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There’s a lot of confusion in this administration so the Biden Economic Advisor is in good company. The President swears up and down his economics are working when Americans tell pollsters it isn’t. The 68-year-old Jared Bernstein has spent time in academia, think tanks and Democratic administrations so it makes perfect sense to confirm him in 2023. He criticizes modern monetary theory.
A match for Biden
The current economic vogue is that deficits aren’t a problem since government can print all the money needed and neither is inflation since government can tax it out if needed. Bernstein saw faults with MMT and wanted to talk about it.
Among other things, he doesn’t think taxation works well for dealing with inflation, he saw problems with the independence of the Federal Reserve and there maybe bond sales problems. Investors don’t like how that money is being handled.
Stephanie Kelton is a professor at Stony Brook University and is a proponent of MMT. She’s also a senior fellow at the Schwartz Center for Economic Policy Analysis at the New School for Social Research, both in New York.
This is Jared Bernstein, the man who sets economic policy for the Biden administration. Asked why the US government borrows money if it can print its own money:
"I can't really… I don't get it. I don't know what they're talking about."
You are doomed. pic.twitter.com/3MT7lvQFo5
— Ian Miles Cheong (@stillgray) May 4, 2024
Biden economics
Kelton is also behind a documentary praising the virtues of MMT called “Finding the Money”. Even Orthodox liberals will have a hard time agreeing with the trailer, regardless the status of each talking head.
Considering the conversations around the theory, Bernstein is a great choice since the whole administration is based on a ship with no sails. Policy goes where Democrat winds blow it.
Bernstein is confident when he says “the U.S. government can’t go bankrupt, because we can print our own money.” So Kelton asks, “It obviously begs the question: Why exactly are we borrowing in a currency that we can print ourselves?”
The Biden advisor
He answers, not sounding like he knows what he’s talking about. “Well, um, the, uh, so the — I mean, again, some of this stuff gets — some of the language that the MM … some of the language and concepts are just confusing,”
He kept going. “I mean, the government definitely prints money and it definitely lends that money. Which is why, uh, uh, the government definitely prints money and it lends that money by uh — by selling bonds. Is that what they do?”
He answers his own question.
“They, um, they, yeah, they, they, um, they sell bonds. Yeah. They sell bonds, right? Since they sell bonds and people buy the bonds and lend them the money. Yeah. So, a lot of times, a lot of times — at least to my ear with MMT — the language and the concepts can be kind of unnecessarily confusing, but there is no question that the government prints money and then it uses that money to um, uh, uh, uh — so, um, yeah … I guess I’m just, I don’t, I can’t really talk — I don’t, I don’t get it. I don’t know what they’re talking about, like, cause, it’s like, the government clearly prints money. It does it all the time, and it clearly borrows. Otherwise we wouldn’t be having this in — this conversation. I don’t think there’s anything confusing there.”
