Spend first then tax later, and learn from Jamaica

Jamaica economic reform journey
From an epic twitter thread from the Bank of Jamaica

**WARNING — some Economics geekery follows**

My favourite podcast (yes, even more so than the bickering of Simon Mayo and Mark Kermode on Wittertainment ) is by David McWilliams.

This week David showed himself, as an ex-central banker, to be a convert to MMT (ha!) in a great riff arguing that we reached peak neo-liberalism with the ridiculous and quickly lambasted grab to make the rich richer that was the European Super League. At the end of his riff, he noted the myth of the idea of “spending the taxpayer’s money” and that this is back to front.

With such a riff, (it is a gift the man has!), David kindly then put it all into a blog for us to read back later. Take time to read it and enjoy his story-telling, then note this key phrase:

Spend first and tax later, as opposed to taxing first and spending later. The only target we have to worry about is inflation.

David McWilliams, in “A 30-year economic supercycle ended this week

If this stuff intrigues you, even confronts you, please be open to new opinions and, as David models in his insatiable curiousity to learn widely, you may even evolve your ideas and change your mind.

Now let me hope that Rishin Sunak (the UK Chancellor) and his party have a similar epiphany around how they manage the economy. One can hope!

I close with a wonderful, educational and fun video from the BoJ on how Jamaica is focused on controlled inflation in the 4–6% range. In the last decade or so Jamaica has performed an economic management act little short of miraculous in terms of reducing government debt and bringing down inflation. For more on this and the “golden window” of opportunity this has created, read this great twitter thread from Marc Gayle.

Originally published at Tom McCallum.

Sounding Board for Leaders seeking to go from Good to Great to Elite to World Class. Daily posts here, or https://tommccallum.com/newsletter-sign-up/

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