Hey, Mr. Evans. I always read your posts. Through them my understanding of MMT has greatly advanced, in particular how it could be used to solve the problems of unemployment and poverty.

As you noted in this post, that would require a very progressive tax structure, lest the taxes that are a necessary part of the process consume the people who are not part of the investor class. Politically, that presents two problems. One is the need to educate people about MMT. The other is to get such a tax regime implemented.

For the life of me, I cannot understand why you, of all people, will not accept my idea of a “democratically distributed income” (or, more neutrally, “allotted income”). Money would be created as needed for that income (same principle as MMT). The total of that created-as-needed money would be the supply of money (as currency) for the economy (same as MMT). [Extensions of credit by banks would continue as at present.] Money would also be created as needed to fund government (same as MMT — but at all levels, not just the central government).

Supplying money for the economy would not, however, involve the creation of debt instruments. Not only would unemployment and poverty be eliminated, but so would the need for public debt/taxes. That should make this proposal politically more viable. (The investor class would suffer some losses in opportunity, but eliminating taxes and redistribution would cut the legs out from under them and their apologists politically.)

To prevent inflation money would have to be returned to its point of origin, but people and businesses would retain plenty of money (proportional to income/revenue), and, unlike taxes, no money would be collected from any person or business before it could be used for purchases or investment. To have money collected, an individual would literally have to be making more money than one could possibly expend, including speculative purchases — beyond the amount retained! [There would presumably be humongous bubbles in speculative instruments, but if mere speculation in currency, commodities, and real estate were to be duly restricted those bubbles would be macroeconomically benign; such restrictions and the presence of that income-as-supply-of-money would make the economy essentially bullet-proof.]

The monetary system and the economy as a whole would be self-regulating. Since the whole thing would be governed, passively but effectively, by demographics, sustainability would be increased (even without more regulations and without requiring any changes in individuals’ behavior).

If you see a fatal flaw in there, you would be doing me a favor by telling me about it. I would drop this and shift my focus to other things.

This idea needs advocates. One thing I have learned is that, for some reason, for people to learn of a new idea from its unknown, unvalidated author seems to make it impossible for people to accept it and advocate for it. (Perhaps you are experiencing that same phenomenon.)