Money, Socialism, Outcomes -- Chartalism Debate

["John Gelles" <indexed-savings@xxxxxxxxxxxxx>]

In recent discussion of bank loans that create "money"
and "national laws" that give to "legal tender" (and bank
deposits) the power to discharge public and private debt,
certain features of money have been presented. But the
connection between money and real wealth, power, war
and peace has largely been left out.

In the Second World War all warring nations had
elements of a money-motivated war effort and a
command-motivated (punishment-motivated) war effort.

Both the love of money's purchasing power and the
compliance that followed commands, worked, often as
partners, to create the real materials needed to fight and
survive.

In that war, nation's spent money that exceeded all
peace time norms. It was more than reasonable loans,
deposits, collateral, and irrational exuberance (bubbles
of expectation of gain) could, in aggregate, create.

It was money spent to pay for specific production,
(including much that was wasted);  but it was spending
(in the USA) that included "greenbacks" in the form of
interest-free cash-- spent as bonds were stacked in the
vaults of the cash-creating central bank.

The connection between the cash and the bonds was
purely legal. The connection between the cash and the
production it paid for was purely economic.

After the war and until today we have had the severe
problem of producing both "guns" and "butter" to
win the cold and hot wars and peace we live through.

In the socialist experiment a command system avoided
the "freedom", and decentralization of decision, that was
welcomed in nations relying more on money than
ministerial instructions to produce the guns and butter.

In both the socialist and money-ordered world huge
environmental and social mistakes were made. On
balance, money trumped ministerial instructions.

Now we, PKT'rs in the money-ordered world, want
more rules to improve outcomes for society and the
environment. The President, himself, said today that
outcomes trump intentions.

We want spending by governments today to rebuild
nations and places where poverty, want, crime and
pestilence reign. But, as clever as we are, in technology,
science, engineering, medicine and information theory,
etc., we do not know how to return to the spending
power we had in the Second World War.

John Kenneth Galbraith (we were told today on PKT)
blames our ineptness on corporatism that seems to have
replaced the new deal spirit we once had. True.

Of course the new deal spirit was unable to rescue our
economy before the war. Only the desperate fear of
defeat by an enemy nation did that.

We ought to be afraid enough today. We have the
power to produce anything we want but not the
will. We have the middle class facing decline and
blue collar labor under siege. We have unacceptable
levels of inequality, envy, crime, imprisonment and
immorality in commerce and trade. And more twisted
states than ever will soon have WMD's for use and
sale.

We ought to be scared enough to find the money
to produce our way back to civilization.

A money-ordered world will not be able to do this.

A ministerial-instructed world would return us to
the police state socialist experiment.

Only the kind of mixed system we once had, where
progressives and conservatives were married to each
other, can save us. And the money they use will be
no more unnatural than it was in the mid 1940's.
Natural money was always partly the face of the
sovereign and mostly the things it could buy.

John Gelles