Chaplin’s Modern Times: Pretty Pro-Communist (Essay)

How awful the thought of oneness… One merging into all and all merging into one. Just think of merging into Herbert Hoover.

-Charlie Chaplin

In 1952, facing harassment from J. Edgar Hoover’s FBI, Charlie Chaplin left the United States and moved to Switzerland. Chaplin shared personal tragedy with thousands of suspected communists across American society, swept up in the blacklists and persecutions of the McCarthy era. Perhaps more so than many of the “subversives” whose nonidentity with white middle class culture earned them the communist label, Chaplin’s social criticism really did take on the monopoly capitalism of his day. It’s not difficult to read Marxist themes into Chaplin’s slapstick depictions of Taylorism and “scientific management” in Modern Times (1936). But to honor the creativity of Chaplin, it is important not to conflate his respectful willingness to think alongside Marxist problems with a dogmatic commitment to thinking exclusively within them. 

Charlie Chaplin’s Modern Times is an ambiguous meditation on the political economy of his day. Though Modern Times speaks most recognizably through a Marxist lens, it gestures beyond Marx in its ambivalent depictions of the social roles played simultaneously by various institutions. While Chaplin’s “Tramp” is dehumanized by the factory’s reduction of his individuality to an appendage of private profit, his work advances the narrative in ways that outstrip profit.

At points, Modern Times does feel like a dramatization of Marx’s descriptions of capitalist industry in the Communist Manifesto. In the first part of the Manifesto, Marx writes that the modern factory worker “becomes an appendage of the machine, and it is only the most simple, most monotonous, and most easily acquired knack, that is required of him.” Marx describes this enslavement of men to machines as “alienation,” in the sense that their labor becomes directed towards alien ends rather than their own. Chaplin portrays this zero-sum formulation to comic effect in the opening factory sequences, in which The Tramp disastrously switches his attention back and forth between the assembly line and his coworkers, losing track of both.

However, this Marxist formulation is complicated and undermined at the level of narrative. Even as this opening scene manifestly depicts a contradiction between The Tramp’s labor and attention serving his own ends and those of capital, both cohere narratively in maintenance of the society more broadly. Events outside of the factory—on the street, at home, and in prison—work in tandem with those inside the factory to produce a narrative that contains each of these settings. While prison seems to serve the capitalist class structurally as an institution to discipline troublemakers before they are sent back to the factory, The Tramp also finds that within prison he is self-directed. This is played for laughs, but the irony of prison being a place for self-directed behavior belies a paradox of Marx’s critique of alienation: that self-directed collectives require institutional mediation beyond their immanent boundaries.

Of course, Marx would be the first to admit that factories rely on other parts of society for maintenance and reinforcement. “No sooner is the exploitation of the laborer by the manufacturer, so far, at an end, that he received his wages in cash,” Marx writes, “than he is set upon by other portions of the bourgeoisie, the landlord, the shopkeeper, the pawnbroker, etc.” While Marx here is allowing for events beyond the factory to be socially meaningful, the social whole in which they cohere is conflated with the social goals of the bourgeoisie. And to be sure, Modern Times does clearly critique the prison and the factory for working in tandem. But contra Marx, it does not necessarily follow from the film’s critique of wage labor that every institution under capitalism serves capital as its ultimate end.

We see a similar polyvalence in the café that The Tramp and his love interest (“the Gamin”) work at, where management’s discipline of the employees does not fully define the terms by which the café can be engaged. The Tramp’s job in the café is waiting tables, and at first this seems to resemble his stints at the factory, in which he is unable to conform his body to the rhythm and pace of work. This seems to culminate in a diner’s roast duck being thrown across the room, but at the moment that this happens, it is caught by a group of athletes and the scene breaks into a performance of a rugby chase that destabilizes the clear division between diners and servers. The diners are folded into a theatrical production, not as a negation of their respective class positions, but as a social valence that was always there to be read.

Later, when The Tramp loses the lyrics to the song he is supposed to perform, he makes up his own song that wins over the audience. Unlike in the factory, The Tramp’s creativity and deviations here are rewarded. The café offers many analogs of social mediation at once, insofar as its social valuation is figured as multidirectional and polyvalent. Whether The Tramp’s mimetic creativity is allowed is a social decision that implicates more than just management. The diners, wait staff, and management are responsible in different ways for the social meaning of The Tramp’s performance. 

Leftists today who are anxious to unify around a single mass organization or “theory of change” would do well to study Chaplin’s non-identical engagements with the problems and themes of Marxism. At a 1942 dinner held in Chaplin’s honor, Chaplin frustrated an FBI informant in the audience with this exact maneuver. “I am not a Communist,” Chaplin declared, “but I am proud to say that I feel pretty pro-Communist.”

Modern Monetary Theory and The Trans Agenda (Essay)

By Nia Cola

To be trans today is to be treated as a political agent at all times, but afforded no  substantive political agency. Everything you do is scrutinized, as your right to exist remains under constant review. In response, trans liberation means actualizing authentic ways of being, without waiting for the sovereign judgment of cis society. The question of how to achieve this will always be open-ended and multi-faceted. Whatever our focus, however, trans liberation requires a gender framework that expands the present bounds of possibility, in excess of the limited forms of life that have been previously afforded space. Modern Monetary Theory (MMT) gives us just that framework. 

MMT allows space for limitless social rearticulation through public spending and employment. In positing money as an infinite public resource, MMT provides a viable counter-narrative to dominant theories of “commodity money,” which account for human differences as economic costs and potential liabilities when it comes to building a mass political base. And while the prevailing economics casts money as an unproductive and symbolic veil over finite resources, MMT’s insistence on money’s active role in directing production allows us to see the affordance of difference as a policy variable. MMT also serves as a powerful analogue for the trans struggle against what could be called “sound gender” ideology—the assertion of a strictly material gender reality that the introduction of new pronouns can only debase. 

Grounded in such materialist reductionism, the stigmatization of trans people is implicit in the hegemonic gender binary system, which is part and parcel of colonial systems of knowledge and control. The patriarchal family, as an “independent” driver of social reproduction, stands in for the Western nation-state’s self image as necessarily profit-seeking and extractive. And Western anxieties about queer and trans forms of life allegedly “replacing” traditional lifestyles are in some ways a projection of the West’s own justification for settler-colonialism, whereby the existence of colonizers required the genocidal “replacement” of indigenous populations.

The sweeping social identities that Western thought derives from the ideology of biological dimorphism, however, are by no means universal. Despite sexual dimorphism, not all cultures have held to a strictly binary view of gender. There are, in fact, many ways for sexual reproduction to be folded into social reproduction, and so the supposedly “practical” and “material” bases of gender identity are in fact socially constructed and essentially contestable. What is more, because the archetypal reproductive household is socially constructed, the very fact of trans existence holds open space for rearticulation and reconfiguration. Trans existence, in other words, belies the falseness of cis society’s claims about itself. If trans existence is so destabilizing, what we’re dealing with are the symptoms of repressed truths about gender—namely, that there are no fixed truths. 

A rigid gender binary restricts individuals from acting outside of a narrow scope of social norms and becomes the basis for social and economic exclusions predicated on one’s performance of gender. While there is nothing evil about trying on binary gender roles, the politics of performance must be self-consciously nested in a contingent and playful non-binary spectrum. This essential space to play and experiment with gender cannot be conceived merely as escaping coercion. It demands ongoing cultivation and maintenance by way of an MMT-based political economic “agenda” that aims to secure trans agency in myriad urgent ways.

The Trans Agenda

As a function of a repressive cis gender binary regime, trans people must daily confront tremendous hardships and challenges. They face extraordinarily high rates of unemployment, for example, often recorded at around three to four times the rate for cis people. Trans persons also suffer from meager wages, lower levels of college attainment on average, and extremely high rates of poverty. Due to social and institutional discrimination, a large proportion of trans people are involved in the Sex Work (SW) industry. The criminalization and stigmatization of this precarious line of work exposes trans people to high degrees of financial and bodily risk, contributing greatly to the high rates of violence perpetrated against the trans community. 

For this reason, decriminalizing SW is an essential part of any trans liberation agenda. It is undeniable, however, that a significant portion of trans participation in SW is tied to discrimination elsewhere, and so justice for trans sex workers cannot be taken in isolation. If trans people are going to achieve liberation, it will mean provisioning lives we want to lead—including those of us who happily participate in SW. 

The issue of discrimination at the point of access to social goods can be viewed as a matter of equal protection under the law, and for this the solution is simple: pass statutes that make it illegal to discriminate on the basis of gender identity. While this is of course a long Civil Rights fight, a good start would be passing the Equality Act, which would immediately alleviate explicit discrimination as a concern by making it illegal at the federal level. The Equality Act was passed by the House for the second time on February 25, 2021 and is awaiting a vote in the Senate. 

Still, the trans agenda must go further. A comprehensive policy platform could fill a tome, of course, and it would be good to develop such an agenda in the future. Here, however, I would like to focus on two key policies–a Federal Job Guarantee (FJG) and, below, Medicare for All–which are only realizable if we embrace the radical implications of MMT. 

The MMT lens implores us to look at the world in an expansive and generative way, rejecting binary and zero-sum thinking at the level of fiscal provisioning. The fundamental insight of MMT is that money is not a private commodity that must be taken from the market via taxation in order to fund the public sector. To the contrary, governments create money to finance their operations, and taxation is simply one tool among many to manage the shape and distribution of monetary demand (as well as ensure a common denomination. Money’s role in mediating access to and participation in social provisioning is a limitless public resource, which can be used however we want and across any time horizon. 

For this reason, the monetary agency of the Federal government to name and finance public priorities can be mobilized at any time to create a public option for employment. If designed and fought for as a fully inclusive and trans affirming program, a FJG would not only establish a wage-and-benefits floor for the entire economy and begin to challenge and change the social meaning of work. It would also create an inalienable foundation to both support and further facilitate trans liberation, while buttressing trans resilience against hostile employment authorities. 

Building a trans positive FJG, meanwhile, would build union power by diversifying and expanding the traditional white cis culture of union membership. As a unionized public works system, the FJG will no doubt irreversibly alter the balance of power between unions and employers throughout the economy. Yet while unions have in the past proven to be crucial countervailing forces against employers, traditional unions are far from perfect and insufficient on their own. Indeed, even in their heyday, large unions predominantly shaped and supported a repressive and exclusionary mid-center social order. 

A diversified FJG union, by contrast, will not merely boster trans life. It would also strengthen the bargaining power of public and private unions alike by preventing them from holding minority groups hostage to exclusionary majorities, or even corrupt alliances with management. A FJG union, moreover, would allow workers to refuse to work in striking sectors, providing an expansive foundation for industrial solidarity that transcends the false opposition between living for one’s self and living for one’s class. 

Too Many Pronouns Chasing Too Few Genders?

As with any expansion of government spending, the standard objection leveled against the FJG is that it will cause runaway inflation. Behind this explicit argument looms an implicit and quite violent social implication: If paying everyone to work increases the rate of inflation, as might be alleged by mainstream economists, the implication is that some of those people are being paid above what they’re worth. Or to paraphrase the economists, it is too many dollars chasing too few socially legitimate goods. Setting aside other critiques of mainstream economics, this is a startling statement about the value of the work of women, queer people, and people of color. It’s a declaration that we are not capable of producing work valuable enough to justify a living wage.

If one outright rejects the possibility that marginalized people can make social contributions that justify a living wage, then it follows that they either should live off the goodwill of “the productive” through redistributive policies, or that they don’t deserve to live at all. While few people will state the latter openly, the former view is highly patronizing and built to fail under pressure. Buttressed by such toxic logics, the work of marginalized communities has therefore long been under-valued, and the expectation that their employment will result in inflation reflects this legacy. 

Perhaps unsurprisingly, the inflation bogeyman is also wielded against trans people through opposition to trans healthcare. Medical interventions allow trans people to assimilate into cis society to the extent that they desire, or equally to challenge the gendered expectations that are hurting them in the first place. We can hear echoes of the inflation panic about illegitimate jobs in objections to trans inclusion in universal healthcare policies such as Medicare for All. According to this reactionary logic, gender affirming care is superfluous and cosmetic rather than “material” in some fundamental sense. The suggestion that there is a tradeoff between trans and universal healthcare implies that provisioning healthcare services for trans people is beyond the capacity of our economy to manage. But this is a demonstrably false statement. The expansion of trans healthcare would likely be a one-off event in terms of increased capacity needs. 

It is reasonable to expect the amount of trans people who would need to be served would increase as stigma falls, more people decide to transition, and healthcare provisions become more available; however, there is scarce evidence that provisioning such a future is somehow beyond our economy’s ability to adapt to these increased needs. It can be hard to shake the feeling that many of these detractors are opposed to trans healthcare not because they genuinely believe in a resource constraint, but simply because they do not wish to see trans people exist in public life. 

Queering Money

To guarantee adequate jobs and healthcare to trans people—and build coalitions around such struggles—we need a fundamental shift in thinking when it comes to government budgeting. When money is imagined as fundamentally scarce, social change is routed through the problematic language of redistribution and replacement rather than creation. This in turn creates an “any port in the storm” mentality when it comes to building coalitions, as the variegated experiences of trans people are reduced to a representative “average” trans person who can be more simplistically advocated for. And as we see, the impulse to reduce and assimilate what is particular into what is imagined as universal for the sake of “widening the coalition” is observable in class reductionist calls to not discuss trans healthcare at all, in favor of supposedly “universal” healthcare services.

MMT, by contrast, provides a different foundation that allows us to articulate a comprehensive trans agenda on generative rather than zero sum terms. In the MMT story, when public money is motivated toward some end, fiscal authorities create it. Because money is created rather than found, spending precedes rather than follows taxation. Creation does not need to be “paid for” by destruction, and the trans agenda does not need to be routed through such zero sum logics. Money creation authorizes public job creation at the same time that it authorizes private purchasing power.

In the dominant economic view, money creation is inflationary because it is imagined as abstract bids on fundamentally scarce goods. In contradistinction to this view, MMT sees public spending, not as subtracting from a fixed pool of public resources, but instead directing its expansion. This is because, as any heterodox economist will tell you, resources are as socially constructed as gender. The flow of inputs at every point of production is linked to the flow of outputs at another. Capacity is therefore created rather than given, and when the government invests properly it can create new capacity over time.

The policies discussed above are possible only with an MMT framework that speaks in the register of rights and guarantees, rather than goals and aspirations. A FJG will require large variations in spending, and any method of ‘paying for’ the program would have to be just as flexible. And while Medicare for All would likely entail more stable spending patterns, it’s too great a budget item to tie to taxation, dollar for dollar. The last thing we need is policy that analogizes gender affirming healthcare services to zero sum redistribution. A proper budget in an MMT framework would deliberately target resource bottlenecks and invest in expanding production where necessary. 

If properly wielded and understood, public money harbors radical potential to reshape society for the better. These two policies would vastly improve life for trans people, but there is no final word in what makes the trans agenda, any more than there is a final word in what makes a trans person. It is imperative, however, to go big. Putting a Federal Job Guarantee and Medicare for All into action for this trans agenda would be a great start.

* “Money” by free pictures of money is licensed with CC BY 2.0. To view a copy of this license, visit

The Mark of Fascism: Lebensraum for the Left (Essay)

By Maxximilian Seijo & Scott Ferguson

A thought that stands outside subjectivity, setting its limits as though from without, articulating its end, making its dispersion shine forth, taking in only its invincible absence; and that, at the same time, stands at the threshold of all positivity, not in order to grasp its foundation or justification but in order to regain the space of its unfolding, the void serving as its site, the distance in which it is constituted and into which its immediate certainties slip the moment they are glimpsed—a thought that, in relation to the interiority of our philosophical reflection and the positivity of our knowledge, constitutes what in a phrase we might call “the thought of the outside.”

Michel Foucault, Maurice Blanchot: The Thought from Outside

Anti-fascism has always been central to critical theory. Yet in resisting fascism, critical theorists have too readily taken fascist projects at their word. When fascism asserts itself within a polity, for instance, or imposes order on another community, it posits territorial rule over and against what is tacitly framed as an external and pre-political commons. Crucially, such a commons is imagined to exist beyond any particular territory, somehow belonging to no one and everyone at once. From this initial commons, fascism decides who is permitted to exist inside the ethno-nationalist state and who must be pushed out. The very act of exclusion, then, strategically defines the ethno-nationalist state at the same time as it shores up its legitimacy.

One finds critiques of this formulation in numerous works, including those by the likes of Walter Benjamin, Siegfried Kracauer, Gilles Deleuze, and Giorgio Agamben, and others. All of these authors opt variously to counter fascist territorialization with a version of what Deleuze and Félix Guattari call a logic of “deterritorialization.” Deterritorialization seeks to undo fascism’s expulsive territoriality so as to carve out extra-territorial room for life. Such seemingly critical gestures are right to contest territorialization. We will argue, however, that they err by problematically repeating, even romanticizing, the appeal to a pre-political commons that drives fascist logics in the first instance. In this brief essay, we wish to not only challenge metaphysical appeals to a pre-political commons, but also set forth a far more capacious and anthropologically-grounded critique of fascist territoriality.

It is instructive to return to one of the relatively unknown architects of fascist theory, the Nazi linguist Jost Trier. An important influence on both Martin Heidegger and Carl Schmitt, Trier argued that the origin of politics must be postulated through the question of terrain and the central problem of what he terms the “fence.” As he intones, “The fence marks the beginning. Deep and thoroughly defining, the fence, the border, nurtures [Hegung] the world formed by humans.” For Trier, the fence does more than establish a territory. It demarcates the political as such. And the political, on Trier’s reasoning, is nothing other than the function of an inherently exclusionary care.

Construed as a line of division inscribed on a blank slate, such logics borrow from Rene Descartes’ planar geometry, Thomas Hobbes’s state of nature, and John Locke’s extension of such logics to theorize the origins of the human psyche as a tabula rasa. Reducing the political to a foundational enclosure, Trier relies upon and gives voice to the metaphysical bedrock of modern Liberalism and its justifications for the private seizure of common forests, fields and waters in early modern England. Yet he also radicalizes Liberal metaphysics, carrying their suppositions to their implied logical and political ends. As a result, he reads the relationship between inside and outside through a univocal prism of absolute opposition.

In order to undo this violence, the critics we mention above respond to Liberalism and fascism alike by attempting to reclaim an original, external commons, which supposedly precedes and exceeds enclosure. Critics affirm “lines of flight,” to again borrow from Deleuze and Guattari, which would seem to defy and escape any sovereign interior. Against the univocal violence of enclosure, then, they picture a pre-political commonality or commons, where humanity and nature exist together in open and unbounded relations teeming with repressed social and ecological potential. In place of enclosure, modern critics construct a politics of exteriority and difference, which frequently appears to mirror, or simply invert, the absolutism of their fascist interlocutors. In the face of fascist efforts to secure a passive environment for a chosen people, these critics call upon a pre- and, in certain iterations, post-political commons to accomplish something disturbingly similar. As a consequence, such critics often naturalize the ontological core of fascistic violence and let Liberalism’s comparatively mild operations too easily off the hook. 

We in the Money on the Left Editorial Collective begin from wholly different premises. Rejecting the ontological exclusion of the fence, we regard the political and, with it, money as an originary multi-scale interdependence. In this way, we turn the entire edifice of Western political philosophy outside-in. Proceeding from heterogeneous institutions and forms of decision making that know no absolute exteriority, we refuse the figure of the fence as politically constitutive, as well as the illusory commons upon which it is based. Demarcations of course differentiate social and material relations in meaningful ways. But any demarcation, we contend, remains forever nested within and relative to broader domains of social and ecological mediation. Put another way, demarcation can never be said to intervene in an untrammeled or pre-political field free from integrated social coordinations and meanings. Eschewing an absolute commons or state of nature, we maintain that there is no legible or legitimate outside to the problem of mediating social and ecological dependence, no matter which side of demarcation one considers.

Crucially, such inclusivity is decidedly not spatialized, or at least not in any Cartesian sense that would imply linear partitions over an infinitely extended plane. Inclusion is instead a qualitative relation interior to infinitude, which relies on overlapping and vastly different proximities to particular centers of mediation and indicates no unaffected outside. Particulars necessarily participate in this ubiquitous inside which, despite their irregular differentiations, nevertheless manages to reach all. As such, the “externalities” and “marginalities” that so flummox neoclassical economists and delight continental philosophers endure always-already inside a broader human and ecological condition, even and especially when it comes to apparatuses of expulsion.

For this reason, Liberalism and ultimately, fascism fail in positing as origin the opposition between fence and commons. In contradistinction to Siegfried Kracauer’s self-conception as “extraterritorial,” what we have elsewhere called the inextricable “intraterritoriality” of existence undermines the modern metaphysics of expulsion. The failure of fascist demarcation to fully externalize those who it identifies as enemies does not, to be sure, make such regimes any less brutal. On our reading, it doubles their brutality, secreting away a clandestine ontological violence under cover of the manifest horrors of genocide. Fascism’s overt violence of course owes to its destructive practices, which perpetuate psychic and social terror in the name of an impossible, pure interiority. Yet what has hitherto been overlooked by fascism’s most trenchant critics is Western modernity’s violent externalization of naming, which surreptitiously legitimizes fascism’s spectacular failures. This violence does not derive, as critical theorists regularly argue, from the supposed imposition of nominalization on reality. It arises, instead, from the metaphysical delusion that nominalization penetrates Being from the outside.

Repudiating an absolute inside and outside, our claim is that designation and, specifically, designation through money always involves contestable analogies. Analogies are nothing but patterns of dynamic relation, entailing diverse spheres of obligation and need. On this view, analogies may partake of homology or likeness, but cannot be reduced to isomorphic sameness. Presuming a shared interiority, analogies forge difference within sameness, with sameness in this case understood as the heterogenous background of Being as such. Analogies at once disclose and shape not only power and its ongoing problematics, but also interdependence and the ongoing difficulties of care. They do so, not from some Archimedean point of mastery, but rather through partial and participatory articulations of nested relationality.

We draw regularly on chartalism and related traditions to show that the analogical conditions of moneyness represent a relative constant throughout much of human history, despite great variations in social and material life that comprise said moneyness. Diverse, multiple, and ubiquitously visible, such histories demonstrate that the conditions of moneyness are as generalizable as they are particular. They also harbor endless lessons for anti-fascist politics.

Take historian Robert Gates indispensable insights into Weimar-era struggle over the nature of money and its political capacities. While Germany’s Free Trade Unions supported a program of massive public works funded by direct public money creation, the Marxist leaders of the Social Democratic Party (SPD) such as Rudolf Hilferding rejected the program as unrealistic and “un-Marxist.” Preparing for a nationalization program projected into some indefinite future, SPD Marxists actively worsened the catastrophe by calling on the party to permit the ensuing economic crisis and joblessness to run its allegedly natural course. Although certainly not solely responsible for the subsequent nightmare, they nevertheless unwittingly assisted in hastening fascist scapegoating of Jews and other minorities along with the meteoric rise to power of a once-beleaguered Nazi party.

Unexplored by Gates, SPD’s disastrous incapacity to approach monetary mediation otherwise relies upon a tacit externalization of inscription. According to the SPD’s logic, the capitalist mode of production and its countless contradictions appeared to operate as a univocal imposition of private property onto unbounded nature. In the face of private property’s total imposition, the SPD could only concoct an antithetical, yet equally univocal project of nationalization that would socialize private industry as part of an eventual dialectical movement toward what the young Marx once referred to as “lower-stage communism.” Far from effectively combating fascism, however, the SPD reified the metaphysical exteriority upon which fascism thrives. The result not only deepened a political and economic calamity the Nazis could exploit, but also paved the way for fascism to wield state money as a weapon of exclusionary uplift and mass extermination. 

Hardly isomorphic to present conditions in and beyond The United States, the work of revealing such historical possibilities and blind spots nonetheless offer haunting analogies for the fallout of persistent neoliberal austerity and the resurgent ferocity of ethno-nationalist violence. And yet, there is still so much more work to be done.

We need historians across disciplines and fields to assist us in tracing the possibilities and limits of the many analogous human attempts to thematize our inalienable dependence on monetary mediation in myriad and unpredictable forms. Through this expressly analogical practice, historians can enable us to envision money’s previously untapped potentials, as well as expose reactionary logics and practices we wish to avoid and struggle against. In doing so, the critical historian must prioritize the vast and heterogenous interiority of monetary inscription, while jettisoning the fascist mirage of exteriority that the Nazis notoriously hailed as “living room,” or Lebensraum.

Long held at arms-length by leftists as a noxious fiction belonging to the far right, the lure of Lebensraum in actuality looms as a powerful temptation for critical theorists as well. Echoing Michel Foucault’s meditation on Maurice Blanchot’s “thought from outside” quoted above, contemporary art critic and media theorist Boris Groys, for example, recently published an avowedly leftist ode to Western philosophy’s dream of immanent exteriority in the journal e-flux. Groys aches for the philosopher’s historic “meta-position” in a non-locatable elsewhere, criticizing the “politics of inclusion” as a form of univocal domination that miserably abets “a comfortable life of consumption.”

“[A] politics of inclusion,” Groys explains, “which presupposes the improvement of the living conditions of the excluded, is precisely directed towards the elimination of the meta-position that is occupied by the excluded. The politics of total inclusion aims to get rid of the space outside of society, to eliminate any external, potentially critical position towards society as a whole. This politics calls for everybody to play by the same rules, to obey the same laws, to pursue the same goals, to be seen and treated like everybody else and to see and treat everybody else in the same way.” Later, he surmises, “The truth is always on the side of the excluded. To recognize the excluded means not to include the excluded, but precisely to recognize this truth—to accept the dignity of the slave by rejecting all property and working hard (Christianity), or to accept the dictatorship of the proletariat (communism). It would not make sense to give a saint or a revolutionary a regular income and a comfortable life of consumption.”

Although he would surely bridle at the accusation, Groys in this piece seems to pine for a kind of living space, or Lebensraum, for the left. Such a realm, to Groys’s mind, would align free-thinking philosophers with the dejected. It would also furnish philosophy with a critical vantage point from which to evaluate society in its existing totality.

As enticing and, perhaps, well-intended as these twisted judgements may be, in truth Groys’s conclusions only further entrench the mark of fascism in the guise of its apparent opposite. Equating inclusion with punishing sameness and transformation with capitalist expansion, such reasoning explicitly flattens the path to justice to an impoverished common denominator born of subjugation. Dignifying the externality of slavery, propertylessness, and a dictatorial party, Groys’s left utopia looks just as univocal as his characterization of capitalist dystopia. Implicitly, moreover, Groys belittles, if not outright forecloses, profound political movements that confront money and mediation head on. Abolitionism or the Black Freedom Struggle for full employment, from this contorted purview, are predestined to conformist complicity.

The allure of what we are calling a left Lebensraum is a fascist trap that critical praxis must abjure. There is no place external to interdependence. Politics are never univocal. And neither care nor critique are micro-level affairs. Only by circumventing the false appeals of “thought from outside” can we begin to radically reconstruct the world we actually inhabit.

Introduction to Theory: Karl Marx

In this podcast, Scott Ferguson presents an introduction to key theoretical writings by Karl Marx: Economic & Philosophical Manuscripts of 1844Manifesto of the Communist Party; and Capital, Volume 1. Drawn from a semester-long university course titled “Theory for Film & Media Studies,” the recorded lecture takes up three distinct texts in order explore continuities and divergences in Marx’s complex contributions to modern thought and politics. Framed as an advanced introduction that is hardly exhaustive, Ferguson’s lecture strives to orient students to Marx’s contested historical significance and to model forms of situated close reading that resist reductionism.

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Radical Heterodoxies & Parallel Institutions w/ Mat Forstater

Mat Forstater joins Money on the Left to discuss the origins of Modern Monetary Theory (MMT), the vicissitudes of heterodox economics, and the challenges of building alternative institutions in and beyond the academy. As one of the principal architects of MMT, as well as teacher and advisor to many of the more recognized MMT scholars and advocates today, Forstater is perhaps the best equipped heterodox economist to give us the details on the innovative assumptions and arguments that created the firmament for what we now know as Modern Monetary Theory. More importantly, how Forstater came to shape the project greatly defamiliarizes popular assumptions about MMT, which tend to reduce what is in truth a rich intellectual and political movement to a narrow and technocratic set of truisms and just-so stories. From experimental poetry and Black political economy to the problems of futurity and invention, Forstater’s circuitous path reveals MMT’s origins to be far more interdisciplinary and heterogeneous than it is often understood to be by opponents and advocates alike.

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Music by Nahneen Kula:

William Saas: Matt Forstater, welcome to Money on the Left.

Mathew Forstater: Thank you. It’s great to be here.

William Saas: It’s so wonderful to have you finally with us. To get us started, we’d like to ask a bit about your professional and personal backgrounds and how they kind of end up leading our guests to what they became. Can you do that for us and tell us how you came to be involved with heterodox economics, maybe what brought you down that path, and what maybe influenced you the most along the way?

Mathew Forstater: So I guess, at some distance, I can say that I was something of an unusual kid. I was a big reader growing up, and I was very interested in Black history in elementary schools, finding books about Martin Luther King, Harriet Tubman, whatever you could find, and all that kind of thing. Actually, all the way up until I went to college, people thought that I would go into the humanities. I won an English award in junior high school. I wrote, I was not a math and science person. I certainly wasn’t taking any personal finance courses or anything like that. A big moment in my development was when I had gone to public school from kindergarten to the end of 10th grade, and I had been not doing well in school in 10th grade–I always did well in school. So anyway, long story short, I went to an alternative high school for my last two years. And I’m sort of the generation that was alive during the 1960s, but not old enough to participate in it, but old enough to be aware of what was going on. I have older brothers and I watched the Watergate hearings with them.

So I went to an alternative school. It was run by very progressive minded people, you call the teachers by their first names, and there’s no rules practically or whatever. I looked at the classes that I was going to pick from my first semester, and there was communism, eastern religions, and transpersonal psychology. I was just in heaven. This was just like the greatest thing. A course that I ended up taking for two semesters that maybe had the biggest influence on me was conceptual art. It just opened up a whole world for me of art, theater, poetry, the borders between fantasy and reality, audience and performer, and all these kinds of different issues. I was always motivated by social justice issues. I was very concerned about the world, especially after Reagan was elected and was talking about the Soviet Union as an evil empire. It seemed very scary. It really was for me. So I decided, instead of going to college, I moved to a farm. It was actually like a Homestead School.

So there was a group of us on this property. We were growing organic food and learning about solar energy. Our goal was to try to be as self-sufficient as possible. Then, the Three Mile Island nuclear accident occurred. It was just 11 miles away from the farm. It was a big deal, because the radiation doesn’t stop at the gate of the utopian commune. The message that I realized was that you can’t separate yourself, or at least I didn’t feel that you can just go and find some place to make your imaginary utopia. There are still these problems in the world, and you’re not going to be able to fix them here. So after that, I left the farm. Then, I lived on the west coast for a couple years and pursued poetry. Finally, I made my way back to the east coast and registered for my first college course. It was “Introduction to the Black Aesthetic,” taught by Sonia Sanchez, who was a well known poet, certainly in the Philadelphia area. She’s like an institution, but she’s someone who was not as well known as Nikki Giovanni or some other young poets that were part of the Black Arts Movement. But now she’s pretty recognized. In any case, it was just fantastic.

I was able to develop a nice relationship with the professor and we all did some type of performance at the end. This course, at that time, was being offered in the department of Pan African Studies. The department at that time was a very interesting department because one of my professors was Vietnamese. There was a very global, third-worldist view and a lot of emphasis on the connections between Africans in the diaspora and on the continent. So I just started taking different courses in Pan African Studies. In the meantime, I was taking introduction to this, that, and the other thing because I really didn’t know what I wanted to major in or what I wanted to do. Finally, I settled on Pan African Studies. The name changed in the middle of my time there to African American Studies, and some of the faculty changed. Temple University became a center for Afro-centric thinking and an African-centered worldview, laying out the methodology and philosophical foundations, and, of course, the critique of Eurocentrism was a big part of the curriculum and what my focus really became. I started to look at issues both in the US and the anti-apartheid movement, which was also going on at that time. 

So the relationship of race and class is what I was grappling with. How much of what we see is due to class and how much is due to racism, and what’s the relationship between capitalism and racism? Then, I also tried to bring gender into the analysis and the picture as well. So I was introduced to political economy by an anthropologist, actually. I only had two economics classes as an undergrad. There were one or two heterodox professors at Temple, but not anymore, one left. I only saw a little bit of mainstream economics in my introductory class. The teaching assistant had to take me aside, I think, after the second day and say, “You’re right about everything you’re saying, but I have to get through this material. Here’s a bunch of professors, you might like their classes.” I’ll tell you, I took a lot of his recommendations and they were all just fantastic. I was very fortunate to have some fantastic professors even just in these introductory courses. They have a required course for all undergrads called “Intellectual Heritage” at Temple, and it’s taught by dozens and dozens of different people. But somehow, just picking a section because of my schedule, I ended up having some wonderful teachers as an undergrad. I was getting into studying, the library, and researching things just on my own.

So I felt like I wanted to systematically study political economy. Somehow I heard about The New School and saw their course descriptions and said, “Okay, I can go there. I can try to catch up on the technical stuff that I don’t have a background in–the stats, maps, and all that. But I can also take these courses in economic history, the history of ideas, and political economy.” In those days, you had three courses that were all Marxian economics, two introductory, one advanced, and then there was another advanced one that was not required. But we really delved deeply into it. This was the time when the mode of production controversies were going on. I got really interested in that because I was interested in economic development, and I was interested in Africa, but sometimes things affect the trajectory of your career where it can seem somewhat arbitrary. At The New School, the faculty is very small. There’s only really one faculty member for each field area. So there’s one person in international trade, one person in labor economics, and maybe one person in money and banking. If we were lucky, we had all these covered, but if a faculty member would leave–which is what happened, the development economists left–then it took them two years till we had a replacement. And by that time, you had to keep moving on.

I was very fortunate because even though development wasn’t available, race and class was being taught by Rhonda M. Williams. And it turns out that she was only at The New School for two years. I used to say I’m the last person who did a field in race and class with Rhonda Williams. It might have been the first and last. There were maybe three people who actually were able to do it. But in any case, she was doing a lot of really exciting work. One of the things about heterodox economics is that there’s different ways of being heterodox and there’s different ways of being orthodox. So we had some heterodox economists who methodologically were extremely conventional, like almost the crudest type of positivism in terms of just their view of science. It wasn’t really any different from mainstream economists saying economics is a science. People who are heterodox in content, but not method, maybe we could say have a very similar idea of–and we see this in some brands of Marxism–the idea of science and so on.

So there was Rhonda Williams, and also another newer professor, Will Milberg, who is now the dean of graduate faculty, but he was a new faculty member then. Both of them were very early explorers of kind of postmodernism in economics. This was the aftermath of Deirdre McCloskey’s book, The Rhetoric of Economics, which raised a lot of methodological issues and kind of reinvigorated a reflection on methodological issues. So that resulted in all of these different cottage industries opening up in different aspects of methodology. That was very important for me. And the professors, despite the remarks I’m making about methodology and so on, were brilliant. I learned a ton. Before, when I heard things from out of economics, I had a gut feeling that something was wrong with these arguments, but because I didn’t know the language, the models, the terminology, and all these things, I really couldn’t engage with it in a very strong way. So this is what I was doing there. I was learning the language.

At the same time, African American Studies is, by its very nature, interdisciplinary. It is very historical in its approach. The critique of Eurocentrism, I would say, is another part. So anything that would come up, if I would see reference to sociological economics or economic anthropology or whatever it was, and then out of this sort of postmodern turn, finally, reaching economics, that also opened up. With Marx and political economy, there were a lot of ways to engage in cross disciplinary thinking, collaboration, and so on. In the end, I had taken a job for one thing, without even having my dissertation topic approved yet. I was at Gettysburg College in Pennsylvania, and there was a fellow from Malawi, Derrick Gandwe, who was in that department. He had got his PhD at Manitoba which still does kind of have a heterodox PhD program way up north in Canada. So he kind of became like a mentor of mine. But you’re working full time and you’re trying to finish your dissertation. So a lot of my motivation for starting the institutes was to provide students with PhD funding so that they didn’t have to work and do the dissertation at the same time if possible, because it’s important for students to have  at least one year to devote to their dissertation.

What I’ve always wanted for students was for them to have the same opportunity that they do in the mainstream departments. I would say it’s pretty unheard of for people to pay their own way through a PhD program. Most of the time, if you’re getting to that point, there’s a good chance you’re going to be offered some type of support. So heterodox economics has never really had that, except on a very, very tiny basis. I really began to see how it was going to be necessary to talk about institution building in heterodoxy. This was also a time when there was a debate about “big tent” heterodoxy versus all these different subfields or paradigms. You have Marxists over here of one type, and Marxists there of another type, and post-Keynesians of one type here, and post-Keynesians of another type there. And some really felt strongly that you couldn’t mix schools of thought. Heaven forbid, we should do something like that. I mean, it really was kind of incredible thinking about it now, because how else do we move forward unless we are grappling with, improving, and modifying? That means learning from other insights and so on.

William Saas: What years are we talking about right now?

Mathew Forstater: In the 80s. I was at The New School physically from 87 to 92. The word heterodox, you never even heard that in the beginning part of that time period. Maybe just toward the end of that time you started to hear it because Fred Lee was over in England, and he was starting the Association for Heterodox Economics and other things. Before that, post-Keynesianism kind of served a similar purpose in that it was, with some exceptions, less dogmatic and more open. People have made these arguments, and there was a big period where critical realism was all the rage in post-Keynesian economics. It’s this idea of open ontology. In any case, it was more open, and therefore, of a certain humility, because I never saw any one of these schools as having all of the answers. Feminist economics and ecological economics started to emerge. You already had Black political economy back from the 60s and so on. You had these different heterodox professional associations, like social economics, evolutionary economics, and the others.

Post-Keynesians never had a professional organization, which did have some repercussions, because, for example, at the big meetings, in order to sponsor sessions, you had to have an organization. So the social economists, the evolutionary economists, the feminist economists, and historians had their sessions, but post-Keynesians, because they didn’t have a professional organization, they would have their own conference. Those became very important for MMT, because UMKC started sponsoring these conferences. And they were very international and very well attended. Very early on, before the term MMT even came out, a lot of these ideas were being debated at these summer schools. There weren’t just conferences. We would have graduate students and young professors, or people early in their careers, who would come, and do three to five days of hearing from all different speakers. Then, at the end, there would be a full two or three day conference. So these are great experiences, and the Institutionalists started doing one as well, which we also sponsored, and some of these were explicitly interdisciplinary.

William Saas: How did you get from Gettysburg to UMKC?

Mathew Forstater: Yeah, so I wrote my dissertation with Robert Heilbroner. Then, I had my third year review. These days, forget it. If you’re getting one year to finish, that is it. I haven’t heard of people getting more than that these days. So for me to go three years, I mean, really… Anyway, I got done in time for my third year review, but I spent all my research time writing my dissertation. So I felt like I needed to focus on some research and publications, and I applied for a research scholarship or whatever with the Levy Institute. It turns out now, Pavlina Tcherneva, who had been an undergraduate student at Gettysburg, obtained a prestigious fellowship with the Jerome Levy Forecasting Center, which is no longer associated with the Levy Institute, but in those days it still was. So she came to Levy and then Randy Ray had a long time association with the Levy Institute, because Minsky had been his teacher and Minsky was the chief kind of face of the early years of the Levy Institute. His former student, Stephanie Kelton, then Stephanie Bell, had been doing an MPhil at Cambridge, and the Levy Institute and Cambridge had an exchange program. So she came as a Cambridge scholar to Levy. So we all converged on the Levy Institute.

Wynne Godley was there as well. His name isn’t brought up so much these days, but sectoral balances was really kind of elaborated by Wynne Godley, and he was a big supporter of ours in terms of all the stuff on money and everything. He was not as enthusiastic about the job guarantee, but he was on the money and budgeting side. So Randy was on leave from the University of Denver, I was on leave from Gettysburg College, one year turned into two years, and all during this time, we were organizing sessions at conferences and had visitors. Bill Mitchell came from Australia and some others. Basically, we were talking to everybody we could possibly talk with. We were submitting papers to the heterodox journals, of which there are many. And we were going to various meetings. We were sponsoring our own workshops and conferences. We used to call them workshops, but if you look at the lineups of our conferences, it’s unbelievable what we brought together. What we had was funding. So we could say we will bring you here, we can fly you from Europe or Australia, we can put you up, and all that kind of thing, and even for US-based people.

Each conference would have a different theme. We had one on Social Security. Several of the people from the National Jobs for All Coalition we invited participated in that–Trudy Goldberg, Helen Ginsburg, and Sumner Rosen. I hate to say it, but unfortunately, and now I can say for myself as well, heterodox people are not getting big invites all around the world to present their work, share their ideas, and so on. I soon figured out that heterodoxy has created a kind of parallel institutional structure. You won’t let us into your journals? We’ll have our own journals. At one time, there was concern that people’s careers could be affected, because if you only published in these heterodox journals, they weren’t ranked as high. Well, I’ll tell you this, it’s not like I’ve been at Ivy League schools or whatever, but I have never seen a non-economist, Dean, provost or anybody question the journals. They’re refereed journals. A lot of them have been in existence for decades. They have editorial boards, people with prestigious records, and so on. But that’s not a completely satisfactory solution. 

Scott Ferguson: It’s a strategy. So you’re talking a lot about this institutional coalescing around the Levy Institute and everyone sort of on leave, and it’s an extended summer camp, maybe. Then, you’re talking about the way you start inviting people and staging these events, and it’s all very exciting. Is this all “big tent” heterodox? Where is so-called MMT emerging? How is that coalescing? Are there certain topics, problems, and shared social values that are coalescing here as well? Or is it just, “Well, we’re all in the same place and we’ve all got different ideas?” What was that kind of primordial soup like?

Mathew Forstater: So that’s a great question. In some ways, there was a certain kind of iterative process to it. But I used to jokingly say, in the early years, I should be writing a book or an article on the socialization of professions, or the sociology of knowledge, like introducing a new paradigm, what that entails, all the different things that happen, and what are the tipping points or whatever. So we did not all just go to the Levy Institute and say, “Oh, we’re all kind of post-Keynesian,” and then next thing you know, MMT happens. It was an organized thing that we would all converge on the Levy Institute. Pavlina had done an internship with Warren Mosler between her junior and senior year. And as a result of that, she did a crash course in post-Keynesian monetary theory. Her assignment was to write a critical review of Mosler’s “Soft Currency Economics.” She did that, and then she also worked on another paper, which was like a math model type paper.

She was able to participate in the 50th anniversary of the Bretton Woods Conference. There were only three economists at that conference, Randy Ray, Charles Goodhart, and Basil Moore. Everybody else was from the world of finance, hedge funds, or something, but Goodhart was working on the paper that became the two concepts of money. He introduced chartalism and metallism and that whole thing. He was working on that paper, and he even incorporated some of the African Studies references about the colonial tax and that stuff into at least some versions of that paper. Then, Randy had started to work on the book that became Understanding Modern Money. That was published at the very end of 1998, I believe. He and I both had working papers starting in 1997. He had one on the government as the employer of last resort, one “Money and Taxes: The Chartalist Approach,” and then one on functional finance.

I forget what it was called, but basically, he covered what at that time we saw as the three main areas: the history of money and the nature of money, different contending theories of money, the government budget, deficits, national debt, and all of that, and then full employment and the job guarantee, which then was referred to as the employer of last resort, or public service employment, you’ll see that as well. So some of these things had different names for a while. With chartalism, some people really didn’t like that name. I never really saw what the big deal was, but in any case, the bottom line is, we were introduced to “Soft Currency Economics” in the summer of 1996. Then, when Pavlina came back from her internship when she was a senior, she took my seminar in macro and monetary theory, and she did an honors undergrad thesis on these ideas.

There was this post-Keynesian email listserv. Instead of blogs or podcasts or whatever, in those days, it was listservs. And a lot went on on those listservs. There were incredible discussions and debates and dramas. Warren Mosler found his way there. That’s where I first saw his name. That’s where he saw my note that I had a student who was looking for an internship. Randy, and then Bill Mitchell, that’s where I first saw his name as well. These ideas, like tax driven money, that the deficit is just accounting information, and these basic sort of cornerstones or whatever of modern money, I mean, each one had to be completely unpacked and thoroughly examined. And what we started to find out is that these were not completely unique ideas. There was a long tradition in each of these areas. Now, maybe finding them all together in quite that way was new.

But one of the things that I did was look for evidence in the history of economics, and beyond economics, to find evidence of people who had recognized that money could be tax driven, because at the beginning, one of the things that people always assumed is that we were arguing that all money that there ever has been, or ever could be, was tax driven. Or our critics would exaggerate our claims. Instead of saying that in a certain institutional context, then, the monetary system or the budgetary system can be managed in this way. But not saying that under any possible imaginable institutional arrangements this is how it is. That gets into a lot of things about what is money and there were plenty of discussions about this.

Maxximilian Seijo: I was thinking, before we perhaps open up that rabbit hole, I wanted to hover on what you briefly mentioned there, which are your contributions. Because, I think, if listeners haven’t already heard, your background in Black studies and poetry and then coming to economics later offers perhaps a bit of a unique intellectual background that led you to this point on these listservs, and then, importantly, as you mentioned in the institutional context of post-Keynesianism and heterodoxy more broadly. So with reference, perhaps, to this sort of lingering background, what do you feel like your primary contributions to this moment and to this coming to be of MMT were, and how did your background inform the shape that they took?

Mathew Forstater: Right, that is great. So I came to the Levy Institute. My stated proposal was to conduct a historical and interdisciplinary analysis of employment and budgetary policy. In fact, I’m still a research scholar on the website of the Levy Institute. And if you click on me, it still says that that’s what I’m doing, which is fine. My colleagues were taking a super macro look at the economy, and you could state all of the main things about money and so on in these kinds of sectoral balances levels. There are three sectors: domestic, government, and the International sector. But I came out of a tradition within post-Keynesian economics that is sometimes called structural post-Keynesianism, institutionalist post-Keynesianism or post-Keynesian institutionalist. Basically, instead of only looking at things in the super aggregated way, the economy is looked at as a set of linkages among industries. Let’s take labor. Movements of workers between different firms and industries, and the different amounts of activity in different industries and so on, was part of both unemployment, and also that understanding, or that level of analysis, had to be part of full employment policy.

So I did a paper on how full employment policies must consider both effective demand and structural and technological change. And this was actually a little bit controversial among my colleagues, but where one of the interesting parts of this comes in is that what was behind me going into this work was the constant bringing up of the Kalecki article about full employment and why full employment could never be in capitalism. I thought that what was kind of missing in a way from the post-Keynesian tradition, or Keynesian tradition, that you had with Kalecki and Marx was recognizing the functionality of unemployment and excess capacity. So this is the ironic thing, the job guarantee actually addresses those issues, whereas, if you just try to have generic government spending, deficit spending, to pump the private sector up to something close to full employment, if you could even get there, then it would create all kinds of problems because of the loss of the functionality of unemployment and excess capacity. So I did publish a couple papers in this area, but my main interest has always been what we could do with this.

And for myself, like you were saying in your question Max, what are the implications for the goal of environmental sustainability? What are the implications of this knowledge that we have now, of how money works, how the budget can work, how a job guarantee program, looking at all the different programs, what their obstacles are? What if all these jobs were helping the environment? What I came to was the first point is that public sector activities should not be judged on the same criteria as private sector efficiency criteria. People, politicians, or the media are always saying how inefficient the public sector is, and that we should have the private sector do it because it’d be better. Private companies seek to maximize profits and minimize their internal costs, but sometimes, we have other goals that are broader social and macro goals. So the public sector activities are not for profit, and therefore, minimizing internal costs is not the goal. The goal is to perhaps find a cost effective way of achieving independently given goals, or goals that are the outcome of a political process.

That means that we don’t do a cost benefit analysis and say, “Oh, well, guess what, slavery is really efficient,” or these kinds of things. Sometimes something is done because it is the right thing to do. And that is independent of cost in just purely dollars and cents. Open things up. Public sector activities should be geared towards other things. That led to green jobs stuff, functional finance, ecological tax reform, and the idea that people have all these different definitions of green jobs. A green job is a job that is not harming the environment. It doesn’t have to be explicitly performing an environmental service. Of course, some jobs will perform an explicit environmental service, but some like caregiving and the library or whatever it is, practically pure services that use very little natural resources and don’t pollute, they’re not producing carbon. So there’s that piece.

Then, with race and class, on the one hand, I got into the colonial tax and colonial money topic using the example of Africa under colonialism and the way that the colonial monetary system, and how the government used the monetary system to promote the growth of market activity to the wage labor, and all those kinds of things. And on the other hand, I did some stuff on African American issues, rediscovering Martin Luther King’s writings on the job guarantee, Bayard Rustin, the A. Philip Randolph Institute, the freedom budget, and so on. I was like, wow, this is great. In the last few years, one would think that MMT was all about social justice and the environment. But it really wasn’t always that way. So I feel like I was able to, first of all, show how we could be thinking about the use of these policies and this knowledge, and opening up some different lines of research.

The one other part was going back and finding all of these statements that are clearly about tax-driven money in writings by like Adam Smith and all the neoclassicals. It’s unbelievable. And, of course, in Marx I found that stuff in there as well. The thing that became clear was that they all were emphasizing how it’s in a specific institutional setting rather than how a government money can be managed. That part started to come through. Of course, there’s a million more discoveries. All the time, people were sending me things like, “Tolstoy was a chartalist!” But the crazy thing is that there’s a lot more awareness, both within and outside of economics, of tax-driven money than previously thought. And there was a lot more support for a job guarantee type program in history than we knew about. The interesting thing about working with a small group of people on something that seems like new is that you’re talking all the time, discussing and debating, somebody says something and somebody else picks up on it or whatever. It’s really difficult to exactly pinpoint the origin of a certain notion. People like Randy often say at the beginning of their books that this is the result of a group, the research of many people, and the work of many people. It really is true.

So our first real target was to thoroughly introduce these ideas, present them, get them discussed and debated among all the different heterodox groups, and to publish our work, for it to go through the standard refereeing process and all that. Then, the opportunity at UMKC opened up toward the end of our second year at the Levy Institute. And basically, we all went to UMKC. They had a PhD program–an interdisciplinary PhD program. It was very successful. We had to show that our students were going to be able to get jobs. So many wonderful colleagues that we have had came out of UMKC’s program. I’ve said this quite a bit, but when I was younger, I always thought education was one of the greatest sources for peaceful social change, but it takes so long. But now that I’m older, I realize that you can have a tremendous impact over a 20-30-40 year career of supervising students. We’ve got dozens of students around the country who are teaching, publishing, organizing, and leading. We’ve got Pavlina, Fadhel, and Stephanie. They’ve gone beyond, but they started out as our students.

William Saas: So the capsule version of your contribution early on was the question: “what can you do with this?” Underscore under the “do.” That’s something that, I think, a lot of us in the editorial collective have connected with MMT over the years. What are the possibilities that are presented by it? I love hearing every time you talk about the history of MMT and tell this story. But I think that I’ve also encountered other versions or angles on it, thinking specifically about Fred Lee’s History of Heterodox Economics posthumously published in 2009 with Routledge. That “what can we do with this?” as a question is interesting, then you run into “how do we do it?” as a supplement or a second order question, and that’s where you seem to run up against institutions and the limits of one’s own capacities at that moment. Returning to Lee’s book, one of the things that I’ve found interesting and also a bit confounding, is where he ends up–and of course, this is 2009, published posthumously–which is we need to basically win out in the academy and that will be our most direct path to potentially affecting policy in a way we heterodox economists have not been able to get to at this point. And we do that by making sure that our journals count equally with mainstream journal publications and things like that. And we build PhD departments.

And really, a lot of it is institution building within the confines of conventional institution building. So it’s almost as if the theory is that we need to match and overcome what orthodoxy has accomplished, but through the very sort of means that they have accomplished what they’ve accomplished. The part of what continues to be compelling about MMT, and you’ve alluded to this by referring to the students, the second generation, is that it seems to me that transcending, operating, or building institutions outside of conventional institutions has become maybe a bit more part of the story, and especially in the recent decade and a half. I don’t know if you could say a little bit about how you understand after we’ve got the heterodox conferences, we’ve got the heterodox journals, we’ve got Levy, and we now have a PhD department, and then, in the last 15 years, how do you sort of see the institutions of MMT having taken shape and evolved, and maybe in a way that people wouldn’t have expected back in 2000?

Mathew Forstater: Right, I think one thing that has to be brought into it is that, as we were focusing on getting the ideas out there and publishing and establishing the department and those things, the real economy continued to make people’s lives miserable. So the global financial crisis and Occupy Wallstreet, I mean, that was huge for MMT. That’s how this patchwork of chartalism, the job guarantee, functional finance, and sectoral balances became MMT. It is really because of the global financial crisis, the most recent pandemic crisis, and so on. And especially, think about the impetus to MMT just as a result of people seeing the amounts of money that were spent during the bailout in 2008, and then with the pandemic, and the impact that even giving people a couple thousand bucks has on their lives and all the other issues. It connected the academic work with the activism. I really feel like social media was important.

We had the proliferation, at the same time, of Facebook and Twitter groups emerging in this way. I would say the Modern Money Network was a total surprise. We’ve got some law students who are interested and started to hold some events at Columbia. Because the thing about the law schools is that Harvard and Cornell have heterodox people in their law schools. So they have a platform. They’ve got the prestige behind their messages. That was a very important piece as well. Then, you had the activism. You had Alexandria Ocasio-Cortez and the Sunrise Movement with “Green Jobs for All” shirts on in front of Pelosi’s office. It’s crazy, I couldn’t believe it. And Stephanie was working with Bernie Sanders and all that brings–lots of media coverage. Things start to have a life and a momentum of their own that propels things. Of course, you get in all different directions and things as well. I feel like it’s great. I have the opposite feeling of anyone who wants to keep…

William Saas: Keep their cards close to their chest?

Mathew Forstater: Yeah, keep a secret to myself or something. If I insist that I’m going to converse with people who agree with me 100% of the time, I would be sitting alone in a room. Are we going to try to find places where we can build alliances and bridges? There were always some people who had sympathy with part of our project, but not necessarily all of it. And I never viewed this as a problem. That’s just the way things are. We’ll continue to have conversations and so on. You should want to have a pretty broad MMT tent. That is what is healthiest for moving things forward. With the doctoral dissertations, I feel it’s great when students do something different with the material. Zdravka Todorova took feminist approaches on household debt with sectoral balances, chartalism, and post-Keynesian and came up with a very great piece of work. There are dozens of examples like this, such as applications to certain time periods. The amount of work that remains to be done is just so much. We just scratched the surface. And you see now you have got to get to work. That’s why it takes resources. This is where funding students is so important. Of course, we’re not like a department of MMT. We do a variety of things, but they’re mutually supportive of one another.

Scott Ferguson: One of the many reasons why we wanted to bring you on the show is this idea you’re very much playing out, which is, in the name of getting certain MMT lessons out there, there’s been an effort to streamline them and to make them into idioms or easily repeatable sayings. And that’s fine, that work needs to be done. Then, there’s the inevitable misconstruing of all of them and things like this. When I see certain resistances to MMT on the left, and in a certain kind of intellectual left that is in some ways in and out of the academy, or working in like literary magazines or whatever, is they don’t have any sense of this kind of rich interdisciplinary history, which includes the present. There are PhD students, Sunrise organizers, and all these people taking up what I often like to call a shared problem space in different ways, going to work on it, and being like, “Yeah, but we haven’t thought about this deeply important feminist problem of the organization of domestic labor under patriarchy.” I really appreciate the way you’re bringing that sense of richness and heterogeneity that often gets lost in certain more dominant discursive spaces to the table.

Now, I have a question to maybe help wrap us up. So you gave a talk that we invited you to give, a keynote, at our first Money on the Left conference. This was a few years ago back at the University of South Florida where I teach, and you did a lot in that talk. It was kind of performative. It was multimedia. You played a lot of hip hop music clips and you yourself engaged in some poetic practice. I don’t want to put you on the spot, but I’m curious if you could revive some of the ideas and impulses of that talk. Ultimately, at least conceptually, could you talk about what you were doing with what I would call futurity, or a kind of practice, research, a method, a modality, a social dynamic that is oriented toward the future in a particular way?

Mathew Forstater: Yeah, first of all, I appreciated coming down to your university and meeting your students and colleagues. It was a fantastic conference. Your colleagues’ presentations and students’ presentations were incredible. You’ve got a fantastic program going on down there. I’m a big fan and supporter of everything that you’re doing with the podcast and the movement. So the methodology for public policy that I worked on in my doctoral dissertation, and that I’ve published some stuff about, approaches policymaking from this idea that we have to begin with a vision of the sustainable and just society that we want to create. And that, analytically, we work backwards from the vision of where we want to go to find a path that connects that future with where we are now. So the idea is that this kind of working backwards invites the imagination to discover policies that would move us in the direction that we seek. That has always been an important part of how I view things. Adolph Lowe, who was Heilbroner’s teacher, and whose work I was examining in my dissertation, he promoted this idea he called instrumentalism, instrumental inference, this working backwards idea. One of its most appropriate applications is when it comes to the environment, because if we know that the assimilative capacity of the environment has the ability to deal with, say, X tonnes of a certain emission per year, then that gives us the strain, in a sense, that we cannot go beyond. Our goal, then, is given to us by that scientifically informed political process. If we would have just worked forward, then there’s no telling if the amount of emissions would be consistent with the sustainability,

Scott Ferguson: We might work through cost benefit analysis instead of this, right?

Mathew Forstater: Yeah, cost benefit gives the goals. That’s how the goals are determined–if there are even any goals determined and we’re not just wandering aimlessly or whatever. That opens up the whole envisioning aspect of things. And because I draw from outside of economics there’s so much rich material that we can engage with. It turned out that Abba Lerner, because he was also at The New School and a colleague of Adolf Lowe, he participated in this conference that was evaluating Lowe’s argument. Basically, Lerner stated that functional finance was perfectly consistent with Lowe’s idea. It also works very well with what I was talking about earlier with a slightly disaggregated analysis from the super macro level stuff. So part of what the methodology work that I did and that I’ve used, it examines things like following a hunch or guessing things that don’t appear in scientific papers. They sit uncomfortably somehow in a scientific paper, but if you go to scientist’s diaries, letters, autobiographies, and journals, then they’re talking all about this kind of stuff.

So the role of the imagination–C. Wright Mills’ sociological imagination–that fits very well with this kind of thing. The economic imagination, the ecological imagination, however you want to describe it. That took me to all these literatures which are about discovery. And even in the presentation down at University of South Florida, I brought up a Sherlock Holmes quote or whatever, because he’s talking about working backwards. Then, I discovered a few other little interesting things. In the appendix to The Sociological Imagination, C Wright Mills talks about the researchers file. It’s not just a file cabinet full of articles, or now files on the computer, but it’s snippets of conversation that you heard, something you read in the newspaper, a dream you had, etc. All of these things can be part of the discovery process. So the whole process of discovery, of diagnosis, of detection, the main kind of issue that came out of it is that a lot of times we feel things are presented as though it’s just by chance.

Like the eureka moment comes because you poured the wrong liquid into the thing. Those things can and do happen, and we can look out for those happy coincidences or whatever, but the part that I was focusing on was there are things that we can do to enhance our powers of discovery. I got really interested in that and sought to apply it, because, in a lot of ways, there is more than a certain content of heterodox economics, or even interdisciplinary heterodox economics. More than a certain content, for me, it was how do I go about investigating a problem or identifying a problem worth solving, to be able to consciously and intentionally make everything a potential source of reflection or consideration? With all these literatures about entrepreneurs and their powers of discovery in finding profit opportunities or whatever, I see no reason why policymakers shouldn’t be able to use the same powers of discovery to come up with innovative ways of dealing with the most vexing problems that we’re facing. It’s hard to get up every day, it’s so overwhelming. It is part of my lifelong grappling with certain core questions, the relationship between materialism and idealism, and some type of rapprochement or whatever in terms of recognizing material and ideological aspects of society, or what the Germans called the problem of freedom and order.

We can have a sustainable world. We can have eco-fascist people on every corner making sure you recycle or whatever. Well, that’s not satisfactory. And now, with the word freedom, people think it is a violation of their freedom to be told to wear a mask during the pandemic or something like that. But inspiration is so important to me. I find the arts and the humanities very inspiring, especially music and performance. So I’ve had some fun over the years. We kind of had a tradition where I would do poems at the end of the summer school. When you get tenure and promotion, then you can go up to the lectern with your guitar or whatever.

Maxximilian Seijo: I’m sure the expansive grappling will continue. But I can’t think of a better place to sort of conclude this conversation. Matt Forstater, thank you so much for coming on Money on the Left.

Mathew Forstater: Thanks so much for having me.

* Thanks to the Money on the Left production teamWilliam Saas (audio editor), Richard Farrell (transcription), & Meghan Saas (graphic art)

28 – We Have Never Been Neoliberal, What Now?

In this episode, co-hosts Natalie Smith and Maxximilian Seijo argue that the pandemic not only killed neoliberalism as a tacit ideological formation; it also revealed how neoliberal truisms have never captured the actual causal mechanisms and potentials that defined the past 50 years. Fleshing out these claims, Naty and Maxx journey through the work of rockstar economic historian Adam Tooze, focusing in particular on his widely-hailed recent book, Shutdown: How Covid Shook the World’s Economy (2021). Naty and Maxx affirm Tooze’s characteristically thorough demonstration of the myriad ways that the world-wide response to the pandemic, however inadequate, dismantled the pillars of neoliberal governance. Yet they also critique the elitist complicity of Tooze’s methodological commitment to historical immanence and inevitability, tracing such impulses to back to John Maynard Keynes’ fatal dismissal of Abba Lerner’s proposal to do away with balanced budgets and revenue-constraints. For the Superstructure crew, by contrast, proceeding “in medias res,” as Tooze puts it, requires an abolitionist attunement to genuine conditions of injustice and possibility, from #Defund and ongoing labor strikes to contests over #MintTheCoin and the Green New Deal. During the conversation, wisecracks and burns abound, per usual. This one, too, is packed with citations, including loving shoutouts to David Stein, Jakob Feinig, Mariame Kaba, Dan Berger, Emily Hobson, Alex Yablon, Nathan Tankus, and Rohan Grey.

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Music: “Yum” from “This Would Be Funny If It Were Happening To Anyone But Me” EP by flirting.
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Mint After Reading: Philip Diehl Talks with Rohan Grey

In this bonus episode, Rohan Grey speaks with Philip Diehl about #MintTheCoin in the wake of this season’s debt limit showdown. Director of the United States Mint under President Bill Clinton from 1994 to 2000, Diehl is best known today as the person most responsible for 31 U.S. Code 5112(k). The law permits the Treasury Secretary to “mint and issue platinum bullion coins and proof platinum coins in accordance with such specifications, designs, varieties, quantities, denominations, and inscriptions as the Secretary, in the Secretary’s discretion, may prescribe from time to time.” This clause charts a completely constitutional path to avert recurrent debt crises and furnishes a ready framework for a new kind of radical financial literacy. No wonder why much ink has been spilled and many hands have been wrung trying to explain away or dismiss its radical implications. Grey’s conversation with Diehl explores the history of the platinum coin, offering a fascinating and unprecedented behind-the-scenes glimpse of life in the U.S. Mint.

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The following was transcribed by Rohan Grey and has been lightly edited for clarity.

Transcript of #MintTheCoin! – Interview with Former Mint Director Philip N. Diehl by Rohan Grey[1]

[1] Assistant Professor of Law, Willamette University & Director, Public Money Action.

Grey: Well thank you so much for joining me. My name is Rohan Grey, and I’m an Assistant Professor of Law at Willamette University in Oregon. I’m also a Director of Public Money Action, a 501(c)(4) that promotes public education and tries to improve our public policymaking process around money and financial issues.

And I’m joined today for this very special one-on-one interview with Philip Diehl, the former Director of the United States Mint, appointed by President Clinton, and currently President of U.S. Money Reserve, to talk about this idea that’s been taking the world by storm, and getting into the press, about how we could potentially resolve the ongoing and recurring debt ceiling crises that we’ve been experiencing through a provision of the Coinage Act, that authorizes the minting and issuing of platinum proof and bullion coins of whatever denomination the Treasury Secretary determines to be appropriate.

So we’re going to go into some detail about the history of that law, and some of the sort-of edges and boundaries of it. But before I get into that, I’d like to let everybody get to know you a bit more, because you’re the sort-of architect behind this in many respects, and have had a pretty incredible and unusual career. So would you mind telling us a little about what got you to be the Director of the U.S. Mint, where you were beforehand, and what that journey was like?

Diehl: Well, I went to Washington D.C. when I was thirty-nine years old, so I had a long career before that in government, some in politics, but mostly in government and the private sector. I went to Washington to be Legislative Director to Senator Lloyd Bentsen (D) of Texas. And I served in that role for almost two years, until he appointed me to be Majority Staff Director of the Senate Finance Committee. And I was probably the shortest-lived Director of Senate Finance, because within three months Bill Clinton was elected, and a few weeks later Bentsen was chosen as Secretary of the Treasury, and then I went in as his Chief of Staff at the Treasury Department on the first day of the Clinton Administration.

I was in that job – a thankless job, my kids never saw me, I had young kids at home – and after about six to nine months, I felt like I had helped the Senator, and now Secretary, transition into the job. And so I decided that I was ready to go home back to Austin, Texas. And he said, well, why don’t you go look at the United States Mint, that’s a turnaround situation, I know you want to run a company.

And I was never a collector. I knew hardly anything about the U.S. Mint. But you don’t tell the Secretary of the Treasury, “No.” So I went over there, and I was very fortunate because a fellow by the name of David Rider was Director at the time, and he was a Bush Administration – H.W. Bush Administration – holdover. And he and I really made a connection. He gave me a great orientation to the U.S. Mint.

So I went back to the Secretary after three weeks and told him, “Yeah, I am interested. This looks like a real good opportunity.” And that’s a very unusual move for someone who came to Washington because of his policy interests. And this really isn’t a policy foundation, it’s a manufacturing and marketing operation. But I saw it as a diamond in the rough, and I thought, “I could do something with it.” And one of the things that really animated me, and animated the team around me at the U.S. Mint, is we had, and have, a very strong commitment to demonstrating what government – well-led government agencies – can do for the American people. That there’s a real role for an active government.

And I really liked this particular audience that I was playing to – the U.S. Mint customers on the bullion and numismatic side of the business – who are, I used to say, white, male, and over fifty, conservative, Republican. And I said the white male over fifty thing was something I aspired to – now I’m well into that demographic – and I think we really had an impact on them, surprising them in what we were able to accomplish in a whole lot of areas.

Grey: Yeah, it’s incredible, you would think that sometimes people come up through the ranks of the Mint, or they come in thinking that their job is just to keep the lights on, and not make waves. But as you said, you came in thinking of it as almost a turnaround, and you had had experience both on the hill, and in the heart of the Treasury, and seen a sort-of bird’s eye view, and saw what this agency could do and what it could become. And not only a vision for active government, but a vision for how to take an agency and to make it bigger than what it might have been. And history is full of people who’ve really kind of had a vision for making something bigger than what it was when they came into government, and to be creative about that.

So do you mind going into a bit more detail about what your sort of vision was for the Mint, what your agenda was? I know you were there for quite a while, but sort of looking back, what would you say your kind of priorities were, or how do you feel your legacy of what you left the Mint, what shape you left it in versus where it started?

Diehl: I started well, what I thought was small, and ended up being pretty big, and with three priorities that I, in my confirmation hearing, I called those out. And one of them was the financial situation at the Mint – both performance and in terms of the whole financial structure – was a terrible mess. And we were one of the first agencies – because we had private sector-like functions – we were one of the first agencies subject to a new federal law that subject government agencies to outside audits. And eventually that spread to every agency. And our first audit, the U.S. Mint failed. And for any number of reasons. So I said we need to fix that.

The second thing was we had a real problem with customer service to our numismatic customers.

Really all three of our customers: bullion, numismatic, and then circulating coins, where the Federal Reserve is the U.S. Mint’s customer. And I said we needed to fix that, that was a big problem with just performance, morale at the agency, the tremendous criticism from outside the organization because of that failure of performance.

And then the third thing was there was – there is – this commemorative coin program, in which the U.S. Mint produces, upon a mandate of Congress, a series of commemorative coins. And Congress mandates every one of those programs. And this is a way of raising funds for organizations that have access to very powerful members of Congress, and it’s a way of circumventing the appropriations process. So there grew to be a feeding frenzy for these programs, and as a result, by the time I became Director, the market for these coins had collapsed because of abuse, really, by Congress. And so getting that program under control was my third priority. And I could only do that with the help of Members of Congress, especially a couple of committee chairs, to reign in that program.

So that’s really where I started. But as we built our capabilities and our confidence in our capabilities, and there’s a psychological element to that, there’s a personnel element to it, there’s a structural element to it, there’s a financial element to it—

Grey: There’s a precedential element, yeah.

Diehl: Yes, yeah. So we grew in confidence and capability in what we could do. Which ultimately led to a series of highly innovative, entrepreneurial programs, that we had Congress enact, and that we built on to build our credibility and our capabilities. And the first one of those programs was the Platinum Eagle program. And I wanted to—first of all, I’d begun to build a relationship with the new Republican Chairman of our Banking Committee, Financial Services Committee, Oversight SubCommittee, Michael Castle from Delaware. And so I went to him and said we have this idea for a brand new platinum coin, that allows us to – will allow us, if we structure it correctly – to compete in international markets. And we had never competed in international bullion markets before.

And so I asked for a blank slate. Completely unprecedented in U.S. Mint and U.S. coinage – two hundred years of U.S. coinage – history. Where in the past, Congress mandated every little detail, and the Mint could not deviate from those details, had no discretion. And I asked for virtually total discretion to design a coin, based on market research and building a relationship with the person, the company, and the patriarch of the company in Japan – which along with North America are the two big international platinum bullion markets. And so that included everything from design to denomination.

And that’s what we were granted. I drafted that bill, he got behind it and carried it to fruition. It got embedded in a much larger Coinage Act that was designed to fulfill one of my promises, and that was to get the commemorative coin program under control. To limit it. So that’s relevant to the issue of the platinum coin, because it has been described as our intent, and Congress’s intent, to create another collectible. And that was not the intent. The intent was to authorize a bullion coin. And as I sidelight of that, it also allowed us to produce a proof coin, which is a collectible coin. It was never intended to be a commemorative coin of any kind.

So that’s sort of how we got started. And that program was immensely successful. Within six months of launching the bullion version of this coin, we had taken sixty, sixty-five percent of the Japanese market away from another competitor. And we’d also, of course, taken the American market away. And that success laid the groundwork for Congress to pass the Fifty State Quarters Program. We demonstrated our ability to perform on an entrepreneurial project.

Grey: So I want to just take a step back – I want to get into the platinum coin provision in particular, but two things that you mentioned were interesting to me. One is you were talking about the idea that Congress had previously micromanaged all of these different coin programs, and you wanted more discretion. One of the things that I traced out in my research on this issue was that if you look at the debt ceiling – before the debt ceiling existed, Congress would micro-manage the issuance of Treasury debt. You have to issue this amount of this kind of duration for this spending program, and this amount for this program, et cetera.

And in the earlier twentieth century that became increasingly unwieldy as the government got bigger. And one of the goals of the original debt ceiling, if not the primary goal, was to give more discretion to the Treasury to choose how to finance, right? You tell us how much to spend, and we will work out how to do it. In fact, I think it was Secretary Mellon in the thirties that said we [the Treasury] should have complete discretion – using similar words to you – in what kinds of securities we issue, in what denominations, to meet our needs. Get Congress out of it entirely.

And it seems like there’s that trend in general, as the government gets bigger and more complicated, to put more discretion on the executive branch. Not to make the important political decisions, but to execute on the sort-of priorities and commitments. And it seems to me that’s kind of consistent with – that there’s a sort of parallel there – with you getting more of that discretion within the Mint’s sort of authority, the way that the Bureau of Debt Management, or Office of Debt Management would have done with Treasury securities.

Diehl: Yes. Yeah, that’s exactly right. And there’s another element to this, and that is that Congress has delegated more authority to the executive branch as it has become more politicized over decades. And a great example of that is the Base Closure Commissions, in which – because it is so politicized, in terms of who are the winners and losers – that Congress in the past was paralyzed in its ability to make the Defense Department more efficient by closing down bases that had outlived their usefulness. And so what did it do? It turned over to the executive branch a process by which it presented a package of bases to be closed and consolidated, and then that package went to Congress, and they could vote it up or down. They could not amend that package whatsoever. So basically what Congress did was said “put these handcuffs on us, and then, you know, just give us a simple option.”

That’s also what they did with that whole Commemorative Coin Program. I basically put together a Base Closure Commission for these coins, so that there was a committee that was formed that would make recommendations to Congress. And Congressmen would make recommendations to us, but they didn’t have to say no. They could say, “Oh, the executive branch committee over here, they said no.


Grey: Mhm. And you can see a clear parallel with the debt ceiling today, where everybody knows it needs to be increased or abolished, but nobody wants to take political responsibility.

Diehl: Yes.

Grey: And so, for the executive branch to step into the breach and say: look, we’re going to do what everybody knows needs to be done–

Diehl: Yes.

Grey: …but may be politically unpalatable, and that might be to use authority that you’ve clearly given us, you know–

Diehl: Yes.

Grey: …in ways that maybe you want to be able to say, hey, you didn’t want this–

Diehl: Yes.

Grey: …and that’s useful political theater, because you can distance yourself a little bit, but it allows us to keep doing what needs to be done.

Diehl: And that is part of the magic of the trillion dollar coin, is it takes – it depoliticizes the whole issue. After you bite the bullet – or bite the coin – and do it, it takes that issue out of the hands of Congress. Everybody is off the hook, except the Secretary of Treasury and the President. And actually, I think what happens – right now what’s happening – is the trillion dollar coin, and also the Fourteenth Amendment, serve as a failsafe–

Grey: Yes.

Diehl: …on the coin. So everybody can play games with the politics of this, knowing that in the end that there are outs to this. And to sort of settle markets down as they pretend to approach this disaster of the economic collapse of default. And I, you know, I think that’s part of what’s happened this week, when all of a sudden, you know, Senator McConnell decides that, well, let’s put this off. Because there were escape hatches.

There were other things that were going on too, like, you know, the Department of Defense intervened, and said–

Grey: We need to keep the lights on, this is a national security issue.

Diehl: Yeah, we need to pay our people. And so there were other things at play too. But the timing of the article that was written by Felix Salmon, that said, you know, that quoted me, saying, Oh, the Treasury Department could–

Grey: could be done in hours.

Diehl: Yeah, can produce this coin overnight, virtually, if they set up a couple of ducks in order. And that’s the first time, I don’t think that had ever been said.

Grey: No, it hadn’t.

Diehl: And so – and it got tremendous play. As you know, Drudge put it at the top of their page, and then gave a spin to the title that suggested it was already–

Grey: They’re going to do it, yeah.

Diehl: …They’re doing it right now. So–

Grey:  The hyperbole helped bring it further into reality.

Diehl: Yes, yeah, yeah. It certainly blew up the whole story.

Grey: Yeah, and I want to just go and take a step back also. Because you were just talking about taking this out of – about depoliticizing this. But of course, this isn’t about depoliticizing the budget itself.

This isn’t about depoliticizing spending itself.

Diehl: Exactly, yeah.

Grey: That’s still an incredibly political process. In fact, maybe the most central political process for Congress. This is just about honoring that spending once it’s already been committed, and not saying we’re going to ignore Congress, or go back on our debts and things. And I just to sort of connect that, because one of the things that you haven’t mentioned about your legacy – and correct me if I’m wrong about when this, the timing of this – but my understanding is that you were also the Mint Director when the Mint really sort of separated its own budget from the rest of Treasury, and became a nonappropriated fund instrumentality, which means essentially that it funds itself through its own operations. You know, the CFPB [Consumer Finance Protection Bureau] does this with fines, other agencies do this with fines, the Fed does it with its own money creation powers.

But you essentially sort of elevated the Mint back up to an equal status with the Fed in terms of being, kind of, off balance sheet from the rest of the government. Which, when you combine that with the Mint’s sort of, internal powers, makes it a very very, you know, powerful institution. As you said, the Mint has been around for two hundred years, it’s the oldest monetary institution in the U.S. government. But that seems to have been a pretty key moment in making the modern Mint what it is today. Do you have any thoughts?

Diehl: Yes, it absolutely was. And when I proposed this to Treasury I got laughed at. They said, how are you going to get Congress to let go of the purse strings on your agency. And I said, I’m going to do it through the Appropriations Committee. Which made them laugh harder, because of course the Appropriations Committee is where that power is exercised. But I already know at the time that the Chairman of my Appropriations Sub-Committee was going to back it, because he and I had talked about it, and he really–

Grey: You worked on the hill, you know how this works.

Diehl: Well, yes, exactly. But also I was very fortunate, because the new Republican Chairman of the Committee – this was in ‘95, so right after the Gingrich revolution – the new Republican Chairman of the Appropriations Sub-Committee was a conservative – very conservative – Republican. But he and I hit it off on a personal level. And he really liked the idea of what I was doing at the United States Mint, of turning it into an entrepreneurial, you know, business-like agency.

Grey: Believing the government can do something, ironically.

Diehl: Yes, yes. This was before there was this commitment in the party – his party – that the best way of showing the government could not perform was to sabotage it. And so he was not like this at all, a guy by the name of Jim Lightfoot from Iowa. And so he said yes, you know, and I explained that all these things that we need to do, I need to have this flexibility. And so I need to operate off my own profits. The U.S. Mint is a profit-making enterprise for the U.S. government. Our profits go directly into the general fund of the Treasury. And I told him, you give me this flexibility, and I’m going to send a lot more money into the General Fund.

Grey: Which means less government debt, right? Less borrowing.

Diehl: Exactly. I mean, that’s exactly right. The money from the United States Mint, part of it, is exactly the same as tax revenue. And the other part of it, which gets to the trillion dollar coin, is very much like the issuance of interest-free loans, uh, bonds. So the combination of that, you know, really was compelling to him. He carried the legislation. Not only did we get completely off the appropriations process, but we also got the FAR, the federal procurement regulations, were lifted from us. So we took a document that was like *this* thick, and turned it into a pamphlet, to describe to outsiders what our acquisition process was.

Grey: So once again, it’s the story of more flexibility, more discretion.

Diehl: Yes. And I will say this: later on, we went to OMB [Office of Management and Budget] and asked for flexibility around the personnel rules. And I had such a good relationship with our unions that I actually had the endorsement of our unions to lift the personnel rules from us. And when my Deputy Director and I went in, we explained what we wanted to do, and pointed to our success on the procurement and on funding. He said, “you don’t understand. It’s not failure we fear, it’s success.” So we realized, okay, we’re at that point of hitting the Catch-22.

And the concern was, and he said – we said, what’s that mean? – and he said well, if you achieve this kind of flexibility, every other government agency is going to want it. And we said, our response was, “well, if they earned it, why wouldn’t you give it to them?”, knowing that is a very high bar to reach, and not very many government agencies are going to do that. One of the reasons they wont do it is because the professional risk – and therefore the financial risk – that leadership in Washington D.C. takes if it wants to make a significant change in how things work in Washington, and in the performance of an agency.

So there were a lot of things that, sort of came – and we got really lucky. We had friendly Republicans in key positions. But it is, yeah, it is hard to get that kind of flexibility.

Grey: It’s just incredible to hear this story in detail like this, I mean I feel like it needs to be a book or a movie, or something. I’ve spent a fair bit of time studying the origins of the Federal Reserve, and it’s incredible to hear this story – that you sort of almost did single-handedly – when you think about the Federal Reserve’s origins as this sort of confluence of massive banking interests in the heart of a crisis. And you’re just behind the scenes, sort of quietly doing something that ends up creating a level of budgetary and legal autonomy that’s sort of comparable within its own space.

But a couple of things were sticking out to me. One is the Federal Reserve also has budgetary independence, but doesn’t have the same kind of independence with its employees, for maybe a similar reason. So there are court cases and things where they say, look, in one sense the Federal Reserve System is clearly a government agency, but it’s got its own separate budget process, but in certain circumstances employees will be considered government employees.

But your point about the seigniorage revenue being a source of income similar to interest-free loans: at the Fed, of course, they create Federal Reserve Notes; they create reserves, which banks use as money. And the profits that the Fed returns from the assets that it buys by creating those dollars, when it returns it to the Fed, at least very recently, it was booked in accounting terms as Interest on Federal Reserve Notes. So the whole thing was, we can create this one kind of currency, and anything we do within our agency will be sent back as the sort of seigniorage profit, or the charge that we pay on what we earn on creating these instruments.

And so it’s sort of interesting to me that we have this moment where, you know, when the Federal Reserve returns eighty billion dollars a year in this revenue, we say this is great, you know, this reduces the need to borrow, thank you so much. This isn’t against Federal Reserve independence, this is good for, you know, statutory agency independence. But nobody kind of notices that the Mint’s also been doing that, often because the numbers are maybe an order of magnitude smaller. But as you noted, in your tenure they went up. And they could have kept going up. And there’s never been a limit historically on the upper limit. It’s only been, sort of, how visionary the Mint Director has been, it seems like.

Diehl: Yes, yeah, those are good points. And it gets to one of the points I like to make, [which] is: the trillion dollar coin is nothing novel. I mean, it has been made out to be this gimmick. And as you say, you know, it’s [an] everyday occurrence at the Fed, and at the United States Mint. Creating seigniorage – seigniorage being the difference between the face value of a coin, in this case, and the cost of production. And that represents sort of a profit, but really it represents more of a loan in this case, because the U.S. Mint sends a coin – a quarter, let’s say – to the Federal Reserve. The Federal Reserve purchases it for the face value – twenty-five cents. Let’s say the Mint produces it at a cost of eight cents. So that’s seventeen cents, margin, that the Mint makes on that coin. Well, you add up all of that in the course of the year, and that acts as – the U.S. Mint moves it over to the Treasury Department – and that seigniorage acts as a means of funding the government, just like a bond does.

And so the only difference a trillion dollar coin represents, is it has more zeroes on the end of it. And, yeah, that’s a huge thing. But it’s not a different process. It’s not a different concept. In fact, this is a concept – seigniorage goes back, you know, I don’t know–

Grey: Yeah, Founding Fathers.

Diehl: …two hundred years.

Grey: Pointy hats–

Diehl: Yeah.

Grey: …and tin whistles, and, you know, the HBO mini-series.

Diehl: Yeah.

Grey: It’s as American as apple pie.

Diehl: [Chuckling] Yes. Yeah, yeah. And it’s because governments have used seigniorage to fund their operations – the King’s operations – for hundreds and hundreds of years. And Mint Directors in the past, if they shaved too much – if they shorted the amount of metal that was in a coin beyond what the Crown had authorized – they were hung, you know. 

Grey: It was a big deal.

Diehl: It was a really big deal, yeah.

Grey: Isaac Newton was the Mint Director in the U.K, took his job very seriously. Yeah, I mean, two things on that. One is, you know, you say it’s sort of like issuing government debt. But it’s important, and this is where, again, being very clear about statutory language – as a law professor I love this whole moment because it’s forcing people to learn how statutes work – but the public debt limit is quite narrow. It’s for things that have interest and principle, and it includes only a certain group of instruments. So for example, Federal Reserve Notes and coins have never been counted in the national debt. If they did, then we’d have probably accidentally violated the debt ceiling a number of times already.

Diehl: Yes.

Grey:  But not only that, there’s actually been instruments that the Federal Reserve issues – interestearning term deposits, which they started issuing in 2009 – that pay interest, are a legal obligation of the government, but are not included in the debt ceiling. And so there’s a lot of instruments out there – including the Greenbacks that Lincoln authorized, that are still legal on the books at the Bureau of Engraving and Printing – that are not included in the debt ceiling. We could call them debt, we could call them a means of financing, but they are no “Debt Subject to Limit” in the same way. And this coin would be very clearly in that category, not in the category of debt subject to the debt ceiling, because that’s a very narrow category. And that’s sort of one of the other confusions. People say, “oh well this is basically violating the spirit of the debt ceiling law.” Well, no more than issuing a quarter is, right?

Diehl: Yes, that’s exactly right.

Grey: And you mentioned, you know, that this was a sort of bullion coin program initially. And I think this is one other confusion – we were just talking about this earlier – people often think, well, bullion coins have to represent the underlying metal value and nothing more. And the reality – correct me if I’m wrong – is that a lot of bullion coins are sold, you know, over their face value because the metal is more expensive.

But there’s nothing that says the face value couldn’t be more than the metal, and we certainly aren’t on a gold standard, or a metal standard in general. And it’s the face value of the coin that matters. In fact, I pulled up a couple of statutes – 31 U.S.C. § 5112(q)(4), which concerns the sale of $50 denominated gold bullion coins, says that the bullion coins shall be sold for an amount the Secretary determines to be appropriate, but not less than the sum of the market value of the bullion, and the cost of designing the coins, including labor, materials, machinery, et cetera.

So even with regular bullion coins – and there’s another one for § 5112(o)(4)(A), which governs the sale of $10 denominated commemorative gold coins, that says that bullion coins shall be sold at a price that is equal to or greater than the sum of the face value and the cost of designing the coins. So even when we think of bullion coins, we’re not thinking of something that can only ever be the value of the metal. That might be a floor, but it’s not necessarily a ceiling. Does that sound correct to you?

Diehl: Yes, that’s exactly right. And it’s only by practice, and sort of practicality, that the U.S. Mint sells bullion coins at a small premium over the spot price of gold, that represents those costs of production, of marketing, sales, and all that. And that’s because the purpose of the coin is to compete in marketplace with other bullion coins. And so those sorts of price constraints apply because of the intent, and the intent of the product, and the circumstances in which the product enters the marketplace. None of that applies to a trillion dollar coin. Its purpose is very different. And so it wouldn’t make sense for it to follow that model, because it is so different.

The other thing that’s important is there is no language in that provision of law that authorizes the platinum coin that says anything about pricing.

Grey: That’s right – other than that the Treasury Secretary has absolute discretion, right?

Diehl: Yes, yes. So the restraints that are in the statute, that apply to gold and silver bullion coins, aren’t there for platinum.

Grey: And I believe it was Harvard Law Professor Lawrence Tribe that talked about this. He said, you know, if you look at all the other statutes, and they have constraints. And then you look at one that doesn’t. And it was intentionally written to not have the same constraints as the others. Then you have to take that seriously as a matter of statutory interpretation. You can’t say, “oh, they meant it to have similar constraints, they just forgot.” You wrote it! You didn’t forget. You made it.

Diehl: [Chuckling] Yeah, no, it’s a feature not a bug.

Grey: That’s right, that’s right. That’s exactly right. And you mentioned also, you know, there was also this other language for “proof” coins in the statute as well. And there’s been some sort of debate around this. People say well, proof coins means they have to only be entered into as collectibles. And obviously, most proof coins are collectibles. But my understanding – correct me if I’m wrong – is that the word “proof” there refers to the method of production. Can you describe that for people that aren’t that very familiar with the minting process, what proofing is?

Diehl: Yeah, so proof coins are produced in a very different way from circulating coins and bullion coins. And they are produced to much higher standard. Also, they look different. They have a frosted image, typically, and a marred background. They are sort of a fine art of coin production. And so those coins are typically sold to collectors. But there’s no restriction. They could be sold as bullion coins. They could be produced and put into the Fed as circulating coins.

Grey: You wouldn’t do it because it would be a waste of money and high production grade, but you could if you wanted to, right?

Diehl: Exactly. I mean, you could do it – and we actually talked about doing something like this – to put a very small portion of, like, a State Quarter,into circulation through these huge ballistic bags that we send to the Federal Reserve, and they put into rolls and they ship to banks. And we decided that there was enough interest in the 50 State Quarters when we launched it without doing something like that, there was–

Grey: Sort of like Charlie and the Chocolate Factory and the golden tickets.

Diehl: [Chuckling] Yes, yeah exactly, yes. And so, yes, we completely had the authority to do it. The economics of it does not work if you’re doing all the coins like that. If you took a very small, you know, percentage and did it like that, then the accelerant would easily pay for itself, because all these other coins would be collected hoping to get those. And you get all the seigniorage profit on that.

Grey: In fact, I believe it was Andrew Jackson who issued a Gobrecht Dollar that was a proof circulating coin. And you might know the history better than me, but my understanding was that it was the sort of reintroduction of a dollar coin. And so it was a sort of, as you say, an attempt to drum up interest, and to make a big show of it. And so the reason that you used this higher production grade quality was precisely to get the marketing and the attention, more than you might for a regular coin. And that was a proof coin that happened to circulate. So there’s no kind of inconsistency there.

Diehl: Yes. There’s a similar situation that as far as I know was an accident. I was not aware it was happening, I don’t at all know it was intentional. But when the Sacagawea coin was launched, there were some of them that were produced on a more highly refined blank, and those coins became especially valuable collector items once they were discovered, and–

Grey: Semi-proof, huh? Quasi-proof?

Diehl: Yeah, but it had a better strike to it. And as a result we had a similar kind of effect that you’re describing.

Grey: And the idea of, kind of, having a high – you know, you call it the [high] art of of coins – seems to be pretty appropriate for a trillion dollar coin. You know, I’ve always said, people say “what happens if it gets stolen?” or something, and its sort of a funny joke. And yeah, we all get to laugh about it. Of course, if you steal a trillion dollar coin and then try to use it, there’s going to be a pretty strong legal presumption you didn’t get it legally, right? But I’ve always thought it would be great to have some ritual and symbolism around this, especially if it was to save the government from itself and this insanity of the debt ceiling.

When you think about the Federal Reserve and its announcements – you know, the ritual of these Federal Reserve pronouncements – when you think of courts and them wearing robes, when you think of military service and the, you know, the music they play, and the folding of the flag, ritual is very important to our government. And if we were to going to mint a trillion dollar coin, having it to be beautiful quality, and then, you know, having a child walk it from the Mint to the Fed–

Diehl: Yep.

Grey: …and say, you know, here we are, I’d like to hand this over, and then “I accept this on behalf of the American people,” you know.

Diehl: Yes.

Grey: And then maybe on the other side it ends up at the Smithsonian, and everyone can tour it in schools as part of their, you know, American history education. It seems like proof coin, there, is sort of the appropriate one. Even if the law had said “bullion, proof, or circulating coins,” if you were going to create a trillion dollar coin, you’d probably want it to be proof.

Diehl: Yes, yes. Well, not only would you stand out if you carried a trillion dollar coin and tried to use it in commerce, but hard to make change for it to. But yes, sitting at the Smithsonian, obviously you’d have to have it well guarded, but the–

Grey: Alongside the Declaration of Independence, or something.

Diehl: Exactly, yes. But the key to this – and to address another knock that we hear that is fallacious on the coin – the key is that the coin does not, and of course, can not go into circulation. It has no impact on the money supply. And that is the wrap, is that all of a sudden, it’s going to be like Venezuela. All of a sudden, you’re increasing the money supply by a trillion dollars, and you’re going to have all of these disasters and consequences. You know, it never goes into commerce. It’s not like other coins, or currency, or QE [Quantitative Easing] for that matter, in which money is being inserted into the economy. This coin is produced at the United States Mint, goes to the Federal Reserve, stays in a vault. There will be, when sanity prevails and the debt limit is increased, that trillion dollar coin can come back to the U.S. Mint, just like any other coin. That seigniorage is taken off the books, and the coin is destroyed.

Grey: Right. The only spending that would happen is the spending that Congress has already said needs to happen, that should be happening anyway, and in fact is constitutionally required under the Fourteenth Amendment.

Diehl: That’s exactly right.

Grey: The money going out of the Treasury’s account into people’s pockets should have kept going anyway, but for the insanity in Congress, and these misunderstandings that the debt ceiling is supposed to stop us from being able to continue honoring those obligations.

Diehl: Yes, yeah, exactly.

Grey: So, one question – you mentioned there, you said the coin doesn’t need to go into circulation. Usually, my understanding – and correct me if I’m wrong – is that coins are sold to the Fed, and that the Fed sells them on to banks, who then, you know, get it out into the public. But the Fed isn’t the only actor that has bought coins directly from the Mint, apart from collectors and bullion investors, right? There are other ways that coins do get into circulation. Do you want to tell us a little bit about some of that history?

Diehl: [Chuckling] Okay, yes. It’s sort of notorious. So we were given a mandate by Congress to produce a new dollar coin to replace the Susan B. Anthony, which was an utter failure for a number of reasons. And this is something that Congressman Castle and I worked together on as well. And we were given discretion in this case too, but only over the design of the coin. And it was through a design competition that the United States Mint executed, that the image of Sacagawea and her infant Jean Baptiste on her back, during the Lewis and Clark expedition, was chosen for that coin.

And so we did a lot of market research – part of the entrepreneurial basis. The United States Mint hadn’t done that before to any significant degree; certainly hadn’t with the Susan B. Anthony. And part of the market research was to go the banks and the Fed, and say, you know, to make a pitch: you should get this coin, it’s going to be much more popular than the Susan B. Anthony, and they won’t be in the vaults forever. Here’s the market research of consumers that shows there will be this demand. And the response from the banks and the Federal Reserve was, “well, you have to demonstrate to us – actually demonstrate to us – that there will be demand for this cause.”

Well [it was] the ultimate Catch-22, because if we can’t get through the Federal Reserve into the banks, how do you demonstrate the public is going to want it.

Grey: It’s almost like they just didn’t want it.

Diehl: They didn’t want it, yeah. The coins and the Federal Reserve – I mean, the banks and the Federal Reserve, they don’t like coins. And for–

Grey: It’s an unpleasant reminder that there’s other monetary traditions other than theirs, right?

Diehl: Yes. And coins are more expensive for the Federal Reserve: they’re heavier, they’re–

Grey: They have to pay face value, not the paper cost if they buy paper notes.

Diehl: Exactly, yes. And a dollar coin that was highly popular, the banks in particular didn’t like. Because what happens if you have a really popular coin? Customers come into the bank, they ask for it, they come to the drive-through. That imposes a cost on the banks they don’t want to incur. So no way, they weren’t going to do it, we couldn’t persuade them. It wasn’t a big enough issue for the Secretary of the Treasury or certainly the Chairman of the Fed to get involved in–

Grey: Small change for them.

Diehl: Yeah, exactly. Doesn’t matter. Penny-ante. And, so–

Grey: In fact, I believe I’ve read some Government Accountability Office reports saying, you know, it would be much better for costs and things to have less dollar paper notes and more dollar coins, but it’s very hard to get people to use it, and it would certainly be hard if the banks are not actually on board with helping people use it, and actively resist.

Diehl: Yes, yes. So, being entrepreneurial, we decided we’d go around the Fed and the banks. And I had a lunch with the brand new lobbyist for Walmart, who’d never done any lobbying before. He didn’t know this kind of entrepreneurial stuff wasn’t smart in Washington, D.C. So I said, what I want to do is I want to launch this coin on the same date in three thousand locations, Walmart locations across the country. And we will direct ship, you know – and it was, my recollection was it was two hundred million coins over the period of those two months – to all those locations. A huge number. They wanted as much as we could produce, well we couldn’t produce more than that. And so none of the banks ordered it, Walmart ordered it, and we did a marketing campaign, and at the end of January 2000, that coin was launched.

People lined up. People think the Sacagawea coin was a failure. And it ended up being a failure for a couple of reasons – one is hostility in the banks and the Federal Reserve. But when we launched it, people lined up at the stores. They were out of the coins by the end of the first day. They wanted to order more, we were on a production schedule. But when people couldn’t get the coin that they wanted at Walmart, they went to their banks, and the banks didn’t have them. And so they were embarrassed.

And so what did they do? They don’t say, “oh, you know, we made a mistake.” They call their contact at the Federal Reserve. And the complaints all come in to Greenspan, Greenspan calls the Secretary of the Treasury, I get a telephone call, and I explained why we had done it this way, and it faded the heat. But what we ended up doing was, we went back to Walmart and said, “we’re not going to be able to provide the second one hundred million coins.” It’s a government contract, and also they had achieved their objective.

So we took that hundred million coins, and direct shipped them to the banks based on orders they made online.

Grey: On the day.

Diehl: Huh?

Grey: On the day.

Diehl: Yes, yeah. And we direct shipped it because the process of getting coins from the Mint through the Federal Reserve to the banks was so slow that we, you know, it frustrated the demand. So we bit the bullet and direct shipped it to them, and so it kind of ended the controversy.

Grey: It’s an interesting story on two levels, because on one level it’s showing that – you know, people often say well the Fed wouldn’t accept the coin – well, maybe there are other people that would accept, maybe not a trillion, you know, not everyone’s looking for a trillion in cash, but there are certain investors and things that are looking for, you know, a billion dollars in liquid cash and things. And if you could say, “hey, you know, we can’t sell any more T-Bills this month, but we can sell some coins that you can store, and they’re legal tender, and they will satisfy your fiduciary responsibilities to invest in safe assets, you know, I think there could be people that’d be interested.

But the other part of that story is that, you know, we often think that, “oh the Fed said it can’t be done, so it can’t be done.” But the reality is that’s just one opinion of one agency within the government, and there’s other agencies with other opinions, and who ends up winning that battle when there’s a difference is often about who’s more creative in putting pressure in the right way. And the story you just told is about precisely putting the pressure. And you mentioned a similar story in the past about the 50 State Quarters, where the antagonist was the Treasury in that situation, if you want to share a little about that story.

Diehl: Well, opinions are a dime a dozen. And so of course, you have to look behind the opinions at the facts. And on all of these monetary issues, they’re very complex. So it’s hard to sort through, and usually you have to rely on somebody whose judgment and independence you trust. But the other thing is it’s crucial to look at what is the motive behind – the economic motive, the emotional motive, whatever–

Grey: The partisan, the political motive.

Diehl: …the power motive behind an opinion. And also, what is the strategic situation. For example, we are hearing from the Treasury Department and the White House that “no, no, we won’t do the dollar coin, I mean the trillion dollar coin. It’s a gimmick.” Well, okay, that may be a sincere expression of their intent, or their adamant commitment not to do it. But also it’s very clear that the White House and the Treasury Department wanted a particular outcome, which they got by standing firm. And to say, “yeah, you know, the trillion dollar coin is an option” releases the pressure, the negotiating pressure, to get the outcome they really wanted. And–

Grey: It was Margaret Thatcher that famously popularized “There Is No Alternative” as a justification–

Diehl: Yes.

Grey: …for doing anything. And often there was. But–

Diehl: Yup.

Grey: …it was a useful line. In fact, I remember speaking to some senior Treasury officials back – about the situation in 2011, and they said that. They said, “we didn’t want there to be another option,” because–

Diehl: Yes.

Grey: …we wanted to force the Republicans to come to the table.

Diehl: Yep.

Grey: And so anything that showed that this could be resolved on our side–

Diehl: Yeah.

Grey: …was inconvenient for us.

Diehl: And it’s easy to frame that in partisan terms. That, okay, the Democrats were smarter, tougher, stood hard this time, as opposed to last time; they prevailed. But it’s crucial to rise above that partisan – you know, it’s really a partisan dismissal of what’s really at stake.

Grey: That’s right.

Diehl: What’s at stake here is using the debt limit as a cudgel by threatening the country with default. And now it’s happened three times. The first two times, the Democrats compromised. They were the responsible party. And what did that do?

Grey: Yep.

Diehl: That just laid the foundation for the next time that–

Grey: Yep.

Diehl: …you know, that their opponents would push them to the wall. And this time, they took a stand and the prevailed.

Grey: And, you know, Mitch McConnell managed to get, what? Ten Senators, or something, on board with this, or to vote to change the rules to extend it for another two months? But–

Diehl: Very difficult.

Grey: …all you need–

Diehl: Very hard.

Grey: …all you need is a slightly more radical, you know, opposition party, or maybe not three branches, where there’s enough, you know, members on one side or the other. And yeah, I’ve described it as putting a gun to the head of the American economy–

Diehl: Yes.

Grey: …and saying, “we’ll pull the trigger if they don’t come to the table.” And, you know, even if they’re being unreasonable by not coming to the table, the fact that you’re putting a gun to the head of the American economy is its own form of, kind of, degradation of the process, and what the public understands, because you’re telling them something that isn’t true–

Diehl: Yes.

Grey: …to achieve an outcome–

Diehl: Yes.

Grey: …and in doing so eroding that trust in government, and in the fact that you can, that your politicians are actually telling you what is going on. And they’re doing so in a way that is playing with fire. And if it gets burned will affect everybody. And–

Diehl: Yes.

Grey: …we’ll go, “I can’t believe this happened,” you know?

Diehl: Yes, yeah. And in – I think in the past, when it came up in 2011, 2013, this became increasingly difficult to believe. But, there are some who believed – and some very smart people, savvy people, who believed – that this was only traditional politics: using leverage to – in a negotiating situation – to get an advantage over your opponents. I think we’ve increasingly come to realize – not just because of previous debt limit fights, but from other political situations – that there are people in the country who believe that they benefit, in terms of power and–

Grey: Disruption.

Diehl: …political organization by damaging the economy of the country when the opposing party will be held accountable for it. And it’s a form of economic sabotage. And there is still a group of people who would benefit from that. Or who could sustain their position for a period of time in those circumstances. But the vast majority of us would be losers.

Grey: And we saw that, almost, with some of the – some of the people motivated behind Brexit, for example.

Diehl: That’s right.

Grey: Now they might have been quite aware of how damaging it could be to their economy, but they didn’t care.

Diehl: Yeah.

Grey: So I don’t know if you don’t want to talk about the 50 State Quarter Program and the Treasury experience there, if you – we can move on on that one. But the other thing was, you know, people have been saying, “well, the Fed could just refuse to accept the coin, and it wouldn’t be booked as legal tender until it was sold. And so it’d have to be sold to someone first, and if the Fed refused to accept it then that would be that.” And you were telling me earlier about, sort of, the difference in the legal rules around when something gets counted as, you know, legal tender – when it leaves the Mint, versus when it gets to the Fed.

Diehl: Yes.

Grey: And it reminded me a little bit of when I teach in Contracts. You know, people talk about the Mailbox Rule, you know, when you accept a contract. You send it in the mail versus when the other person receives it; it’s a question of, kind of, when was it accepted. But can you tell us a little bit about that rule, and how it’s changed, and, sort of, what you think about it?

Diehl: You bet. First of all, I think this is a highly unlikely–

Grey: Right.

Diehl: …  theoretical scenario, where–

Grey: …the Federal Reserve would have to be refusing to go along with the Treasury, and saying, “we prefer default in this eleventh-hour moment”–

Diehl: Yes.

Grey: …we will be the ones putting our hand up, saying–

Diehl: Yes.

Grey: …‘we’re willing to cause this default–

Diehl: [Chuckling] yes.

Grey: …in the name of Federal Reserve independence, which, by the way, we hope will still be around tomorrow–

Diehl: That’s right.

Grey: …if we do this.”

Diehl: [Chuckling] Yes, yes. That’s one half of the equation that makes it virtually impossible to happen. The other half of it is just politically, the President, and the Secretary of Treasury, and the Chairman of the Federal Reserve are going to have to agree on doing this beforehand. It’s just, it’s inconceivable that the White House would try to jam this into the Fed. But, I mean, there are scenarios you can conjure up where something like that may happen. So–

Grey: I had a colleague remind me that it’s still on the books that the Treasury Secretary can remove the Fed Chairman for cause, and–

Diehl: Yes.

Grey: …maybe this would be moment–

Diehl: Yes, yes.

Grey: …that unthinkable moment where you might actually be able to remove the Fed Chairman for cause, because they’re standing in the way of preventing unconstitutional default.

Diehl: [Laughing] Yes. I definitely think that would be cause.

Grey: As far as stakes go, you would hope–

Diehl: Yeah, that would be cause.

Grey: …that would be high enough. If the President said, “it’s my sincere belief that–

Diehl: Yeah.

Grey: …this Fed Chair is standing in the way of us, you know, preventing default, I can’t imagine the Supreme Court getting in the way and reversing it. So, you know [shrugs].

Diehl: Yes, yes. And I can think of at least three members of the Senate who you could move into the Chairmanship of the Federal Reserve [clicks fingers] that would accept a trillion dollar coin that fast.

Grey: I won’t ask you to name their names right now.

Diehl: Yes, I’m not gonna name them. But they – and not just because it avoids default, but because there are a whole set of other policy issues that come together in the trillion dollar coin that people don’t talk about because they’re complex. Very complex. And they are downstream from what we are talking about here today.

So this caveat here, to answer your question – this is my recollection of what happened twenty-plus years ago at the United States Mint, and why it happened. And I do not know whether it has changed since then or not. I’d be very surprised if it changed because of the reason why it changed.

So during my term and before my term – during most of my term – seigniorage was booked when coins left the Mint loading dock, on its way to the Fed. So in the case of the trillion dollar coin, we, you know – the U.S. Mint strikes it, they send it to the loading dock, a truck takes it over to a helicopter, which flies it over to the Federal Reserve in New York City in an hour. So under that scenario, boom. The seigniorage would be booked immediately.

There was a point late in my term, when it was the OMB (the Office of Management and Budget), I believe – it could have been Treasury, but I think it was OMB – that changed that booking procedure. And changed it so that the seigniorage wasn’t booked until the Fed had accepted the coin. And – a quarter, whatever coin. And the reason – and it might have happened during the Fifty State Quarters Program (that would make sense) which was launched in 1999 – [was] because we were shipping so many coins to the Federal Reserve, that OMB looked at that and said, “oh, we need to change the incentives for the shipment of coins to the Federal Reserve.”

Grey: You’re too successful. You’re getting to many out the door.

Diehl: Well, it was just the concern that some time in the future the U.S. Mint would produce a whole bunch of coins, send them over to the Federal Reserve – or the Administration would order it to happen – and then inappropriately book – “inappropriately” [inverted fingers] book – all the seigniorage.

So – and this is ironic, because – when I got to the [Mint], there was this boom and bust cycle of the production of coins. And as you can imagine, the demand for coinage depends on the economic activity in the economy. More coins are needed when there’s more economic activity.

Grey: We had a coin shortage last year. I think it’s still enduring, because–

Diehl: Exactly.

Grey: …of the pandemic.

Diehl: Yes. And so – and this was magnified by the Fed’s terrible model for projecting coin demand. And so I had a very smart young economist, who I brought in and said, “uh, we gotta fix this.” Because what happens is we fall way behind in production when all of the sudden all of this demand comes in. And then so we’re so slow in cutting off production, the Federal Reserve vaults fill up with coins. Then those back up into – we had them not in vaults, but in hallways back in those days.

And then when demand comes back up, all that flows out; we have to crank up production. And so the irony of this is that we [the Mint] were responsible for changing the model that the Fed used in cutting down this shipment of excess coins and seigniorage and everything.

But – so, that change occurred. And that would obviously affect the trillion dollar coin, because if the Fed refused to accept it, then the seigniorage wouldn’t be booked. But as we were saying, that’s a highly unlikely situation for all kinds of reasons. It, you know, it would only be done as a failsafe measure. And –

Grey: And the rule that the OMB set could just be changed, right?

Diehl: Well that’s the other thing. Yeah.

Grey: It’s not legislative, it’s not statutory. It wasn’t Congressional intent. This is all within the executive branch, this is all internal baseball between different agencies and internal politics, right?

Diehl: [Nodding] It wasn’t even a regulatory rule change–

Grey: Right, so it wouldn’t need to go through the–

Diehl: …that required public notice and all that stuff. It was just [snaps fingers] you know, they’re just done.

Grey: So if Biden needed to change that rule five minutes before that coin got struck, he could, potentially.

Diehl: Yeah. Absolutely, yeah.

Grey: So I know we’ve been going – we’re [at] the end of time, but I’ve got one last question, sort of. You mentioned all of these downstream, second-order implications of the coin. One of the things that I was writing – and found this, you know, whole issue so fascinating – is because, you know, I was an elementary school teacher. I like social myths and public narratives – about how our government works, that provide the basis for us to understand the world we live in – that are accessible to people.

A colleague of mine – a sociologist named Jakob Feinig – talks about this term “monetary silencing:” where average people are taught to, you know, “you don’t need to know about this stuff. It’s very complicated. There’s people in the room – you know, who wear suits, who have finance backgrounds – they understand all of this stuff. You shouldn’t try to understand it at all, you know?

Diehl: Yes.

Grey: We need economic literacy and monetary/financial literacy in schools, but what we really mean is you,you know, you should balance your checkbook. You shouldn’t learn how the government actually works, and how this sort of ‘veil of money’ works.

And even, you know, very respected scholars who I otherwise respect, you know – there was an op-ed in the New York Times by Peter Coy, just recently, about this – they would say, “look, yes, it’s a Noble Lie that we can’t make money out of thin air, and things like that. But, you know, even if Noble Lies aren’t great in some situations, we shouldn’t probably be drawing attention to this too much right now.” And at least to me, if you look at the alternative, it’s this catastrophic debt ceiling that we keep coming back at. It’s politicians saying we can’t afford to deal with climate change, we can’t afford to deal with poverty, because we don’t have enough money.

And as you said before, it’s a useful political kind of rhetoric, to say, “oh, there’s no alternative to austerity. There’s no alternative.” But if there is an alternative, then these myths are not just things that keep the lights on – they are things that actively harm us. And maybe we could be looking to a new set of myths. Something that meets our new moment and our new needs.

And if we’re in a world now where – you know, bitcoin, and dog[e]coin, and all these things – people have embraced the idea that you can coin an asset out of thin air. It could literally be made of zeros and ones on a computer.

Diehl: [Chuckles] Yes.

Grey: And the value is: how people accept it, how people use it, what’s backing it, has it got the force of law behind it, et cetera. That, if we think about coins, there’s actually maybe a time for a renaissance of coins as a sort of symbol of the money power–

Diehl: [Nodding] Yeah.

Grey: …and going back to that two hundred year history. And one last little point on that before I get your thoughts is: I know that we’re in now this world of government digital currencies – we’ve been talking about, you know, they say a “central bank” digital currency.

Diehl: Yes.

Grey: And I’ve testified to Congress, saying “why don’t we talk about coinage? Why don’t we talk about digital coinage?” Because if you think about a bank account, there’s a third party in the middle. There’s not as much privacy. In fact, there’s a whole third-party legal doctrine that says you don’t have privacy if you put your money with the bank. But even paper currency has a barcode. Coins are the original, anonymous money. If it’s in your pocket, it’s yours.

And one of the earliest forms of digital currency that was tested by a government was Canada, and it was the Royal Mint. They created the “Mint Chip” program–

Diehl: Yes.

Grey: …and it was an attempt to create a digital coin. So maybe, you know, I’d be curious to your thoughts – as we’re entering a digital world, as we’re discussing how to create a whole new form of currency, that maybe the Mint should be in the room. Maybe we should be thinking about this beyond just the Federal Reserve. Beyond just a better bank account. And what lessons we can learn from the history of coinage – and from the design of coinage – even if it will be, you know, a digital equivalent.

Diehl: Well Mike Castle – Representative Mike Castle – back in, probably, ‘96, ‘97, had a Congressional hearing on the future of money. And I testified at that. And all these issues sort of came up in a primitive form.

Grey: You were talking about stored value cards at the time, if I remember that correctly.

Diehl: Yes, yeah, that’s exactly right. Stored value coins. And this is one of the things that I was – you raised one of the issues I was really intent on at the time – was that coinage is the ultimate private exchange. Cannot be traced.

And that – in those days, people weren’t concerned about privacy. I mean, it was amazing to me how nonchalant people were about privacy. And then we saw all that take off with social media. Where people told their life stories, and said things online that inevitably would come back to haunt them. And people just sort of didn’t care about it.

Well now, especially after 9/11 and the surveillance act–

Grey: The Patriot Act.

Diehl: Yeah, Patriot Act. People woke up to what that meant. And so, you know, it’s begun to sink into the culture. And I think you’re absolutely right.

You know, coinage is the physical embodiment of that set of privacy values, which are being expressed in what I believe is a highly-dangerous-to-individuals-form in crypt[o]currency. And also, you know, has the potential of destabilizing the larger economic system. So–

Grey: If the only kind of privacy we get is these volatile crypto private-currencies–

Diehl: Yes.

Grey: …then it will be a very bad day for privacy, because–

Diehl: Well, if we–

Grey: …it doesn’t have the full faith and credit of the United States. It doesn’t have that whole infrastructure. You can’t use it at a store, necessarily. All those kinds of things. 

Diehl: Well we’ve lived through that before too. Leading into the Civil War, when before there was the American Greenback.

Grey: Greenback, yeah.  

Diehl: And so you had all these banks issuing their own currency. And yeah, you know, if you were using it locally you knew something about the stability and reputation of that bank. But the further you got away from that bank, that note would still be used, and people didn’t know, you know, what was the providence behind this note. And–

Grey: I remember someone saying it used to be better to get a counterfeit note on a good bank–

Diehl: [Chuckling] Yes.

Grey: …than a good note on a bad bank.

Diehl: Exactly right, yes. And the U.S. could put up with that, economically. And there wasn’t the political will to do anything about it until the Civil War. And then the U.S. federal government – number one – had the ability to do it because half the nation who opposed doing anything about that left Congress. And the other was: we need to finance, you know, the war.

So necessity bred a change. And unfortunately that’s how the government works; our government works. It reacts. So there will have to be some disaster that occurs around cryptocurrency that will drive Congress, the Federal Reserve, the regulators, to do something about it. Hopefully that occurs somewhere else, not in the U.S., and we learn the lesson from somebody else.

But let me address the assumption that underlies this question. And that is that people don’t really understand fiat currency. I think that may have been true in the past. Probably was true in the past. But people have driven into their minds, over and over again – certainly since 2009, with the QE, and the, you know, and the opening, basically, of the flood of the money supply into the economy to save the economy (not just the U.S. economy, but the world economy) – people came to understand that what fiat currency means.

And they don’t necessarily understand what it means: the “full faith and credit of the United States Government.” What that means. But – especially when you’re threatening to default on your, you know–

Grey: Especially when it doesn’t mean as much as it used to, maybe.

Diehl: Yes, yes. So I think people are getting that. The other thing, why people are being educated on that, is that a conservative mantra has been against fiat currency [and] for the gold standard. And, you know, that’s been the case since, you know, ‘33? Since FDR got us off the gold standard. And – well, informally–

Grey: They’ve been predicting the–

Diehl: …and then Nixon took us off. But – so I think the predicate has been laid for the trillion dollar coin. People just don’t – it looks like a gimmick. And when you think about it, this is a branding problem.

Grey: Yep.

Diehl: Because “QE” (Quantitative Easing), it hides what it does. Those words, it sounds really complex. Beyond our comprehension. Whereas a trillion dollar coin sounds ludicrous, you know? Grey: Yep. What we’re doing is we’re easing, quantitatively–

Diehl: Yeah.

Grey: …with a trillion dollar coin. Let’s just, Mint Quantitative Easing. Yeah. And you’re absolutely right. You know, there were newspaper headlines: “oh trillions of dollars have been created.” If that was going to cause a panic in the streets, where was it? Where was it the last ten years? When the last debt ceiling crisis happened, even Standard & Poors downgraded the U.S. credit rating. And what happened? People flooded into Treasuries, not out of them.

And I remember Neel Kashkari, last year – the President of the Minneapolis Fed – said, “we have an infinite amount of dollars that we can use to save us from this crisis.” I’d never heard a Federal Reserve person use the word –

Diehl: [Chuckling] No, that is pretty good.

Grey: …“infinite” in public before. Maybe in private, but not in public. And the New York Times had an op-ed headline saying, “the Coronavirus money is being pulled out of thin air.” And if that’s not going to cause a crisis, you know, I think you’re right. The idea that the public can’t handle this truth that it’s too big, it’s too scary – even if that had some credibility in 2006, it doesn’t have the same credibility in 2021.

But maybe you’re right. Maybe it does take necessity to breed government action. And maybe we do need to get even closer to that debt ceiling cliff, you know, before we will entertain the unthinkable.

Diehl: If I could–

Grey: Sorry.

Diehl: If I could make one other point, that has really been impressing on me under these current circumstances. There will come a day when it’s inevitable: what comes down must also go up. And I’m talking about the inflation rate. And all know this in the back of our minds, that once the inflation rate goes up, and the federal government is no longer paying what is essentially zero-interest on an inflation-adjusted basis for, you know, on its bonds. When inflation goes up and we have to pay more, and we have thirty trillion dollars in debt, then we are going to see interest payments – the financing of that debt – devouring larger and larger sections of the federal budget.

Grey: Yeah.

Diehl: And coinage – and seigniorage – is one of the ways to think conceptually about how to deal with that. And this is particularly relevant in terms of the whole starve the beast strategy, [which] is that we will build all these deficits, at some point the government will have to face reality, and will have to start cutting social security, and killing all the old New Deal and Great Society programs. And Obamacare, now. All that will have to die, and there won’t be any choice.

Well, there are choices. And we just need to be aware that that day is gonna come.

Grey: And we need to be preparing pre-emptively to do that marketing work, and do that public education, and building the institutions. And I know I speak to people, and they say well, you know, even if the Treasury issued zero-interest financing, the Fed would pay interest on reserves if it wanted to raise the interest rate. So it doesn’t matter, which way.

And I say to them, “but you know it’s very different in the public mindset if this is the cost of ‘borrowing’ or the cost of government spending on one hand, or if it’s the Federal Reserve choosing to pay money – for free – to people because it wants a higher interest rate. If the Fed wants to do that – if it wants to take responsibility for paying, you know, hundreds of billions of dollars of interest as part of its monetary policy – it can take responsibility for doing that, and see whether or not that’s the best way to actually limit inflation.

There were debates in the ‘70’s, in the ‘50’s, about using other forms of qualitative and quantitative credit regulation, and other ways to limit, you know, investment in the economy – to cool the economy down – that didn’t require raising interest rates through the roof like Paul Volcker did. And my guess is when it’s easy to blame the Treasury for those interest payments, then it’s a lot easier for the Fed to raise rates. If the Fed had to own the politics of raising rates like that – and giving free money to interest-earning, you know, people who hold interest-earning reserves, or other assets issued by the Fed – and had to take responsibility for that on their balance sheet, my guess is they would be a little more creative about finding other ways to manage inflation.

Diehl: Yes, yeah. Yes.

Grey: Well thank you so much. It’s been an absolute pleasure, Director Diehl. I honestly feel like this is the kind of conversation that will hopefully go into the history books. Because I’ve never heard these kinds of stories from within the government before. So thank you so much for taking the time with me, and for your voice and for your courage in speaking out. And I hope I don’t have to see you again because we don’t have this problem recurring, but–

Diehl: [Chuckles] Yes.

Grey: …maybe we will, and I look forward to connecting again in the future. Thank you very much.

Diehl: My pleasure. Thank you.

End of Transcript

* Thanks to the Money on the Left production teamWilliam Saas (audio editor), Rohan Grey (transcription), & Meghan Saas (graphic art)


We are thrilled to present the very first Superstructure episode rereleased with a brand new transcript, brought to you by the generous effort of friend-of-the-show, Mike Lewis.

Framed by a cold open from Chapo Trap House’s recent Bernie retrospective, hosts Will Beaman and Maxximilian Seijo inaugurate the Superstructure podcast with a discussion of the failures of a reified left wing imagination. To chart a path forward for an MMT-informed leftist praxis, they critique reductive castigations of spectacle, damaging affirmations of scarcity and zero-sum politics as well as a burgeoning ‘anti-woke’ left-right coalition.

Transcript: Mike Lewis

Link to our Patreon:

Music: “Yum” from “This Would Be Funny If It Were Happening To Anyone But Me” EP by flirting.
Twitter: @actualflirting

Superstructure: Critique After Bernie Transcript

Amber A’Lee Frost  00:00

You’re trying to convince people that the media is just a bunch of fucking spectacle and to ignore and not let them psych you out.

Will Menaker  00:08

Well, I mean, but that didn’t happen. And it didn’t happen here either.

Amber A’Lee Frost  00:10

No it didn’t happen. But it didn’t happen here either. But you know what, that’s going to have to be the thing that we do. Like, sorry it didn’t happen last time. Sorry it didn’t happen this time. But that’s the thing. Yes, it didn’t work that time. It didn’t work this other time. But that is the challenge. It’s going to be hard. And we’re not going to succeed at it most of the time. But, you keep doing it.

Will Menaker  00:27

Oh, the question I just have is, who are we talking to? Are we talking to like—and let’s talk about America specifically—clearly, an absolute majority of Democratic primary voters, the people who vote in democratic primaries, if they didn’t believe what the mainstream media was saying about Bernie, they took the message from it that he was unelectable. In either way, he was not an option for them no matter what he said. And then there’s the other group of people who we were hoping to get; the people who are not taking their cues from the media, either by believing what they say or taking their attitude toward Sanders as, like an indication of his viability. And not enough of them were reached to be mobilized to vote for him. So where? Because your rhetorical attitude is going to be different depending on which group of people you’re talking to.

Amber A’Lee Frost  01:23

Yeah, obviously. But…

Will Menaker  01:26

So I guess the question is which one, which group of people is the one that maybe in retrospect, should have been addressed more explicitly with a specific message? Or in the future should be?

Amber A’Lee Frost  01:38

I think the latter, just because, and I’m not saying this is a moral position, just because I think they’re the bigger group of people.

Will Menaker  01:45

Right, but we’ve seen that even though they’re a bigger group, they are harder to reach.

Amber A’Lee Frost  01:48

Well, we’re trying for a harder task.

Will Menaker  01:51


Amber A’Lee Frost  01:51

We’re doing something hard.

Will Menaker  01:53


Amber A’Lee Frost  01:53

No one wants to hear that. Like, you’re going to fail like nine times out of ten. Because this is very hard.

Will Menaker  01:57

People do want to have…they need some sort of I mean…Yeah, they might know they’re gonna fail, but they need to know that they could win.

Amber A’Lee Frost  02:03

Well, I’m telling you: we can win.

Will Menaker  02:07

Alright, but I guess … how do you get to the people who have decided that politics is not real for a good reason? Who saw the Sanders campaign and were completely unmoved by any part of it.

Amber A’Lee Frost  02:21

I don’t have like that kind of alchemy.

Maxx Seijo  02:27

Will, what did we just listen to?

Will Beaman  02:31

So that was Chapo Trap House reflecting on Bernie dropping out of the race.

Maxx Seijo  02:37

“Reflecting” might not be the right word.

Will Beaman  02:39

Basically, reiterating everything that they believed before the race is probably a little bit more accurate. This stood out to me as a kind of paradigmatic example of what a lot of the reactions from Marxist left that I’ve been seeing have been. It’s just they disagree, but there is consensus on a kind of a hopelessness, and Amber just kind of takes a different, you know, attitude towards that, which is basically that leftists need to just toughen up and keep going.

Maxx Seijo  02:57

It’s interesting, because I think what you said just there sort of crystallizes, you know, pun intended, perhaps crystallizes the why we’re talking to each other right now, which is that it seems like the guiding response to Bernie’s loss, you know, if we can call it that, has been hopelessness and a real inability to articulate a theoretical and political path forward for the left in the US that isn’t a sort of retrenchment or reduction of its scale and aspirations.

Will Beaman  03:54


Maxx Seijo  03:54

And on Superstructure, you know, which, I suppose we could take a bit to explain the title as well. We reject that vision, and we think that it’s one which, because politics never stops, it’s one which will actually condition and produce a set of outcomes that are radical but quite destructive.

Will Beaman  04:22

Right. The name Superstructure: it’s something that for Marxists, I think, probably immediately sounds like a huge self-own, but that’s kind of why we’re doing it because I feel like what’s guiding this response is the idea that ideas are the problem, or they’re a distraction. And the media is basically it’s a distraction that you need to ignore. Yeah, right. And everything that isn’t a grind basically is a spectacle. And this is actually something that goes pretty deep into the core of Marxism, which really is this skepticism of ideas, of thought, of communication, of everything that is not this sort of class struggle by sheer numbers and force that there’s no way around it except, you know, having exponentially increasing our, you know, number of people that we have phone banking and things like that. And, you know, none of those things are wrong or bad to do necessarily, but it does create this reaction to what I think should be looked at as an ideological loss, as well as a literal loss. It creates a reaction to it that’s sort of like, well, that was our one chance after these 30 year cycles where the left gets a chance to win, basically, by doing the same thing. And if there are lessons that they want to take away from it, they’re are going to be you know, kind of slight adjustments. No new theory creation is on the table. And Maxx, you and I come from, you know, different backgrounds a little bit, but we’re in the same milieu which is, you know, Modern Monetary Theory. And basically the idea that this is a new paradigm that actually opens up a lot of new, a lot of new political opportunities that we wouldn’t see before.

Maxx Seijo  06:28

The spectacle. Another way of putting it is it opens the left to alchemy, right? It opens the left to a sort of magical thinking, but I don’t use that in its reductive, like negative terms. I think it opens the left to the possibility of creating things out of thin air, which is what money, right, is and it’s a political creation throughout. And so yeah, it’s interesting to hear and to have so clearly encapsulated in the discussions around Bernie’s loss, this sort of, “well, you know, we’re gonna lose, and we’re gonna lose most of the time. But we need to ignore the spectacle, and we need to keep…”

Will Beaman  07:17


Maxx Seijo  07:17

I mean, it’s essentially, I mean, it deconstructs itself, right? The reason why we lose is because we ignore the spectacle. We’re trying to reject alchemy, and if we think of it along those terms, and if we think about, you know, the ability to actually exert political power over the spectacle, and to actually reject the very concept of the spectacle in the first place, which is what I mean, we could easily call this podcast The Spectacle as well as, you know, rather than Superstructure, which is to say…

Will Beaman  08:00

Maybe we should, we haven’t released this yet. Yeah.

Maxx Seijo  08:03

Which is to say, ultimately, that the new paradigm has to be, we have to be immanent, right? And I’m normally someone who in my work, in my thinking, rejects philosophical immanence. But, the left lacks a real immanence to the spectacle, and to the “superstructure” is that it assumes the solutions, this sort of utopian aspirations, or even just pragmatic aspirations of a left political project, is about getting outside of money, getting outside of the social relations that we all share and participate in on a daily level. We have to just ignore the media. We have to, you know, we have to ignore all that stuff and go to the place where power rises from, right? And this is, like, on the other end, a sort of critique of this sort of philosophical category of immanence, which would posit that they’re reducing it down, the source of being as such is not just the material, but it sort of reduces down to this sort of fundamental level with which power rises up, right?

Will Beaman  09:30


Maxx Seijo  09:30

Ground up. And everything else on top is pure domination. It’s bile politics. It’s all these things, and we can talk more about that at length, but I think it’s important to frame what we see this podcast being as an intervention into the realm of praxis and what a left political praxis means for the aesthetic level, at the economic level, at the level of struggle to say that we ignore our leverage, and the capacity to build just, inclusive structures, social structures at our own peril, because we can’t ultimately get outside of them. Right? I mean, that’s the sort of the lamenting history of critical theory is, we can’t get outside them, so we have to work through them. And it’s one thing to pay homage to, well, we can try to work through them, or to set up these like binaries of electoralism versus immediate class struggle, but ultimately, electoralism, or a media class struggle. It’s all political. And it’s all inside the structures of society as such, and so strategically, we have to work with ideas, and we have to work with material struggle. They have to be linked and strategically leveraged. And so what Chapo and the sort of ChapoJacobin-left lens has done is set up this imagination that Bernie was it because Bernie leveraged our only theoretical apparatus to its nth degree, and it failed.

Will Beaman  11:39


Maxx Seijo  11:39

What is there to do now?

Will Beaman  11:40

Yeah, and the failure, basically, it takes the form of, you know, like a sand castle getting knocked over or something, you know? Like it, it really is, like, we have to start all over, you know, with this kind of building this like Katamari ball of working class power, that the reason that, you know, they use visuals, like, you know, “Rising” and, you know, “bottom up” and these things is because there are appeals to, you know, to physics and things that don’t involve ideas.

Maxx Seijo  12:12


Will Beaman  12:13

You know, ideas, the reason that they think ideas are spectacle is because they believe that power, essentially, is totally immanent, and the ideas are secondary, you know, like, whoever’s the biggest guy on the block is gonna get to decide what all the ideas are, and then we’re all going to be kind of consuming them or something. But until we kind of, you know, take over through this mindless and demoralizing thing that we try again every three decades when there’s an opening.

Maxx Seijo  12:36

Yeah yeah. Yeah, yeah. And I think it’s also important to say, like, we’re not Hegelians. We’re not trying to retrench and say, well, ya know, we reject materialism and blah, blah, blah…I think another way to put this, which is to say that, if Marx wanted to keep the dialectic, and essentially keep the idea of universal particularity, what we’re trying to do is to take what materialism is, and sync with how the material and the idea, constitute and mutually constitute one another. Which is sort of in the spirit of Marx, right? It’s in the spirit of Marx, but it’s important to say that, fundamentally speaking, there’s a anti teleological core to this project that we share, and obviously, we’re not in any way the sort of origins of this. But there’s some…

Will Beaman  13:58

Yeah, and by anti teleological, you mean that we’re against the idea of a predestined path that we’re on a gravitational drift toward.

Maxx Seijo  14:10

That’s right, right?

Will Beaman  14:11

And a way that erases the kind of conscious world-making that we do through, you know, not literally just through coming up with ideas, anybody can come up with an idea, but it is nevertheless ideas that tell people what, ideas that condition what people believe is materially possible.

Maxx Seijo  14:32


Will Beaman  14:32

And so the ideas are organizing the material world. Ideas in a certain sense, you know, once they’re established and become going concerns that are, you know, reproduced along with the rest of society, you have something where, what Marxists believe is the superstructure: this kind of passive reflection of our material circumstances. You know, some of those things should constitute the base, as well. The superstructure is the base. I guess is another way of putting it.

Maxx Seijo  15:08

The superstructure is the base and you know, unless we realize that and invert that structure. I mean, and again, we’re being perhaps a bit cheekily immanent here. We might even reject binary as such, but until we leverage political agency through an ideological formation as a process of political creation on all fronts, right? On all fronts. We won’t have a cohesive and universal project. Right? I mean, that’s been the left’s fracturing problem since the beginning. But I think we’ve opined on this enough, and, you know, it could be useful then to go into a few examples of how this sort of idea is manifesting that this one that we’re critiquing that is sort of encapsulated in that Chapo clip throughout other facets of the sort of dominant left media structure.

Will Beaman  16:18

Yeah. So part of what I wanted to do is survey the landscape a little bit, just because it seems like we’re at a breaking point now where they feel like “okay, the left have lost, we need to look around ourselves materially and see, you know, who’s there that we can build a coalition with.” You know, being real politic and pragmatic, and all of that kind of thing. And what you end up with basically is well, it’s all the Trump people, right? Like, it’s, you know, and maybe not literally diehard MAGA people, but there is an idea that to the extent that it’s successful to rail against identity politics and “wokeness”, then that’s something that the left should do if it wants to be relevant, because that’s just kind of how everybody is thinking already. And I don’t think that there’s really a better example of that right now. The most advanced case of this sickness I guess, I would say is Rising, the show on Youtube from The Hill TV; seems to have tapped into a lot of like The Young Turks audience, some Bernie people, some conservatives, but mostly it’s like a Crossfire-esque show that has a “left wing populist” and “right wing populist” debating for a mostly pro-Bernie audience that is basically being warmed up to the idea that the real, necessary discourse in order for the left to have any power is going to be debating in good faith with “right wing populism.”

Maxx Seijo  18:02

Who hosts that show again?

Will Beaman  18:04

So Krystal Ball is a former MSNBC person. She is the left populist, the right populist is Saagar Enjeti who is a former Daily Caller person. The Daily Caller is the media outlet that Tucker Carlson founded. They’ve had a couple of official crossovers with Tucker Carlson now where Krystal will go on Tucker’s show and kind of do like, you know, “I’m just at my wit’s end with the bad parts of the left.” And then they’ll you know, kind of commiserate on, you know, the anti identity politics or hating corporate democrats or something like that. And, yeah, I mean, it’s just, you know, you can hear the basic structure of what Saagar says, a lot representing right wing populism, you know, is this sort of idea of economics being about trade-offs, and that mapping onto something like immigration where you can’t let migrants into the country because they’ll drive down wages and harm the working class. And then of course, there’s a long history of leftist kind of flirtations with this sort of idea.

Maxx Seijo  19:28

It’s important to say that Bernie is not outside of this, right? Bernie is also culpable on these terms, too.

Will Beaman  19:33

Yeah right, completely. Yeah, he said open borders was a Koch brothers proposal, you know, blah, blah, blah. And to the extent that Bernie is better on it, it’s because he stakes the entire claim that it’s possible to have open or almost open borders during times when it is possible, because we’re just doing so well economically that it’s not going to be like, you know, a big loss for us. So Jacobin had a review of their show, which I think just kind of encapsulates what I’m concerned the kind of institutional left’s reaction is going to be to these kind of flirtations with with Red-Brownism. So he, the reviewer talks first about Krystal, you know, then about Saagar. He had nothing but good things to say about Krystal. And then Saagar, he says: “Repeatedly [Saagar] warns us that the ‘electoral failure of the American left will be economic progressives kowtowing to woke identitarians.’ I agree with him — but what’s maybe more important is that I agree because (like Saagar, I suspect) I want the Left to win. Is Enjeti a secret Bernie-bro receiving late-night directives from Jeff Weaver in undisclosed DC parking garages?” You know, and then goes, “I think not” but you can’t figure out why this guy who keeps you know, sprinkling in that he’s a Republican who used to work for Tucker Carlson is sounding a lot like a Marxist to him. And it’s, it’s bad. And then later in the review, he says, talking about Krystal Ball again, and the consensus between them: “Ball’s arms-length relationship with “socialism” might have something to do with one area where she and Saagar agree most — not on markets nor the role of government, but on the invidiousness of identity politics. Unlike many millennial left wingers…” Notice the word ‘millennial’ is always used as a modifier…

Maxx Seijo  20:41


Will Beaman  20:52

… to go by that, you know, these are university students. Yeah, their children, basically, they’re superstructure. “Ball is completely uninterested in identitarian pandering. She loathes it. And part of Rising’s successful formula is that the hosts reject the “woke” culture-war approach to politics that so many on the…” oh god…”is that so many on the young, hip Brooklyn-by-Oakland left mistake for politics.”

Maxx Seijo  22:06

Brooklyn-by-Oakland is one of the most heinous…Ughhhh

Will Beaman  22:09

Yeah, I mean, it’s brutal. It’s also just really funny whenever Jacobin, you know, kind of does. It’s just you can just feel the self-loathing.

Maxx Seijo  22:19

Yeah the Cosmopolitan. We are the Cosmopolitan elites. Like, that’s the ooo…yikes.

Will Beaman  22:24

Yeah, we have to check ourselves that we’re not, that our globalist roots aren’t gonna betray the working class.

Maxx Seijo  22:32

It’s so funny, because this actually reminds me and it’s something that the left spent so long making fun of is this, like, this really reminds me of the sort of JD Vance kind of Hillbilly Elegy in reverse, right? So after 2016, the liberal wing of the Democratic Party really thought, “Oh, well, we haven’t been listening to these, you know, these white working class voters in Pennsylvania and in Michigan, and in Ohio, and we have to go on the ground. And we have to give them a voice.” Right? “We have to look at them with nuance, and really take into consideration why they hate Black and brown people so much.” And, you know, obviously like this is all not to say that we shouldn’t take everyone into consideration, and that symptoms and racism isn’t filtered through an entire social structure of scarcity and ideology that can be addressed at its roots. Right? Which is not–that’s not what that is. It’s about naturalizing and reifying the ideological and economic “realities” that a left political movement has to address.

Will Beaman  23:18


Maxx Seijo  23:53

And to say that “Oh, okay, the Brooklyn and Oakland, left woke identity…”

Will Beaman  24:02


Maxx Seijo  24:03

Brooklyn-by-Oakland – excuse me for not paying homage to the literary sophistication. The Brooklyn-by-Oakland elite, the Brooklyn-by-Oakland sort of woke identitarian left needs to take a backseat like I don’t know, I mean, it’s one of those things that as you’re suggesting, if The Daily Caller and Jacobin are agreeing, and if you really can’t see why that’s a problem, I really, that’s a bad sign. And it comes down to this question of the spectacle and ignoring the superstructure and ignoring identity politics, and the alchemy associated with a non-class base, reductively class-based vision, what dependence and what inclusion and what a sort of unified or universalist lens brings. Because the moment we start reducing to class, we start excluding.

Will Beaman  25:19

Right, and they have a way that they talk about identity itself, even though they believe that identity is bullshit, they also seem to believe that it is scarce and that you need to protect the identities of everybody that you need in order to win. And therefore, you know, you shouldn’t alienate them with woke identity politics, and, you know, blah, blah, blah. And, of course, it all comes back to, you know, denying the ability to just like, they deny that you can create money and give it to people to you know, build something new, they, they similarly deny that you can paint a new picture of the world that includes everybody, you know, and there’s a connection, you know, between the fact that they think that, that the world and everything in our lives is a scarce thing that we’re fighting over. And that therefore we all need to make make sacrifices for each other’s interests, which are opposed to each other. But ideally, you know, there’s like some kind of a happy medium that we could find. And the idea that politics itself is just kind of redistribution through either, you know, the dispersion between wages and salaries at the point of production, or through taxation, basically. There’s just no discussion on the left about building a new world, it’s just fighting over the world that has already been created solely on the terms of people who had no intention of including everyone.

Maxx Seijo  27:02

Yeah, it’s such a great lens to think through it. I mean, one gets this sense that, like, the majority of the last sort of five years of US politics has been a debate over whether we should be taxing whiteness, to pay for, you know, a space for Blackness, or taxing Blackness to pay for a space for whiteness. And, obviously, we need to shatter that entire structure. And I think, you know, something that probably is going to come up on this show, as we move on more is gender and the question of, really the malleability of identity forms, and how that actually can be mapped back on to economic formulations, in a non-zero sum way. And I don’t want to get too far ahead, but that’s just a sort of signpost for listeners to think about what we can expect on this show. And I think now would perhaps be a good time to move to another example of this sort of thinking.

Will Beaman  28:07

Yeah, so it’s not even just the Marxist left. I mean, don’t get me wrong, like it is the Marxist left. You know, you have other podcasts like Red Scare, you know, that just had Steve Bannon on. You know, things like that, but even among people who are, you know, interested in fiscal policy as something that’s constructive, and not just redistributive, it’s, you still get this refrain that is basically this kind of the same sound finance logic, you know, that they’re applying to just culture and identity instead. So I wanted to read something from a really big Twitter thread that Thomas Fazi had a couple of months ago now. I think this was right after the big labor wipe out when, you know, kind of similar to what’s happening in the US, you know, what was happening there is you have basically a bunch of Marxists who had kind of dug their heels in on defending zero sum terms. And actually, before I even get into Thomas Fazi, I guess I should set it up with an article that James Medway wrote. James is a policy adviser to John McDonnell.

Maxx Seijo  29:29

Former policy adviser John McDonnell.

Will Beaman  29:31

Former policy adviser

Maxx Seijo  29:32

Shadow Chancellor for Corbyn’s opposition.

Will Beaman  29:36

Right. Yeah, and so I won’t read the whole thing, but there is a section that starts literally with “the economy is a zero sum game.” “The economy is a zero sum game. This is the starting point. Understanding this was critical to the success of the 2017 Manifesto. Failing to understand it was critical to the failure of 2019. The economy has grown weekly since 2008. Real wages have not, and public services have disintegrated. An economy that behaves like this in which some people get richer, but most very visibly not, is one in which the broad promise of growth is broken down. Many people perceive the economy to be, broadly speaking, a racket in which a minority at the top are doing well at the expense of others. And they are broadly speaking, correct.” So we have growth in this finite world, but for some reason, we’re getting all this economic growth, and we’re still, you know, just producing this shit world. So what he then gets to is where we would just be like, okay, well, maybe we should talk about growth differently in a way that’s, you know, inclusive, he says, “To see the economy like this is to see it as a zero-sum game whose brutal logic is this: I can only do better if somebody else does worse. If I want to be better off, someone else must be worse off. The political logic that follows from this is equally simple: to talk about winners, you first have to talk about losers. You will get a license to describe the new world you want to build if you first describe, to be blunt, how it will be paid for.” Which is basically like, you know, you only get to talk about the new world that you want to see if you put as a disclaimer that we’re really just moving things around in the old world and not building anything new.

Maxx Seijo  31:30

And it’s so just mind bogglingly, like, upsetting about this is the fact that this is how Nancy Pelosi views the world.

Will Beaman  31:39


Maxx Seijo  31:40

This is the Nancy Pelosi vision of the world. That’s why you need PAYGO. Right? I mean, it’s so interesting to think about it in these terms. Because how do you then go to an electorate and say: we want to, for example, build houses for the homeless, and just do that, and give people who are “rough sleepers”, as it’s called in the UK, a place, a space to live.

Will Beaman  32:24

Yeah, in order to talk about that, you have to first say whose space you’re taking away.

Maxx Seijo  32:29

Exactly, right?

Will Beaman  32:29

So you have to tie the existence of homeless people to parasitism.

Maxx Seijo  32:36


Will Beaman  32:37

The non-existence of someone else.

Maxx Seijo  32:39

And we have the space!

Will Beaman  32:40


Maxx Seijo  32:41

We have the space! I mean, isn’t that obvious? And so, it’s one of those, you know, I mean, I think there’s gonna be a sort of theme, which is just: I am angry. I am angry about the world and about these naturalizations of scarcity, and that’s gonna come out because you know, what? The left, you know, sure, the right, they’re reactionary, they’re racist, they’d much rather kill half the earth than cede any ground and have to be defeated. But the left is reifying that worldview. And that is deeply, deeply upsetting for anyone who believes any sense of universal justice and universal inclusion.

Will Beaman  33:30


Maxx Seijo  33:31

And it’s one of those things that played out in the Labour election, and, you know, there’s a way in which, to be nuanced about it, it’s sort of understandable, you know. You tell a precarious polity that someone has to lose. Someone has to lose. Of course, they’re going to think that it’s them. Right? And these are people like, and that’s not to say that the polity as such, are this sort of middle class, white cosmopolitans, right? I think we even saw this playing out in Biden’s popularity in the South, and I’d be interested to bring on more perspectives on this, but there’s a lot to lose. Even for people who are marginalized, people have a lot to lose, and to tell them that we can’t do anything better, unless we lose.   

Will Beaman  34:29

Right. Or that you’re not really going to lose because there’s this global financial elite that actually has all of the money. It’s very easy then for that to, you know, obviously it begs the question of why aren’t we retrenching into nationalism, and national identity?

Maxx Seijo  34:47


Will Beaman  34:48

If the core of all people can more or less be okay, which is what the left is basically arguing, then, we’re supposed to still be giving things up to external actors? Like the whole thing is, yeah, and it just paves the way for people to critique the Meadway position on the ground, basically correctly pointing out that it’s weak.

Maxx Seijo  35:20


Will Beaman  35:21

But in a way that affirms some sense of expansion, but only on the terms of the Nation. And one big example of this that we saw is this guy, Thomas Fazi, who is, you know, a prominent MMT-adjacent person. I think he would definitely identify himself as MMT, but we want to be clear that there’s a distinction that we’re drawing here which is basically: if you accept that money is boundless and abstractly mediated creation of society is boundless, then you can’t keep talking about everybody’s place in the world, as if it’s not also, you know, like that also turns on whether or not we’re choosing to use our boundless potential to give everybody space in the world. And Fazi is a really good example of somebody who, you know, kind of mobilizes the rhetoric of, you know, the government could just deficit spend, but we’ve had that ability taken from us by the EU, which is, of course, true, in a sense. But the narrative that comes out of it, basically, is that we’ve been alienated from our own sovereignty by the global elite, and what we need to do is unlock the power of the nation-state, but realize, then—and this was kind of his sleight of hand—realize then that the nation-state is dependent on a culturally-fixed subject, if that makes sense.

Maxx Seijo  37:16

And territorialized, as well.

Will Beaman  37:17

Right. Yeah. So in this Twitter thread, he says, “The woke left likes to vilify the nation-state, but all the major social, economic and political advancements of the past centuries were achieved through the institutions of the democratic nation-state, not through international, multilateral or supranational institutions.” Which, you know, I mean, there’s, I’m pretty sure I can think of some examples of internationalist movements and internationally-coordinated.

Maxx Seijo  37:48

No, no, no: we’re just gonna, we’ll pass right through that one.

Will Beaman  37:52

Yeah, actually, let’s just skip over that counterfactual. “Furthermore, modern concepts of “natural identity” of national identity…” You see a little Freudian slip, there.

Maxx Seijo  38:04


Will Beaman  38:05

“…are incredibly ‘progressive,’ based as they are on transcending individual particularities – sex, race, biology, religion, etc. – to create cultural-political identities based on participation, equality, citizenship, representation.” I just I love how kind of paradoxical this little line is, you know, that we’re transcending individual particularities in order to create a universalism that’s exclusive.

Maxx Seijo  38:35

Yeah, well, it’s just yeah, it’s an individual identity-particular social relation. That’s what the nation is. You critique a internationalist vision that seeks to sort of take these given forms, which are ambivalent these nation-states, and sort of create some sort of universalist project in order to transcend them in order to just round down that same logic as a mode of justifying the exclusion which you ultimately want to conduct. And it’s so funny to me, and this also comes back down to the sort of Meadway, like, essentially he’s teeing up fascism here.

Will Beaman  39:22


Maxx Seijo  39:23

Which is to say that you’re not going to out-exclude the right. You’re not going to out-scarcity the right. I’m sorry.

Will Beaman  39:34

Right. Because they’re the ones who believe in Manifest Destiny and believe that you should take maximally in a zero sum situation. So of course they’re going to be the ones who are making a more compelling vision than your fully-costed.

Maxx Seijo  39:48

Yeah. Fully-costed, fully-automated luxury communism. I mean, I’m sure there’s many ways to metaphorically like render this just complete absurdity of this vision. I mean, essentially what the left has been trying to do is walk on to the field, right? And Meadway talks about, you know, the economy as a zero sum game, and it’s to accept that this thing called the economy is this sort of thing, right? Not a social relation that we have agency at varying levels of the process over. And to then say, “Okay, well, we’re gonna play your game on your your field. We’re gonna play your scarcity struggle game, and on your terms, and we’re going to try and beat you where you have the advantage and the upper hand. Because, yeah, sure we have these morals that they hamper us. They make us strategically less effective. They make us worse at the game.”

Will Beaman  40:59

Right. Which is such a repeating trope that you hear in all the postmortems about Bernie.

Maxx Seijo  41:05

Yep. We’re worse. We’re not as we’re not as ruthless, right?

Will Beaman  41:09


Maxx Seijo  41:10

Chapo has gone on about this about Hillary Clinton, just how ruthless she is. “We’re not as ruthless. We can’t win this game. We lose most of the time because we don’t have the alchemy that the right does.” But you know what that alchemy that the right has is? It’s the full embodiment of the commitment to scarcity that the left is just is dabbling with and hoping that it can, you know, have a little exclusion as a treat. Instead of rejecting the logic of exclusion in the first place, and really taking on a non-zero sum vision that calls into question—it really calls into question. This is unsettling. And I understand how unsettling this is. The fact that all of these forms—what constitutes the economy, what constitutes growth, what constitutes identity—these are malleable; these are up for debate; these are not biological forms.

Will Beaman  42:06

Yeah. Well, I would stop you there and continue reading from Fazi because he actually has a theory of national biology that I want to get into.

Maxx Seijo  42:18


Will Beaman  42:19

Yeah, he says, “While national identity is, of course, constantly evolving, the pace of the change is everything.When the national community perceives the pace of change to be too fast (for example a too-rapid inflow of immigrants with very different cultural and social norms), it naturally, instinctively…” like white blood cell, no I’m just kidding. “…instinctively reacts against the breakdown of social cohesion. To equate this with racism is absurd.” Yeah, and in case any of us were thinking about racism, for some reason, while he said that.

Maxx Seijo  42:55

Yeah, yeah, yeah, no. Famously “borders,” they’re good for the left! They’re good for, you know, communities of color. You know, it’s funny that there’s one thing like, we’ve been shit-talking a lot of the sort of established left, but there is a segment of the American left that has a sort of nuanced understanding. And, you know, and most importantly, a historical understanding of…

Will Beaman  43:08

Right, yeah.

Maxx Seijo  43:30

…the forces that have been at play here. And I’m thinking as well of the likes of, you know, some like Daniel Denvir, who hosts The Dig podcast. In his book about how the American border and the struggle for not only immigrant rights, but also indigenous rights as a sort of function of, of borders, and territorialization has been the crux of the left’s fight for justice. And it’s been the crux of the right’s project. And you mentioned Manifest Destiny, and I also think Greg Grandin despite a lot of problems that I have.

Will Beaman  44:09

Future friend of the show, Greg Grandin. Yeah.

Maxx Seijo  44:11

Future friend of the show, Greg Grandin. A lot of the problems I have with his framing, also, like historically captures this is that, you know, Fazi is not your friend. Blue Labour is not your friend. Amber A’Lee Frost. Red Scare. They’re not your friend. Right? These are people who represent a segment of “the left” that will capitulate to The Daily Caller. They will. They will sacrifice. They will make pragmatic sacrifices.

Will Beaman  44:48


Maxx Seijo  44:48

In order to “attain power”. And you know, historically speaking, you know, if you look to the Weimar example, if you look to other examples, this is a sort of mode that has not turned out to be one that forwards the inclusive vision of what the left needs to represent and what we will posit⁠—this sort of non-zero sum MMT-inflected ideological project⁠—needs to represent.

Will Beaman  45:21

Yeah, I mean, it’s just put simply, it’s a lot easier to defend your humanity if it’s not on zero sum terms, you know? If it’s not on the terms of I have a right to exist even though that’s going to bring down wages a little bit. You know, which is, it’s the position that really good people on the left, and you know, the reason why I strongly identify with the left even with people who I don’t think are MMTers yet is because I think that we do, nevertheless share values. And I just think that MMT is, you know, you need that non-zero sum vision in order to realize them, and in order to not just be plunged into a huge kind of pessimism, you know? And you saw that kind of like, when we opened with the with the Chapo clip, you know, I mean, Matt Chrisman was just extremely, extremely pessimistic. You know, Amber was in the acceptance stage of grieving already and was ready to move on to newer and better anti-woke alliances.

Maxx Seijo  46:31


Will Beaman  46:31

Yeah, coalitions. Right. Yeah, just another good member of my coalition that I need to win.

Maxx Seijo  46:36

Yeah, and it’s funny, because this is a sort of nice way to actually think about what came of Bernie’s campaign that was actually quite, quite inspiring, which was. And I think, the impulses are there too, even within Chapo Like, there’s a lot of things that they talked about, and did that was, that was really moving. And important. But the Brooklyn rally with AOC, when Bernie said to, you know, look around to your left and right, and really see the shared humanity of everyone, it really foregrounds the fact that, you know, I’m sure people look to their left, and they look to their right, and there were people in the top 5% of the tax bracket.

Will Beaman  47:23


Maxx Seijo  47:24

I mean, which is not to say that people in the top 5% of the tax bracket aren’t privileged in some sense, or don’t have more power or don’t have far too much power over the political process. That’s not the point. The point is, is that you don’t need their money. We don’t need their money.

Will Beaman  47:41

Yeah. We shouldn’t be hearing from that “Are you willing to pay higher taxes for somebody that is different from you,” you know, or something.

Maxx Seijo  47:49

Right! And that’s not what Bernie was saying either.

Will Beaman  47:52


Maxx Seijo  47:52

Right, then that’s important. And that’s one of the things that, you know, which is why Bernie is so important for the left. But it’s one thing to say “Bernie is all we have and ever have. And his ideas are all we have are all we’ll ever have.” And it’s another thing altogether to say, “There are kernels of a path here. We need to hone in them. We need to develop them. We need to build a cohesive vision out of them and leverage every site of power we have over the political process along the way.”

Will Beaman  48:35

Yeah, I mean, it’s profoundly pessimistic to look at this situation where because Bernie lost, even though we are now completely throwing paying for Coronavirus relief out the window, the first time we’ve done that for anything, like ever in decades, you know.

Maxx Seijo  48:59

Except for wars.

Will Beaman  49:00

Right. Yeah, except on the terms of, you know, righteous exclusion that we’re gonna need to do.

Maxx Seijo  49:06

Wall Street, wars, righteous exclusion.

Will Beaman  49:06

Yeah. But no, like, this really is the first time in a while that, like, there is an ideological paradigm shift. And, you know, I mean, there’s Ross Douthat was just on on The Daily, you know, the other day. Ross Douthat, The New York Times columnist…

Maxx Seijo  49:20

Yeah. You have to listen to that? I’m sorry, Will.

Will Beaman  49:27

Yeah, well, you know, living at home during the summer has its perks. And then it’s not so perks. But yeah, I mean, even he was saying he thinks that, you know, now social democracy is on the table, more or less. So he’s more optimistic than the left is.

Maxx Seijo  49:46

Ugggh. I mean, we could critique even what his conception of social democracy is, but I think…

Will Beaman  49:53

Yeah, to the extent that he wasn’t lamenting it, it’s probably because it was just like some kind of a Herrenvolk like. You know, Scandinavia, for white people.

Maxx Seijo  50:04

We can have a little bit of Scandinavian racism as a treat.

Will Beaman  50:08

Yeah. So like, I just want to cap off the reading from from Fazi with, you know what, what, what it all leads up to for him. “This is not an argument against the evolution of national identity. It is an argument for respecting a national community’s right to have a say in the pace and form that such evolution takes. To ignore the latter is, quite simply, political suicide.” I just I love the use of the word suicide here because it just…

Maxx Seijo  50:39

Oh yeah.

Will Beaman  50:42

It just completely gets across that creation is not an option: if things change, it’s because we’re dead.

Maxx Seijo  50:48

That’s right.

Will Beaman  50:49


Maxx Seijo  50:49

It’s only a death drive.

Will Beaman  50:50


Maxx Seijo  50:51

That’s all there is.

Will Beaman  50:51

So he says “We are now in a position to offer a different explanation of “social conservatism”: this is simply society’s self-defence against those factors – internal or external – that are perceived as threatening its members’ need for community, belonging, rootedness and identity.”

Maxx Seijo  51:09

Signed Carl Schmitt.

Will Beaman  51:10

Yeah, I mean, that is just like, holy shit, the math is off.

Maxx Seijo  51:14


Will Beaman  51:15

Yeah, I don’t know how you have internal, setting aside the problematic external thing, but like the fact that they’re internal, you know, that there are people who are internal to our society who really are external to it, because they’re not part of the program. You know, it’s the nationalist conception of the Marxist idea of what the economy is, you know, which is, you know, this is the material world the way that it is, you know, this is the material political body the way that it is.

Maxx Seijo  51:47


Will Beaman  51:47

And all we can do really is…

Maxx Seijo  51:51


Will Beaman  51:52

Yeah! Very, very slowly improve things, but not too quickly. And it’s really interesting also, that this is basically how Krystal Ball will talk about anti-racism or transgender issues or anything like that, you know, where she will kind of say, you know, “of course, I’m on your side, you know, on this one leftists, but you have to understand that these things are going to take time.” She talks about, you know, managed progressivism in the same way that that people like Fazi are talking about managed migration, as well as manage progressivism.

Maxx Seijo  52:28

Yeah. And I mean, we’ve been going for a little while here, but I do think as we’re sort of starting to wrap up this first episode and think about the way we move forward, it’s important to say that at some level, right, we here are wholehearted proponents of a non-zero sum material vision for the left. But at the level of ideas, this is not a view that should be tolerated.

Will Beaman  53:04

Yeah, we’re not interested in a debate with Krystal Ball.

Maxx Seijo  53:07

No, we’re not. We’re not interested in debate. She represents a reactionary anti-left trend. And that’s a trend that has to be stamped out. And we have to win that debate. And so it’s important to say, like, non-zero sum is not a sort of participation trophy for all the competing intellectual approaches to left wing progress. No, no, no, no, don’t confuse the fact that we allow a space for all people, for all life to flourish, and we demand that space, as allowing a space for ideas that…

Will Beaman  53:55

That are predicated on the opposite of that.

Maxx Seijo  53:57

That are predicated on the opposite of that.

Will Beaman  53:59


Maxx Seijo  54:00

And that is the central gambit, I think, of this podcast. And ultimately, I think that the rise of the MMT project, and the MMT movement or things like the Modern Money Network, has been through the insistence on that non-zero sum vision as a matter, not just of a sort of intellectual fancy or we would like it to be this way, but as a matter of the technical facts. A matter of the technical operations themselves. And that’s the vision.

Will Beaman  54:01


Maxx Seijo  54:01

I think this is a pretty good place to leave it, as well.

Abstractions also Liberate with Anna Kornbluh

Anna Kornbluh joins Money on the Left to discuss the politics of form and literary realism as theorized in her provocative book, The Order of Forms: Realism, Formalism, and Social Space (University of Chicago Press, 2019). In The Order of Forms, Kornbluh lays bare the problematic “anarcho-vitalist” underpinnings of neoliberal discourse which, she argues, also inform much  critical theory and left critique. In contrast, she upholds the necessity, malleability, and contestability of social form. Focusing, in particular, on English novels from Wuthering Heights to Alice in Wonderland, Kornbluh reads myriad nineteenth-century literary realisms as at once speculative and generative abstractions, capable of newly mapping and scaffolding social space. At the same time as forms might oppress, she concludes, abstractions also liberate. Wrapping up the conversation, Kornbluh considers how the politics of form reorient our approaches to contemporary academic labor, pedagogy, and learning. 

Kornbluh is Professor of English at the University of Illinois, Chicago. Her research and teaching center on the novel, film, and theory, especially formalism, marxism, and psychoanalysis. Kornbluh is the author of Marxist Film Theory and Fight Club (Bloomsbury 2019), and Realizing Capital (Fordham 2014), and has just completed a manuscript “Immediacy, Or, The Style of Too Late Capitalism.” She is a founding facilitator for The V21 Collective (Victorian studies for the 21st Century) and InterCcECT (The Inter Chicago Circle for Experimental Critical Theory).

Find Anna Kornbluh on Twitter @V21collective

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Music by Nahneen Kula:


The following was transcribed by Richard Farrell and has been lightly edited for clarity.

Scott Ferguso: Anna Kornbluh, welcome to Money on the Left.

Anna Kornbluh: Thanks for having me. It’s so fun to be here.

Scott Ferguson: Yeah, it’s so great to have you here, and especially since you are a dear, old friend of mine who I have learned so much from throughout the years. It’s great to finally have you on our podcast.

Anna Kornbluh: It’s really exciting to listen to you guys and see the conversations you’ve been creating.

Scott Ferguson: Thanks. So maybe to begin, I know you, but our audience doesn’t necessarily know you. Maybe you can say a little bit about your scholarly background and maybe your personal background if you feel like that’s relevant?

Anna Kornbluh: Sure. I live in Chicago–the best city–where I teach at the University of Illinois at Chicago. I’m in the English department and teach a lot of literature, especially focused on the novel and the history of the novel, as well as film, and then a fair amount of literary and critical theory when I’m lucky to do that. I earned a PhD in English with a focus in theory at UC Irvine. I met Scott when I lived in Los Angeles and when I was getting a Master’s in Film at UCLA. Before that, I had an undergrad degree in political theory. I love the Midwest. I’m stupidly lucky that I am a person who got a job in 2008, and a job with job security and research money. I just couldn’t be more fortunate and wish nothing but these conditions for my fellows.

Scott Ferguson: Perhaps more so than some of our regular guests, your work is deeply critical and theoretical. I think you have a grammar and a style that is very precise, and it does a lot of rich important work. And so, we can improvise it a little bit and that’s cool, but we decided we were going to put together some more formal questions in order to kind of honor the complexity of your thoughts. So perhaps unlike some of our other episodes, we’re going to unabashedly read these questions, just because we wanted to make sure we were getting it right. And with that, I’m gonna hand it off to Billy to take the first one.

William Saas: We’ve invited you here to speak with us specifically about your brilliant scholarly monograph The Order of Forms: Realism, Formalism, and Social Space, which was published in 2019 with the University of Chicago Press. In that book, you articulate a scathing critique of what you deem the “anarcho-vitalist tenor of much contemporary critical theory.” Inversely, you develop a comparatively capacious political formalism which you uncover in the modern novel. We would love it if you could flesh out some of these reciprocal moves for us. How do they intervene in debates in critical theory past and present, and what do they tell us about the construction of what you term social space?

Anna Kornbluh: Thanks for the question. Yeah, so it is a book that’s integrating a lot of different things, right. Chiefly, it is trying to integrate aesthetics and politics, and trying to think about the ways that the traditions of critical theory, and of humanistic interpretation, especially for people who work in the aesthetic humanities–literature, film, art and so on–how they have tended to think about what is that relationship between aesthetics and politics. What does art have to teach us about politics? What is artistic about political arrangement and political dispensation? Maybe I’ll try to put my finger on some of the kinds of biases or habits that have emerged in some of those traditions.

So specifically, I tried to track a position that would associate freedom with formlessness and would privilege a lot of artistic forms of dissolution, disintegration, fragmentation, hybridity, irony, instability, and so on. It has this whole aesthetic vocabulary about those things, because one imagines that those are actually political virtues or values, or that they’re emancipatory. So what gets built into that reinforcing framework then, are some judgments about what kind of art is good. What kind of art is politically educational? What kind is politically not conservative and innovative? Then, there are also some mistakes, maybe, about politics, and chiefly some biases against institutions, such as a kind of reflexive anti-statism we see across aesthetic humanist positions and a horizon in which what we understand to be the nature of a political act is to disrupt something, to break something, to suspend something, rather than to hold it in place or build it up.

Scott Ferguson: I wonder if you could follow up specifically about your critique of Giorgio Agamben’s idea of “destituent power,” is that correct?

Anna Kornbluh: Yeah, so I sort of take him as exemplary of some of these habits of mind in the opening of the book, because he’s such a tremendously influential theorist in the 21st century. I think Homo Sacer is Stanford University Press’ best selling book of all time. In his consummating of Foucault’s biopolitics, in his really trans-historicizing of these tendencies of the state, and of institutions to control life, he has this consummation of an idea that all of Western political power could be schematized according to its constituent tendencies, to make things, to contain things, and to bring things under the purview of control and under the purview of power. And the alternative for him is destitute power, or taking it apart. This is the realm of play, the realm of freedom, and the realm of dissolve for him. If constituent power is violent–like he thinks any active kind of making, forming, putting into place, and instituting is always going to be violent–then, if you want to be on the side of the good, you have to be on the side of the unmaking. So I take him as just kind of emblematic of, or a crystallization of, these habits. Again, I find humanist method and interpretation that have built in these aesthetic and political suppositions insufficient, really.

William Saas: So you’ve named Giorgio Agamben. Are there any other sort of leading lights of this position that you are, in fact, taking a position against?

Anna Kornbluh: Yeah, this is such an interesting problem, right? It’s like when you’re trying to put your finger on a structure of, not feeling, but of ratiocination, or a kind of prevalent form of argumentation. And in one that crosses disciplines and schools, then who are its leading lights? Does it have leading lights? Is an episteme identifiable with a person? And what’s the frame of argument in which you would say there are figureheads of this movement, and then their bodies of thought are consistent with it entirely and so on. Because, obviously, I have friends who deeply love Agamben and who are unhappy about this characterization. But I think some of the other positions that I might name in the book, or certainly in schematising the field, would be queer antinomianism, certain kinds of queer of color critique and feminist critique of institutions, a kind of immediatising, anarchic tendency in certain strains of Marxist theory, in the tradition of thinking aesthetics and politics, the almost messianic or ceaselessly negative kinds of positions of certain texts in the corpus of, and then certain interpretations of, Walter Benjamin and Theodor Adorno. I also identify the most recent real innovations in the theory of aesthetics and politics from Jacques Rancière and Caroline Levine as also continuing to privilege disruption, dissolution, unmaking, hybridity, collision, aleatory, and unpredictable as the kind of value pole, or the good side. We don’t like what stands in place. We don’t like what is sustainable. We don’t like what is form.

Maxximilian Seijo: So then contra this anarcho-vitalist unmaking, your political formalism emphasizes building, making, and structuration as not just a possibility, but as this sort of constitutive engine or motor of politics. Could you perhaps talk more and spell out then what your, dare I say, positive articulation of that critique forms and what it means for thinking the aesthetics of politics or the politics of aesthetics?

Anna Kornbluh: For sure. So the little word vitalism is doing a lot of work for the imaginary that life just springs forth, right? And that there is a kind of Eden of effulgent plenitude that we could be liberated to if only we stopped having the state, or if only we stopped having law, or we stopped having the symbolic. The alternative, the formalistic position that I try to propose and substantiate, and indeed, try to argue that the history of ideas provides plenty of fodder for and eloquence about, is one in which we think forms are not opposed to life, forms are actually infrastructure for life, and forms are essential to life. Human beings have no given format for their existence. It takes a village, should we be in small states, or how should we be organized? But we’re interdependent animals and that’s something that actually differentiates us from other animals. We have this prolonged infantile need of one another in order to survive, not just to live well, but to live at all.

So what shape should that take? There have to be arrangements, patterns, and orders for the making of life. So there’s a kind of ontological claim that form is essential for our well being and for our existence, and that we can recognize and admit that necessity and that essence without having to naturalize particular forms or without having to give up on, forget, or repress the contingency of particular forms. So historical materialism is something like a procedure of accounting for the contingency that human social experience takes. And the content of the formalist doctrine, as it were, also is necessity and contingency at the same time. Human beings need form, but there are no given forms.

But also thinking that every form has been made, every form has been contrived, instituted, and can be remade, and that we can have a horizon of political activity which is about reformation, not in any anti-revolutionary sense, but in the sense of like actually contriving and designing the structures that will enable human wellbeing and that will facilitate flourishing. What’s the best shape? What should be our voting system? What should be our governance? We’re confronting this question now on ecocide, and your previous guest, Kim Stanley Robinson, is very good at thinking about this problem. Is there something about ecocide that requires a super state formation, or an international confederation and what should that look like? That’s a speculative problem for us. And you can’t solve that speculative problem if a priori, or out of the gate, you think forms are bad, forms are oppressive, and we just need to burn it all down. We just need to get out of the purview of power or something.

Scott Ferguson: Yeah, absolutely. I think before we dive into your specific, sustained literary focus in your book, I just wanted to draw attention to something that I think is implicit here, but we can tease out, which is the convergence and unintended complicity between anarcho-vitalist, destituent modalities that are anti-formal, or are about pushing to the limits, or accelerating past extant forms, with neoliberal logics, if not broader modern capitalist logics of disruption. Marx has a dialectical gambit in mind when he says, “All that is solid melts into air.” He thinks that history is going to generate something out of it, but I think you’re holding us back from that precipice and saying, “Well, wait a minute. This is actually the dominant regime. It has a hegemonic logic of dissolution. Maybe that’s not what we should be doing.”

Anna Kornbluh: Exactly. And I think one wants to articulate not in an idealist sense. We don’t want to say, “Oh, theorists are causing these conditions in the world.” We want to do it in a materialist sense, and say, “The structure of theory is determined by the structure of the world.” The ideas in every society are the ideas of the ruling class, and the vocation of theory is to make a cut from that determination. The vocation of theory is to know from which it speaks, and understand its conjunctures, and then figure out what some other logics might be. So if we are supplied, since 1973, with the abundant logic of the dismantling of social institutions, and the highly minimalist vectoring of state power towards the purpose of accumulation and away from the purpose of flourishing–and of course, people will argue that’s never been the purpose of the state, as Marxian anthropology would suggest–but if we cannot see this affinity of our thought with the kind of empirical practices of power, that is an aporia in our reasoning and an insufficient self scrutiny.

The whole gesture of critique, as Kant, Hegel, and certainly Marx produce it, is to look back on the conditions in which your thought is possible. So I do want to articulate that affinity is true. And I do want to point out the underside of that. I think the political theorist, Jodi Dean, is really eloquent about this. We have actually lived through a revolution in the United States in the last 40 years. It’s been a revolution of incredibly disciplined exercise of collective sovereignty by the collective that is against us. It has been incredibly disciplined from the level of school boards and local elections on up to the presidency and the Supreme Court, and the interpreting and mobilizing of institutions for the sake of oligarchic and plutocratic wealth transfer, and anti-democratic consolidations. It’s not the truth of those institutions, necessarily, but they’re mobilizing for that. This has been a highly disciplined and effective practice. That has to be a lesson to us, that our suspicion of the vehiculations of collective agency haven’t gotten us anywhere.

Maxximlian Seijo: So moving from one revolutionary context to perhaps one of a different kind, in your book, you focus, as Scott sort of already mentioned, on literary realism in general, and then on the Victorian realist novel in particular, which the latter you suggest is a rich historical vehicle for thinking through the stakes of what you just diagrammed as political formalism. So against certain currents in Marxist literary theory, as you’ve already mentioned, you argue that literary realism is irreducible to a certain metaphysics of representation, where, in the novel, its various signs, affects, and grammars are judged according to whether they succeed or fail to correspond or refer to an extant historical reality. So then, in this context, what exactly is literary realism on your analysis and how does this particular mode of political formalism work?

Anna Kornbluh: Yeah, that’s a great question. So I’m extremely interested in thinking about literary realism as an experiment, as speculative, and as a wild kind of thought that isn’t available to us in ordinary life. Who gets to think in the third person? Who gets to produce an omniscient perspective? Who gets to survey broad swaths of psychic interiority, social expanses, social depths, different social classes, and long historical arcs and stuff? Only these made up, realist narrators. And this experimental quality is taking into account or giving itself certain constraints. Realism could be defined as against, say, an irrealism of infinity. We take time and space constraints seriously in realism. Nobody lives forever. There’s a lot of death and birth and sex in the realist novel. We’re not on other planets. We’re just stuck on Earth. Like this is what we have. But within these constraints, the great moment of ferment of literary realism in the 19th century is one of tremendous social transformation with the Industrial Revolution, imperial expanse, and then imperial contraction and contestation, democratizing movements, great explosions of literacy, and the urbanization of mass population for the first time in world history.

So there’s all this social churn going on, and realism is this experimental form for trying to figure out like, what should society be shaped like? What should we be doing all day long? Given the constraints that human beings are mortal, and that they’re vulnerable, what should our societies look like? So I like to think about realism as a kind of theory of institutions, a theory of limits, and a theory of human sociability that maybe has some different precepts than the reification that might be attributed to it, or the kind of boringness or un-imaginativeness that might be attributed to it, but also has some different precepts from say, the anarcho-vitalist imaginary. The realist novel is super into schools, banks, governmental agencies, churches, and the places where banal existence is produced and the offices where it happens. And somebody has to think about those banalities. There’s a lot of power there and a lot of possibilities there.

William Saas: So is it possible that the mode of literary realism is conflated with the limited imagination, or the constrained perspective, of the author when it’s sort of at the expense of the mode itself? Would that be fair to say?

Anna Kornbluh: Yeah, I think that’s right. We end up with these kinds of approaches to realism and literary study where we want to correlate it to the context of the author, or correlate it to the biography of the author. We want to sort of say, “Well, the realist novel is only a voice box of the values of its time,” instead of, “No, there’s an immanently critical operation that’s possible in any kind of literary production, and these people are involved in an extremely voracious and demanding kind of imagining of what the world should be like.” I like to say, I know I say it in the book, that all of the major Victorian realist novelists were all journalists, and they were all successful journalists. They all gave that up, because they wanted to do something else. Trollope a little bit less so, he was a bureaucrat his whole life, or a postman. But Thackeray, Eliot, and Dickens, they had jobs writing how things were, they wanted to say something else, they wanted to know something else, and they started writing how things could be.

Scott Ferguson: Okay, so I have the big doozy of a question. I’m just gonna start reading. And hopefully I can get it off the page. With the caveat that we don’t wish to simply conflate your project with the work we do within the Money on the Left editorial collective, we nevertheless find many areas of sympathy and convergence between us. Perhaps above all, we find that your emphatically anti-lapsarian insistence on the speculative and political generativity of abstraction resonates greatly with our conception of money as an abstract and constitutive political form. While you don’t overtly thematize this in your book per se, you come closest to doing so in a passage on page 46, which if you don’t mind, I’m going to read for our audience. Differentiating your theory of literary realism from other influential Marxist interlocutors, you write:

“Prominent recent efforts to advance Marxist aesthetic theory of the contemporary have once again taken up realism, and here too Alberto Toscano, Annie McLanahan, Leigh Claire La Berge, Alison Shonkwiler, and Joshua Clover generally prize reference above all else. For Marxists, realism thus paradoxically occupies two poles simultaneously: the paragon of ideology–the imaginary resolution of real contradictions, the false suture of a partiality as a totality–and the paragon of artistic truth-telling, the gold standard representing  actualities behind the veil.”

This is supercharged language for us. So what’s striking for us in this passage is how it links a problematic metaphysics, a literary reference, to what is, in our view, an equally problematic metaphysics of money qua passive representation. Money is regularly imagined to be a veil over real extant relations and private resources, and the gold standard as a system of signification in which truth telling is somehow guaranteed. Against this monetary representationalism, we would contend that money is constitutive. It’s transformable and it’s public. And it is, above all, an abstraction that is contestable. As such, it enables radical forms of political activation, including urgent contemporary struggles for abolition, reparations, universal healthcare, and an expressly anti-imperialist global Green New Deal. So what we’re wondering is, would you be willing to reflect a bit on this language and some of these resonances that we’re picking up on?

Anna Kornbluh: Yeah, I think that’s a really great question. That may be the best question of all the ones that you guys prepared for me because it speaks to how generative and creative you guys are that you can think about the capacity of abstractions across disciplines, and that you can think about the affinities of different kinds of arguments. I’m just a lowly literary form person. I did write a book about the history of finance, but that’s not this book. But I think that you’re fundamentally right. My most favorite sentence in this whole book, it’s only three words, maybe you guys liked it too: “Abstractions also liberate.” We’re very familiar, as aesthetic humanists, with the position that generalizations are bad, that abstractions are bad, that institutions are bad, and that big ideas exclude the particulars. We think that we can only have this job of championing the particular, the content, the substance, the real, and the body.

So the work that I’m trying to do in terms of pointing out that viewpoint and mindset, and how pervasive it is in the aesthetic humanities, I think, is a parallel logical move and parallel critical move to the work you guys are trying to do you in suggesting that the way that we regard the institution of money is really impoverished, that given the social circumstances of the late capitalist state, and given the tools available to us of the Fed, for instance, that there is a possibility to activate the political determination of what money represents, or how money functions, and that that possibility should be seized by people. And it should be articulated and named by our leaders. So I think that there’s a lot of affinity, or a lot of parallelism, between the approach to institutions, the approach to the state, the approach to representation, the symbolic, and so on, that I’m interested in and you’re interested in.

If one was to try to articulate a possible point of disjuncture, it is how we acknowledge the outside of that position. So I say the existing forms that are available to human beings can be repurposed, re-constellated, they’re malleable, they can be mobilized for different ends, that politics is the work of collectively deliberating what kind of shape for our lives we should have, and that we don’t have to have a kind of revolutionary iconography of the endless horizon of messianic new forms or non-forms. We can work with some of our available forms. How do we articulate that dialectical capacity, that existing possibility, that political prospect, while also acknowledging that this is a delimited horizon of action. Of course, people who want to abolish the value-form are always going to be unsatisfied with your work and with Stephanie Kelton’s work. Of course, our radical, anarcho bro colleagues are always going to think that Stephanie Kelton is insufficient, that Bernie is not enough, and so on.

So what is the kind of gesture intellectually, but then also rhetorically, that gets us to avow money as an instrument in this concrete situation which we find ourselves, that the available determinants of the situation permit to be used and deployed quite differently? That’s a different question from: should we have a society with no money or should we have a society with no abstraction? So what I really find exciting is the insistence by your working group, and by some of its great, accomplished scholars and leaders, that we could do different things with these tools. I got super excited when Janet Yellen gave her induction speech. That might be something you have to delete, I might get fired, haha. I mean, the things that she said about what state power actually has available to it to produce values that benefit the greater good, the greater masses of the people and so on, those were really exciting formations. So yeah, I think there’s a lot of affinity between our projects.

Maxximilian Seijo: I think to that last point on Yellen, at least in the context of the COVID response and the seeming ongoing crackup of the orthodox monetary policy mold that has been dominant for the last 40 to 50 years, this, as you say, sense of the potential for malleability, it’s interesting to see in context with your work that opening and potential thinking. We had KSR on the show a while ago about the way that opening in a formal sense, in the political economic sphere, is also producing all different types of openings in literary spheres. I think that it’s a really interesting way in which there’s almost like a dialogic phenomenon between the different disciplines or areas in which we’re thinking along these similar terms.

Anna Kornbluh: Yeah, I think that’s a great point. Different aesthetic formations are possible and different aesthetic practices are possible when you have a different relationship to mediation. So if you can understand money as a collective sovereign driven determination of value, that doesn’t have a substance behind it in large part, but that can be deployed, you have a kind of orientation towards what forms are able to do that isn’t predicated upon their transparency of representation or their presencing function.

Scott Ferguson: What you just pointed out there, I just want to, not really pushed back, but just kind of clarify something. I know when you say that we think money as not being backed by a substance in the standard understanding of gold or silver, or whatever it is, but I think our relationship would be to say that it is not non-substantial in the same way that I think a lot of us would probably treat language. Language is not without substance. Language really organizes the world. But it doesn’t have to be a chit or a finite thing. We don’t have to presume a chit or a finite substance somehow behind language. The language of the world is participating in the whole of the world in heterogeneous ways. So again, I just think breaking with the metaphysics of representationalism is something that you do quite well. And I think other humanities scholars can do, but not when it comes to money. Money is this kind of blinding social form in that way.

Anna Kornbluh: Yeah, I think so. One way that I like to think about that is that there is a material efficacy to money. There is a performative power, there is an agency of the symbolic that isn’t reducible to a fixed substance behind it, as you say, or that isn’t conflatable to the presences. It does produce things. It does act. And we can have more or less collective exertion of power around those acts given that it’s the vehicle of valorization in our society–within these constraints of what this society is. So yeah, what’s our vocabulary for thinking about that performative efficacy, thinking about forms that produce things, activations of materiality, or what Lacan refers to as the letter has a material substrate? That’s not a substance, that’s not a solidity, and that’s not a concrete thing. It’s an abstraction too, but it is one that takes hold of us.

William Saas: I want to get to our next question, but I want to get there by way of some editorializing and maybe recontextualizing some of the conversation so far. So returning to Jodi Dean’s comments on the revolution of the last 40 to 50 years, we might call that neoliberalism. It strikes me that it might be reasonable to call the folks who are at the head and have orchestrated and been instrumental in that revolution as being really good at political formalism. So I think the sympathy between our projects boils down to this fundamental question that cannot be probably articulated as beautifully as, “Abstractions also liberate,” but, “How’s that worked for you?” might be another way to pose it. So another similarity or affinity between our projects, I think, is, in the face of frustration and ultimately calling for violent revolution or exodus or refutation, we’re up to recovery, re-examination, and re-discovery. And one of the ways that your book demonstrates this is through case study. We’d love for you to walk us through your second chapter in which you reread Marx and Engels’ Manifesto of the Communist Party through the lens of Emily Brontë’s Wuthering Heights, which I think is a very strange pairing, but wonderfully done. But what theoretical or meta-methodological moves are you making here? And how do they serve an alternate history of political form, which can be, as you put it, necessary, malleable and constructible?

Anna Kornbluh: Okay, that’s great. So I think the issue is almost like what is the middle distance? What is the mid-level that we can think about that isn’t total abolition of the value-form or the complete hypothesis of a realm without abstraction or of unstructured life, of anarchic, primordial chaos? And then, on the other side, just only adhering too closely to the smallnesses is where nobody ever wants to think about what power is actually available to us. So I think that mid-level is tactical thinking. I think that it is strategic thinking. It is about what are the tools available in a situation and how do you use them. And the thing that I’m really interested in as a problem between the Manifesto of the Communist Party, which is a document that Marx and Engels produced in late 1847, that comes out in the winter right before 1848, and then has, arguably, an exhortative relationship to the springtime of peoples across Europe in 1848, that document, which comes out at the same time as Wuthering Heights, is exactly this problem of what is the distance or what is the middle? How are we thinking about the constraints of a situation? How are we thinking about the absolute quality or the openings in the political horizon?

So, to make that more clear, in the manifesto, there is an assertion that all of human society is a history of class struggle. And there is also a kind of concluding gesture that the communist revolution will bring with it an end to all antagonism. So what is, I think, a problem of the rhetorical strategy there, of the exhortative anti-capitalist strategy there, is a reduction of the expanse, or this total set as it were, of social contradiction and social antagonism, to the specifically capitalist version of it. Because it simply isn’t true that if we did away with capitalist antagonism, we would have a non-antagonistic society. And it simply isn’t true that we would have a motivated or immanent or natural logic of how to be organized, to go back to our earlier discussions about how there isn’t a given form of human life. And if Marxism implies this, which I don’t think Marx at all consistently does, but I think he deleteriously does at points, then it’s failing the bar of historical materialism, of understanding what is contingent about the capitalist articulation of social antagonism and what is contingent about its managing of social antagonism through the class system.

It’s a problem of how, yes, we can organize a phase theory of history according to the kind of basic class relations, and, yes, we can particularly tell the progressive kind of development of capitalism according to this simplification, he calls it, of class relations, but this isn’t all of human history. And if we represent history in these bombastic ways that he does, as all of this, then we lose the underside or the underlap of history with capitalism. We lose the other part of the set of human antagonisms. And what I think is so amazing about Wuthering Heights is that it has this repertoire of vocabulary of images and tropes that let it think about antagonism as a kind of transhistorical problem for human beings. The basic problem of the hearth, where so much of its action is set, of architecture, of construction, of house holding, of familial shape, all of these are just inexhaustible dilemmas in that book.

And at the same time, there’s this just exuberant, hyper-stylized, incredibly beautiful, and uncanny kind of production of symmetry, of forms, of doubles, and the kind of problematic of formalization itself that just helps us to think about how you can have infinity of social contradictions, and the ability to inscribe and formulate the fact of that infinity of contradictions, such that your proposed political solutions don’t imagine or fantasize that you would ever be away or be done with contradiction.

Maxximlian Seijo: Thank you for that. I think that is a really cogent way of saying that. I wanted to dig in a little bit into some of what you mentioned about the spatialization in Wuthering Heights in an architectural sense. You also motivate this through a photographic analysis, as well, in the way photography as a forming medium does this too. In Wuthering Heights, as you said, we think about the construction of homes, rooms, window frames, this doubling that you mentioned, which these forms seem to shelter, maintain, and then also open social space in ways that even outstrip domination and antagonism at times. Can you give us a little bit more detail or taste of this specifically architectural analysis? And why, in the context of this ontological argument about antagonism, and this ontological argument, essentially, about historical materialism that outstrips these very specific immanent capitalist class antagonisms, why you see these architectural mediums and modes as so important for thinking that transhistorical problematic?

Anna Kornbluh: Yeah, so architecture is kind of a master trope throughout the book. There is, as you are getting this in an hour in a kind of a Frankenstein sense, a lot in the book, but architecture is one of the spines of it. And that is partly because it is a trope of construction, and I’m interested in constructive criticism. It’s a trope of building and I’m interested in putting things together. It is art that straddles the line between necessity and contingency. It’s Hegel’s first art for that reason. Human beings need shelter. But how are you gonna make it? What shape is it going to have? These are questions that are on that threshold of materially and necessarily essential, but also kind of open to variability, to different formations, and to the different processes of creativity. So, for me, architecture just holds so much of this problematic up, of how we need shape to live, and how we need shelter to live. Should you have a triangle roof or A-frame? How should you be living? 

And in Wuthering Heights, it’s just part of the absolute, extreme–I can’t even find adjectives for it–sublime force of that book. It keeps constantly trying to juxtapose highly textured, extremely attentive figurations of the made environment, of the built environment, of fence posts, window frames, lintels, doors, hearths, walls, and house structures overall. It just cannot stop lavishing attention onto those things. And that is a whole vocabulary of ideas and images. What is that doing in the same book with stuff about the arrival of the bourgeoisie, stuff about the insufficiency of the family form, and stuff about immoderate desires? So there’s all this stuff in the plot that is excessive and wild and unsolvable, and then there’s all this stuff in the form that is detailed, material, instantiated, and installed. And then, you can trace the contour of it and you can study it.

So this is how I think novels work. They kind of produce these weird combinations where you’re like, “Okay, so, what do those things have to do with each other?” That is the thought the novel is trying to have. So, what is Wuthering Heights doing with this incredible lavishness of form and this just incredible immoderacy and un-containability of passion and of antipathy and of fighting and of economic transformation and of the slave trade? It is trying to tell us that form is a technique for managing antagonism and a necessary one and a useful one and not a dispelling of antagonism, not one that means that you have to lose track of its extent or its scope.

Scott Ferguson: So one of the things I really appreciate that’s coming out here is, to kind of come back to the critique of anarcho-vitalism, what you’re showing throughout the book, but in this chapter that we’re talking about in particular, is that vitality is with form. It’s shot through form. You’re not arguing against vitality. You’re saying, it seems to me, that form is a question of vitality. It’s not the expunging of vitality.

Anna Kornbluh: Yeah, not the containing of it. That opposition that form constrains, form contains, that institutions police us…

Scott Ferguson: Which they do.

Anna Kornbluh: Which they do, but it’s not the limit of what they do, or containment is not the only thing we can say about what they offer us. That the whole value that emerges, the negative Rubin’s vase illusion of that, formlessness, lack of containment, and lack of constraint is what freedom is. As opposed to, freedom is the meaningful deployment of forms for human flourishing or capacitating our management of necessity so that we don’t denigrate necessity.

Scott Ferguson: So speaking of books that hold very different things together, on the opposite end, maybe, from Wuthering Heights, we have your chapter on Alice in Wonderland. Which you, very provocatively, in a super cool way, you’re trying to convince us that it’s a realist novel. Which, I’m not sure that anyone’s ever made that case before. But you’re not just being shocking for the sake of being shocking. You’re drawing something out about the abstractness of the realist novel that we tend to repress or not avow by calling Alice in Wonderland a realist novel. That’s my initial gloss, but maybe you can unpack what you’re doing here and why it’s so important?

Anna Kornbluh: Sure. Yeah, that’s totally the chapter where I’m talking nonsense, except that the point of the nonsense is to produce something by this dramatic inversion. And it’s less saying Alice in Wonderland is realist as a text, but that its own internal properties of form function as a kind of distillation or crystallization of realist form, that it is something like the symbolic logic, the reduction to the minima, of what realism tries to do. Because Alice is such an experimental investigation into what words are and who fixes the meaning of words. What is social order? And who puts it in place? What is sovereignty? And to whom does it belong? How do we undo it? And what do these things have to do with each other? Why is the question of beheading, and “off-with-their-head-ness,” and the sovereign decision on life, also a question of punning and of the containment of, or the proliferation of, semantic quality? So it’s a kind of prismatic intensification or hardening of the tendencies of experimental inquiry into how society should be that I think realism performs. So that’s the kind of force of it. And then, it’s also kind of playing with some of the historical events of its author having been a mathematician and a revolutionary advent of symbolic logic in relation to other kinds of mathematics in the 19th century. So what does it mean to think about distillation as a representative strategy? And what does it make possible even as it is boiling things down? It’s, yeah, a little bit bananas. But hopefully it’s a breather in the middle of the book, too.

Maxximilian Seijo: I just really appreciate how you boil down to something like Alice in Wonderland is asking ontological questions. By necessity, your political formalism then can kind of feed into that nonsense with a certain logical structure. I just really appreciated the way you took on that so paradoxically. Moving from that context, I wanted to talk about your final chapter, which reads states of psychoanalysis, formalization, and the space of the political. Within it, you plumb deep impulses within psychoanalysis, which in case listeners haven’t sort of picked up on yet, is another one of these combinatory substrate themes in this book. So you plumb these impulses to theorize what might be called the inescapable psycho-political problem of the polis. On your account, why is psychoanalysis such a meaningful tradition through which to confront this indelible, political problematic?

Anna Kornbluh: Sure. Psychoanalysis is like another one of the bolts in Frankenstein’s neck. So I think the first thing to say is psychoanalysis is a discourse of the objective. However much we would want to assimilate it to an egoistic, self help, personalizing kind of pathological formation–bourgeois, insidious, etc–it is an account of the structure of social relations. It is an account of language as the medium of social relations, of ungrounded non-theocratic reason, and of the problem of secular modernity as the structure of the kind of scaffold against which the human subject emerges, or the void that the human subject answers. So it’s an extremely descriptive kind of project in this course of trying to understand the contradictions of modernity that also attend capitalism. It has a kind of different register and a different idiom for investigating those contradictions. So in the biggest sense, it makes sense of social relations. And it puts the arbitrariness of social relations first and foremost, front and center. Why do human beings suffer? Why is there discontent in culture? Why is there discontent in civilization? Because there is not an immanence to it. Because there’s not a groundedness of it. Because we can’t make the words coincide with the things. So it has affinities with the formalist project I’m articulating, as well as affinities with what I think a historical materialist project is. So that’s why it’s so important.

But then, more specifically in that chapter, I’m working with some of the Lacan and Freud’s own thinking about institutions and their own thinking about the relational space of psychoanalysis. You can’t do psychoanalysis on yourself. It’s not self help. It is a dyadic relation that has to take place within very specific formal conditions, the conditions of the clinic, the couch, the two people, the variable session, and usually with the authorization of the institution that will enable the analyst to have been trained, and the patient to transmit what it is that they have done in their processes that they are working on. So there is a lot in the history of psychoanalysis of meditation on what an institution is and why you need it for this practice of health and human beings suffering less. So that makes it an intrinsically political theory. And then, of course, Freud wrote a whole number of political and theoretical texts, as did Lacan. So that’s why I look at psychoanalysis in a way. Then, there are also slightly more historical reasons. Like Freud was one of the great appraisers of the realist novel. He said that Eliot, Dickens, Trollope and Thackeray had invented psychoanalysis before he had. So there’s a kind of according and an esteem for the realist novel in psychoanalysis that is also really enabling for me.

William Saas: Thank you. To get us to the end of the interview, we want to step out of The Order of Forms, or get a little bit adjacent to it as you have in other articles. You’ve written about everything from the so-called method wars in literary studies to reflections on what you have named the climate realism of contemporary novelist, Kim Stanley Robinson, who was a recent guest on our show. So throughout these articles and publications, you place front and center the question of theory, or better, of theorizing as a social formation. And through this writing, it appears that for you, theorizing is not simply a specialized mode of academic labor within the Academy. But it is rather at once a critical and generative activity that takes place through fiction as much as through nonfiction. We like this commitment, and partly, because it links the labor of the humanities to constitutive world building, while pushing back against certain self-loathing impulses in the neoliberal Academy. See before: “how’s that working for you?” Is this a fair characterization of your work? Or are we way off base? If it is fair, could you say more about why it is that you prize this kind of unconventional, even promiscuous approach to theorizing?

Anna Kornbluh: Yeah, I think that’s very fair. And I appreciate it very much. I’m so glad that you guys could read that. I just think that creative, speculative, wild utopian inventiveness is a deep, deep faculty of the human. I really do, I am a humanist in that way. I think humans enjoy play and abstraction. I think it’s a staggering truth that human beings made abstract cave paintings before they knew how to make houses 70,000 years ago, before they knew how to bury bodies. Abstraction is a faculty of our creative power and our creative capacity to make things. So I love that I have labor conditions that afford me the security and the time and the venue to try to take my mind wild places. This is equipment for living. Our ideas clearly haven’t sufficed till now. We live in a society of mass immiseration with more and less brutal instantiations of it and spectacles of it, more or less viciousness, and mass inequity. And we are rapidly losing the ability to live. And that’s not a generic problem of human beings, that is a problem of our oligarchs, but it is going to be true and unevenly distributed that people won’t be alive. This is a fact that in 20 years billions of people will live on land that will be uninhabitable or hot or underwater or both. This is a recipe for mass death, a recipe for forced extinction, and a recipe for mass violence as well.

So shit is not working. People are miserable and the earth is burning up. So we need new ideas. And we need ideas that aren’t just messaging and telegraphing and DMing what’s already here. There’s a kind of real collapse of both the theoretical and the aesthetic imaginary right now into this just endless, sadistic documenting of how bad shit is. And that’s not really galvanizing as art, that’s immobilizing as art. So I would kind of just defend ontologically, politically, tactically, and libidinally what theory has to offer us, what big ideas, what speculation, what thinking abstractly, what defamiliarization, and getting outside the normal frames of reference have to offer us.

William Saas: I just wanted to acknowledge and show some appreciation for your own acknowledgement of the conditions of the labor that you’re doing. And I’ll maybe invite you to say a little bit more about theorizing and the space-time labor value that is required into this essential labor of theorizing our way out of this climate mess and out of all other associated messes. What do we need to do that?

Anna Kornbluh: Right, so we obviously need lots of collaborative time, I think, because none of the available idioms are working. And that includes that the engineers don’t know how to convey the crisis of value that we’re living in even if they know how to decarbonize. They don’t know how to motivate the political action. But the storytellers haven’t quite figured out how to galvanize a mass insistence on decarbonisation or on other ameliorative measures, because maybe they don’t have enough riveting facts or they don’t have a good enough sense of what the functional storytelling is. But we need a lot more collaborative, imaginative, and technically inventive work together across disciplines. I do think that’s true. And I think that individuals need time to spend reading, to spend marinating, and to spend producing collaborative knowledge in the space of the classroom. I don’t at all oppose research and teaching. I think that is just totally not what I mean when I say like we need time for thinking.

But people need time for teaching. And that means that they need small class sizes, they need workable loads, and they need the ability to have preparation that involves reading new things and changing their course syllabi all the time and like genuinely encountering and making ideas happen in the classroom. There’s this line in Rachel Buurma and Laura Heffernan’s book, The Teaching Archive, about how like in the humanities you deal with students saying like, “I couldn’t make it to class, what did I miss?” And they say, “You missed everything and you missed it forever.” Because we make the knowledge happen in that haptic, collaborative, and dynamic moment of mutual determination of meaning. That is what you missed. So I think we need time for research driven teaching and research generative teaching. And what we also know is that it is just emphatically and empirically good for students, about small class sizes, about a lot of individual attention, about a lot of dynamic kind of evolution of what’s on the syllabus, and a lot of in-person collective work.

The other thing I might say about that, because I really, really care about this, is we need people who think about our conditions of labor and who are willing to do the work to make the place where we work, work. Service in the institution, being the associate head of my department of a hundred people, working in my academic union, these are things that have taught me so, so much about big ideas, about communication, about pattern, about organizing, about power and politics. It is a formal problem, how should you organize a class, make a budget, or at what level should departments cooperate, and so on. And I wrote two books in the last five years while I was doing really heavy administrative work, and I think that every faculty member must do it, and also must do it in their union. Because self governance has to mean something and because making our institutions functional and habitable is also content.

William Saas: Just wondering, returning to the self-loathing academic and the neoliberal Academy, part of that being potentially linked to perpetuation, and throwing one’s hands up at the structure as it is and saying, “I can’t do anything about it. I can’t create that space that I know is necessary in the classroom. Let’s just burn it all down.” Right?

Anna Kornbluh: No, I think that’s absolutely pervasive. And some of it is a response to feeling themselves burnt out. Burnout is a generational and cultural structure of feeling and so on for lots and lots of reasons. We, again, have a society that is immiserating people on a mass scale. The amount of overwork that is extracted from people no matter what their level of compensation is, or the level of job security is, is just intolerable. And I think it’s really, really vivid in the pandemic that academics are like essential workers in how much they’ve been asked to over function, how much they’ve been asked to overproduce. Many people, not all, were insulated from the dangers that say healthcare workers or grocery store workers had in the last 20 months, but not from the extremizing intensification of the demands on our work, and certainly not from the emotional toll of what it has taken to try to be there for students and invent new modalities and respond to our employers contempt for our survival and so on. So you can understand what the burnout is, you can understand what the dissolution is, but your fellow people have some power to join with you and transform a lot of those conditions.

A lot of these power structures are actually open and available. It’s not that hard to be a department head, it really isn’t. And people can do that work together. And that’s what faculty governance, another beautiful promise of it, is. It is really, really, really rewarding to make a faculty union. And it is really rewarding to do that in relationship to student unions and in relationship to graduate employees unions and in relationship to staff and janitorial unions and in relationship to your public school teachers union. And to think about 4 million people work in higher education. That’s more than in the airline industry, or the restaurant industry, these giant sectors that got COVID bailouts, that we did not in the same way or that we didn’t have value for. We serve 20 million people nationwide. Like our work is incredibly valuable. There’s a lot of power in that value that we can collectively seize up together. I know everybody’s tired and everything is terrible. But I really think that affirming the good stuff that we have and the agency that we have is the only way out.

Scott Ferguson: Anna Kornbluh, this was an incredible conversation. Thank you so much for coming on the show.

Anna Kornbluh: Oh my god, I’m so honored that you guys read my work and I’m such an admirer of the efforts you guys are making to just think differently.

* Thanks to the Money on the Left production teamWilliam Saas (audio editor), Richard Farrell (transcription), & Meghan Saas (graphic art)

Chekhov’s Coin with Rohan Grey (New Transcript!)

In this special episode, Rohan Grey joins Billy Saas to discuss the latest episode in the #MinttheCoin saga. Rohan Grey is Assistant Professor of Law in the College of Law at Willamette University.

Read his article on the trillion-dollar coin in the Kentucky Law Journal titled “Administering Money: Coinage, Debt Crises, and the Future of Fiscal Policy” here:

John Stewart on the trillion-dollar coin in 2013:

James Buchanan and Paul Samuelson in John Maynard Keynes: Life, Ideas, Legacy documentary: 

Visit our Patreon page here:

Music by Nahneen Kula:


The following was transcribed by Richard Farrell and has been lightly edited for clarity.

William Saas: Rohan Grey, thank you for joining me for this special episode of Money on the Left.

Rohan Grey: Thanks for having me.

William Saas: So, first question: #MinttheCoin, have many people been saying this?

Rohan Grey: Yeah, a lot of people have been saying it, and louder and louder. The reality of it is this is not even the first time, not even the second time, but probably more like the third or fourth time that this issue has come back around. It’s really run the gamut from tragedy to farce, to impatience, and I think now to maybe inevitability at some point. The underlying problem just continues to get more ridiculous. And in doing so, I think a lot of people who thought of the idea of using a kind of crazy accounting gimmick or something that would look silly in the eyes of the public, or the rest of the world, the risks associated with that have gone down relative to the risks of just continuing with this absolutely ridiculous charade indefinitely. We are a decade into these kinds of debt ceiling games and there’s no ending in sight. And the Biden administration’s approach seems to be pretty much exactly the same as the Obama administration’s approach was a decade ago. So if this is the best that we’ve come up with after ten years, then why not start being more creative?

William Saas: Yeah, can you give us your sort of elevator pitch for #MinttheCoin?

Rohan Grey: Yeah, so the idea is that we continue to run up against a legislative and operational log jam, where Congress tells the executive, the Treasury secretary, to spend a certain amount in accordance with the congressional budget directives, to tax a certain amount, and then to make up the difference with some sort of financing. Typically, the way that would happen is the Treasury secretary would spend a certain amount, and then, to make sure that there’s enough funds in its account at the Fed that it spends all the money out from, it will sell Treasury securities, Treasury bonds, Treasury bills, Treasury notes, or what we collectively call the national debt. Then, the funds that come into its account when it sells those to private dealers become the funds that then go to people for Social Security checks or government employee checks. But in an instant where the debt ceiling limit prevents issuing more Treasury securities, the risk is that the general account will run out of funds. And if it does so, there is another law on the books prohibiting the Federal Reserve from allowing the Treasury to run an overdraft on that account. So, effectively, the Treasury secretary is in this sort of awkward position where they have to keep spending because Congress has told them to spend, their job is to execute Congress’s directives, but they also can’t change the accounting and spending operations in a way necessary to ensure that happens.

Interestingly enough, there’s a part of the Coinage Act that was passed in 1996 as part of a commemorative coin bill that gives the Treasury secretary clear, plain language, no caveats, no asterisks, the power to mint and issue platinum proof coins–proof, here, meaning highly polished coins–of whatever denomination they wish, of whatever amount that they wish. So a lawyer named Carlos Mucha, when he was going under the internet moniker “Beowulf” on a MMT blog picked up on this idea from earlier writers, like Ellen Brown, and there was also a politician who kind of proposed it in the 1990s named Bo Gritz, to use this statutory authority to mint a series of very high value coins, trillion dollar coins, or multi-trillion dollar coins, have the mint deposit them at the Fed, the Fed then credits the Treasury for the face value of those coins, because once they’re accepted they’re legal tender, and then those funds would be available to ensure that the checks go out and the spending happens just like selling treasury bonds. And the important note there is that coinage, including all the coins that we use today, including the coins that we’ve minted and issued for hundreds of years, are not subject to the debt ceiling. So this would be using a parallel source of financing that is legal on the books to make sure that we honor our spending commitments without some catastrophic default or government shutdown.

William Saas: Do you think parallel is the best kind of metaphor or explanation for it? Or what do you think of things like end run, circumvention, or roundabout? I don’t know, what do you think?

Rohan Grey: Yeah, I think using the trillion dollar coin to avoid a debt crisis–a debt ceiling crisis, I should say, because it’s not a debt crisis. It’s the ceiling itself, which by the way, virtually no other country has in the world, and certainly not in the way that the United States has it. And if you look at the debt ceiling history, it was actually originally designed to give more flexibility to the Treasury. So up until the early 20th century, whenever Congress wanted to spend on, you know, new bridges, a war, the postal service, or whatever else, it would direct the spending to happen, and say, “Hey, executive branch, spend X amount,” and it would have specific authority. It would say we authorize you to issue a certain amount of bonds, or collect taxes or customs, or mint coins, or whatever it is. And each spending directive would have a specific financing authority. But then World War I comes around, and it becomes very difficult to manage all of the different spending commitments in a very large scale way with basically a thousand different spending authorities. So Congress says, “We’re gonna make it easier for you at the Treasury, we’re gonna roll all that up into one big spending authority.” It’s sort of like having 20 different credit cards, or 20 different bank accounts, and then rolling them all up into one. Then, you can move around the funds. And if you’ve got excess from one spending commitment to another, you can move it all around without having to come back to us each time.

So the original debt ceiling was actually designed to make it easier for the executive branch to discretionarily adjust its financing operations as needed. In that sense, the debt ceiling was always not intended to become this political football, but once it was created, like so many other things, its purpose got twisted. But the coin, I think, is definitely a workaround to the twisting of the debt ceiling. I would perhaps argue it’s more faithful to the spirit of the original debt ceiling and the longer term trajectory of the Treasury, which is to get more and more discretion on how to finance spending. One of the things I argue in this paper I wrote that we’re going to talk about later is that, even as Congress was giving the executive branch greater discretion in its financing, it was exercising strict control over how much was spent and on what. So it’s not a matter of letting the president, or the Treasury secretary, go crazy and do whatever they want. It is more about how, when we tell you to spend a certain amount and tax a certain amount, you have to do that. But in terms of how you do that, we’re going to leave that to you because the world is complicated, the administrative state is complicated, and we’re not going to micromanage the day to day financing activities. So as long as you spend what we tell you to spend, we’re going to give you latitude in working out how to do that the best way. In that sense, the coin is a workaround to the perversion of the debt ceiling.

But to the broader point, the mint’s authority to create coins and to generate financing capacity through the power of seigniorage is a parallel power to the issuance of Treasury bonds and the reliance on the Federal Reserve and the bond market to be a part of that process. The mint is the oldest monetary institution of the United States government. It was created years after the country was created. The Federal Reserve only was established in the early 20th century. So the mint has always been there. And nowadays, when people say, the government can create money, they usually think that it has been basically exclusively delegated to the Federal Reserve. So the Treasury is sort of reduced to, like you and I, someone that has to ask permission to access this power that the Federal Reserve has, or can only indirectly access it through the Fed, and that the Fed’s job is to protect the boundary very closely and guard this power from abuse by elected officials. This is the idea of central bank independence.

My argument is, whatever may be true or not about central banks, it’s never affected the mint. The mint has been part of the Treasury for a very long time. And that power to issue coins has never been taken away from the Treasury. It has never left the Treasury. It’s never been something that the Federal Reserve has taken over. So this is not so much the power grab away from the Fed, as it is a resurrecting a somewhat dormant power and using it for creative purposes in a moment of crisis. Of course, the mint has been issuing coins the whole time, and has been returning hundreds of millions of dollars in seigniorage to the Treasury into the same account that the funds from selling the bonds go into. But we’re talking about going from hundreds of millions of dollars to trillions of dollars, and that is obviously an order of magnitude difference. But it’s a quantitative difference. It’s not a fundamentally different kind of operation or a different kind of power. So in that sense, I would say, yes, that the coinage power and the central banking power have existed in parallel for a long time.

William Saas: Right, so the trillion dollar coin resurrects this authority, or reanimates it, in interesting ways. To carry through that metaphor, it seemed like in February of 2021, Mike Lee wanted to kill it dead again by striking that obscure 1996 provision that granted the mint authority to create coins in any denomination. I’d like to get an update from you on the status of Mike Lee’s attempt to do away with that provision.

Rohan Grey: I haven’t heard any progress on it. There was a Republican congressman, seven or eight years ago, that did something similar, and that went nowhere as well. In part, this is posturing for them. It’s part of their kind of fiscal conservatism. It’s the same kind of reason that half of these Republicans put out gold standard bills every now and again. They don’t actually want that to happen, but it’s good posturing. I think they’d be fine if the coin statute was eliminated, but the point of that was really to give them a platform and to express outrage that this could even be considered. I think this goes to the sort of larger underlying ideological difference of trying to pretend that there is no such thing as public money, there’s only taxpayer’s money, and that you can only either tax or borrow. Those are the only two ways to get spending capacity. You have to be clear about how you will rob Peter if you’re going to pay Paul, and all of this austerity, scarce-money framework that their entire political ideology is based on. Even if we don’t use the coin today, even if we don’t ever use the coin, the existence of the coin, the fact that it’s there on the table, the fact that it gets talked about, is of great discomfort to them, because it keeps open the space for different kinds of politics, different kinds of discourse, where we don’t have to be thinking in purely zero-sum terms, and that things like the debt ceiling are not actually a limit on borrowing from our grandkids and government spending run amok as they like to pretend.

They are, in fact, as I mentioned earlier, just an operational part of a financing process that could be done a whole range of different ways. And whatever craziness the idea of minting a coin worth a lot of money might have sounded a decade ago, we’re deep into the world of crypto and digital currencies nowadays. Everybody is creating their own coins and these kinds of things. I think the larger imaginative and metaphorical threat that the coin presents is part of what needs to be attacked by these people’s perspective, because we’re right in the middle of a discussion about creating a government digital currency, a US digital dollar. So should this digital dollar look more like a bank account or should it look more like a coin? A coin is anonymous. It’s even more anonymous than a paper currency which has a barcode on it. They tracked the Lindbergh baby through the barcodes of the money, right? You can’t do that with coins. It was historically seen as something that you put in your pocket and you can carry it wherever you want. So the metaphor of a coin, of a public coin, the idea that the mint might have more to teach us in this moment of digitizing currency than complicated central banking operations, I think, is deeply threatening beyond just the immediacy of the debt crisis itself.

William Saas: We’ve referenced it before, and we’ve talked to you twice in previous podcasts, but I don’t think we’ve had an opportunity to talk to you since the publication of your Kentucky Law Journal article, which is called “Administering Money: Coinage, Debt Crises, and the Future of Fiscal Policy.” So I wanted to discuss that just a bit. Getting into the notion of the trilemma, as you outline it here, as others have outlined it, and how you position and frame your argument in this Kentucky Law Journal article as a supplement to that, can you walk us through the idea of what a trilemma is, or the trilemma is, when it comes to a president’s available options when faced with something like what President Biden is faced with today?

Rohan Grey: Yeah, sure. First of all, big shout out to Carlos Mucha, who was the guy who coined the idea so to speak, and to people like Joe Firestone who have been really pushing this for a long time. A lot of this paper is collecting and organizing existing arguments, and then adding my own around the edges and trying to put a spin on the whole thing. But a lot of the paper is really in dialogue with another paper by a law professor, Michael Dorf, and an economist, Neil Buchanan, called “How to Choose the Least Unconstitutional Option.” It was a Columbia Law Review article from about 2012, and it was one of the ones that was discussed in the White House when they were dealing with these crises. Their argument is that, when Congress directs the executive branch–the president and the Treasury secretary, specifically–to spend a certain amount, to tax a certain amount, and then not to borrow more than a certain amount, that that can create, essentially, a paradox. That is, you have to spend 100, you can only tax 50, so there’s 50 left, but you can only borrow 30. So what do you do with the rest? This is an ongoing process. What do you do every month for the 20 that’s not being accounted for? Or, eventually, you can borrow no more, and so, what do you do for everything after that?

Their argument is that, in a moment like this, something has to give. And of those three different options–spending, taxing, and borrowing–their argument is that the spending and taxing powers are core congressional powers. They are the core of the power of the purse. This goes back to your political science 101 classes with the power of the purse and the power of the sword. And that the debt ceiling is, relatively speaking, a kind of administrative, procedural, technical, and operational thing that has evolved over the years, has been basically dead letter for a number of years, because nowadays the way that we actually lift the debt ceiling periodically, which we used to do as a pro forma issue, is to suspend it, and then retroactively raise it when we increase it again. It’s sort of like saying, you have a credit card that has no limit. But next month, we’re going to retroactively impose a limit that’s exactly the amount that you happened to spend last month. And then, we’re going to do that for 30 minutes, and then we’re going to suspend that for another month. And then, next month, we’re going to impose it again for 30 minutes, and it’s going to be exactly what it was this last month, and then we’re going to suspend it again. It just makes a mockery of the whole thing. It allows politicians to grandstand every few years, but it’s not actually designed to put a limit on anything on a daily basis.

So their argument is, when you’ve got these three options, and you have to violate one of them as the president. Because the alternative would be to ignore the will of Congress, to ignore your clear legal obligations, to execute the laws unfaithfully under Article II of the Constitution, and that would provoke a separation of powers crisis and would be the president engaging in a unilateral kind of power grab and doing whatever they want. So if you have these three choices, you should choose the least unconstitutional, which is to violate the debt ceiling. Keep the spending, keep the taxing, just blow through the debt ceiling, and keep issuing treasury bonds tomorrow like you were yesterday. I agree with that argument on its face. That is to say, I think if you have to blow through one of the three, then the debt ceiling is the obvious one to blow through. There is a very good argument that taxing and spending is a higher sort of constitutional power to be separated and that the debt ceiling is already kind of a joke at best, operationally speaking.

But my argument is that we have to be careful that we’ve exhausted all the alternative legal options first. And if the coin is, in fact, the legal option, then that allows us to avoid this paradox whatsoever. It allows us to avoid the idea that we have to violate the constitution in some way, or that all we need to try to do is choose the least bad. In fact, we could do something that is legal. Buchanan and Dorf engage to quite a degree with the coin. They say they think it isn’t legal, it would probably count under the debt ceiling, and that even if it was legal, it would cause the population to question the value of the currency, and in doing so, could basically promote a catastrophic economic outcome. So the president should consider that and say, “What’s the cost of a catastrophic outcome versus just a little bit of unconstitutional behavior?” Relative to that, we should do the low grade unconstitutional thing rather than the technically legal but functionally catastrophic thing. I spent a fair bit of the paper pushing back against that and unpacking some of the assumptions in that claim. Is it true that minting a coin would cause the markets to kind of freak out? Is it true that it would cause runaway inflation? Is it true that it would actually have these effects? Or is that just a bunch of speculation by people who have a very strong commitment to a very liberal and scarce theory of money? And that what they’re actually saying is, we should be discounting any action that could reveal to the public how money really works?

We all know that money works like this. Look at the central bank of Japan. It’s been buying up stocks and government bonds hand over fist. You look at the Federal Reserve with quantitative easing and things. We’ve been “printing money,” we’ve been monetizing government debt and the world hasn’t collapsed. But the public maybe hasn’t fully grasped it all and fully caught on. So should we be avoiding any legal action that might tell the truth here in the name of the noble lie, that the public can’t handle the truth? My argument, and I think this is the strongest argument, the most unique contribution that I try to give in this paper, is that this is really dangerous. This is really dangerous to democratic governance and to an informed electorate. Because now you’re having a situation where the executive branch is openly and explicitly violating the Constitution, and violating their directives to do what Congress tells them, on the basis that they’ve got no other option. And this is in knowing full well they have another option, but believe that they are not required to entertain that option seriously because the public can’t handle it. To me, that is in the same category as the secret Pfizer courts that have warrantless surveillance, that nobody can hear because it all needs to be redacted. Chief Justice Roberts gets to sign this thing, nobody else gets to read it, and it’s in the name of democracy. But it’s in the name of democracy that we couldn’t possibly let you see.

It’s in this realm of “there are weapons of mass destruction.” Trust us. We can’t show you the materials, but we just have to do it because the alternative would be so catastrophic. Just trust us. I think it’s a very dangerous precedent when there are monetary theories that the public supposedly can and cannot handle–not economic theories. Remember, we’re not saying that this would be inflationary. We’re saying that the public would think it’s inflationary, therefore, we should be afraid of doing it. Because rather than educate them, rather than work through the truth, we should indulge their delusion and reinforce their delusion. And that is sound governance, even if it allows us to violate the constitution whenever we want to and use this as an excuse. My argument is that is the moment where we have to be really careful and where we need to be saying that the executive branch actually doesn’t have this discretion. They are not empowered to choose whether or not to tell the truth to the public, and if they decide they don’t want to, to then go and violate the constitution.

The thing that the coin is actually protecting us from is an imperial presidency that can basically threaten a government shutdown rather than admit that this is all a stupid game and that they’ve always got an escape clause. And the Democrats, I think, to their credit, they don’t want the government shutdown. They want the Republicans to cave. They want the Republicans to break, to cry uncle, and to stop playing these stupid games. But again, how many years in now are we to watching the Republicans play nihilistic, willing to blow everything up games? And how reasonable is it to hope that they’re going to come to the table and be a working partner in governance? It’s that kind of “fool me once, shame on you; fool me twice, shame on me” thing, but now we’re at like fool me 55 times. And Biden’s big solution is to say, like, “Come on, man. This is unreasonable. We want you to be adults.” You’re talking to Mitch McConnell, who’s saying to your face things like, “I want you to implode and fail as a president.” And if that means blowing up half the American economy along the way, so be it. This isn’t sound governance, this isn’t adult strategy, and this isn’t some genius, 11th dimensional political chess by the Democrats. This is just them wanting to play the only playbook they know how to play even if it means marching us into catastrophe.

William Saas: And it’s pervasive and entrenched. When I got to this point in “Administering Money,” where Buchanan’s talking about how maybe it’s better to preserve the myth than to let it out, that the government does have this money creating authority, there’s that documentary with Paul Samuelson that we’re all aware of on John Maynard Keynes, where we have Paul Samuelson, author of the most circulated or widely used economics textbook, talking about the need to preserve the myth of the balanced budget in order to reinforce discipline with the fisc. But immediately before that clip, James Buchanan is talking–was this James Buchanan, or is this the other Buchanan? Anyhow, I think this is a really good point of transition. You’ve sort of summarized this already, but you put it very nicely in the article. You say, “Taking the trillion dollar coin proposal seriously–if not necessarily literally–allows for consideration of the deeper constitutional implications of replacing the ‘trilemma’ with a four-dimensional conceptual framework that includes money creation alongside spending, taxing and borrowing.” Alongside that quote, and your narration of the “Lucy with the football” history of the Democrats and Republicans in recent decades, I want to play a clip for you from Pod Save America, January 2017, an episode rather ominously titled, “Obama’s Last Interview,” which, as far as I know, is not correct. But by this they mean his last interview as president on his way out of the White House.

Pod Save America: When were you most scared in the White House? What was the scariest moment?

Barack Obama: Well, I think it was that moment when John Boehner didn’t seem to be able to generate the votes to make sure that the US didn’t default. We had to start drafting the speech. And we were having these conversations with Jack Lew and others about what options, in fact, were available. Because it had never happened before. And there were all kinds of wacky ideas about how potentially you could have this massive coin. I mean, it was like something primitive, like out of the stone age or something, and I pictured rolling in some coin. For those who are listening, it gets pretty technical but there was this theory that I had the authority through the mint to just issue this massive, trillion dollar commemorative coin. And then, on that basis, we could try to pay off US Treasuries. And it was a very realistic possibility that we couldn’t get the votes for that and we couldn’t get those debts rolled over. And we would be in a situation where, technically, we’re in default. And at that point, you were in uncharted territory. What was also true was that, in addition to talking to Jack Lew, treasury secretary, and my speech writers about a speech, there were also questions about whether any actions that I took might be violations of the law. So we had to be talking to lawyers about potential challenges and legal actions and lawsuits from bondholders around the world.

Pod Save America: Not fun.

Barack Obama: It wasn’t my favorite night, yeah.

Pod Save America: What was your favorite night?

William Saas: Okay, so a lot to talk about there. Do you have any initial impressions or things that you’d like to reflect on from that clip?

Rohan Grey: I mean, yeah, there are two things. One is, and Obama did a great job of this during his entire presidency, and of course, he’s talking to his kind of people in this interview, but just the idea that anything that’s outside of his worldview is crazy and that anything within his worldview is eminently sensible. Talking to lawyers about what happens if we default and then we get sued by millions of bondholders, that’s serious. Minting a coin, that is wacky. Boehner not having the votes is a grave, serious problem. Him not playing hardball with the powers that he actually has, that’s wacky. That kind of rationality being the limits of his own worldview is something that is just an enduring theme of the Obama administration to me, and I think it really manifests here. The other thing that’s interesting here is just this idea of Jack Lew telling me what we could do, the lawyer is telling me what we could do, I’m always constrained, and I don’t have any power. But the reality, of course, is that, whether or not we pursue these things and try, is his choice. I think that kind of powerlessness is an enduring theme of his presidency.

Well, what do you expect me to do? I’ve tried nothing, and I’m already out of ideas. It’s that kind of mentality of the reason nothing ever gets done when I’m in charge is because everybody else is stymying me rather than because I am not taking responsibility for actions. It’s just very interesting when we’re talking about something that he has a constitutional requirement, a mandate, to do. He signed on, he put his hand on that Bible, and whatever. But when the time comes, when the rubber hits the road, it’s someone else’s problem. The limits are someone else’s, and all he can do is turn and face different parts of the prison that he’s caged in, while, of course, laughing at anybody trying to help him out of it, while, of course, having nothing but smug derision for any possible option that could have gotten him out of that. And I think it’s notable that he calls this the scariest moment in his presidency. The global financial crash, that’s not that scary. Presiding over the decline into warrantless surveillance and drone striking, that’s not that scary. The failure of the Paris Agreements, or whatever, that’s not that scary. It’s just very interesting that of all the things that really reached the limit of his ability to keep a cool head, it was the bloody debt ceiling.

William Saas: It’s stark, too, when you consider the other ways that executive power expanded and continued to expand throughout his presidency. There’s this disavowal of executive authority when it comes to domestic financial and fiscal problems, and then just unstoppable expansion when it comes to military adventures abroad.

Rohan Grey: Yeah, you accidentally drone strike an American child. Oh, well, whoopsie, mistakes happen. But God forbid that we do something that doesn’t sound very serious when it comes to preventing a catastrophe. And he’s talking about Boehner there, and of course, Boehner blissfully peaced out of the political scene when Trump came on the scene. And McConnell’s still around and was a big part of the story then. But I think it’s important that, at that point, the Republicans did blink. When the Democrats played hardball, their gamble paid off. They put a gun to the head of the American economy and said, “We’ll pull the trigger. We’ll do it if you don’t tell us to step down.” The Republicans said, “Fine, step down. The polling is hurting us.” This time around, I don’t think McConnell will do that. But I think the other thing that’s important is that, since then, we’ve made some strides now that this is on the table in crisis preparation. And at that point, there were these debates about, well, how are we going to prioritize different kinds of payments? Can we actually ensure that people who hold government debt will continue to get paid even if we have to sequester the government, employees, Social Security payments, and things.

Well, make sure the finance guys get paid even if everything else gets cut. That was a very hard operational challenge at that point. I don’t think it’s as hard now. And I think that certainly McConnell does not want the bondholders to not get paid. But I think he would be fine if this time around a government shutdown completely stopped Social Security checks, government employee paychecks, and things. If they could show that next time there’s a debt ceiling crisis, or next time there’s one of these crises, the only people that will actually potentially suffer, are the welfare state, the kinds of things that they love nothing more than starving, that will be a big win for them. Because in that moment, putting a log into the spokes of the wheel of the budget machine is just one more tool to starve the beast that they’ve been trying to starve forever. So I think that’s something to be very weary about. In transposing the fight that happened in 2011 and 2013 to the present is the stakes are higher, that the republicans are willing to draw more blood, and the people that are likely to be most harmed, if we do go across that Rubicon moment, will not be the international bondholders first, it will most likely to be the people who receive benefits from the government or employee salaries.

William Saas: Yeah, another one of the differences between 2011 and 2013 is we didn’t find out that the trillion dollar coin proposal was considered by the President, by the executive branch, and the President specifically, until after the fact until everything was resolved. Whereas, last week, we had Michael Gwin, a White House spokesman, telling Politico that, “There is only one viable option to deal with the debt limit: Congress needs to increase or suspend it as it has done approximately 80 times, including three times during the last administration.” So upfront, he is saying it’s on the table but it’s not on the table.

Rohan Grey: Yeah, we’re taking it off the table. It could have been on the table, but for us. I think you’re even noticing that in the journalist treatment, as well. The first time around, people like Joe Weisenthal, who were really at the forefront of this, they were kind of out there on a limb talking about this, but with eight or ten years of just watching how insane everything else has gone, watching the kind of sea change in macroeconomics, and watching not only the response to 2008 but the response to COVID with the New York Times printing articles saying, “Printing money’s on the table again,” and this kind of stuff, it urns out, when we need it, there is “infinity dollars,” as Neel Kashkari at the Fed says. It makes it harder to sustain that underlying scarce money myth. And the coin suddenly becomes, while still in the realm of wacky fantasy, a little bit closer to reality than it was the first time around and people have been somewhat desensitized to it and that kind of thing. Nowadays, Politico and others are reporting on this, as well as Bloomberg. And the reporting says the White House is choosing not to consider the coin. That’s the framing this time. And I don’t think that was the framing last time. The framing was, is this even something they can consider?

William Saas: Jon Stewart’s coming back too late.

Rohan Grey: That’s right. He’s not here to bring his brand of common sense. I don’t have much love for Paul Krugman, but there was just an absolutely insane moment where Jon Stewart ends up having this multi day spat with Paul Krugman about the coin, and Krugmn said, “Yeah, it’s economically fine. We should do this. The Republicans are playing hardball.” It’s one of those rare moments where I agree with Paul Krugman’s political strategy. And Jon Stewart is just playing the comedian, right? “Well, I’m just a dumb clown, what do I know?” But this seems silly to me. You’re not being a dumb clown in that moment. You’re trying to shut down ideas by appeals to common sense, but not informed common sense, rather this gut instinct, populist kind of what you think sounds like common sense. “You’re telling me that injecting a bit of a virus in you is supposed to make you less likely to catch a virus? That sounds crazy!” And it’s like, that’s just what a vaccine is.

There’s an appeal to common sense that was a lot more bipartisan a decade ago than it is today. “I’m a social liberal, but a fiscal conservative” was a smart sounding thing to say in 2010. And nowadays, it’s a cruel joke. Yeah, Jon Stewart’s rally to restore sanity looks hilarious at this point when you know that Trump’s five or six years are coming down the pipeline. “I disagree with you, but I don’t think you are Hitler.” Well, turns out that some of them are literally white nationalists with pitchforks and ramming cars into people. So do you still think they’re not Hitler? Do you still want to have a reasonable debate there while you’re simultaneously calling Paul Krugman an idiot on economics? And again, I’m in a very weird position to be defending Paul Krugman on economics, but relative to Jon Stewart’s pop-libertarian, you know, “Ron Paul has some good ideas,” kind of bullshit, he is certainly more of an adult there.

William Saas: Yeah, well, he’s coming back just in time, it seems like, for relevancy.

Rohan Grey: I think one other point on this is just that Biden was in the room for all of this as well. He was the VP for this. And while people might have thought about the coin being stupid, saying, “Well, this is stupid, we should just get rid of the debt ceiling,” of course, we should get rid of the fucking debt ceiling. But when has that been on the table? When has any democrat been interested in fighting that fight? We’re eight to ten years after these crises moments and the first round of debt ceiling debates and the democrats have not upgraded their strategy. They haven’t done anything. This is rolling exactly the same way as it did last time. And if that’s their solution, to shut down anything that would actually fix the problem, but offer nothing for a whole decade. Their solution is just to say, “No, this time around, just like last time, we’re just going to expect eventually to find that last 1% of humanity in Mitch McConnell, or those last vapors of a commitment to institutional norms, and that that will save us.” It’s like, whatever you thought about institutional and social norms in 2010, if you still think that we’re in the same place in 2021, you’ve been asleep, you’re completely delusional. A lot of people who might have been willing to give the genius President Obama, the Harvard law professor, the benefit of the doubt, that he’s playing some 11th dimensional chess that they can’t possibly understand, I think people are less willing to believe that average Joe has got some genius plan in there, especially when everything looks exactly the same as last time.

William Saas: McConnell will fold or a trillion dollar coin–one of these is whimsical.

Rohan Grey: That’s right. One of these is the kind of thing you should be laughing about on a podcast about politics and the other is a proposal to mint the coin.

William Saas: I do want to pause for just a moment on the question of common sense and what common sense was 10 years ago versus common sense today. Because common sense to Jon Stewart in 2011 or 2012, I don’t know that it’s going to look that much different in terms of understanding the fiscal situation. I’d be interested in your perspective on this, especially, because the reception of the coin, like you say, the idea, is a little bit more staid this time around. Whereas before, it was like, “Isn’t this interesting?” And, “That seems like a meme, right? Let’s talk about it and laugh.” Although, at the same time, it’s very serious, and there’s a spectacular quality to it. Whereas now, having, as you said, appeared, reappeared, and disappeared so many times over the past several years, I feel like the reception is not as strong today. And I think that this question of reception of the idea is maybe central to the whole project of things like Modern Monetary Theory. Is it chipping away over time until it becomes so banal that it just gets taken up without reflection? Or is it something else?

Rohan Grey: Yeah, I mean, I don’t have any faith that it’s going to be adopted this time around. When I say I think it’s closer, I don’t think it’s closer to being enacted. But I think that it’s less shocking to people that have been so shocked. People sort of say, “Oh, if you take a lot of MDMA, then your serotonin receptors have been blown out. There’s nothing left for them to fill up with.” Well, we’ve kind of just been shocked about the spectacle. There’s just nothing left now to raise us to eleven after seeing just a complete shit show over the last few years and seeing the climate crisis and everything else. But I think the difference is that, this time around, the focus is less on the coin and more on the decision of why not to use the coin. And it’s not that that’ll necessarily be enough pressure to cause Biden to change. But I think it feeds now into this larger narrative of when are we finally going to play hardball to save the planet, save ourselves, and to fight back against this kind of Republican and reactionary nihilism. And when Biden got into power, I don’t know if everybody voted for him for this reason, but a big part of his shtick was I can work with people across the aisle and nothing is going to fundamentally change, right? I’m a bridge builder, let’s get America back to being harmonious, and let’s heal our divisions. I think this is just making a mockery of that. This is showing that, once again, this wasn’t an adult, serious political vision. This was just some naive bullshit that was going to give the Republicans power to continue to set the agenda and continue to threaten to blow things up.

And if it’s not the debt ceiling, if it’s not minting the coin, it’s going to be something else. And if it’s not Biden, it will be someone else, if there even are other elections in the future, before Trump 2.0 stops them from happening or whatever. I think if we’re gonna get out of this descending spiral, something radical needs to change in how we are willing to use power, to take power, and to fight strength with strength. I think the coin is going to continue to stand here as an example. If rustling the feathers of nervous nellies, as Neil Buchanan says, is a bridge too far, then everything else is a bridge too far too, right? Then, Greta Thunberg is a bridge too far. Then, canceling student debt is a bridge too far. Then, reparations is a bridge too far. And if it’s not the coin, then when are we going to finally start saying, “No, those are the kinds of politics we have to be willing to play or we’re just going to keep losing, we’re just going to keep ceding ground, and eventually, we won’t be able to cede ground again.” Yeah, eventually, the next group that they come for, the next issue they come for, you’ll look around for allies and there won’t be enough left. So I think that’s the big thing for me. Yes, it’s not that eventually it’s gonna become so banal that we can slip it in without people noticing or something. It’s that eventually these contradictions are going to get so unavoidable that something will have to give. And the coin will continue to be here as proof that this issue, like so many others, is not as intractable as it seems.

William Saas: I think that’s a great place to leave it. Rohan Greywrong, thank you again for joining us again on Money on the Left.
Rohan Grey: Thanks for having me. It’s great to see you. Take it easy.

The Neoliberal Blockbuster: Toy Story Part 2 (Full Episode)

This Money on the Left/Superstructure episode is the eleventh premium release from Scott Ferguson’s “Neoliberal Blockbuster” course for Patreon subscribers.  Typically reserved for Patreon subscribers, this special two-part episode about Toy Story is available to the general public in full. 

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Course Description

This course examines the neoliberal Blockbuster from the 1970s to the present. It focuses, in particular, on the social significance of the blockbuster’s constitutive technologies: both those made visible in narratives and the off-screen tools that drive production and reception. Linking aesthetic shifts in American moving images to broader transformations in political economy, the course traces the historical transformation of screen action from the ethereal “dream factory” of pre-1960s cinema to the impact-driven “thrill ride” of the post-1970s blockbuster. In doing so, we attend to the blockbuster’s technological forms and study how they have variously contributed to social, economic, and political transformations over the past 40 years. We critically engage blockbusters as “reflexive allegories” of their own technosocial processes and pleasures. Above all, we think through the blockbuster’s shifting relationship to monetary abstraction and the myriad additional abstractions monetary mediation entails.


2001: A Space Odyssey (Stanley Kubrick, 1968)

Jaws (Steven Spielberg, 1975)

Star Wars (George Lucas, 1977)

RoboCop (Paul Verhoeven, 1987)

Toy Story (John Lasseter, 1995)

Jurassic Park (Steven Spielberg, 1993)

The Matrix (Wachowskis, 1999)

Avengers: Infinity War (Joe & Anthony Russo, 2018)