Mint the magical coin!

Dear you,

Florida legislative session 2023.  Hell. A columnist for Tampa Bay Times (Stephanie Hayes) opines that bullies from 1980's movies are running Florida.  Think about the most abusive characters played by James Spader in that era.  And the "Heathers" sticking together to enforce their views on everything as, well, the law.  The session was a massive success in terms of restricting or criminalizing individual and even corporate liberty.  But hey, some people point out, there were some good results too.  Like, you know, establishing permanent tax breaks for children's diapers and adult incontinence products. Please.  Really?  Things are so messed up here we are celebrating tax breaks related to excrement.  

And things are pretty messed up outside our sunshine state borders.  Pick your topic.  How about the possibility of us defaulting on our debt?  I am very freaked out about this. I look for ideas, solutions, something never done before.  I am one of the weirdos who think the minting of a magical trillion-something dollar coin would be great!  I hear this is idiocy, but I am not alone.  I discovered I am part of a group called Coinistas.  We even have a hashtag, #MintTheCoin.  

Inspired by Warren Mosler, creator of Modern Monetary Theory, Carlos Mucha, came up with the magic coin idea back in 2010 noting Congress has already delegated to the Treasury all the "seignorage power authority it needs to mint a $1 trillion coin." See a recent vox.com interview with Dylan Matthews where Mucha added two other options:

"Treasury can issue perpetual consols [debts that never mature and continue paying interest forever until the government buys them back]. Since there’s no guarantee to repay the principal, it doesn’t add to public debt (which measures amount of guaranteed principal). The Fed can just donate the Treasury securities it holds back to Treasury.  Of the three [the above two and the coin], issuing consols is probably the least disruptive. Treasury can announce it is issuing T-bonds “payable at the pleasure of the United States” instead of a fixed term and can hold an auction later the same day. So that’s what I’d expect to see if Treasury runs out of money."

Perpetual consols and donating Treasury securities back to the Treasury.  This sounds really circular and made-up.  The whole financial game itself feels circular and made-up.  At least the coin option is concrete, like bartering with your landlord if rent is late.  "I can give you this nicely broken-in Barcolounger and whatever I have in the fridge instead of cash. And there is a lot of good beer in that fridge!"  That makes sense.  I never dealt with a landlord who accepted perpetual consols.

I say just #MintTheCoin.  Shut down the Republican intimidation machine.  Magically!

Love,

Fiscally risky Joyce