Tonight we will encourage you to ask questions which many of you already have. The portion of the event will be dedicated to questions where people have already asked questions and you can vote on those you are most interested in hearing the authors answer. And last you can see us but we cannot see you so feel free to relax and get comfortable. Without further ado, it is my honor to welcome the professor of economics at the State University and contributing columnist to discuss her book. We are also looking to be joined by the Senior Reporter at the post where he covers congress, the white house Economic Policy and discussing the book the price of peace money, democracy and the life of john maynard keynes. Hello, everybody. Nice to be with you. I want to start by talking with stephanie about her book called the deficit myth. A when i listen to the economic commentary there is a talk about the debt and deficit. There was a visit from the link in the project that was antitrump republican talking about how donald trump had run up 17. 8 trillion National Debt increasing the deficit and adding to the National Debt is probably the least bad thing donald trump has done. If the mainstream politicians who talk about the deficit and debt, virtually everybody talks about it in a negative way. When we hear people it is almost always the case that they are there to complain about it. They are presented to us as problems at a minimum. My hope is i can reduce the level of anxiety. I start in chapter one of the book telling a story about being a child and watching the Television Show sesame street. It was good at teaching us the different categories. These things are similar, these things are unlike the rest of them. As a kid, my sister and i would watch him play along as the images came on and one of these things is not like the other and we would holler back at the television the shoe is not like the others so i am an adult now but Still Holding back at the television because i turn on the tv and i hear often socalled experts on economics talking about the deficit or the debt in ways that i think are fundamentally wrong and they are getting some big things wrong. The reason i wrote the book i think is to try to get to a better place and a better understanding where we can have a more meaningful discussion about deficits and National Debt and government finances but ultimately i hope get us to the point we make a better public policy. Host a common criticism you get from people that talk about these theories you believe that deficits dont matter. There was a review in the wall street journal where somebody accused you of this. Do you believe that deficits dont matter what do you make of this . Its funny because if you go to the webpage that i created to talk about the book, it says reagan proved deficits dont matter. He was wrong. So there i am saying i disagree with dick cheneys characterization that they dont matter. My argument in the book and throughout my work is that deficits matter but not in the way you were taught to believe that they matter so weve been talking as i said earlier that they are inherently dangerous, undesirable. That there is something that you do in times of crisis because you have no choice like now but that in a more normal times is that something we ought to be avoiding. The governments shouldnt spend more than they take in and they should strive to balance the budget and avoid increasing the debt. So i walk through a variety of ways that deficits matter. One more important way every deficits is good for someone. That is the reality. So when you see the republicans passing these huge tax cuts at the end of 2017, the republicans passed knowing they would increase deficits so if they really believe that deficits were inherently dangerous and they would recount back and future grandchildren, the reality is the republicans understand i think very well every deficits is good for something so what they did was massively cut the taxes and 83 of the benefits 1 of the Income Distribution and another is those who needed the help, but the deficit the government is running become financial surpluses in somebody elses pockets. Theyre deficits become our surplus. The question is who is ours, we as benefiting from that . The republicans are happy to run deficits because they know in creating a financial surplus they can direct into the hands of the people they are most interested in helping. What i would hope is democrats were reached the point they understand its something we should be striving to wrestle down as we do but that deficits can be used as a tool to carry out an agenda that serves a broad public and benefits people who are truly hurting so that is a lot of talk about in the book. It feels when i read the book whether it is in this or blog posts youve done over the years, there is an emphasis on the economic distribution whether it is resources and how you move supply chains from point a to point b. Or what kind of society you want to live in terms of economic inequality and the focus seems to be on a social vision more so than i dont want to say youre not an economist here but the way a traditional economist focuses on it as the sort of primary way of understanding seem to have to my mind at least a broader social vision. First of all is that an accurate description of the way you think about your own work and what do you think it does about the economics profession that we have this focus on the debt and deficit instead of these other social priority is . In the book, Chapter Seven is called the deficits that matter so that is exactly what i am trying to do to redirect in our everyday lives and for millions of people in this country you are right that for me, i look at those as a document and the entr our elected officials and they get to write and fax the budget determines where the Financial Resources can be dedicated and to what end. And in my view our elected officials are there to act in the interest of the broad majority of the people of the country. If the people of the country indicate they want everybody to have healthcare for example, then i think that the congress should be looking for ways to budget the nations resources so we can deliver that wellbeing to people. So its about saying listen, the easiest part of any agenda is the right, that is the easiest part. The challenges how many of the nations productive resources, how many of the workers, how many people, how much of our factories, how many machine, how much do we want directed to producing public goods, healthcare, education and infrastructure, those sort of things and how much do we want to lead to the private sector so there is a balance there and when i talk about addressing those that matter whether it ia tradition, student loan debt, all of it in the chapter i talk about, im focusing in ways that are maybe not common among the economists to think about directing real resources to solve real problems in the economy. That reminds me quite a bit of a fellow i spent quite a bit of time studying. I dont know if youve heard of him same as john maynard keynes. Are you familiar with his work . M. I. Familiar with his work. [laughter] it rings a bell. She is one of these broad fingers kind of an economist by accident. Hes constantly surrounded by these artists and writers like Virginia Woolf and those from the 80s and 90s and this vision of society they would get his ideas access to power. It is extremely dense like eating a pretzel covered in forms but a lot of his other work is very clear he has the ability to distill these complex ideas into fragments ordinary people understand because they think hes fundamentally concerned with ordinary people in what they can understand because it is in this weird thing but its the way to address the policies that he cares about with war and peace and authoritarianism and democracy of the big problems of the early 20th century. The economics profession today doesnt seem to be working at the same level for the most part. But the idea that you could sit down economics are there to tell us know, we cant do the things we want to do. We cant solve the problems we need to solve so my question for you is what are the problems that economists need to solve today if it isnt debt and deficits what should the great minds be focusing their attention on . In the moment it seems to me there are obvious answers of unemployment and this is the big problem they wrestled with in the general decree because the economy was in the grips of the Great Depression to hear we find ourselves again tens of millions of lost jobs in the course of the nations history. You know this, you and i know a lot of these people. They are also engaging in a climate space but they are working in collaboration working alongside philosophers and people outside his own and whether it comes to healthcare ohealth careor education there s economists can do and ways we can be useful betwee but we neeo sometimes show some humility and recognize how they feel and about to bring an awful lot to the table in the extent we could work better together. And they fit hired together in the pyramid and the hierarchy of so unemployment, healthcare, the environment. I want you to share what made you want to study this man that is a fascinating figure but what was it about him that made you want to study and spend years studying his life . From an economics background i studied philosophy as an undergraduate and the job i sort of fell into after i graduated college i wasnt thrilled to think that than the then they de favor and explored it and it became very exciting to cover the Banking Sector and there was a shift that happened everybody i talked to agreed the markets are rational and supply and demand find the equilibrium we all know things are going to work out if it stays out of the way and it was to say obviously the government needs to intervene immediately to rescue the Financial Sector otherwise the economy is going to collapse into society is going to lead to despair. When that happened, people weree over in at least the Financial Market participants were open about the fact that they were changing their minds. All of a sudden they were talking about this guy who said his ideas were relevant and key. He had been dismissed to the academic margins if youre a specialist in economist i guess paul krugman had a job at the times that academically wasnt taken super seriously. You have to work for a particularly special institution and in the markets people didnt really talk about it like it was a real thing and suddenly it was totally legitimate. And i thought that was an incredible. It was remarkable not only because he changed his tune but because the possibilities that were available in terms of policy making seemed incredibly broad and specific policies we pursue in 2008 where we bailed out the Financial Sector, that struck me as a not terribly great way to go about that. It struck me as odd that a fellow would prescribe Something Like that. I tried to read this general theory and like i said, the general theory is a nasty piece of work. If you want to give yourself a big headache im a just start on page one and try to get through it. Its one of the great triumphs of the western letters but i just like reading it where you go through dozens of pages until you get to the one in my goodness this man is brilliant. I read the economic consequences of peace, the treaty that ends world war i in 1919 and this is much easier to understand economically it is what made him famous today as an economist, but the moral and philosophical force and the political ideas that are involved i think are just as urgent as everything in the general theory and as any piece of political writing ive ever encountered. That book just kind of cheese onto something serious. A book about political accountability. He says essentially those that have organized this peace treaty have saddled every country with insurmountable debt whether it is to analyze that they have assumed over the course of the reparations that have been assessed on germany lost world war i obviously as a result. People are going to be shipping money across borders and are not going to have the Funds Available to mobilize the resources that are going to make the economies recover and generate prosperity. There is a brilliant point that isnt just going to be an economic problem. People are going to blame outsiders for the fact they are not recovering and they will not be wrong because there will be capital that could be spent and that is going to lead to dictatorship. I thought that the connection between the economic dysfunction and the social crisis was something i just felt a sense of unfairness over the bailout in 2008, but i didnt feel like there were economists putting it together saying the reason they appear to add up on paper but the revolt didnt feel like that was something in the positions of expertise. In his work i felt a deep force and also the concern for things that were not really about dollars and cents. He was concerned about the equation but more afraid of the dictatorship and focused on the big kind of social problem, the pot of gold at the end of the rainbow but more like the fascist at the end of the rainbow. But he was afraid something badg bad happening to society and to the community, not of an equation that failed to balance appropriately. So i became completely obsessed with the guy and i was a philosophy student. I found a lot of his ideas they made me understand them as a philosopher more so than a econometrician. He wasnt somebody that caret deeply about the mathematics even though he studied mathematics as an undergraduate when he was at cambridge. They didnt even have a degree in economics but some o one of e greatest economists that ever lived. He is kind of early to the profession. Its something thats just being born when he is studying as an undergraduate. I wrote this because of the crash of 2008 and my feeling of confusion about where the world was going and my kind of moral despair and he was somebody that i could speak to that uncertainty and unfairness frank b. That was in the air. Air. I feel like, you know, you feel like you know him, like you are so inside his head, and you come to this at the moment right at the financial crisis and the meltdown, Global Economic meltdown and you talk about the treaty of versailles and reparations imposed on germany and how he could foresee the kind of rise of fascism and social unrest and all that. How did it feel working on this project and looking at what was happening in europe where the countries didnt feel like they were living in the moment . Spinnaker was terrifying. So i went to cambridge to go through his papers at Cambridge University and in the spring of 2017 this was one of the worst days of the great debt crisis but every single week there were headlines about the golden dawn and the far right fascist parties that were rising up in other countries into the conservative parties were also sort of subsuming these fringe parties and making it part of the more mainstream conservative policy agenda. He would go through the papers and i really worry germany is going to do fascist boring really worry germany is going to do fascist and boom, they would do it. Keep turning the pages through the document. Mussolini has taken power. Its an economic connection between these things but it was obviously just common sense. I feel i can kind of argument you could argue that now that theres a connection between the Economic Policy of the social disruption, which i dont think you actually have to do in europe. Give in europe. People just kind of access they might deny whether or not the particular policy making is responsible for the fascism the idea that interconnect it is just common sense. And there were some things. He just has this incredible capacity to communicate to other people. I dont want to say the way he felt the way i felt that i felt a real sense a real residence talking about coal miners going on strike and say we wont work for this terrible wage anymore. Buzz off. So only god there is a huge strike. And then in 1826 have a huge general strike in britain the enormous moment of upheaval were all the labor unions have the conditions demanded from the government so i feel we see some of that today. Obviously george fully needs killing is the spark for all the unrest around the country in the United States right now that underlying that is a deep sense of unfairness at everything, not just the police to be exploited against working people particularly black and brown people. There is no way to say that tomorrow will be better than today. That the political system has abandoned. But even just most of the country. So that crisis just makes his way to come alive and with that economic material it doesnt have the same sort of fire behind it. You think of the keynesian economics often times what i gather on gather thinking that government is supposed to prime the pump and grease the wheels when the economy slows down. And then you can safely take your hands off and the economy will find its way back to equilibrium. And then theres no need for sustained presence on the federal government. So where we are and recognizing continuing with social unrest and opportunities for people who might want to take advantage and take us in a fascist direction what could we have in the chat box with us . Do something to safeguard the American People to provide jobs for everyone and healthcare and education do we embrace the fdr style new deal program of the 21st century . I think he would approve of your work, but frustrated by the fact that its necessary. He would say we know the question about money and numbers is just the core question we have a Climate Crisis, huge breakdown of International Relations between United States and China European Union is disintegrating and the states have not gotten along and now we have deep inequality and in every country whatever stage of development and with deep inequality within each country so to talk about a grand plan that could be used one of the biggest complaints he felt the countryside had far more. He tried to do more than one t