More generally:
Universal social programmes are never paid for by tax revenues, they are paid for by government deficit spending.
I am beginning to think this simple aphorism of monetary economics is the most important cultural message we need to propagate in our lifetimes. Why? It is because there is massive popular will to collectively change the inherent injustices of market capitalism --- which leaves so many losers behind while creating a tiny handful (the proverbial one percent) of billionaire winners --- and massive popular will to reduce wealth inequality, increase general prosperity, and mitigate the effects of climate change. All such positive political projects are hindered by capitalism and aided by socialism. But the refrain from conservatives and neoliberals is, "how are you going to pay for it?" This is a stupid question. Society can decide whatever the hell it wants to do with the public purse. Governments with a sovereign fiat currency are not constrained by spending money, they are constrained only by resources and political will. Governments can print money (or electronically increment bank accounts at the Fed/Reserve Bank, at will.) The only reason governments do not issue money to spend on fixing social and environmental problems is a lack of political will.
The "debt ceiling" is a fictitious notion, and one of the most anti-social false doctrines of pseudo-responsible paternalistic neoliberalism of our times.
When politicians speak of debt ceiling they are using false notions of frugality and austerity. A debt ceiling is little more than a way to reduce the positive effects governments can have on lives of under-privileged and poor people. "The poor in your midst are My trust; guard ye My trust, and be not intent only on your own ease." (Baha'u'llah, The Hidden Words)
Note that the social democratic projects of reducing poverty, reducing inequality, and restoring the health of the environment are not actually all that resource constrained either. They are willpower constrained, and only by will. If you understand monetary economics you will see that there is no fiscal obstacle in the way of spending on a Green New Deal, on Job Guarantee programmes, on Social Welfare, and on Free healthcare and Free education. All these things can be afforded, because we already have all the resources: we have the teacher, the physicians and nurses, the engineers and builders, the unemployed looking for work, and the blueprints for green energy. There are no monetary or material obstacles to these social programmes. If the proper political willpower can be mustered, then the only obstacle in practise would be a lack of people needed to run these social programmes. But there is no danger at present of a lack of qualified people.
The only obstacle is the fictional notion that government deficits are a bad thing. Well, our response is: no they are not! Government deficits are good (in general). Every dollar the government leaves in the economy, rather than taxing back out of the economy, is food and fuel for the private economic circulation system and for households.
Government deficit = private surplus.
This is another aphorism which desperately needs to be spread as a powerful meme for our times. We have gone on far too long down the neoliberal road of wage slavery and indebtedness of generations to afford to keep up the facade of irresponsible foolishness that governments need to save like households. They do not! Governments never need to save money because they can issue money at will, and so can never go into proper debt. What does the deficit mean then? It is nothing more than an historical number, a ledger, keeping note of how over the course of history so much money has net been pumped into the economy.
Government deficit is good, household deficit is bad. And they are two sides of the same coin.
Here is a terrific summary of this aphorism and more, by Professor Stephanie Kelton, which every informed citizen should know:
Without government pumping currency into the economy people would have no way of paying taxes. You cannot pay taxes with gold or diamonds or yachts. Thus, taxes are why the currency is valuable (and why Bitcoin has no inherent tax-worthy value, and so is not a proper currency). Bitcoin is only valuable if you can convert it into dollars to pay your taxes (or if someone demands bitcoin from you as a cyber-ransom).
If the government deficit ever becomes negative (a government surplus) then we (households) would really be in serious trouble, because there would then likely not be enough fiat currency in circulation for all of us to pay our taxes, and so then we would need to take out credit. Credit is what drives indebtedness and eventually recessions. We need government deficit spending in order to avoid financial recessions. This is another aphorism for our economic times:
Government deficits are good. Deficit spending is how we avoid household debt and avoid recessions.
which should come with an associated aphorism:
Government deficits can help avoid recessions, but they do not fix other problems with capitalism, such as systematic growth of inequality and anti-democracy.
The most critical area of life where we have almost zero democracy is the place we spend over 50% of our time: the workplace. This leads to another twin pair of aphorisms:
Workplace democracy is possible only when there are no bosses.
When workers own their place of business and choose their managers, this leads to workplace democracy.
which should be complemented with an aphorism on why workplace democracy is good:
We need workplace democracy for justice and for sound economic sense,
that is because an anti-democratic (capitalist) workplace invariably funnels the surplus value of worker labour up to a wealthy few, which leads to social instability and wider imbalances in justice and opportunity.
If you want to learn more about workplace democracy, visit and subscribe to the channel Democracy At Work
On Winners and Losers
You only need to read Nassim Taleb's Fooled By Randomness to learn that rich folks almost never become wealthy by being smart or having great skill millions, or even only tens, of times more skilful than the average person. They become wealthy mostly by dumb luck or inheritance.
It was while dipping into Taleb's book of Aphorism that I decided to come up with a few counterpoint aphorisms. Some of which I have already written above. I think Taleb, although brilliant, is too cynical to be a great force for good. Nassim Taleb is a great force for encouraging critical thinking and avoiding stupidity, and in advocating ways to work around your emotions and engage slower more contemplative corrective critical thinking. But he is too cynical to see that his own scepticism is corrosive. When you refuse to see purpose and meaning when there is in fact hidden purpose and meaning you are missing out on the greatest gift human begins have, which is our mind's ability to comprehend abstractions. That said, I have enormous respect for Taleb and his wariness of nerdery, wonkishness and platitudes.
So it is hilarious to me that to many of Taleb's aphorism smack of trite platitudes (see "Additional Aphorisms, Rules, and Heuristics (Added to the Incerto)", by Nassim Nicholas Taleb"). I'd like to have a go at writing a few anti-Taleb aphorisms. Aphorism for the hopeful and the not-too-cynical. I regard these as not contrary to Taleb's collection of aphorisms, but rather a corrective tonic. I guess my first Anti-Taleb aphorism would be:
A good aphorism is not so perfectly true that it is a tautology, but contains a sufficient grain of truth to be useful.
I will continue with these anti-Talebisms in later posts as I see fit, but one more which I want to write for today is a counterpoint to Taleb's cynicism about the trite aphorism "Keep It Simple Stupid". I grant he is correct to be wary of oversimplification, which is often a mask for stupidity, or lack of imagination, or deceit. But what I like in counterpoint to Taleb is this one (which is a paraphrase of Einstein's remark on scientific theories):
Keep it simple, but no simpler than necessary to convey the truth.
This is complemented by:
Always admit more complexity, but only up until complexity hides the truth.
I know what you are thinking: who defines "truth"? The cynic would argue truth is relative, and all ethics and moralizing is dub, or even dangerous. But that would be itself a false picture of reality. The truth is that morals, ethics, and spirituality have always guided people on the path of good. What we wish to avoid is excessive sanctimonious self-interested pseudo-moralizing. This is where Taleb again goes wrong. He claims to "hate moralizers". I think he is guilty here of oversimplifying. For sure, moralizing rhetoric is bad, very bad, if done for non-spiritual motives. But healthy ethical and moral thinking has always been part of overcoming our baser emotions and part of rational critical thinking.
Spiritually motived moral thought is a force for good, almost by definition. The trouble we have is in identifying when moral analysis is good and separating it from the empty sanctimonious corrosive moralizing that takes place in private boardrooms and senseless socially corrosive Twitter feuds and the like.
When you see someone poor and destitute, you know that something is not good. That is a healthy moral observation. It might be incumbent upon you, if you have means, to inquire into why that person is not faring well, and help them. But a bad type of moralizing would be to ignore them and dismiss their plight as some sort of karmic retribution for their presumed past crimes or failings. The cousine of this bad moralizing is the way most wealthy people justify their wealth and status as "earned" and "just reward" for their innate virtue. There is rarely a case where such self-righteousness is justified or even vaguely accurate. Most wealthy people have gained their wealth either directly or indirectly by exploiting other people. That is a morally good and correct observation by most accounts.
Unfortunately (or I like to think fortunately, since it leaves us room to grow and explore the wonders of the Mindscape) it is impossible, I think, for anyone to have a sound decision procedure for separating good moralizing from bad moralizing. And "Truth" is never perfectly attainable. Our great fortune and saving grace is that we, through critical thinking bound to spiritual motives, are able to sensibly discern good from bad, healthy morals from cynical use of moralizing, and we are able to discern for ourselves partial truths from among the dross and jetsam of deceitful lies, veiled truths, and fabrications. This leads to my last triplet of aphorisms for today:
Truth and Good are impossible to know, but can be arbitrarily closely approached through will, knowledge and humility.
Moral thought is our highest form of thought, and our lowest form of debasement when corrupted for selfish ends.