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Episode 13 – Public Money & The Right to a Job with Raul Carrillo
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Steve Grumbine’s guest is Raul Carrillo of the New Economy Project and Modern Money Network. As an anti-poverty economic justice attorney he has a unique perspective on the monetary system.
Raul talks about his seminal article, “The Dangerous Myth of Taxpayer Money,” and the legal history of taxation, citing the Supreme Court ruling that the gov’t has power to issue money backed only by the full faith credit of the US gov’t – not backed by gold, taxes, or bonds. He reveals some startling facts about the connection between taxation and the civil rights struggle for public education.
Raul & Steve discuss the scramble to find truncated ways to present complex ideas. Progressives must attack false scarcity, which is at the core of both conservative & liberal thinking. Raul says that fighting for the Job Guarantee brings people to understand the concentration of power. It’s an awareness that can create the momentum to take on the system itself.
Racial Taxation: Schools, Segregation, and Taxpayer Citizenship, 1869-1973, by Camille Walsh
www.uncpress.org/book/97814696389…racial-taxation/
splinternews.com/the-dangerous-my…money-1819658902
@RaulACarrillo on Twitter
Modern Money Network modernmoneynetwork.org/
New Economy Project www.neweconomynyc.org/
Special Thanks to Geoffrey Ginter for the excellent intro song! And of course special thanks to our guest Christian Reilly, the donors of Real Progressives and our excellent staff of volunteers.
Macro N Cheese – Episode 13
Public Money & The Right to a Job with Raul Carrillo
April 27, 2019
Raúl Carrillo [intro/music] (00:03):
If you are talking about a right to a job, you need to be honest that a lot of things are going to change. That we are talking about changes in how people think of money, how people think taxes, how they think of their duties and rights to each other, how they think of just living and we want to do that for the good.
Raúl Carrillo [intro/music] (00:20):
I think people are going to have a better time planting trees, or, I know I would, or rebuilding Flint or rebuilding Houston or rebuilding Puerto Rico instead of going to work at McDonalds.
Geoff Ginter [intro/music] (01:29):
Now let’s see if we can avoid the apocalypse altogether. Here’s another episode of Macro N Cheese with your host, Steve Grumbine.
Steve Grumbine (01:34):
All right, everybody. Thank you for joining us. This is Steve Grumbine with Real Progressives. Tonight, I have friend and fellow modern monetary theorists, Raul Carrillo. Raul Is from the Modern Money Network and he is one of the smartest guys I know. He’s written some incredible writings. I mean, like, there’s one from Splinter where he talked about the myth of the taxpayer dollar. This is a guy who’s out there fighting every single day. Really, really want you all to give it up for Raul Carrillo. Welcome to the show, sir.
Carrillo (02:08):
Glad to be here, Steve. Glad we could finally make this work out. Look forward to talking about things today. I’m not sure how you’d like to proceed, but I know that I’m happy to talk about MMT from both a bit of an activist perspective and also a lawyer’s perspective, which I know is not necessarily customary on this show. So we’re getting a little bit of a different lens here.
Grumbine (02:29):
You’re, it’s going to be real helpful. So do me a favor. So tell us a little bit about who you are and what you do at the Modern Money Network so folks understand exactly where you’re coming from.
Carrillo (02:41):
Sure thing. So I’ll give a little bit of just panoramic view of what I do within the MMT world and without, so that people have a sense of that. And I’ll talk a little bit about the history of the Modern Money Network, how we came to be and kind of the lens that, again, we’re bringing to all of this, you know, great movement that everyone’s working on here at Real Progressives and elsewhere.
So I’m currently actually an antipoverty attorney by day. You could call it an economic justice attorney as well, if you wanted for the most part. So I work at a nonprofit called New Economy Project. I’m not here representing them today, but I think it’s helpful for you to know what I kind of do day to day to see how a lot of this theory that we talk about, you know, intersects with some things that I’m fighting for, so to speak.
So the New Economy Project is about 20 years old. It’s located in New York City. And one thing that we do is we help folks fight debt collectors, banks, anyone who is starting to take advantage of them through the financial system essentially, and I operate a hotline every day. Folks call with problems that they have with, you know, the money power. They come in here and we chat a little bit about that.
We try to find ways to help them. The other thing that we do is local community economic development, and try to facilitate that. So we help build worker co-ops, financial cooperatives, like community development credit unions, community land trusts, all these sorts of democratic enterprises which, as we’ll discuss later, require funding, ultimately, to operate.
And then, the other things that I do in addition to the Modern Money Network, which you mentioned, is I am a director for the National Jobs for All Coalition, which is a organization of JG advocates that formed at the end of the last historical movement for the job guarantee when Coretta Scott King was out in the streets leading the fight.
And there’s some friends of MMT as well, some MMTers involved with that organization. And then the other group is, of course, The Global Institute for Sustainable Prosperity. I am a research fellow there and look forward to working with them more in the future.
But my main hat is really the Modern Money Network. And the Modern Money Network started off in 2015 as a collection of law students, now lawyers for the most part although the chapter there is still operating as well as at a few other campuses now.
But it was folks who didn’t really have a sense that we were being taught what law and political economy was, what law and macroeconomics was outside of the traditional school of, you know, law and economics which started at the University of Chicago and exchanges a lot of concepts with neoclassical economics, even with new Keynesian economics and the kind of folks that we find ourselves in opposition with or against often on the economy.
And we started looking at this thing MMT and we all got there by various different paths, but we were like, you know, modern economics, the crash had happened recently, doesn’t give us the answers to analyze the economy as a lawyer. We don’t know how the institutions work. We don’t know how things operate on a day-to-day basis.
And this paradigm, this new thing that we’re looking at, actually gives us some kind of lens into the practicality and the administration and the rules of the game for the economy. Since then, we’ve expanded into a organization with several chapters across the country.
We’ve had events in Europe, Australia, and Brazil, and we’re looking forward to expanding more and really focusing on getting an interdisciplinary perspective for all of this that’s not just the law. We have a humanities division, that’s doing great work.
We’re trying to bring in historians, sociologists, all these other people who have so many things to say about the economy but don’t necessarily get a voice. Perhaps most importantly, we are connecting to other social justice movements.
We kind of see ourselves as providing, you know, a particular software or particular kind of way of looking at things that can be helpful to people who are fighting for the things that, you know, all get us going in the morning.
Not everyone is necessarily excited about reforming the monetary system. What it takes is conversations as you know better than anybody else, Steve, about why this is important for all these other things. And for me, why it’s important to me just then. So that’s a little bit about what we’re doing.
Grumbine (06:54):
It’s fantastic. So what I want to do is, you and I discussed this when we planned this talk out and there’s two real primary things that we want to dress down on. First thing is the idea of the taxpayer dollar. The article you and Jesse Myerson wrote in Splinter was just epic. I probably share it once a week. I don’t think it can be shared enough.
If I could share it daily without looking like a stooge, I would share it every day. It’s just that good, you know, because seriously, this is, you know, I’ve been running around saying, you know, “Taxes don’t fund spending at the federal level.” And everybody says, oh, you know, blah, blah, blah. But when you broke it down, the thing you did was you hit the social justice movements right where they needed to hear it.
And that is, tell me what a taxpayer looks like. What do you think federal taxpayer looks like? Do you think it’s a young African American, you know, that’s living in a shelter? Do you think that it’s a young Latino that is literally being asked for their ID in the middle of the streets? What do you think a taxpayer looks like?
And the idea this racist, xenophobic term that is used very, very cavalierly by both Democrats and Republicans and really mainstream media, et cetera. That was the best go to paper I’ve seen yet. Can you tell me about how you and Jesse came to write that and talk a little bit about the concept of the taxpayer dollar and then the concept of why it’s a racist, xenophobic term?
Carrillo (08:27):
Absolutely and Steve, if you don’t mind, I’d like to start talking about that article and then kind of introduce a new book that I’ve discovered by a legal historian named Camille Walsh, which goes into racial taxation and the injustice around the very frame, which I think is tremendously helpful for our movement.
Grumbine (08:46):
Absolutely.
Carrillo (08:46):
So I think that Jesse and I, and I don’t want to speak too much for other folks throughout the podcast and I’m speaking for myself to be clear unless I say otherwise. But I think Jesse and I felt that it was getting very frustrating, you know, being in this political moment and, you know, various forms of the resistance, you know, so to speak, taking off.
And people were still very focused on this notion that look at X thing that X, Y politician is doing. And the key problem here is that they’re wasting our taxpayer dollars. And we think that this way of looking at things is not only technically incorrect as MMTers and I think most followers of Real Progressives know, it also has this political and legal and moral and cultural connotation that is ultimately toxic.
And even if you don’t subscribe to MMT yet, you should take a look at this narrative and understand that, hey, “Maybe this is really, really poisonous and it warps our sense of who deserves what, of who’s giving what to whom, of our relationship between ourselves and the state, et cetera.”
So that was really the impetus for that article and, as you can see, we walked through it. We walked through the technicals and we can do that right now depending on how you want to spend our time here, Steve.
Grumbine (10:06):
Do it, do it.
Carrillo (10:06):
Yeah, something we do a little bit differently and that I try to do with my writing at least, and I think speaks to people who don’t necessarily hear the talk about spreadsheets and keystrokes, et cetera, as I say, this is really a matter of law at the end of the day. Again, part of the reason why I’m attracted to MMT is its legal coherence, it’s roots and respect for legal history.
And so there’s a series of cases following the civil war when the whole country, you know, is, or at least those who can participate in this sort of debate, are having this argument about what the power of this new federal government is. It’s really a constitutional moment in American history and the justices get a series of cases from the end of the civil war until I think the last one was 1844 and they’re called the legal tender cases.
And it’s figuring out what are the monetary powers of the national government. Christine Desan writes a little bit about this. She’s a legal historian up at Harvard. But, basically, the Supreme Court rules, as a matter of constitutional law, that the United States has, the United States government, has the power to issue money backed only by the full faith and credit of the United States government.
I think if you look at things logically, if you talk a little bit more with political theorists, you understand that it’s not just the decree that matters, it’s the force behind it. But that’s a key moment in monetary history in the United States where the Supreme Court is confirming, yes, in fact, if the government didn’t have this power, it wouldn’t be much of a government at all.
And so it doesn’t have to, the notes don’t have to be backed by gold. They don’t have to be backed by taxes. They don’t have to be backed by bonds necessarily. It can be a mix of things. It could be, you know, there are ways in which you can issue money, but, ultimately, this is a sovereign power retained by the government.
And so what the US federal government does following that Supreme Court ruling is, you know, exactly that. There’s a lot of problems that go on with the gold standard, et cetera, you know, throughout the rest of American history, but, essentially, this core has maintained that the US government has the sovereign ability to issue fiat money.
And so, again, that’s what, that’s what we do. Congress votes and then the Treasury and the Federal Reserve really figure it out on the backend. And that conversation with how to come to, like, the actual bank account that the Treasury uses to credit other banks’ accounts and the spend money, that conversation between the Treasury and the Fed and all their like really, really boring lawyers has gone many different ways over the course of history.
But at the end of the day, whether we’re talking about bonds or whether we’re talking about taxes, this is new money. And as you know, as it’s talked about throughout American legal history, this is the power to create and the power to destroy. It is not necessarily robbing Peter to pay Paul.
Grumbine (12:54):
That’s absolutely fantastic. I want to get your assessment on something because, you know, I’m trying desperately, our team tries to boil things down to people that normally wouldn’t pay five seconds of attention. So we’re scrambling to find truncated ways of presenting really complex things.
And so one of the things that we’ve been saying, and I know we can nuance the heck out of this, the idea of the birth of a dollar is congressional spending and the death of the dollar is when it’s received and it’s done its loop as a tax. And so this is kind of how we have presented that framework right there.
Randall Wray came on and spoke about how the glory days of the 1900s and so forth, they used to bring barrels of money, you know, wheelbarrows of money and burn it. And colonial times they talked about burning the tobacco that was used to trade, et cetera.
So in this particular case, money destruction is not something new. Somehow or another, somebody got it in their head that a dollar is a permanent entity. It just lives in perpetuity. And the reality is dollars are created and destroyed constantly. Can you speak to that a little bit?
Carrillo (14:03):
Yeah. I think that some of those metaphors can be helpful and, you know, it’s a hard thing that we do, right? Because we’re trying to talk about balance sheets and we’re trying to talk about taxes of foreign debt at the same time, we’re trying to picture, depict the flows to people and how things work.
One way that I actually find is, and we do this a little bit in the piece, is I think it’s helpful to encourage people to think about all the other ways in which the government funds that general account again and, or, you know, increases assets or equity on its balance sheet. And so it’s not just through taxes. It’s not just through bonds.
It’s also through seizing the assets of people that the government thinks it’s credit are criminal. It’s also land. It’s also, you know, student loan interest that I pay every month to the federal government. It’s all these other things. And so the real conceit here, even once you get above the mechanics, is about ownership. And it’s about this idea that what the federal government needs in order to spend money is tribute, essentially.
It’s got to come from you. If I’m going to help somebody, it’s got to come from you. And that’s how really power relationships are kind of cemented. And so I think it’s important to talk about the mechanics, but also ask people, “How do you think the federal government gets money? What are the many different ways?
How can you tell me that the person who will ostensibly get a job, or get schooling, or get housing, is being funded by your tax dollars?” And that’s the way that it needs to work; and what you do when you start asking those questions is you start people, getting people to think about not so much even left, right, liberal, conservative, but top, bottom.
Wait. So these, you know, these folks with all the money are telling me, or ostensibly the ability to create money, are think, are saying that I need to pay for these other things. Well, it might be a good thing for you to do morally.
Like it might be nice if you believe in democracy, you want to see other kids educated, you want to see other people housed, et cetera, et cetera; but this sense of twisted ownership is really what changes and subverts the framework. And this is intentional so that people will think that it’s all coming horizontally. It’s coming from your neighbor.
It’s not necessarily coming from your neighbor. It will immaterial, no, it’s not coming from your neighbor; but even when you look at the earmarking and the categories, et cetera, you can’t prove that it’s coming from your neighbor. You have to zoom out and look at like a wider system of economic relationships that we have with each other and that the state has with us.
Grumbine (16:42):
Very good. That’s incredibly deep conversation to have, because I think folks, when they see, you know, the old stories that we’ve heard about bonds funding the government and ZIRP is out there, zero interest rate policy, et cetera, renders that basically null and void. But we still need that anchor, that magnet, if you will, that pulls people to require that currency.
And I think you explained it in a way that we never heard on Real Progressives before. So thank you very much. That was really good. Talk to us about this book that you’re bringing up regarding the taxpayer dollar and the foundations of it.
Carrillo (17:19):
Sure. So it actually, it actually fits right in here. So Camille Walsh, who is a legal historian in Washington, has just published a book called “Racial Taxation.” And it doesn’t so much look at taxpayer money as it does the concept of taxpayer citizenship.
The suggestion that really is the source of a lot of opposition to MMT, if we think about it, the suggestion that if I pay more in taxes, I am somehow a better citizen, a better person, and I’m surrendering some of my money so that you may have X, Y, Z. So you owe me more respect. You owe me more recognition. You have to, you know, give me some sort of deference here.
And that is a deeply, deeply, deeply, deeply ingrained concept in American, you know, culture in a lot of the ways that, you know, both conservatives and liberals and even radicals think about things in this country. And what we don’t realize is that it arises from some particular moments in history. It is part of a political project.
This idea of taxpayer citizenship is also tied to misunderstandings about what taxpayer money is. And we hope to unwind the concept of taxpayer citizenship through, you know, in part telling people how public money actually works as in comparison to taxpayer money. And just to provide an example of how pernicious this is, Camille Walsh walks through the history of the concept of, again, taxpayer identity or taxpayer funding.
And she asked when did it really, really, really take off? And she’s looking at education and it’s important to us to look at these sorts of historical struggles because, you know, we’re fighting for jobs for all. Throughout the history of fighting for education for all, and fighting to desegregate public school systems throughout the United States, it was inseparably intertwined with ideas about taxation.
The end of the 19th century, you have really a lot of middle class, such as it was African American and Latino and Asian American folks, bringing lawsuits as taxpayers to the courts and saying, “I deserve rights as a taxpayer.” And really the issue there is very different from what we see now.
People are saying they have rights as taxpayers because they’re getting taxed and getting no benefit whatsoever – in that context, that’s separate but equal schools. So there’s laws on the books in many jurisdictions that, you know, you’re supposed to provide funding to everybody or schooling to everybody but the funding is coming from many people’s pockets but only going to white kids.
And so it’s initially seen, and this is back in a different monetary era, we’re still very much on the gold standard, et cetera. It is seen as empowering, right, to say, “I’m a taxpayer, especially at the local level, and you’re not using my tax dollars correctly,” but where this taxpayer identity really breaks into the mainstream and really becomes part of the core of right wing political thought in America is when we start integrating schools.
So when it goes, when Brown V. Board of Education happens, 1954, you have a relatively liberal court that makes what I think people in our line of thinking would call a bit of a strategic error. You can say it’s an ideological error, but it turned out to be a strategic error as well. And while they do the wonderful thing of integrating schools, they avoid the taxation question.
At that point in time, property taxes are still the main funder of school, right? And it says, “We’re going to focus on the psychological harms and on the morality that’s really problematic by desegregating schools.” And that’s really important. But what they do is they kick the can down the road.
And they say, because we don’t want to touch all this taxation stuff or talk about like, what money is or what you’re in and you can read this in the, in a lot of the letters surrounding the case. They don’t want it, they don’t want to touch the taxation stuff. And so it gets kicked down the road.
And the next really big case that we have about a fundamental right to education in this country is called San Antonio V. Rodríguez in 1973. And in that case, people . . . starts with Mexican American folks in San Antonio, but eventually comes to represent all kinds of kids and their parents throughout Texas. And they’re saying it is, “There’s a fundamental right to education.
And what’s happening here is you have a property tax system that discriminates against people for being poor.” Now, what does the Supreme Court do? It says there’s not a general right to education as we all know in this country, this is the reason we now do not have a federal right to education.
We have many state rights, 50 of them that are enforced by the federal courts, but it says, we cannot say that “There is a right to education that trumps people’s rights as taxpayers.” And so that is where the right to education went to die. It died in MMT land, so to speak.
And if there had been better understanding that you had had nine justices, even if they were a bit conservative, you had a better understanding of operational reality, perhaps things would have gone different. You, of course, always have to grapple with the idea that there are a lot of folks in American society who just do not want to give entitlements for folks, especially to poor folks of color, et cetera.
But really where the doctrine got in trouble was it’s running up against right to education, taxpayer rights, right to education, taxpayer rights. And so it’s one thing, you know, to say, as Jesse and I do, that, you know, this is pernicious and it’s kind of all soaking like our psyches, et cetera, on the concept of taxpayer money and the idea that because you pay more in taxes, but at least you’re charged a higher rate that you deserve more rights.
That’s bad enough, but it’s not just out there in the either. It’s something you can look through the history of the courts and say, “This is a problem.” This is where social justice lost – is we could not get over this question. So that’s just really one more reason that folks should care.
And you can start by telling people, you know, if you care about education, if you care about this thing, this thing, this thing, this thing, this thing, this other thing about taxation is in your way. And you can look at the record.
You can look at the historical record, you can look at legal record and it’s there. It’s one of the many problems to overcome but there’s no way around it, almost, if you don’t start thinking about what money is, what taxation is and the usual narrative is not suiting us.
And we have to convince a lot of other folks to get beyond that in our fight for a right to a job, actually, because, you know, we already had to deal with the animus again, that people don’t want to see other people, necessarily, succeed and that’s for a variety of different reasons; but there’s also this idea, again, that you are robbing Peter to pay Paul.
And if we can attack that a bit, head on, our political battles, our protests in the streets, our conversations with family and friends and eventually defending whatever legislation we pass in front of the courts is going to be a hell of a lot easier. And, in fact, I don’t see, again, I don’t see how, how we get around one fight without addressing the other one.
Intermission (24:29):
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Grumbine (25:18):
The right wing of this country, coupled with the pseudo right wing of the Clinton side, the Clinton Democrats, if you will, they have basically made the weapon, how are you going to pay for it? It is, literally, in my opinion, economic terrorism and I will, that’s my bend is to fight it as if it is economic terrorism. Because I believe they do know the truth.
I don’t believe that they’re immune from the truth. I believe they’re using it to advantage, to extract GDP, to keep the divide, the gap growing as you’ve seen since 72. And it’s just gone [whistling noise] and I don’t see any stop in sight. But you raised something very important that I want to touch on. You said that it could have been an ideological problem or it could have been a strategic error.
I like to go back momentarily just for a second to a very important subject that I think everybody ends up getting tripped up on and that social security. FDR gave everybody the belief that they were paying into social security. That there was like a piggy bank with crumpled up old dollar bills, ha’pennies, and, you know, nickels from back in 1919.
And people have really, really gotten to the point where they believe, “Hey, I paid into that, daggonit. That’s my money. It’s sitting there waiting for me when I get old.” Talk about this strategic error, if you will, and talk about how it has, because you’ve got Democrats, they mean well, they have all the best interests, but they sit there running around, talking about how the Republicans raided social security, it’s going bankrupt.
They don’t realize they’re actually playing into the very scheme, if you will, that seeks to privatize social security by trying to defend it the way they do. Can you talk just a moment about strategic errors and social security?
Carrillo (27:06):
Sure. And I’d like to begin with just the note, I think, that you can, you can attack both the actual model for funding social security and, you know, say that it has problems while recognizing that it was a different political and somewhat differently monetary situation when FDR was creating this plan, when activists were out in the streets advocating for social security, et cetera.
And I think that it’s important to again, look at the empirical record and see that this strategy whereby we convince people that they, that their payments in to the fund via payroll taxes is what’s necessary to keep it going, has not really worked. And you can see the appeal there.
If you tell somebody that this is yours because you’ve paid into it, then they’re more likely to think, “Hey, you know, hands off, you know, I worked my whole life. That’s mine.” People think similarly about their tax dollars in a general setting, even outside of the social security setting.
Now not only do you think that you deserve it, but you think that people, working people, very specifically in the case of social security, need to have their funds drawn in order for the operation to continue. And that’s really where the problem is. You can, there are million ways to say that people deserve social security.
You could create a right. You could say that this is just what we need for a decent society. You could do all kinds of other things. It doesn’t have to be linked to payroll taxes, even though it has been in the American mindset for a long time now. And I want to highlight, I think Stephanie Kelton talks about this and she’s really talking about the law here.
She gives an example of different kinds of funds that are run in different kinds of ways and highlights the different set of political problems for each. So we know, everybody knows about social security. They’re really for, I think, big trust funds which are, you know, four corners of paper that have numbers on them set aside in the back of the house, right? And two of them are within Medicare themselves.
One is the hospital insurance trust fund and everyone says that that one is going to run out of money by 2020. The other one is the Medicare supplement medical insurance fund. The legislation and the regulations for that fund say that it is not subject to a discrete amount of appropriations in the sense that Congress will haggle back and forth about like what’s going to happen here.
Ultimately, at end of the day, the funding for that program is determined by the number of eligible claims on the fund itself. How many people are saying I have a right to that Medicare money, you know, as opposed to how much money is left in the pot. And that’s huge. That’s really big for our fight for a right to a job.
That’s really big for anything else really, that progressives want to roll out here and, you know, there is, I think, good faith disagreement about this amongst job guarantee advocates; but I think ultimately, you know, again, these fights are not separate.
If you want to protect the program, if you want it to be resilient, if you want to want it to stick around long enough to provide the benefits to people, to folks so that they buy into the program, you have to get the funding right within the legislation. No doubt it will be challenged in court.
You know, how could it possibly be that you can just take as much money as you want, but we know that programs already exist that on a spectrum of different kinds of financing. So we need to watch out for that.
And as you know, as this movement, you know, generally as Progressives gain, you know, power and energy throughout the country and start demanding things, you have to watch out for these trust fund traps. And I think MMTers know that this has become a problem because we watch it diligently. And that really is like a good role.
I think people can hear it. And again, you could lead with the fact that, like, folks think that grandma’s eating cat food because, you know, the trust fund’s out of money and not because maybe the law wasn’t written with as much foresight as to be expected, or perhaps it’s not up to date with our monetary system.
Grumbine (31:14):
That’s great. What I want to do now because you just did a great job. I really appreciate that. That’s going to be cut up and used multiple times. What I want to say is this. So as we push for a federal job guarantee ourselves, we are pounding that drum here like you wouldn’t believe. And of course, we come head to head with our friends, the UBI folks, the universal basic income folks.
And what we’ve tried to say is, “Hey, listen, you know, 40,000 people a year commit suicide from joblessness. We have a situation where there are millions of people that are unemployed that do not wish to be unemployed.” And there are people in particular, vulnerable communities like let’s just use Flint, Michigan because it’s easy.
The people in Flint, Michigan, if we had a federal job guarantee, would be able to leave Flint, Michigan, go somewhere else, drink clean water, smoke marijuana safely, whatever in Colorado, wherever the heck they want to go. And, you know, women that are in a very, very bad domestic violence situations, for example, suddenly have mobility because they’re worried, oh my god, I’ll be left destitute, et cetera.
Federal job guarantee gives them, well, we’d like to believe it would give them a living wage, living benefits, a citizens benefits. We like to look at as citizens benefits versus the welfare side of this. And so as we push this forward, the UBI folks always counter, “Hey, you know, what about automation?” And I’m, like, “Well, you know, I have an autistic son and my autistic son is not going to be helped by a robot.
And we have bridges throughout the United States that, literally, are D rated. You take your life into your own hands.” Not that this would be the quote, unquote “job guarantee,” but it would pull people out of currently lower tier jobs, put them into those jobs. Because just maintaining our infrastructure is a job guaranteed for a long, long time, if we just funded it.
But to provide that base level of resetting the economy, making it the quote, unquote “labor standard,” as Ellis would say, and, ultimately, providing people with a way out. Here’s an opportunity to not let the capitalist control them. They have an opportunity to pick something other than that and they have the opportunity to never be unemployed again, if they choose to.
Talk to me a little bit about the fight that we see, Pavlina’s constantly in it, you’re in it. Everybody’s in it. Y’all were fighting with Matt Bruenig the other day about UBI versus federal job guarantee. Let’s start there and then we can roll into a larger job guarantee discussion.
Carrillo (33:59):
Sure thing. Yeah, so as you know, Steve, I agree with a lot of what you just said, if not all of it. And many of my feelings and thoughts and arguments with respect to this conversation can be found in the debate that Rohan Grey and I had in print with Matt Bruenig on this issue in which Elisa Battistoni also provides a very nice article at the end, talking about how approaches might be integrated.
And, you know, more and more as time goes on, my response to a lot of this is that I don’t want to have this conversation if we’re not talking about things in a legal context, in a political context, in a cultural context, in a social context, if we’re not looking at what, you know, empirical record we do have about what people want.
If we’re not, you know, talking about many people’s need, honestly, at the end of the day, to participate in something bigger than themselves, as opposed to just have distance from the government or the community, which is important. And I think is a value that needs to be protected and respected within what we’re doing. But people want to participate and, at a certain level, and this is, you know, this gets tricky because people will accuse you of, you know, fighting for make-work. But I invoke solidarity.
There is work that needs to be done. And if we get robots in a UBI, you have to ask yourself who is going to be doing that sort of work. Who’s going to be participating in a means of production when you have, you know, people at the center of Silicon Valley, essentially, hiring other people in a very literal sense to do individual jobs for them, but also provide the greater infrastructure which they need.
When you consider that in the global context, I think what we’re talking about is whether we want to build a society and this is what’s drawn from UBI really where, increasingly, people are taking a certain kind of right to exit society further to say, “No, thanks.”
Which again has meant there are many reasons to respect that, but do we want to build that in the middle of an unjust world, in a predatory world, within the United States but especially within the globe. And I think not. I don’t think that, you know, people should be compelled to work in the direct sense that, you know, people often accuse us of wanting.
And, but I do think that there is much, much, much to be said that, certainly, everyone deserves, you know, a standard of living to be comfortable but people also want to do more and we need to do more. And the folks who were fighting for all of this and David Stein is really the person to talk to you about all of this, as well as Jeanne Theoharis and other people.
The people who fought for the job guarantee during the last movements in this country, at least in the forties and in the seventies, they were making a moral demand. It was not just about satisfying particular incomes.
It was just not, not just about getting people distance again from each other, from the government, from the communities although there are many, again, important reasons for doing that. It was about coming together to try to fundamentally transform society. And I think that we are trying to do that on a certain level.
I know that there is a strain of argument within the community where people want to describe things apolitically; but if you are talking about a right to a job, you need to be honest that a lot of things are going to change.
As we’ve been discussing this entire interview that we are talking about changes in how people think of money, how people think of taxes, how they think of their duties and rights to each other, how they think of just living.
And we want to do that for the good. And for me, and this is present in all of my writing and all of this, it’s, you know, very central and the left foreign presentation I gave with some other folks a couple of weeks ago, we are running out of time now because we’re on the climate clock, right? So you could say that, what does UBI do to confront climate change?
Well, it stops people from engaging in the, in the industrial system that produces things. But if the other part of your argument is that robots are also just going to keep producing all those things and creating all the emissions, then we’re not confronting the industrial system and the financial system that sits on top of it. We’re not doing what we need to do to literally survive as a species.
And I know there’s been a lot of argument on the internet about how much the JG can actively do to combat climate change. My dear friend and colleague Nathan Tankus talks about the billions of trees that the CCC, you know, planted and that’s just one example. There is a lot of non-capital intensive work that people can do.
And I think people are going to have a better time planting trees, or I know I would, or rebuilding Flint or rebuilding Houston or rebuilding Puerto Rico instead of going to work for McDonald’s, instead of going to work for TJ Maxx. There’s a giant cultural thing that is happening here and I think it’s a bit about a bit more than just satisfying incomes.
Grumbine (38:49):
I agree a hundred percent. I want to ask you a quick question. Obviously, the bulk of the constraints that we have are political – they’re not operational, they’re political. When it comes to politics and so forth, we understand that conservatives have certain, and I’m not talking about crazy, you know, goose-stepping conservatives, I’m talking about regular rank and file Americans that find themselves growing up conservative.
Maybe they’re a country boy, maybe they want to be left alone, whatever their reasoning is. They’re not, they’re not these bad guys, right? They’re just wrong on some subjects or different, whatever you want to say. But we know, number one, they don’t like taxes. They do not like taxes. They got their don’t tread on me flags flying proud.
They also don’t like interference because they feel like if the government helps them, it’s the nanny state and the government is somehow or another controlling their lives. But more importantly, though, there’s this battle, if you will, to some extent, that their tax dollar is going to fund those things that they don’t like.
So what we’ve tried to do with regards to the job guarantee and other things like that by dispelling the idea, obviously, of the role of taxes in terms of that, is showing that, you know, Republicans love their kids too. Hey, what if we could give you and your family free dental care? What if we could give you a job guarantee?
What if we could give you these things as a citizens benefit where everybody gets it. You’re not going to pick and choose winners. You get it, they get it, we all get it, whatever. I’ve seen conservatives very, very receptive to that.
And what I’m wondering is is that if we stop looking at it, Democrat versus Republican and just start looking at it as the 99% and start really thinking about people in general, a people based monetary reform. This is an opportunity to build broad coalitions that we never thought possible.
And I believe, I believe and I’m probably wrong, but I really do believe in my heart of hearts, that between the federal job guarantee and providing these benefits, you know, by investing in infrastructure, investing in green energy, investing in R and D, investing in school, investing in health care, et cetera, you’re going to have so many good, good jobs where they’re going to have to train new people to fill it because we won’t have enough of those bodies to fulfill the demand that we’ll have.
But the thing is the people themselves will not, it’s like it takes some of the secondary xenophobia out of the picture. It takes some of the secondary racism out of the picture by taking away the competition for scarce resources, if you will. Do you think there’s any merit in that or do you think that that’s over simplification?
Carrillo (41:39):
I think there is a lot of merit in that. You know, everything has nuances but that’s essentially, I think, the idea here. It’s whenever possible, we attack false scarcity and that is really kind of the core of what has come to be known of a lot of conservative thinking; but even what goes by the name of liberal thinking now where you’re trying to keep power concentrated within particular hierarchies, it’s the idea that there is not enough to go around.
So we have most of it, but there’s not enough in a total sense, so you all got to fight over the rest. You got to fight over the scraps, right? And I think, ultimately, although we categorize things in terms of left and right because of where a particular set of old white dudes sat during the French revolution in the assemblies, et cetera, this is really bottom up and it kind of always has been.
And there’s a lot of divide and conquer that comes just straight out of the false notions of false scarcity. And so attacking the idea that there are a finite number of dollars in the world, that there are a finite number of jobs in the world and that we all have to scramble and beat each other’s throats for them is essential to coming across this.
I happen to think that the job guarantee is a particularly good segue into this conversation. When you’re talking with conservatives and I grew up on the US-Mexico border so, majority Latino, but lots of rank and file just working class conservatives, country, country, boys and girls and country folks, as you were indicating.
And I have never met a single one who did not agree that it should be a right that you should be able to work, that there should be a job for you if you want to work to, you know, to feed your folks and to feed yourself. I have never met anyone that fights that. The people, the kind of Republicans I meet who don’t like that are the ones that don’t wear jeans.
And, you know, they don’t ride the subway either. Those are the kind of Republicans that hate that notion. There’s a reason it has huge, huge political valence in this country because we all participate in the labor system or are alienated from the labor system and don’t get to participate in the way we want, or we have shitty jobs or whatever. People have different opinions but we’re all roped in.
So talking about the job guarantee is politically a way to get people to talk about power in a very different way. As for the intervention thing, I mean, we can walk through the history, et cetera, but I think you have to ask yourself whether it’s a natural system that the US government, which has all the guns and all the power and the constitution and the taxes, et cetera, has set up a system so that you have to go serve somebody else in order to work.
And you can’t serve your local community as a matter of right. You have to work to get the dollars to eat as MMT says, but you have to get in a subordinate relationship to somebody else unless you have a lot of property to begin with. Does that system seem natural? Do bonobos do that? Do chimpanzees do that?
Of course, you know, we work with other species, but the point is that there’s a lot of false naturalization that goes on here. And I really think that the right discourse is a way to break through that because it speaks to people on a deep level and it doesn’t come up when we talk about UBI, it doesn’t come up when we talk about robots, et cetera.
But I truly think that people across the political aisle believe in this idea that you should be able to labor and hopefully it’s equitable labor. Hopefully, you’re not discriminated against. Hopefully, it’s not so shitty with whoever your JG administrator or boss it is, but everyone should be at least be able to do that.
Like, we’re not asking for that much if, when you think about it, the ability to work and which is like a condition, maybe we don’t want to be in, in the first place, but we’re here. So can we at least all do that?
Grumbine (45:18):
Right. I want to ask, there’s an important thing that it may be the most important thing and I think it’s especially important for vote blue folks and greens alike to hear this loud and clear. There is a constant, in fact, we’ve had friends of mine, people that have been around MMT too long to be saying this anymore.
They still continue to say, we need to cut the military spending by 50% and then we can use that money to do X, Y, Z. And this is a repetitive, recurrent state of mind. It seems logical because in your home, you’re thinking, gosh, man, if I just cut out Direct TV, then maybe we can go on a vacation in a couple months, man.
So I’ll cut there to spend there. And while we may want to get rid of the military or we may want to cut it or we want to repurpose it or close bases down, whatever, there’s a very strategic reason why the money is spent into the military and it’s not just to blow things up. It’s because it’s the one funding mechanism that they’ve, everybody agrees to, that they can secretly fund throughout the country.
Hey, man, we’ll build steering wheels up in Connecticut. We’ll build that bolt down in New Mexico. We’ll build a wing over there in North Dakota, whatever. And they spread this out and this is how they flood, this is, like, the secret funding method, I think. But there’s also that belief that, well, we just got cut the military.
Maybe we want to cut the military for moral reasons because we don’t want to bomb people anymore. Maybe we want to get away from this idea of being an empire, whatever the rationale. But my question to you is, how can we break them of the belief system that we can’t spend on Medicare for all or free college or getting rid of student debt before we cut the military?
This to me is a nonstarter. It is the progressive give up strategy. It is what liberal Democrats have done forever in my entire life. That’s the thing they put out there. And it’s like, the more I know, the more I realized that’s them putting their poison pill into what they’re fighting for so that they can ensure it doesn’t come to pass. Can you talk about that for just a second?
Carrillo (47:28):
Sure thing. This is certainly omnipresent as you’ve been indicating and, you know, really my kind of short answer to this and I’ll be clear. I want to reduce military spending. I think like many of the people want to stop doing a lot of things with public money via the military, but we don’t have to as you indicated.
And it may not be the first order issue that we get to. I think, you know, again, it’s important to look at which of the things that we’re fighting for are politically motivating in and of themselves like the job guarantee and how that can swell into progressive momentum to eventually tackle the bigger, the honest problems like American military might.
And instead of focusing on, you know, the hydraulic, so to speak, idea that you can take away military funding and we need that to use it to, you know, to spend on social programs. I think that you can number one, I mean, look at the numbers which people do, of course that’s helpful. Pentagon, how do they get money? Do they go through a series of trust funds?
Do they have legislation that says, you know, we’re going to come revisit this every year in the way that we do with other social programs or does the Pentagon pull. Does it pull money rather than wait for Congress to push? Has it established itself both through the law and the cultural consciousness of eating whatever it wants.
And the answer to that is clearly yes. And you can look at that in the historical record. And I think you can, you know, you know that in the United States because you see all this military equipment coming everywhere.
You see it coming . . . Police departments are using it back in my hometown, I’m sure in other places. You know that like they have so much money that they don’t even hold onto their own weapons anymore and that’s problematic.
But another, just to suggest a way to integrate these conversations as well, so, you can, you say, you know, the military doesn’t have to ask why does the job guarantee or Medicare for All have to ask for money in that way that you’re suggesting.
But then you also say, you know, part of the reason that the military has so much buy-in is that a lot of people through their broader families, through their communities are tied to it because there are jobs because the military builds infrastructure, et cetera.
And the job guarantee and other policies that MMTers may or may not support, help pull away from that and say, we don’t need to organize production around militarization necessarily. You know, personally, I think it’s very important that my cousins and my community and, you know, other people not go halfway across the world to hurt other, you know, other folks of color.
And that’s an ongoing dynamic that’s been happening for a long time but the way I see ultimately stopping that is, you know, really confronting, confronting the money power, thinking of talking about how political economy works. And until then, we’re doing the same old dance. And you know, that dance has not worked since Vietnam. I don’t see it working in the Trump era or anytime soon.
Grumbine (50:21):
Absolutely not. Raúl, this was fantastic. I want to thank you so much. It was well worth the wait. I wanted to have you on here for a very, very long time. I think you’re an eloquent speaker. I think you’ve got a great perspective and you’re an excellent communicator. So thank you so much for joining me.
Carrillo (50:38):
Sure thing.
Grumbine (50:38):
Have a great one, everybody. Thank you. Raúl.
Ending Credits (50:46):
Macro N Cheese is produced by Andy Kennedy, descriptive writing by Virginia Cotts and promotional artwork by Mindy Donham. Macro N Cheese is publicly funded by our Real Progressives Patreon account. If you would like to donate Macro N Cheese, please visit patreon.com/realprogressives.
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Steve Grumbine’s guest is Raul Carrillo of the New Economy Project and Modern Money Network. As an anti-poverty economic justice attorney he has a unique perspective on the monetary system.
Raul talks about his seminal article, “The Dangerous Myth of Taxpayer Money,” and the legal history of taxation, citing the Supreme Court ruling that the gov’t has power to issue money backed only by the full faith credit of the US gov’t – not backed by gold, taxes, or bonds. He reveals some startling facts about the connection between taxation and the civil rights struggle for public education.
Raul & Steve discuss the scramble to find truncated ways to present complex ideas. Progressives must attack false scarcity, which is at the core of both conservative & liberal thinking. Raul says that fighting for the Job Guarantee brings people to understand the concentration of power. It’s an awareness that can create the momentum to take on the system itself.
Racial Taxation: Schools, Segregation, and Taxpayer Citizenship, 1869-1973, by Camille Walsh
www.uncpress.org/book/97814696389…racial-taxation/
splinternews.com/the-dangerous-my…money-1819658902
@RaulACarrillo on Twitter
Modern Money Network modernmoneynetwork.org/
New Economy Project www.neweconomynyc.org/
Special Thanks to Geoffrey Ginter for the excellent intro song! And of course special thanks to our guest Christian Reilly, the donors of Real Progressives and our excellent staff of volunteers.
Macro N Cheese – Episode 13
Public Money & The Right to a Job with Raul Carrillo
April 27, 2019
Raúl Carrillo [intro/music] (00:03):
If you are talking about a right to a job, you need to be honest that a lot of things are going to change. That we are talking about changes in how people think of money, how people think taxes, how they think of their duties and rights to each other, how they think of just living and we want to do that for the good.
Raúl Carrillo [intro/music] (00:20):
I think people are going to have a better time planting trees, or, I know I would, or rebuilding Flint or rebuilding Houston or rebuilding Puerto Rico instead of going to work at McDonalds.
Geoff Ginter [intro/music] (01:29):
Now let’s see if we can avoid the apocalypse altogether. Here’s another episode of Macro N Cheese with your host, Steve Grumbine.
Steve Grumbine (01:34):
All right, everybody. Thank you for joining us. This is Steve Grumbine with Real Progressives. Tonight, I have friend and fellow modern monetary theorists, Raul Carrillo. Raul Is from the Modern Money Network and he is one of the smartest guys I know. He’s written some incredible writings. I mean, like, there’s one from Splinter where he talked about the myth of the taxpayer dollar. This is a guy who’s out there fighting every single day. Really, really want you all to give it up for Raul Carrillo. Welcome to the show, sir.
Carrillo (02:08):
Glad to be here, Steve. Glad we could finally make this work out. Look forward to talking about things today. I’m not sure how you’d like to proceed, but I know that I’m happy to talk about MMT from both a bit of an activist perspective and also a lawyer’s perspective, which I know is not necessarily customary on this show. So we’re getting a little bit of a different lens here.
Grumbine (02:29):
You’re, it’s going to be real helpful. So do me a favor. So tell us a little bit about who you are and what you do at the Modern Money Network so folks understand exactly where you’re coming from.
Carrillo (02:41):
Sure thing. So I’ll give a little bit of just panoramic view of what I do within the MMT world and without, so that people have a sense of that. And I’ll talk a little bit about the history of the Modern Money Network, how we came to be and kind of the lens that, again, we’re bringing to all of this, you know, great movement that everyone’s working on here at Real Progressives and elsewhere.
So I’m currently actually an antipoverty attorney by day. You could call it an economic justice attorney as well, if you wanted for the most part. So I work at a nonprofit called New Economy Project. I’m not here representing them today, but I think it’s helpful for you to know what I kind of do day to day to see how a lot of this theory that we talk about, you know, intersects with some things that I’m fighting for, so to speak.
So the New Economy Project is about 20 years old. It’s located in New York City. And one thing that we do is we help folks fight debt collectors, banks, anyone who is starting to take advantage of them through the financial system essentially, and I operate a hotline every day. Folks call with problems that they have with, you know, the money power. They come in here and we chat a little bit about that.
We try to find ways to help them. The other thing that we do is local community economic development, and try to facilitate that. So we help build worker co-ops, financial cooperatives, like community development credit unions, community land trusts, all these sorts of democratic enterprises which, as we’ll discuss later, require funding, ultimately, to operate.
And then, the other things that I do in addition to the Modern Money Network, which you mentioned, is I am a director for the National Jobs for All Coalition, which is a organization of JG advocates that formed at the end of the last historical movement for the job guarantee when Coretta Scott King was out in the streets leading the fight.
And there’s some friends of MMT as well, some MMTers involved with that organization. And then the other group is, of course, The Global Institute for Sustainable Prosperity. I am a research fellow there and look forward to working with them more in the future.
But my main hat is really the Modern Money Network. And the Modern Money Network started off in 2015 as a collection of law students, now lawyers for the most part although the chapter there is still operating as well as at a few other campuses now.
But it was folks who didn’t really have a sense that we were being taught what law and political economy was, what law and macroeconomics was outside of the traditional school of, you know, law and economics which started at the University of Chicago and exchanges a lot of concepts with neoclassical economics, even with new Keynesian economics and the kind of folks that we find ourselves in opposition with or against often on the economy.
And we started looking at this thing MMT and we all got there by various different paths, but we were like, you know, modern economics, the crash had happened recently, doesn’t give us the answers to analyze the economy as a lawyer. We don’t know how the institutions work. We don’t know how things operate on a day-to-day basis.
And this paradigm, this new thing that we’re looking at, actually gives us some kind of lens into the practicality and the administration and the rules of the game for the economy. Since then, we’ve expanded into a organization with several chapters across the country.
We’ve had events in Europe, Australia, and Brazil, and we’re looking forward to expanding more and really focusing on getting an interdisciplinary perspective for all of this that’s not just the law. We have a humanities division, that’s doing great work.
We’re trying to bring in historians, sociologists, all these other people who have so many things to say about the economy but don’t necessarily get a voice. Perhaps most importantly, we are connecting to other social justice movements.
We kind of see ourselves as providing, you know, a particular software or particular kind of way of looking at things that can be helpful to people who are fighting for the things that, you know, all get us going in the morning.
Not everyone is necessarily excited about reforming the monetary system. What it takes is conversations as you know better than anybody else, Steve, about why this is important for all these other things. And for me, why it’s important to me just then. So that’s a little bit about what we’re doing.
Grumbine (06:54):
It’s fantastic. So what I want to do is, you and I discussed this when we planned this talk out and there’s two real primary things that we want to dress down on. First thing is the idea of the taxpayer dollar. The article you and Jesse Myerson wrote in Splinter was just epic. I probably share it once a week. I don’t think it can be shared enough.
If I could share it daily without looking like a stooge, I would share it every day. It’s just that good, you know, because seriously, this is, you know, I’ve been running around saying, you know, “Taxes don’t fund spending at the federal level.” And everybody says, oh, you know, blah, blah, blah. But when you broke it down, the thing you did was you hit the social justice movements right where they needed to hear it.
And that is, tell me what a taxpayer looks like. What do you think federal taxpayer looks like? Do you think it’s a young African American, you know, that’s living in a shelter? Do you think that it’s a young Latino that is literally being asked for their ID in the middle of the streets? What do you think a taxpayer looks like?
And the idea this racist, xenophobic term that is used very, very cavalierly by both Democrats and Republicans and really mainstream media, et cetera. That was the best go to paper I’ve seen yet. Can you tell me about how you and Jesse came to write that and talk a little bit about the concept of the taxpayer dollar and then the concept of why it’s a racist, xenophobic term?
Carrillo (08:27):
Absolutely and Steve, if you don’t mind, I’d like to start talking about that article and then kind of introduce a new book that I’ve discovered by a legal historian named Camille Walsh, which goes into racial taxation and the injustice around the very frame, which I think is tremendously helpful for our movement.
Grumbine (08:46):
Absolutely.
Carrillo (08:46):
So I think that Jesse and I, and I don’t want to speak too much for other folks throughout the podcast and I’m speaking for myself to be clear unless I say otherwise. But I think Jesse and I felt that it was getting very frustrating, you know, being in this political moment and, you know, various forms of the resistance, you know, so to speak, taking off.
And people were still very focused on this notion that look at X thing that X, Y politician is doing. And the key problem here is that they’re wasting our taxpayer dollars. And we think that this way of looking at things is not only technically incorrect as MMTers and I think most followers of Real Progressives know, it also has this political and legal and moral and cultural connotation that is ultimately toxic.
And even if you don’t subscribe to MMT yet, you should take a look at this narrative and understand that, hey, “Maybe this is really, really poisonous and it warps our sense of who deserves what, of who’s giving what to whom, of our relationship between ourselves and the state, et cetera.”
So that was really the impetus for that article and, as you can see, we walked through it. We walked through the technicals and we can do that right now depending on how you want to spend our time here, Steve.
Grumbine (10:06):
Do it, do it.
Carrillo (10:06):
Yeah, something we do a little bit differently and that I try to do with my writing at least, and I think speaks to people who don’t necessarily hear the talk about spreadsheets and keystrokes, et cetera, as I say, this is really a matter of law at the end of the day. Again, part of the reason why I’m attracted to MMT is its legal coherence, it’s roots and respect for legal history.
And so there’s a series of cases following the civil war when the whole country, you know, is, or at least those who can participate in this sort of debate, are having this argument about what the power of this new federal government is. It’s really a constitutional moment in American history and the justices get a series of cases from the end of the civil war until I think the last one was 1844 and they’re called the legal tender cases.
And it’s figuring out what are the monetary powers of the national government. Christine Desan writes a little bit about this. She’s a legal historian up at Harvard. But, basically, the Supreme Court rules, as a matter of constitutional law, that the United States has, the United States government, has the power to issue money backed only by the full faith and credit of the United States government.
I think if you look at things logically, if you talk a little bit more with political theorists, you understand that it’s not just the decree that matters, it’s the force behind it. But that’s a key moment in monetary history in the United States where the Supreme Court is confirming, yes, in fact, if the government didn’t have this power, it wouldn’t be much of a government at all.
And so it doesn’t have to, the notes don’t have to be backed by gold. They don’t have to be backed by taxes. They don’t have to be backed by bonds necessarily. It can be a mix of things. It could be, you know, there are ways in which you can issue money, but, ultimately, this is a sovereign power retained by the government.
And so what the US federal government does following that Supreme Court ruling is, you know, exactly that. There’s a lot of problems that go on with the gold standard, et cetera, you know, throughout the rest of American history, but, essentially, this core has maintained that the US government has the sovereign ability to issue fiat money.
And so, again, that’s what, that’s what we do. Congress votes and then the Treasury and the Federal Reserve really figure it out on the backend. And that conversation with how to come to, like, the actual bank account that the Treasury uses to credit other banks’ accounts and the spend money, that conversation between the Treasury and the Fed and all their like really, really boring lawyers has gone many different ways over the course of history.
But at the end of the day, whether we’re talking about bonds or whether we’re talking about taxes, this is new money. And as you know, as it’s talked about throughout American legal history, this is the power to create and the power to destroy. It is not necessarily robbing Peter to pay Paul.
Grumbine (12:54):
That’s absolutely fantastic. I want to get your assessment on something because, you know, I’m trying desperately, our team tries to boil things down to people that normally wouldn’t pay five seconds of attention. So we’re scrambling to find truncated ways of presenting really complex things.
And so one of the things that we’ve been saying, and I know we can nuance the heck out of this, the idea of the birth of a dollar is congressional spending and the death of the dollar is when it’s received and it’s done its loop as a tax. And so this is kind of how we have presented that framework right there.
Randall Wray came on and spoke about how the glory days of the 1900s and so forth, they used to bring barrels of money, you know, wheelbarrows of money and burn it. And colonial times they talked about burning the tobacco that was used to trade, et cetera.
So in this particular case, money destruction is not something new. Somehow or another, somebody got it in their head that a dollar is a permanent entity. It just lives in perpetuity. And the reality is dollars are created and destroyed constantly. Can you speak to that a little bit?
Carrillo (14:03):
Yeah. I think that some of those metaphors can be helpful and, you know, it’s a hard thing that we do, right? Because we’re trying to talk about balance sheets and we’re trying to talk about taxes of foreign debt at the same time, we’re trying to picture, depict the flows to people and how things work.
One way that I actually find is, and we do this a little bit in the piece, is I think it’s helpful to encourage people to think about all the other ways in which the government funds that general account again and, or, you know, increases assets or equity on its balance sheet. And so it’s not just through taxes. It’s not just through bonds.
It’s also through seizing the assets of people that the government thinks it’s credit are criminal. It’s also land. It’s also, you know, student loan interest that I pay every month to the federal government. It’s all these other things. And so the real conceit here, even once you get above the mechanics, is about ownership. And it’s about this idea that what the federal government needs in order to spend money is tribute, essentially.
It’s got to come from you. If I’m going to help somebody, it’s got to come from you. And that’s how really power relationships are kind of cemented. And so I think it’s important to talk about the mechanics, but also ask people, “How do you think the federal government gets money? What are the many different ways?
How can you tell me that the person who will ostensibly get a job, or get schooling, or get housing, is being funded by your tax dollars?” And that’s the way that it needs to work; and what you do when you start asking those questions is you start people, getting people to think about not so much even left, right, liberal, conservative, but top, bottom.
Wait. So these, you know, these folks with all the money are telling me, or ostensibly the ability to create money, are think, are saying that I need to pay for these other things. Well, it might be a good thing for you to do morally.
Like it might be nice if you believe in democracy, you want to see other kids educated, you want to see other people housed, et cetera, et cetera; but this sense of twisted ownership is really what changes and subverts the framework. And this is intentional so that people will think that it’s all coming horizontally. It’s coming from your neighbor.
It’s not necessarily coming from your neighbor. It will immaterial, no, it’s not coming from your neighbor; but even when you look at the earmarking and the categories, et cetera, you can’t prove that it’s coming from your neighbor. You have to zoom out and look at like a wider system of economic relationships that we have with each other and that the state has with us.
Grumbine (16:42):
Very good. That’s incredibly deep conversation to have, because I think folks, when they see, you know, the old stories that we’ve heard about bonds funding the government and ZIRP is out there, zero interest rate policy, et cetera, renders that basically null and void. But we still need that anchor, that magnet, if you will, that pulls people to require that currency.
And I think you explained it in a way that we never heard on Real Progressives before. So thank you very much. That was really good. Talk to us about this book that you’re bringing up regarding the taxpayer dollar and the foundations of it.
Carrillo (17:19):
Sure. So it actually, it actually fits right in here. So Camille Walsh, who is a legal historian in Washington, has just published a book called “Racial Taxation.” And it doesn’t so much look at taxpayer money as it does the concept of taxpayer citizenship.
The suggestion that really is the source of a lot of opposition to MMT, if we think about it, the suggestion that if I pay more in taxes, I am somehow a better citizen, a better person, and I’m surrendering some of my money so that you may have X, Y, Z. So you owe me more respect. You owe me more recognition. You have to, you know, give me some sort of deference here.
And that is a deeply, deeply, deeply, deeply ingrained concept in American, you know, culture in a lot of the ways that, you know, both conservatives and liberals and even radicals think about things in this country. And what we don’t realize is that it arises from some particular moments in history. It is part of a political project.
This idea of taxpayer citizenship is also tied to misunderstandings about what taxpayer money is. And we hope to unwind the concept of taxpayer citizenship through, you know, in part telling people how public money actually works as in comparison to taxpayer money. And just to provide an example of how pernicious this is, Camille Walsh walks through the history of the concept of, again, taxpayer identity or taxpayer funding.
And she asked when did it really, really, really take off? And she’s looking at education and it’s important to us to look at these sorts of historical struggles because, you know, we’re fighting for jobs for all. Throughout the history of fighting for education for all, and fighting to desegregate public school systems throughout the United States, it was inseparably intertwined with ideas about taxation.
The end of the 19th century, you have really a lot of middle class, such as it was African American and Latino and Asian American folks, bringing lawsuits as taxpayers to the courts and saying, “I deserve rights as a taxpayer.” And really the issue there is very different from what we see now.
People are saying they have rights as taxpayers because they’re getting taxed and getting no benefit whatsoever – in that context, that’s separate but equal schools. So there’s laws on the books in many jurisdictions that, you know, you’re supposed to provide funding to everybody or schooling to everybody but the funding is coming from many people’s pockets but only going to white kids.
And so it’s initially seen, and this is back in a different monetary era, we’re still very much on the gold standard, et cetera. It is seen as empowering, right, to say, “I’m a taxpayer, especially at the local level, and you’re not using my tax dollars correctly,” but where this taxpayer identity really breaks into the mainstream and really becomes part of the core of right wing political thought in America is when we start integrating schools.
So when it goes, when Brown V. Board of Education happens, 1954, you have a relatively liberal court that makes what I think people in our line of thinking would call a bit of a strategic error. You can say it’s an ideological error, but it turned out to be a strategic error as well. And while they do the wonderful thing of integrating schools, they avoid the taxation question.
At that point in time, property taxes are still the main funder of school, right? And it says, “We’re going to focus on the psychological harms and on the morality that’s really problematic by desegregating schools.” And that’s really important. But what they do is they kick the can down the road.
And they say, because we don’t want to touch all this taxation stuff or talk about like, what money is or what you’re in and you can read this in the, in a lot of the letters surrounding the case. They don’t want it, they don’t want to touch the taxation stuff. And so it gets kicked down the road.
And the next really big case that we have about a fundamental right to education in this country is called San Antonio V. Rodríguez in 1973. And in that case, people . . . starts with Mexican American folks in San Antonio, but eventually comes to represent all kinds of kids and their parents throughout Texas. And they’re saying it is, “There’s a fundamental right to education.
And what’s happening here is you have a property tax system that discriminates against people for being poor.” Now, what does the Supreme Court do? It says there’s not a general right to education as we all know in this country, this is the reason we now do not have a federal right to education.
We have many state rights, 50 of them that are enforced by the federal courts, but it says, we cannot say that “There is a right to education that trumps people’s rights as taxpayers.” And so that is where the right to education went to die. It died in MMT land, so to speak.
And if there had been better understanding that you had had nine justices, even if they were a bit conservative, you had a better understanding of operational reality, perhaps things would have gone different. You, of course, always have to grapple with the idea that there are a lot of folks in American society who just do not want to give entitlements for folks, especially to poor folks of color, et cetera.
But really where the doctrine got in trouble was it’s running up against right to education, taxpayer rights, right to education, taxpayer rights. And so it’s one thing, you know, to say, as Jesse and I do, that, you know, this is pernicious and it’s kind of all soaking like our psyches, et cetera, on the concept of taxpayer money and the idea that because you pay more in taxes, but at least you’re charged a higher rate that you deserve more rights.
That’s bad enough, but it’s not just out there in the either. It’s something you can look through the history of the courts and say, “This is a problem.” This is where social justice lost – is we could not get over this question. So that’s just really one more reason that folks should care.
And you can start by telling people, you know, if you care about education, if you care about this thing, this thing, this thing, this thing, this thing, this other thing about taxation is in your way. And you can look at the record.
You can look at the historical record, you can look at legal record and it’s there. It’s one of the many problems to overcome but there’s no way around it, almost, if you don’t start thinking about what money is, what taxation is and the usual narrative is not suiting us.
And we have to convince a lot of other folks to get beyond that in our fight for a right to a job, actually, because, you know, we already had to deal with the animus again, that people don’t want to see other people, necessarily, succeed and that’s for a variety of different reasons; but there’s also this idea, again, that you are robbing Peter to pay Paul.
And if we can attack that a bit, head on, our political battles, our protests in the streets, our conversations with family and friends and eventually defending whatever legislation we pass in front of the courts is going to be a hell of a lot easier. And, in fact, I don’t see, again, I don’t see how, how we get around one fight without addressing the other one.
Intermission (24:29):
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Grumbine (25:18):
The right wing of this country, coupled with the pseudo right wing of the Clinton side, the Clinton Democrats, if you will, they have basically made the weapon, how are you going to pay for it? It is, literally, in my opinion, economic terrorism and I will, that’s my bend is to fight it as if it is economic terrorism. Because I believe they do know the truth.
I don’t believe that they’re immune from the truth. I believe they’re using it to advantage, to extract GDP, to keep the divide, the gap growing as you’ve seen since 72. And it’s just gone [whistling noise] and I don’t see any stop in sight. But you raised something very important that I want to touch on. You said that it could have been an ideological problem or it could have been a strategic error.
I like to go back momentarily just for a second to a very important subject that I think everybody ends up getting tripped up on and that social security. FDR gave everybody the belief that they were paying into social security. That there was like a piggy bank with crumpled up old dollar bills, ha’pennies, and, you know, nickels from back in 1919.
And people have really, really gotten to the point where they believe, “Hey, I paid into that, daggonit. That’s my money. It’s sitting there waiting for me when I get old.” Talk about this strategic error, if you will, and talk about how it has, because you’ve got Democrats, they mean well, they have all the best interests, but they sit there running around, talking about how the Republicans raided social security, it’s going bankrupt.
They don’t realize they’re actually playing into the very scheme, if you will, that seeks to privatize social security by trying to defend it the way they do. Can you talk just a moment about strategic errors and social security?
Carrillo (27:06):
Sure. And I’d like to begin with just the note, I think, that you can, you can attack both the actual model for funding social security and, you know, say that it has problems while recognizing that it was a different political and somewhat differently monetary situation when FDR was creating this plan, when activists were out in the streets advocating for social security, et cetera.
And I think that it’s important to again, look at the empirical record and see that this strategy whereby we convince people that they, that their payments in to the fund via payroll taxes is what’s necessary to keep it going, has not really worked. And you can see the appeal there.
If you tell somebody that this is yours because you’ve paid into it, then they’re more likely to think, “Hey, you know, hands off, you know, I worked my whole life. That’s mine.” People think similarly about their tax dollars in a general setting, even outside of the social security setting.
Now not only do you think that you deserve it, but you think that people, working people, very specifically in the case of social security, need to have their funds drawn in order for the operation to continue. And that’s really where the problem is. You can, there are million ways to say that people deserve social security.
You could create a right. You could say that this is just what we need for a decent society. You could do all kinds of other things. It doesn’t have to be linked to payroll taxes, even though it has been in the American mindset for a long time now. And I want to highlight, I think Stephanie Kelton talks about this and she’s really talking about the law here.
She gives an example of different kinds of funds that are run in different kinds of ways and highlights the different set of political problems for each. So we know, everybody knows about social security. They’re really for, I think, big trust funds which are, you know, four corners of paper that have numbers on them set aside in the back of the house, right? And two of them are within Medicare themselves.
One is the hospital insurance trust fund and everyone says that that one is going to run out of money by 2020. The other one is the Medicare supplement medical insurance fund. The legislation and the regulations for that fund say that it is not subject to a discrete amount of appropriations in the sense that Congress will haggle back and forth about like what’s going to happen here.
Ultimately, at end of the day, the funding for that program is determined by the number of eligible claims on the fund itself. How many people are saying I have a right to that Medicare money, you know, as opposed to how much money is left in the pot. And that’s huge. That’s really big for our fight for a right to a job.
That’s really big for anything else really, that progressives want to roll out here and, you know, there is, I think, good faith disagreement about this amongst job guarantee advocates; but I think ultimately, you know, again, these fights are not separate.
If you want to protect the program, if you want it to be resilient, if you want to want it to stick around long enough to provide the benefits to people, to folks so that they buy into the program, you have to get the funding right within the legislation. No doubt it will be challenged in court.
You know, how could it possibly be that you can just take as much money as you want, but we know that programs already exist that on a spectrum of different kinds of financing. So we need to watch out for that.
And as you know, as this movement, you know, generally as Progressives gain, you know, power and energy throughout the country and start demanding things, you have to watch out for these trust fund traps. And I think MMTers know that this has become a problem because we watch it diligently. And that really is like a good role.
I think people can hear it. And again, you could lead with the fact that, like, folks think that grandma’s eating cat food because, you know, the trust fund’s out of money and not because maybe the law wasn’t written with as much foresight as to be expected, or perhaps it’s not up to date with our monetary system.
Grumbine (31:14):
That’s great. What I want to do now because you just did a great job. I really appreciate that. That’s going to be cut up and used multiple times. What I want to say is this. So as we push for a federal job guarantee ourselves, we are pounding that drum here like you wouldn’t believe. And of course, we come head to head with our friends, the UBI folks, the universal basic income folks.
And what we’ve tried to say is, “Hey, listen, you know, 40,000 people a year commit suicide from joblessness. We have a situation where there are millions of people that are unemployed that do not wish to be unemployed.” And there are people in particular, vulnerable communities like let’s just use Flint, Michigan because it’s easy.
The people in Flint, Michigan, if we had a federal job guarantee, would be able to leave Flint, Michigan, go somewhere else, drink clean water, smoke marijuana safely, whatever in Colorado, wherever the heck they want to go. And, you know, women that are in a very, very bad domestic violence situations, for example, suddenly have mobility because they’re worried, oh my god, I’ll be left destitute, et cetera.
Federal job guarantee gives them, well, we’d like to believe it would give them a living wage, living benefits, a citizens benefits. We like to look at as citizens benefits versus the welfare side of this. And so as we push this forward, the UBI folks always counter, “Hey, you know, what about automation?” And I’m, like, “Well, you know, I have an autistic son and my autistic son is not going to be helped by a robot.
And we have bridges throughout the United States that, literally, are D rated. You take your life into your own hands.” Not that this would be the quote, unquote “job guarantee,” but it would pull people out of currently lower tier jobs, put them into those jobs. Because just maintaining our infrastructure is a job guaranteed for a long, long time, if we just funded it.
But to provide that base level of resetting the economy, making it the quote, unquote “labor standard,” as Ellis would say, and, ultimately, providing people with a way out. Here’s an opportunity to not let the capitalist control them. They have an opportunity to pick something other than that and they have the opportunity to never be unemployed again, if they choose to.
Talk to me a little bit about the fight that we see, Pavlina’s constantly in it, you’re in it. Everybody’s in it. Y’all were fighting with Matt Bruenig the other day about UBI versus federal job guarantee. Let’s start there and then we can roll into a larger job guarantee discussion.
Carrillo (33:59):
Sure thing. Yeah, so as you know, Steve, I agree with a lot of what you just said, if not all of it. And many of my feelings and thoughts and arguments with respect to this conversation can be found in the debate that Rohan Grey and I had in print with Matt Bruenig on this issue in which Elisa Battistoni also provides a very nice article at the end, talking about how approaches might be integrated.
And, you know, more and more as time goes on, my response to a lot of this is that I don’t want to have this conversation if we’re not talking about things in a legal context, in a political context, in a cultural context, in a social context, if we’re not looking at what, you know, empirical record we do have about what people want.
If we’re not, you know, talking about many people’s need, honestly, at the end of the day, to participate in something bigger than themselves, as opposed to just have distance from the government or the community, which is important. And I think is a value that needs to be protected and respected within what we’re doing. But people want to participate and, at a certain level, and this is, you know, this gets tricky because people will accuse you of, you know, fighting for make-work. But I invoke solidarity.
There is work that needs to be done. And if we get robots in a UBI, you have to ask yourself who is going to be doing that sort of work. Who’s going to be participating in a means of production when you have, you know, people at the center of Silicon Valley, essentially, hiring other people in a very literal sense to do individual jobs for them, but also provide the greater infrastructure which they need.
When you consider that in the global context, I think what we’re talking about is whether we want to build a society and this is what’s drawn from UBI really where, increasingly, people are taking a certain kind of right to exit society further to say, “No, thanks.”
Which again has meant there are many reasons to respect that, but do we want to build that in the middle of an unjust world, in a predatory world, within the United States but especially within the globe. And I think not. I don’t think that, you know, people should be compelled to work in the direct sense that, you know, people often accuse us of wanting.
And, but I do think that there is much, much, much to be said that, certainly, everyone deserves, you know, a standard of living to be comfortable but people also want to do more and we need to do more. And the folks who were fighting for all of this and David Stein is really the person to talk to you about all of this, as well as Jeanne Theoharis and other people.
The people who fought for the job guarantee during the last movements in this country, at least in the forties and in the seventies, they were making a moral demand. It was not just about satisfying particular incomes.
It was just not, not just about getting people distance again from each other, from the government, from the communities although there are many, again, important reasons for doing that. It was about coming together to try to fundamentally transform society. And I think that we are trying to do that on a certain level.
I know that there is a strain of argument within the community where people want to describe things apolitically; but if you are talking about a right to a job, you need to be honest that a lot of things are going to change.
As we’ve been discussing this entire interview that we are talking about changes in how people think of money, how people think of taxes, how they think of their duties and rights to each other, how they think of just living.
And we want to do that for the good. And for me, and this is present in all of my writing and all of this, it’s, you know, very central and the left foreign presentation I gave with some other folks a couple of weeks ago, we are running out of time now because we’re on the climate clock, right? So you could say that, what does UBI do to confront climate change?
Well, it stops people from engaging in the, in the industrial system that produces things. But if the other part of your argument is that robots are also just going to keep producing all those things and creating all the emissions, then we’re not confronting the industrial system and the financial system that sits on top of it. We’re not doing what we need to do to literally survive as a species.
And I know there’s been a lot of argument on the internet about how much the JG can actively do to combat climate change. My dear friend and colleague Nathan Tankus talks about the billions of trees that the CCC, you know, planted and that’s just one example. There is a lot of non-capital intensive work that people can do.
And I think people are going to have a better time planting trees, or I know I would, or rebuilding Flint or rebuilding Houston or rebuilding Puerto Rico instead of going to work for McDonald’s, instead of going to work for TJ Maxx. There’s a giant cultural thing that is happening here and I think it’s a bit about a bit more than just satisfying incomes.
Grumbine (38:49):
I agree a hundred percent. I want to ask you a quick question. Obviously, the bulk of the constraints that we have are political – they’re not operational, they’re political. When it comes to politics and so forth, we understand that conservatives have certain, and I’m not talking about crazy, you know, goose-stepping conservatives, I’m talking about regular rank and file Americans that find themselves growing up conservative.
Maybe they’re a country boy, maybe they want to be left alone, whatever their reasoning is. They’re not, they’re not these bad guys, right? They’re just wrong on some subjects or different, whatever you want to say. But we know, number one, they don’t like taxes. They do not like taxes. They got their don’t tread on me flags flying proud.
They also don’t like interference because they feel like if the government helps them, it’s the nanny state and the government is somehow or another controlling their lives. But more importantly, though, there’s this battle, if you will, to some extent, that their tax dollar is going to fund those things that they don’t like.
So what we’ve tried to do with regards to the job guarantee and other things like that by dispelling the idea, obviously, of the role of taxes in terms of that, is showing that, you know, Republicans love their kids too. Hey, what if we could give you and your family free dental care? What if we could give you a job guarantee?
What if we could give you these things as a citizens benefit where everybody gets it. You’re not going to pick and choose winners. You get it, they get it, we all get it, whatever. I’ve seen conservatives very, very receptive to that.
And what I’m wondering is is that if we stop looking at it, Democrat versus Republican and just start looking at it as the 99% and start really thinking about people in general, a people based monetary reform. This is an opportunity to build broad coalitions that we never thought possible.
And I believe, I believe and I’m probably wrong, but I really do believe in my heart of hearts, that between the federal job guarantee and providing these benefits, you know, by investing in infrastructure, investing in green energy, investing in R and D, investing in school, investing in health care, et cetera, you’re going to have so many good, good jobs where they’re going to have to train new people to fill it because we won’t have enough of those bodies to fulfill the demand that we’ll have.
But the thing is the people themselves will not, it’s like it takes some of the secondary xenophobia out of the picture. It takes some of the secondary racism out of the picture by taking away the competition for scarce resources, if you will. Do you think there’s any merit in that or do you think that that’s over simplification?
Carrillo (41:39):
I think there is a lot of merit in that. You know, everything has nuances but that’s essentially, I think, the idea here. It’s whenever possible, we attack false scarcity and that is really kind of the core of what has come to be known of a lot of conservative thinking; but even what goes by the name of liberal thinking now where you’re trying to keep power concentrated within particular hierarchies, it’s the idea that there is not enough to go around.
So we have most of it, but there’s not enough in a total sense, so you all got to fight over the rest. You got to fight over the scraps, right? And I think, ultimately, although we categorize things in terms of left and right because of where a particular set of old white dudes sat during the French revolution in the assemblies, et cetera, this is really bottom up and it kind of always has been.
And there’s a lot of divide and conquer that comes just straight out of the false notions of false scarcity. And so attacking the idea that there are a finite number of dollars in the world, that there are a finite number of jobs in the world and that we all have to scramble and beat each other’s throats for them is essential to coming across this.
I happen to think that the job guarantee is a particularly good segue into this conversation. When you’re talking with conservatives and I grew up on the US-Mexico border so, majority Latino, but lots of rank and file just working class conservatives, country, country, boys and girls and country folks, as you were indicating.
And I have never met a single one who did not agree that it should be a right that you should be able to work, that there should be a job for you if you want to work to, you know, to feed your folks and to feed yourself. I have never met anyone that fights that. The people, the kind of Republicans I meet who don’t like that are the ones that don’t wear jeans.
And, you know, they don’t ride the subway either. Those are the kind of Republicans that hate that notion. There’s a reason it has huge, huge political valence in this country because we all participate in the labor system or are alienated from the labor system and don’t get to participate in the way we want, or we have shitty jobs or whatever. People have different opinions but we’re all roped in.
So talking about the job guarantee is politically a way to get people to talk about power in a very different way. As for the intervention thing, I mean, we can walk through the history, et cetera, but I think you have to ask yourself whether it’s a natural system that the US government, which has all the guns and all the power and the constitution and the taxes, et cetera, has set up a system so that you have to go serve somebody else in order to work.
And you can’t serve your local community as a matter of right. You have to work to get the dollars to eat as MMT says, but you have to get in a subordinate relationship to somebody else unless you have a lot of property to begin with. Does that system seem natural? Do bonobos do that? Do chimpanzees do that?
Of course, you know, we work with other species, but the point is that there’s a lot of false naturalization that goes on here. And I really think that the right discourse is a way to break through that because it speaks to people on a deep level and it doesn’t come up when we talk about UBI, it doesn’t come up when we talk about robots, et cetera.
But I truly think that people across the political aisle believe in this idea that you should be able to labor and hopefully it’s equitable labor. Hopefully, you’re not discriminated against. Hopefully, it’s not so shitty with whoever your JG administrator or boss it is, but everyone should be at least be able to do that.
Like, we’re not asking for that much if, when you think about it, the ability to work and which is like a condition, maybe we don’t want to be in, in the first place, but we’re here. So can we at least all do that?
Grumbine (45:18):
Right. I want to ask, there’s an important thing that it may be the most important thing and I think it’s especially important for vote blue folks and greens alike to hear this loud and clear. There is a constant, in fact, we’ve had friends of mine, people that have been around MMT too long to be saying this anymore.
They still continue to say, we need to cut the military spending by 50% and then we can use that money to do X, Y, Z. And this is a repetitive, recurrent state of mind. It seems logical because in your home, you’re thinking, gosh, man, if I just cut out Direct TV, then maybe we can go on a vacation in a couple months, man.
So I’ll cut there to spend there. And while we may want to get rid of the military or we may want to cut it or we want to repurpose it or close bases down, whatever, there’s a very strategic reason why the money is spent into the military and it’s not just to blow things up. It’s because it’s the one funding mechanism that they’ve, everybody agrees to, that they can secretly fund throughout the country.
Hey, man, we’ll build steering wheels up in Connecticut. We’ll build that bolt down in New Mexico. We’ll build a wing over there in North Dakota, whatever. And they spread this out and this is how they flood, this is, like, the secret funding method, I think. But there’s also that belief that, well, we just got cut the military.
Maybe we want to cut the military for moral reasons because we don’t want to bomb people anymore. Maybe we want to get away from this idea of being an empire, whatever the rationale. But my question to you is, how can we break them of the belief system that we can’t spend on Medicare for all or free college or getting rid of student debt before we cut the military?
This to me is a nonstarter. It is the progressive give up strategy. It is what liberal Democrats have done forever in my entire life. That’s the thing they put out there. And it’s like, the more I know, the more I realized that’s them putting their poison pill into what they’re fighting for so that they can ensure it doesn’t come to pass. Can you talk about that for just a second?
Carrillo (47:28):
Sure thing. This is certainly omnipresent as you’ve been indicating and, you know, really my kind of short answer to this and I’ll be clear. I want to reduce military spending. I think like many of the people want to stop doing a lot of things with public money via the military, but we don’t have to as you indicated.
And it may not be the first order issue that we get to. I think, you know, again, it’s important to look at which of the things that we’re fighting for are politically motivating in and of themselves like the job guarantee and how that can swell into progressive momentum to eventually tackle the bigger, the honest problems like American military might.
And instead of focusing on, you know, the hydraulic, so to speak, idea that you can take away military funding and we need that to use it to, you know, to spend on social programs. I think that you can number one, I mean, look at the numbers which people do, of course that’s helpful. Pentagon, how do they get money? Do they go through a series of trust funds?
Do they have legislation that says, you know, we’re going to come revisit this every year in the way that we do with other social programs or does the Pentagon pull. Does it pull money rather than wait for Congress to push? Has it established itself both through the law and the cultural consciousness of eating whatever it wants.
And the answer to that is clearly yes. And you can look at that in the historical record. And I think you can, you know, you know that in the United States because you see all this military equipment coming everywhere.
You see it coming . . . Police departments are using it back in my hometown, I’m sure in other places. You know that like they have so much money that they don’t even hold onto their own weapons anymore and that’s problematic.
But another, just to suggest a way to integrate these conversations as well, so, you can, you say, you know, the military doesn’t have to ask why does the job guarantee or Medicare for All have to ask for money in that way that you’re suggesting.
But then you also say, you know, part of the reason that the military has so much buy-in is that a lot of people through their broader families, through their communities are tied to it because there are jobs because the military builds infrastructure, et cetera.
And the job guarantee and other policies that MMTers may or may not support, help pull away from that and say, we don’t need to organize production around militarization necessarily. You know, personally, I think it’s very important that my cousins and my community and, you know, other people not go halfway across the world to hurt other, you know, other folks of color.
And that’s an ongoing dynamic that’s been happening for a long time but the way I see ultimately stopping that is, you know, really confronting, confronting the money power, thinking of talking about how political economy works. And until then, we’re doing the same old dance. And you know, that dance has not worked since Vietnam. I don’t see it working in the Trump era or anytime soon.
Grumbine (50:21):
Absolutely not. Raúl, this was fantastic. I want to thank you so much. It was well worth the wait. I wanted to have you on here for a very, very long time. I think you’re an eloquent speaker. I think you’ve got a great perspective and you’re an excellent communicator. So thank you so much for joining me.
Carrillo (50:38):
Sure thing.
Grumbine (50:38):
Have a great one, everybody. Thank you. Raúl.
Ending Credits (50:46):
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