@bgawalt in 2008 i think the concern was mostly that business’ banks would fail, or for big businesses that typically borrow cash in the commercial paper market, that market might dry up, leaving them illiquid. obviously in the ensuing recession lots of businesses failed, eventually running out of assets to sell or borrow against when revenues were depressed. but the fears about deposit access and commercial paper came first.
@bgawalt (i mostly renember the fear “the atms would stop working”. which already feels anachronistic.)
@paul oh, i so fear we’ve done the opposite. if, per the Joni Mitchell song, love is touching souls, it was hard enough when you were sure the entity with which you spoke had one. now so often we just won’t know whether we are alone or not, whether when it feels like we have made contact we are just fooling ourselves or being fooled.
when you answer a phone call, there should be a button you can choose that automatically intones “this call may be recorded for quality assurance” and then does that.
(whose quality did you think they were trying to assure anyway?)
@bgawalt You don't want a public option in transfers and deposits. You want a public infrastructure for transfers and deposits that strictly replaces the private system. You have to restrict the ability of private securities to be money-like. 1/
@bgawalt Obviously, the first thing you do eliminate deposit insurance on any private liabilities after you convert existing deposits to liabilities of the Fed (in one form or another). So then anyone who tries to pile into a private "money" would understand in theory that they are not insured, their funds are at risk. 2/
@bgawalt But if you let private institutions offer money-like securities (e.g. money market mutual funds whose "shares" are always priced at a dollar but whose number increase with interest payments made from the underlying commercial paper), and you let people treat them as quasi-bank accounts, we know from experience private securities issuers will entice "investment" in large quantities of risky securities they persuade holders are just "money". 3/
@bgawalt When lots of retirees hold a product they were sure was safe money and then the bank behind it goes bust, it doesn't matter that it wasn't Federally insured. The state can't not bail it out anyway. During the 2008 crisis, policymakers had to guarantee all money-market mutual funds. 4/
@bgawalt So you need to insist on a public monopoly on money-like securities. Privately-issued securities need to be explicitly at-risk with routine price fluctuations and/or restricted in liquidity (e.g. two-day notice for redemption). Strong norms have to be set that the only safe securities are Federal securities. Regulators have to clamp down hard whenever private firms try to entice cheap financing by pretending you're not risk investing, just depositing. 5/
@bgawalt If you leave it as a "public option", you'll still have private firms looking for that subsidy, but they'll have to pay higher interest rates on their moneylike products (since they have to entice people out of the genuinely safe public option). The end result of that would simultaneously to have lots of fragile private money that can't credibly not be bailed out, and less profitable issuers more likely to go bust. 6/
@bgawalt You might *start* with a "public option" as an incremental strategy to move to the new system (though frankly it'd be better just to convert all deposits into Fed liabilities and have the Fed replace all prior deposits with its own loans, which it would wind back over time). But if you let private firms issue things that duck-type as money, and let them entice customers with good rates, you've fixed nothing. You'll have uninsured products you can't credibly not bail out. /fin
@LowlyAdjunct 70 years young!
@merz @failedLyndonLaRouchite @jgordon @DeanBaker13 Perhaps, but arguments in politics are largely about legitimacy. Profiteers profess both moral rights to profit, and extravagant claims about the necessity of their profits to innovation. If you already see through all that, sure, arguments about subsidy are superfluous. Many people do not, so emphasizing how profoundly subsidized and derivative even the best new original work is remains important.
@merz @failedLyndonLaRouchite @jgordon @DeanBaker13 (and the German government more directly subsidized BioNTech. and of course John Galt did not perform the basic research.)
do you want to argue that, bc antivaxx bad publicity, $100+ per dose is necessary in order for continued updates to pencil?
there is no innocence in pharma. it is all derivative of subsidized science. there is a policy question: what is necessary to remunerate the costs + risks of finding and making available good drugs?
@jgordon @DeanBaker13 Dean did in the piece! Absurdly, the mRNA vaccines whose development risk we almost entirely subsidized will fall into duopoly control and be priced extortionately. There are a bunch of other COVID vaccines in the world, already developed. The US government should make sure the ones that work are marketable by anyone that pleases to offer them.
@jgordon @DeanBaker13 I don't concede that drug development is insanely hard, or that there mightn't be much better ways to organize it than the subsidize-most-of-it then let last-stage developers monopolize it.
Nevertheless, that's not the proposal here. The proposal here is to use the public purse to overcome regulatory burdens to bringing already discovered drugs to market, in ways private sector coordinates not to, precisely because multiplying options destroys industry profitability.
@jgordon @DeanBaker13 (i quick edited, commercialize -> monopolize, which is what i initially intended.)
@stephenjudkins let's fix global warming yesterday. the urgency is ringing in my ears.
why must landscaping be so loud?
The government itself should run and finance US clinical trials of cheap alternatives to price-gouging patented drugs and vaccines. The taxpayer cost of the trials would be peanuts compared to the public’s savings on the drugs.
see @DeanBaker13 https://econtwitter.net/@DeanBaker13/110106851188936413
not propitious when the bbq place u r going to shares a stripmall with this.
Sign says “Simple. Easy. Affordable. Cremation”
@scottsantens perhaps people use butter in surprising ways, and substitutes just aren’t adequate.
i would like a stochastic carrot.
@stephenjudkins think about the motherfuckers getting a cut of every good or service you buy in private markets from consolidated industries. that nonprofits stylized stat is donations only, not including the services eg states pay nonprofits to provide. (but i have to track this stuff down more carefully before i’d omit that weasel-word stylized.)
@stephenjudkins if you want to feel good about the public sector, compare it to the private nonprofit sector. we pay nonprofits about as much as we pay the 50 state govts combined. which sector delivers more?
@stephenjudkins for all the real inefficiency and graft, states get roads and parks built and schools run. there is no reason why they can’t do this too.