Fiscal sustainability is very much in the News these days because of the activities of the President's National Commission on Fiscal Responsibility and Reform, The Peterson Foundation's very vigorous efforts to present a point of view on fiscal sustainability that reinforces and expands the outlook of the National Commission's statement of purpose, The Washington Post's continuing expression of the deficit hawkism point of view, and CNN's “news alliance” with The Peterson Foundation. All this and more is part of a steamroller being formed to ensure that only one point of view on fiscal sustainability, namely a neo-liberal point of view dominates the landscape of public discussion.
When that sort of thing happens, as it did in the health care debate, the people suffer, because any policy, based on an alternative framing of the fiscal sustainability problem, is immediately off the table of policy consideration because it is outside the frame of “legitimate debate.” Let's not let that happen with fiscal sustainability. Let's keep a number of frames under consideration, so that we can consider all fiscal sustainability policies that might work. The test we use to determine whether a policy will work needs to be an evaluation of its consequences; not an evaluation of whether it's outside a dominant frame of ideology.
The Peterson Foundation “Fiscal Summit”
On April 28, 2010, the Peter G. Peterson Foundation is sponsoring a “Fiscal Summit” in Washington, DC. The purpose of the Conference, which is scheduled for the day after the first meeting of the President's recently constituted National Commission on Fiscal Responsibility and Reform, and which includes many notables, is:
”. . . to further a national dialogue on solving America's fiscal challenges through several moderated discussions with leaders on the issue from across the political spectrum. . . .
Robert Kuttner's comment (in his post 'Fiscal Folly) on the Peterson-sponsored Conference is:
”This is billed as a "national dialogue on solving America's fiscal challenges," but spare me. This is a propaganda event. For the most part, the featured speakers follow the Peterson line. John Podesta, the closest thing to a liberal playing a headliner role, accepts that there is a serious deficit problem, but would entertain a value-added tax as part of the remedy. But the speakers' list is clearly stacked and there is no one to Podesta's left.
And for good measure, the left-right paradigm is not even very applicable here at all, because everyone listed above whether “liberal” or conservative, shares the neo-liberal assumption that Government spending in the United States is operationally constrained by the ability to tax or to borrow money from non-Government sources. Given this false assumption, all the participants in this so-called “national dialogue” will share the idea that fiscal sustainability has something to do with Government deficits, debts, and the ratio of debt held by the public to GDP. There will be disagreements among them about how long the Government has over time to bring deficits down, or to moderate the trend toward increasing debt, or about what a “responsible” ratio of debt held by the public to GDP ought to be. But none will entertain or discuss the idea that deficits, debts, and debt to GDP ratios are inappropriate tests of fiscal sustainability, irrelevant measures of the degree of fiscal challenges we face, and, in fact, nothing more than a by-product of the real fiscal challenges facing us, namely achieving renewed economic growth and full employment. So, this Conference will take “off the table” any ideas about fiscal sustainability, that don't center around this neo-liberal austerity-oriented definition of the idea.
A Fiscal Sustainability Teach-In Counter-conference
That's just intolerable. What is badly needed is an immediate answer to the President's Commission and the Peterson Conference. Our answer is entitled “the Fiscal Sustainability Teach-In Counter-conference.” We plan to hold it in Washington DC, on April 28, 2010, from 8:30 AM to 5 PM, at The George Washington University, and to make it a free event open to the public.
The purpose of our conference and teach-in is to look at fiscal sustainability relative to public purpose, including full employment, and also to teach the new economic paradigm of Modern Monetary Theory (MMT) and its application to fiscal sustainability. We want to propagate an alternative message about what fiscal sustainability means in the mainstream mass media, and in the blogosphere, on the same day as the Peterson Foundation Conference. Here is our tentative program schedule as of 04/17/10.
Fiscal Sustainability Teach-In Counter-conference Tentative Program
|Time Period ||Topic ||Team Leaders |
|8:30–8:45 AM ||Welcoming Remarks || |
| 8:45–10:15 AM || What Is Fiscal Sustainability? || Team Leader: Professor Bill Mitchell, Research Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at the University of Newcastle, NSW Australia, and blogger at billyblog. |
|10:15–10:30 AM || BREAK || |
|10:30 AM–12:00 PM || Are There Spending Constraints on Governments Sovereign in their Currency? || Team Leader: Stephanie Kelton, Associate Professor of Macroeconomics, Finance, and Money and Banking, Research Scloar at The Center for Full Employment and Price Stability (CFEPS), University of Missouri - Kansas City, Research Associate at The Levy Institute of Bard College, and blogger at New Economics Perspectives |
|12:00–12:15 PM || BREAK || |
|12:15–1:45 PM || The Deficit, the Debt, the Debt-To-GDP ratio, the Grandchildren and Government Economic Policy || Team Leader: Warren Mosler, International Consulting Economist, Independent Candidate for the US Senate in Connecticut, and blogger at moslereconomics.com |
|1:45–2:00 PM || BREAK || |
|2:00–3:15 PM || Inflation and Hyper-inflation || Co-Team Leaders: Marshall Auerback, International Consulting Economist, blogger at New Deal 2.0 and New Economic Perspectives, and Mat Forstater, Associate Professor of Economics and Black Studies, Director of CFEPS, Department of Economics, University of Missouri — Kansas City, Research Associate at The Levy Institute of Bard College, and blogger at New Economic Perspectives |
|3:15–3:30 PM || BREAK || |
|3:30–5:00 PM || Policy Proposals for Fiscal Sustainability || Co-Team Leaders: L. Randall Wray, Professor of Economics, Director of CFEPS at the University of Missouri - Kansas City, and Senior Scholar at The Levy Institute of Bard College; and Pavlina Tcherneva, Assistant Professor of Economics at Franklin and Marshall College, Senior Research Associate at CFEPS and Research Associate at The Levy Institute and bloggers at New Economic Perspectives |
Please fund this Fiscal Sustainability Teach-in Counter-conference. The thinking and austerity posture of the deficit hawks is the single biggest threat to the American economy since the policies of Herbert Hoover himself. And the ideology and frame of deficit hawkism remains a serious barrier to any program progressives want to legislate that costs serious money. Whether it is economic recovery, re-inventing the economy, alternative energy development, education, health care, or climate change, deficit hawkism is also there influencing what progressives can put on the table. The new economic paradigm of Modern Monetary Theory is an answer to all this. It provides a much better guide to our economic crisis than the “seven deadly innocent frauds,” and other neo-liberal economic myths.
In order to hold the teach-In Counter-conference, the organizing group, led by myself, Joseph M. Firestone, Ph.D. needs a total of $8,000 to be expended as follows. Approximately $6,000 for travel expenses of Conference presenters, and $2,000 for venue, AV and incidental expenses. All conference organizers and speakers have donated time, web site-related work and expenses, and, in some cases, considerable frequent flyer miles to the project of implementing the Counter-conference. Please join with us in resisting The Peterson Foundation's movement of deficit hawkism by attending this very significant face-to-face Counter-conference, funding these costs, and enabling us to hold it.
You are in a shopping cart that will let you fund the Counter-conference by credit card at various levels of support. Please call or write me if the level you want to fund at isn't represented here. This cart is owned by Executive Information Systems, Inc. (EIS), a Delaware Sub-Chapter S Corporation, and its division KMCI. EIS is a private company, acting as one agent of fiscalsustainability.org in raising funds for the conference. The agency services of EIS and KMCI are being donated for this purpose, and I, the Managing Director of KMCI and signator of the account at Wachovia/Wells Fargo, which will receive the payments made less service charges, am acting as fiduciary for proper use of the funds for Conference expenses. Once the fund raising targets for the Counter-conference are met, the link to the Cart will be removed, and the various levels of support will be deleted from the Cart, thus discontinuing EIS fund-raising for this event. Any excess funds gathered (likely to be a very small amount) will be used for expenses incurred in maintaining the fiscal sustainability.org web site and the continuing effort to educate the public about Fiscal Sustainability from the MMT point of view. Please note that your sponsorship amounts will not be tax deductible unless they can be categorized as business expenses for education. This is true because Executive Information Systems, Inc. is a profit making Company.
Joseph M. Firestone, Ph.D.
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