Money From Nothing

July 13, 2020
Hockett, a Cornell University law professor and economic policy advisor to Congresswoman Alexandria Ocasio-Cortez, and UC Irvine philosophy professor James (Surfing with Sartre) deliver an illuminating and accessible guide to how the Federal Reserve could act to improve the economy and the lives of everyday Americans. Eschewing financial jargon for pop culture references, analogies, and philosophical allusions, Hockett and James explain the basics of fiat money systems and contend that the federal government, as the sole issuer of U.S. currency, could simply produce more dollars—while taking steps to keep inflation under control—in order to fund social services, ameliorate economic crises, and make direct payments to citizens. Pinpointing income inequality as a catalyst for political and racial discord, they propose a “new social compact” between the Federal Reserve, public and private banks, and citizens. Its pillars include a basic income guarantee, more flexible work hours, and public financing for employee-owned businesses. Though tangents, including a history of money from the ancient world to the present, delay the proceedings somewhat, the authors present a lucid and persuasive call for financial reform. Progressives and policymakers will want to take note.