“Have we fallen into a mesmerized state that makes us accept as inevitable that which is inferior or detrimental, as though having lost the will or the vision to demand that which is good?”
Rachel Carson
Silent Spring
On Thursday, David Attenborough’s programme ‘Climate Change; The Facts’ was aired on the BBC. This has followed weeks of Schools Strike demonstrations around the world and direct action by Extinction Rebellion in London over the last few days. For three decades and more, the polluting fossil fuel industries have deliberately sowed the seeds of doubt and confusion in the minds of politicians and the public in the debate about climate change doing so to protect their financial interests. We are reaching the point of no return. A day of reckoning is approaching. As one of the scientists interviewed on the TV programme noted ‘The cost of action dwarfs the cost of inaction’.
Climate change, environmental destruction, rising poverty and inequality are the four most pressing challenges that the human race is facing and yet still politicians waver.
To woo the electorate the current government pays lip service to them with a mixture of rhetoric, denial and hollow promises to loosen the public purse but only when politically expedient to do so. It combines its political pledges with the promise to also be a party of fiscal prudence and book balancing whilst also pursuing an ideologically driven privatisation agenda. Corporations over democracy. The pursuit of damaging growth over the health of the planet and its citizens.
Countering the damaging austerity narrative, the opposition, on the right track it must be said, proposes a credible, realistic and radical agenda to address those same urgent challenges. At the same time, it promotes fiscal credibility rules obliging future Labour governments to balance ‘day-to-day’ spending with tax revenue and draws up ‘how to pay for it’ plans. The magic money tree and the rich in the Cayman Islands feature in this narrative as does ‘borrowing to invest’.
Both left and right with radically different political ideas but both describing their plans in the same misleading narrative which has dominated since the 1970s. The false analogy of household budgets in which governments have to tax or borrow to spend and where deficit and debt is a spectre which haunts successive governments is the common public understanding. Governments whose successes are often measured at election time in terms of their fiscal prudence rather than their economic record. The vast damage which has been caused to public and social infrastructure and the cost of decades of inaction on climate through the pursuit of such narratives is a testament to its failure to deliver economic and human well-being or consider the future of the planet that nurtures us.
Every day there are reports in the media about the effects of such narratives on the lives of some of the poorest and most vulnerable citizens who have suffered as a result of cuts to public spending on public services and welfare and who have been at the sharp end of a political ideology favouring the individual over cooperative action and putting power and wealth into the hands of ever fewer people.
Every day, reports from around the world detail the increasingly damaging effects of climate change, poverty and inequality affecting millions of people across the world. Human stories about pain and suffering. Every day, we hear about the effects of deforestation, fires and flooding and the destruction of wildlife habitats causing whole species to go extinct. Take one piece out of the planetary jigsaw and the rest suffers. Our interdependency is clear.
So, it isn’t any wonder that the public when seeing around them the harm that government policies in cutting spending and inaction on climate has caused that people on the progressive left whoop with delight when opposition politicians promise to bring the magic money tree home from the Cayman Islands to restore equity by making the rich pay towards public services or deliver a Green New Deal. It seems so just and right!
There’s no doubting that the rich should pay what they owe in tax as much because it is a sign of a fair and just society but also as a mechanism for redistributing wealth in the form of progressive taxation. But what if the whole premise upon which we base our understanding about how money works and how governments spend is wrong? What if we have been hoodwinked to serve a political purpose? Doesn’t it seem strange that governments say we can’t afford public services but when it suits money can always be found to bail out banks, fund corporations delivering public services or go to war? If you are starting to think along these lines then you are right to.
The scale of the challenges we face in respect to climate change and bringing about a fairer and more equitable society are formidable but there is still hope. No matter how justified we feel in thinking so ‘bringing home the magic money tree’ from the Cayman Islands (let’s make the rich pay) or borrowing to invest because interest rates are low these are not the solutions, in fact, they don’t even represent monetary realities in terms of how money is created. Worse and ultimately more damaging adherence to household budget descriptions will limit any future progressive government’s radical plans for change as well as our ability to protect the planet for future generations. As the economist Stephanie Kelton remarked ‘Money doesn’t grow on rich people’, indeed there aren’t enough rich people in the world to pay for the scale of spending that will be needed to address climate change, poverty and inequality. We must think in terms, not of money, which is infinite, but resources which are not, their availability and how they can be used efficiently to deliver public purpose aims. Governments should serve the people who elect them not the corporations who dictate their own interests.
Left wing progressives need to look for example to the US where MMT is framing the bold New Green Deal agenda led by Bernie Sanders and Alexandria Ocasio-Cortez. We need to follow their lead in developing bold and ambitious programmes if we are to meet the targets signed up to in the IPPC Paris Agreement. This will require cooperation on a global scale.
As uncertainty about the future rises how money works may not be everyone’s first port of call in thinking about delivering change, but it certainly can help. So, if this has whetted your appetite to find out more and you live in the Midlands, near Birmingham or further afield GIMMS has the perfect opportunity for you to explore these vital ideas with founding proponents of Modern Monetary Theory – Professor Bill Mitchell and Warren Mosler – who will be joined by their fellow internationally respected author, Professor Martin J Watts. Daily, MMT is getting more press coverage some of it is misleading or downright wrong. So, for the real heads up please join us for what will, without doubt, be an informative event aiming to challenge our preconceptions about how money works and how such an understanding offers a lens through which we can develop solutions to the pressing ecological, social and economic challenges we face.
You can book your place here by following the link. There is a small charge which will help us to cover the costs of the venue and organising the event.
And if you can’t come, then don’t despair! GIMMS has an extensive library of resources from FAQS to more in-depth coverage as well as a database of academic papers. There is something for everyone.
When politicians tell you that addressing climate change and social injustice is monetarily unaffordable or that there are monetary limits to spending, it’s time to challenge the narrative for the sake of future generations. The fate of the planet depends on it.
We hope to see you there!
Events
Bill Mitchell, Warren Mosler and Martin J Watts to speak at GIMMS Seminar – Birmingham