Free Money until Collapse
I know it’s a dry topic; but this article piqued my interest today:
Modern Monetary Theory (MMT). Free money!
It’s the idea that governments (like Australia’s) can print about as much money as they want, without any consequence. It would drive economic growth, full employment and all that. The linked article from the ABC is actually quite an in depth analysis, yet reasonably easy to digest.
There’s just a one particular caveat that keeps popping up: “within limits”.
“Australia, the US, Canada, the UK, Japan) no longer have to fear a shortage of gold, and that leaves them free to print as much money as they need to fully employ their “real” resources — workers, factories, machines, raw materials — within limits”.
Those limits, hinted above are the ‘real stuff’ that actually matters. Things like people, raw materials and what it doesn’t even mention: ENERGY. You can print 10 trillion dollars; but if there isn’t the people; materials and energy to make it happen… well that’s when you have run-away inflation, and you have “households fighting over a shrinking amount of goods, [and] prices soar. If you start feverishly printing money in that situation, you’ll make things even worse”.
In case you haven’t noticed, there are limits on this planet, and we are fast approaching them (or overshot them, as the case may be). There are also limits to the amount of waste the planet can absorb, and we’re well past this point, a la Climate Change.
An MMT approach without some kind of emissions trading or an ‘ecological economics plugin’ is a one way road to disaster.
However; those limits (planetary, and energy) apply to our standard “neoliberal economic orthodoxy” as well, and indeed capitalism-is-destroying-safe-operating-space-for-humanity
The Covid pandemic has sent some of these concerns into the background (energy is currently pretty free-flowing and oil is cheap); but with a massive increase in government spending and stimulus (in the hope to keep the economy ticking over until things can ‘return to normal’); it’s only a matter of time before those limits assert themselves, even IF these policies are effective at keeping people employed and economic growth stable for a while.
I’ve been talking about collapse for years (less so lately), but the fear is still there.
It’s still coming… we could even be going through the early stages of it now.
In case you thought Permaculture is only about gardening, it’s pretty explicit in Permaculture circles about how it has a significant role to play in an era of collapsing finance, energy crisis and indeed pandemics, where a resilient household that grows it’s own food is well placed to weather both the storm of ‘stay at home’ boredom, and meeting the immediate needs (even partially) of the household.
Back into the garden we go…