘If governments create the money that sustains our economies’?
I thought banks created money or was that on Monday? What about ‘Double entry’? Jesus even within the same day he spins about three directions
and if we have the real resources to provide security, care and a livable future free from fear, why do we continue to organise society as if we cannot afford to do so?
We don’t have the real resources to provide such nebulous concepts as are outlined here. What does ‘provide security’ mean – some kind of police state whereby all criminals are kept locked up 24/7 for life? Who defines this? Does it mean ‘defense’? Indeed does it mean under this surreal analysis (AI infused which in some ways makes it worse!!) anything at all?
‘A livable future free from fear’? I don’t even what to contemplate what he means by that – all I know is it will involve him expropriating peoples assets and redeploying them in one of his pet schemes. Can I live free from that fear? It might involve him being detained in a secure facility but is that a possibility?
In terms of why society is organized thus it’s because of precisely that which our gallant host points out. It’s like he listened to the Tears for Fears song ‘Everybody wants to rule the world’ and proceeded for 4 decades on that basis.
Utterly delusional in every aspect.
Government doesn’t create Money…..
It claims the sole, exclusive right to make the tokens you *use* as money. And enforces it on pain of Pain..
It doesn’t matter if the government creates the tokens, or if private parties do it: make too many of them, and their value will drop.
Whether based on a large stash of inert metal or “the total estimated value of the economy”, their *actual* value amounts to [amount of tokens]/[underlying value].
With things being quite fuzzy at the edges and Large Numbers you have a couple % leeway before you notice any effect, but like gravity… Ignore it and it *will* exert itself. Harshly.
But such mundane realities are beneath the Great Sage of Ely….
“It claims the sole, exclusive right to make the tokens you *use* as money. And enforces it on pain of Pain..”
How many times have you seen countries that have inflated their own countries paper currency so badly, so often that even despite the monopoly on the use of force the citizens of that country no longer accept it in trade, leading to the effective dollarisation of the country?
Happens all the time in South America and I expect it’s true in most of Africa as well (because why wouldn’t it be?)
If the state can inflict Pain by locking you up if you don’t pay taxes, but accepts its own fiat currency in payment of those taxes, that currency – however badly mismanaged – will retain some residual value.
This might only be a small residual value, and it would certainly not be a barrier to the dollarisation of most activities.
‘Sustains’ is doing a lot of work there.
This did make me snigger “A little reluctantly, and as a result of persuasion, I have included myself in this series as a concluding entry to indicate the point I have reached after 50 or so years of thinking . . ” I’m not egotistical me, don’t even know what it means, just happened to end with me ‘cos outside forces. Yeah right.
“Oh, the cleverness of me.” — Peter Pan
We. Don’t Organise. Society. Society is an emergent feature of humans interacting with each other. It’s like “organising” the weather.
Not quite.
People like us do not organise society, nor do we wish to. Or at least, we do not do so above the level of the little platoons.
But there are plenty of people who are not like us, and they do organise it. Shittily, for it cannot be otherwise, but organise it they do.
That’s the state and its many agencies. Society is just Burke’s little platoons…
It’s a Question of Spud! He is turning into Roger Irrelevant.
If magic beans can be activated by the tears of crywanking accountants and hatstands are infinite, why – candidly – do we continue to organise society as if motorbikes were ferrets?
If he says “candidly”, he’s about to uncork a really big lie.
And because it’s not the money that sustains our economies – it’s the industry and innovation of the people in them that die that. As can be clearly seen when govt tries to sustain an economy by printing more and more money….
Exactly. Spud ascribes magical powers to money. As if money IS the economy.
Money does not sustain our economies: they are sustained by people doing useful work (e.g. Jim producing food, or the brickie building houses, or the carpenter making furniture).
Murphy, as a not-very-good accountant, wants to believe that it is money (which is merely a means of exchange) that matters and not reality.
Because you don’t actually have those resources. No one does at the scale of a nation. If they did they’d already be cheap and we wouldn’t need to worry about allocating them.
The government can print all the money it wants, there’s only so many cans of beer and microwave pizzas available. More printed money doesn’t make more available – the ratio stays the same, they just all cost more.