Rohan Grey, who taught us to understand money as a creature of law, is back for his tenth appearance on Macro N Cheese. 

Steve and Rohan dissect the humor and horror of the political landscape. They make a realistic assessment of the Biden administration and look at figures like Elon Musk and Ramaswamy as part of a new wave of governance setting out to undermine the fabric of federal institutions.  

The conversation touches on the absurdity of contemporary American politics, where a ‘meme president’ can emerge amidst a cacophony of discontent and confusion. All this against a background of imperialist atrocities and genocide.  

As always, Rohan warns against viewing political and economic developments through a simplistic lens and suggests a nuanced understanding of these realities within their historical context 

Rohan looks at the alternating and sometimes contradictory positions taken by conservatives and progressives on several issues. Judicial activism was once identified with the left – Thurgood Marshall, for example. Today judicial activism is synonymous with Samuel Alito. What has it meant to conservatives in the past to have an independent Fed? What does it mean today? In what ways do Trump’s interests align with Main Street instead of Wall Street? 

Part of the episode is devoted to cryptocurrency. Rohan explains why he refers to 2024 as the ‘crypto election’ and then talks about some of the fears and predictions about the Trump administration. 

Instead of comparing bitcoin to the US dollar, Rohan suggests we compare it to oil: 

We're not talking about holding Bitcoin. We're not talking about internalizing Bitcoin into the payments architecture of the United States government. We are talking about taking an interest in stabilizing the price of something that is otherwise functioning as a commodity. 

No Rohan Grey episode is complete without a couple of references to popular culture. Speaking of the broader issue of crytocurrency, he says it’s as if the digital dollar looked in the mirror and fell in love with itself. He compares it to a certain episode of Seinfeld. 

Rohan Grey is an assistant professor at Willamette University College of Law, where he teaches contracts, business associations, financial institutions, and a seminar on law, money and technology.  

Find his work and an expanded bio at rohangrey.net 

@rohangrey on Twitter 

Have faith. Have faith. Believe in your source. Have faith. I refer often to Martin Luther King In the context of the civil rights movement.

He said, he said, I have no time for the tranquilizing drugs and for. The tranquilizing drug of gradualism and incrementalism. Here's another episode of Macro and Cheese with your host, Steve Grumbine.

All right, folks, this is Steve with Macro N Cheese, and I am going to be talking to a guest that I haven't spoken to in a number of years. This gentleman gave the absolute must-listen-to history of the Federal Reserve. He is one of the smartest people I know. And that would be Rohan Grey.

For those of you who haven't heard of Rohan Grey, where you been?

Rohan is an assistant professor at Willamette University College of Law, where he teaches contracts, business associations, financial institutions, and a seminar on law, money and technology.

Rohan is also the guy that really, really planted in my brain that money is a creature of law and the things that go into understanding money have to go into understanding the law. And with that in mind, I want to say today's guest is must-listen-to. So folks, don't be afraid to share this when it comes out.

Rohan Grey, welcome back.

Yeah, thanks for having me. It's been a while. Nice to see you, Steve.

Absolutely. How do I put this? I mean, this election - I'm no fan of the current administration and I'm definitely no fan of the incoming administration.

You know, I had a lot of problems, and I still do with warfare out in the broad open seas, man. We're talking about Ukraine, we're talking Gaza, we're talking all this other stuff.

But then we've got this other lurking evil coming out of the woodwork in the Trump administration part two.

He's bringing a cast of characters with him like Elon Musk and this [Vivek]Ramaswamy guy who just was a failed candidate, I guess, in the previous run-up to selecting Trump as the Republican nominee. However, he's tapped these guys to be part of the Department of Government Efficiency, AKA: DOGE. And, you know, it's just kind of hilarious to see the meme president come back into office and to see what he's got in store for us.

And one of the things that I felt was really important about this, though, is that not only are they looking to slash eighty to a hundred federal agencies through this system, but there's also a lot of talk about crypto being backstopped by the Fed and the elimination of the Fed - roll it into the treasury - which some people would celebrate as a tremendous victory in the grand scheme of things. But these guys have a totally different angle. And I'd like to take this opportunity to let you set the stage for how we got here and what's happening.

Yeah, there's so many different historical and materialist analyses that you can do about how we got here.

But somewhat facetiously, perhaps, I've started joking that the best way to kind of predict what's coming next is to work out what would be the most maximally, literarily, kind of hilarious, and also tragic storyline and trust the American public to make sure that the TV channel stays interesting, you know? I think describing him as a meme president is sort of along those lines. It's a very darkly poetic way of pushing social progress forward.

And I think, I forget who it was. It might have even been Schumpeter had some line that, you know, I shall create, if not an overture, a desecration.

And as you said, there's no need to give credit to straight-up fascism in this cartoon clown car of villains that come out alongside Trump.

But at the same time, the idea that we could have just continued to kind of extend and pretend, or hope that the existing regime will find enough juice when it was so clearly kind of collapsing - I think it's its own form of delusion that was going to break. And we had moments to break it gently, you know? We had moments to transition it softly. And that regime really resisted as strongly as it could.

And eventually this sort of buildup of pressure is such that it ends up in this, again, maximally cartoonish sort of something that you would think would be a bad FX show. And that's the version that we get. And I think for a lot of people, it really is somewhat in addition to all of the economic pain and the social reaction and the centuries of white supremacy and all these other things, there is this sense that this is a country whose greatest imperial export is Hollywood. And it's people are living from social media dopamine hit to social media dopamine hit.

But it really felt like after the '08 crisis there was a time, you know, you break a global economy and you either really, really fundamentally transform it in response, or don't. And there's a ticking time bomb to fascism, which is only further encouraged by austerity.

So to me, I don't know, you get to this point and it's not sort of better the devil you don't know than the devil you do know. But it is like insanity is doing the same thing over and over and expecting different results.

And you can call this Trump movement stupid. And you can obviously call it diluted, but I don't think it's insane in that way. And compared to that, I don't know whether the sort of insanity of the Democrats is better.

You're hearing a lot of these people, what they call the kind of popularists, or the people who are supporting, quote, unquote, deliverism.

But I think the better way to understand what that election was - the sort of liberal regime trying as much as it could to adapt and evolve, you know, but failing. Trying to accommodate as much change as it could without fundamentally changing anything, right? That Biden line, that kind of nothing will fundamentally change sort of also rings in my head.

And I think that you try to get to nothing fundamentally changing, while also kind of look how much we've changed, look how much we've heard your suggestions in the suggestion box, thank you very much.

It's sort of talking out of both sides of your mouth and not really getting any of that.

One example of this, which I sort of was making fun of on the platform formerly known as Twitter a couple of weeks ago, was one of the senior Biden economists, a guy named Ernie Tedeschi - so a pretty sort of beige, technocratic guy - had a grumpy tweet in early October, I think. It was saying, I don't know why everybody keeps giving MMT credit for the Biden economy. You know, there were no MMTers in the Biden admin.

You know, we weren't thinking about that every day. And I was sort of pushing back at the time. Being like, come on. That's true, I know that we weren't in the room.

But also, the only reason there was even sort of public space for big spending was in part because of the work that we did. But at the same time, post-November 6th, let's take your own words and hang yourself with them, buddy.

Because, yeah, you're right. You didn't listen to us. You tried to do your crappy milquetoast version of big fiscal, and not in the way that we wanted and not in the way that we thought was necessary.

And now we see what the results of that are.

You know, it's funny because going into Biden's first, you know, right up front, you know, the whole transition team with Stephanie, Derek, Sarah Nelson, and others, there's the slightest, tiniest piece of hope.

And it was so tiny for me that I barely gave it any notice because all I could think of was Biden has always celebrated destroying anything that helped the common man. I mean, his whole track record is filled with a soundtrack of everything that you would think Ronald Reagan might have said.

The credit card from Delaware.

Yeah, the senator from MBNA, or whatever. And he's just an awful person. I couldn't stand him going back to the Anita Hill days, and I wasn't about to forgive him.

But just hearing this slight bit of positivity - I was still listening to Bernie Sanders at the time - and it still kind of made a dent in what I thought. But lo and behold, the Green New Deal got swept away. It was now called the Green Dream.

All the different things that we had talked about as - let's call it an MMT movement of sorts - you know, that progressive Bernie movement had gotten wiped away with a really, really bad tagline called Build Back Better and once again, completely watered down.

And the series of unfortunate events - from parliamentarians to the Manchin-Sinema to the rotating villain, you name it - watered it down to the point where really, I mean, it might have been a couple teeny spokes on a wheel. It wasn't even a full wheel. It was really pretty weak sauce. And for somebody that was pushing for A Green New Deal it was like, how do we stop advocating for Medicare for All? How do we stop advocating for a Green New Deal? What happened to a Job Guarantee? What happened to all this stuff? We just . . .well, Biden says Build Back Better so we're going to say Build Back Better, I guess. And you saw them literally take a ax to everything and chop it down.

Remember the PRO Act?

Oh, yeah.

It was pretty bizarre to me to watch the word parliamentarian suddenly come up. You know, coming from a country that has an actual parliament, it was like, wait, you guys have one of those?

I've been here for 15 years. I haven't heard that bloody term come up at all. And now suddenly it's the one person holding up the single largest legislative achievement of an incoming president? Come on.

And again, this is a good example. Like whatever else you say about Trump, I just can't imagine him letting a gnat like that on the board stymie him.

Exactly.

You know what I mean? Or if he does, he's going to fight for it.

And again, not trying to give the guy credit, but just saying when somebody says they want to do stuff because they're so self-interested and narcissistic, you can at least trust that they love themselves, you know, that they're going to fight for themselves if the alternative is jail in a way that, you know, weekend at Biden's is not. And to your point, I think getting Lina Khan into the chair of the FTC was a genuine coup.

The howling of betrayal by the Republicans who thought she was just going to be another commission member only for a kind of last minute switcheroo was a genuine move.

And I think, you know, we watched in live time my former doctoral advisor Säule Omarova and Mercer Beraderon get kind of left out to pasture in the OCC share nominations.

And then if you were going to look at serious financial regulation, like who's left on the board after those two? You got Marty Groomberg at the FDIC who's going through his own scandals right now and was pretty lackluster, pretty MIA. And apart from that, Powell stayed on and you know, put Janet Yellen at Treasury. I mean, this is a Fed chair who was a sort of pretty beige Fed chair and now she's the Treasury.

I mean, whatever you say about putting someone like her at Fed chair or whatever you think about the Fed in general, the Treasury is a fundamentally different beast to the Federal Reserve.

The Federal Reserve is always more reactionary, always more technocratic, always more of a lagging indicator of change rather than a leading indicator. And the treasury is sort of, by definition, unavoidably political.

You know, it's got OFAC, the Office of Foreign Asset Control, which is essentially kind of the terrorism money people. It's got FinCEN, which is sort of like the cop money people.

It deals with the Bureau of the Fiscal Service, which deals with all of the kind of prepaid debit cards that go out for different health care benefits and other welfare programs. And of course it's sort of, you know, directly accountable to the President in a way that the Fed Chair isn't.

So what are you saying when you appoint the previously highly independent Fed chair to be your Treasury Secretary? You're saying, I'm going to stay out of this stuff. You know, I'm going to let the technocrats run this stuff.

I'm not going to politicize it in a positive way.

So there was this sort of like early moment where we had things like the Pro Act and Childcare Tax Credits and these unemployment insurance programs and other support reports from COVID. And then they all went down by the wayside. And student debt cancellation got dropped and he refused to use the more aggressive legal authority for that.

And so, you know, whatever the kind of first 18 months of small, you know, grayish haggard pieces of meat being thrown to the progressive base, it all just dried up instantly.

You could probably draw a decent map on where Ron Klain's departure from the White House - you know, before and after - and you'd probably get a pretty decent kind of superimposition on where all this stuff really ended.

But I was saying to people - even with Harris's nomination, which was, you know, clusterfuck in all sorts of ways - there was a moment when she first announced she was running where it looked like she really was going to turn the page from his regime, right? That she was talking about helping families and, you know, all these different things was sort of a care agenda.

And then by the end you've got like more Liz Cheney interviews and her talking about having a gun, and all this. Again, that's before you even get to the complete silence and complicity on the Palestinian genocide.

So I kind of joked that it was sort of mildly convincing or mildly distracting to give us sort of a year to a year and a half out of a four-year administration. But to give us like half of a month in a three-month campaign, it doesn't really work. You barely have time to get excited before it's already been abandoned again. And so this time in microcosm. Second time is minifoss.

You know, and I don't think it worked at all, as we can see with the election results.

Yeah, I would just say this one thing and I don't want to spend a lot of time on the political angle of the Harris slash Biden group, although I think it led to the inevitability of Trump, quite frankly. And that is when Harris was asked, what would you have done differently than Biden?

And she just sat there doe eyed and said, I wouldn't have changed a thing. And for all of us who were desperate to hear something better than that, that was kind of it.

I think that her saying that nothing would stand in the way of her funding Israel, I think was the final pin for me, final pulling of the grenade that set me completely off that track because to me there was no issue. I don't think another issue existed other than Gaza.

For me, for the last year, when in our lives have we ever seen a live stream genocide, kids seeing it for the first time, watching the kids on campuses getting brown shirted by this administration. There was no empathy, there was no anything. It was like calling people that were fighting against Zionism antisemites was peak liberalism.

That was peak horrible. I, I couldn't believe what I was seeing or hearing.

But here we are now at this point where Donald Trump has been elected and let's be fair, it was kind of a historic defeat. We're not talking about like some, you know, close call.

Yeah, look, there's no, there's no Jill Stein voter to blame for all of. It's really rough for them.

You know, Matt Iglesias and David Shaw basically had the run of the place, had play money of, you know, three times as much as Trump did and they still couldn't make it work.

You know, to your point, Harris, I think the one that I saw when she was asked what her like policies would be different from Biden, the first thing that she came up with was like home Medicare qualifications so that like family members could get Medicare for supporting family members. And like I have no problem with that policy, but how small potatoes is that if that's your big turning of the page?

And I think it was ironically, one of the johns like John Favreau from Pod Save America or something was talking the other day about how important it was to be able to clearly differentiate from prior regimes or prior things that you're trying to turn the page from if you really want to like show the public you're different.

And I kind of responded snarkily, like my kingdom for somebody who will clearly differentiate from Obama's decision to let all the homeowners go under after 09. That represented the single largest destruction of black wealth in a generation.

And even against the backdrop of very finance friendly Democratic Party politics for decades, really epitomized the let's save Wall street and see if Main street comes limping behind it. And we understand that it's complicated in the sense that Obama remains this sort of very transformationally popular figure as an individual.

But like, what was Biden if not just like a member? Berry for the Obama Admin. Remember, like, nobody wants to do the Clinton thing again, but like, remember Obama?

Like, what if we just tried to like, you know, scrape some fumes? What if we just kind of collected some of the shavings that are in the bottom of the jar and see if we can make one more piece of toast?

And it was like, it was, it was a very, it was a very. I've got nothing. I mean, even watching Biden campaign, as you said, he's been a pretty mediocre guy his entire life.

He's been around 40 years and nobody particularly was begging for him to do anything strong until Obama plucked him out of obscurity. Every time he tried to run for president, he had to withdraw because he kept stealing other people's election speeches.

And so there is a sense in which this is all, to me still a referendum on that post 08 brand of democratic Party. And again, it's not like I want Trump to get elected, but if you don't break that thing, it keeps limping along.

It keeps trying to aggressively resist anyone else taking the reins away.

I remember that moment with the Green New Deal to your earlier point where Dianne Feinstein was lecturing all those kids in her office saying, I know what I'm doing. And then five minutes later she's senile.

Five minutes later her staffers are running her Senate office to the point that it was a borderline like electoral integrity issue. I mean, she doesn't know what color her socks are. She doesn't know what she's doing. This woman's 140.

It's nuts that we are dealing with this sort of gerontocracy vision. And I sort of agree about Gaza just overshadowing everything else. My father grew up as a Vietnam War protester and anti apartheid activist.

And I can't think of anything as central to our modern day definition of ourselves.

And it's been pretty crazy as a foreigner to see the global south and so many people around the world identify this as a kind of Waterloo moment for American imperial hegemony. And interestingly enough, I was thinking the other day, like, Corbyn was such a canary in the coal mine. Yes.

You know, they went after him with all this bullshit antisemitism claim. It's funny because he had a pretty aggressive socialist agenda domestically. But you know what it was? It was the peacenik stuff.

It was the fact that he went to every anti war protest since he was 15.

You know, this most gentle person who makes jam in his spare time was suddenly this sort of sinister, Machiavellian geopolitical operator that we should all be quaking in our boots.

All these people with $400,000 incomes in the City of London are suddenly terrified of the man that you would trust to look after your kids if you had an emergency at the hospital. They live next door. So watching that happen, and I have a lot of respect for Bernie a lot of different ways.

I also have a lot of disrespect for Bernie a lot of different ways, but.

Yep.

But he was always kind of not challenging that version of American empire, like straight down the line, you know what I mean? He makes criticisms of it.

He's just got the bill today to try to defund armies, Israel and things, and probably more anti imperial than almost anybody else who's made it to the Senate for as long as he has. But he wasn't representing, I would say, the same kind of existential threat to the US military machine as Corbyn would have represented.

That means this is a place that was having debates over tried nuclear subs and represents a key, you know, geopolitical access for the US interests in Europe. Do we really think they would have let him win?

Right.

He would have fallen off a bus or something five days before the election. So it is not only a key issue, just from the sort of human rights moral standpoint of watching a genocide in a lifetime on tv, but it's also just.

It's the empire that's most extended and it can feel that, and the rest of the world can feel that. And the moral bankruptcy of it all is just overwhelming at this point.

Absolutely.

The fascists take notes from us. Yeah, absolutely.

I mean, and it wasn't when Trump was in Office only. Right. Like we're talking about a bipartisan push to that merger of corporation and state.

All those whistleblower protections that the people enjoyed under Obama, you know, all the protection of civil liberties. We definitely didn't have the Director of National Intelligence straight up lie to Congress, you know.

Exactly. I mean, I think what really, really came down was watching the fight against inflation.

Yeah.

And you know, the MMT community, you previously said, and I use this all the time, and I do try to give credit when credit is due, but I oftentimes talk about how we were a fist with the deficit myth, but we were like a bunch of pinkies when it came to inflation.

And the concept of the Fed raising interest rates a la Volcker was not as bad as Volcker, but it was still, you know, I want to add that interest income channel, in the absence of other spending, was about the only thing keeping the economy, at least in terms of the stock market and in terms of investors.

It kept money flowing, but it also masked the stratification that we see in America where the people that are below that investor grade, individual, that managerial class, that pmc, were literally drowning and working two and three jobs trying to pay for the increased costs.

And it doesn't take much history reading to figure out the Treaty of Versailles and the brutal conditions that were placed on Germany led directly to the conditions that did bring about Hitler. And I don't think it's overstating it that we saw a similar, I wouldn't call it one for one by any stretch, but a similar result.

Those rich folks, those very well to do folks that laughed at the DNC when people were trying to protest and they threw their head back and just affluenza driven insanity. Yeah, they ignored the working class, they ignored the unions. I mean, Biden himself broke a strike.

So all the working people that would have normally either fell in line with the Democrats, a vast majority of them, abandoned the Democrats in a relatively predictable fashion. And so as you think about it, you know, I had people coming at me like I was somehow or another Republican. I'm like, no, I'm just a truth teller.

I'm just calling it like I see it. I'm not here picking sides because I believe the whole thing's theater, okay.

But with that in mind, watching people I talk to on a daily basis, you know, people that are working in 911 centers, people that are delivering food, people that are stocking shelves, people that don't have posh jobs, were literally struggling mightily and there was some barrier that blocked those people from looking low enough to see how bad it was.

And I think that that lack of willingness to have a class analysis, to really, truly focus on the stratification narratives that played out before our eyes, I think doomed us all. And I think it's very predictable to see something like this happen.

And now with that in mind, you see a lot of people investing in crypto and you see the Trump administration already, even before taking office directly, sidling up to guys like Elon Musk, who is a vast recipient of federal spending.

And you see guys like Ramaswamy who are biotech mega rich people, these folks, these Silicon Valley types, falling in line with him backing of crypto, talk of the Fed backstopping crypto, buying crypto assets to produce stability, et cetera. I mean, strange times we're living in, correct?

Yeah, I mean I was saying the other day, obviously I think I would actually want this. It was the only bullet. But you know, you have one bullet to change how Congress works.

I wouldn't mind having people's net worth and previous year's income just sort of hanging over their head like a computer game like HP Bar, you know, like every time journalists report just pointing out that Nancy Pelosi is worth, you know, a hundred million dollars and whatever else, I think that there really is still that continuation of the Chuck Schumer kind of for every working class voter we lose, we'll get two people from the suburbs in the Panera Breads. Like that was still part of this strategy.

And for a party that claimed to be the party of the working class to capture pretty much all of the upper wealth quintile like majorities and all of the kind of rich suburbs while losing a lot of the poor workers is something that they have to come to terms with eventually.

And the level of comfort for the rich grifter class who took $1 billion of campaign money and somehow lit it on fire and still had the nerve to ask people for a donation the day after the election is just so, it's so time depth about all of that. And to your point, Nathan, who's been doing all that great work foyering the Fed and getting the kind of history there. Yes.

Who is also, I think he's a fantastic historian. I'm very glad to have him part of our organizations. And he's a long standing friend, brother.

But he's also got this almost Olympic ability at moments of key historical kind of significance, like the Greek crisis and things sort of like it's almost like everything slows down. And he can be an Olympian that kind of sort of sees things really, really quickly, you know.

But almost immediately after the election, you know, one of the things that became apparent and he's been harping on very well is that for average people, the increase in interest rates was a basically a direct continuation of the pain from inflation.

Inflation hurt your pocket by making your paycheck go less far and the higher interest rates hurt your pocket by making the debts go up on your balance sheet. And so, I mean, we can talk about this more in a second.

But the fact that Biden doesn't pick a fight with Powell, the fact that even sort of, I would say center left, so progressive, even more than liberal technocratic people, I would consider, if not friends, certainly acquaintances or people I expect to see at the same conferences and things who know our work, who respect what we do as MMT is to a degree we're still valorizing Powell and valorizing the Fed and saying, well, we've at least got one adult agency in the room when, you know, Congress is broken. At least we get all this nimble emergency lending.

And isn't it great that we got the big money cannon from the Fed to save us from COVID and it's again, a millionaire, a Republican former banker is the great white hope. Like that's what we can do. We can hope to keep that guy and have his former boss and mentor be the treasury secretary.

Like, yeah, we should be handing ourselves a grenade and then stepping on it if that's our vision. You know what I mean?

And so I think to go back to something we mentioned earlier, like the pro act was a moment of trying to show labor that we stood with them. And then, oh no, we hit a parliamentarian, we hit a speed bump that nobody even knew existed and now we're defeat. Oh no, I am defeat.

You know, it was so pathetic to see how much that was a fight. And I think it's sort of sometimes hard or it provides useful cover.

The fact that it can simultaneously be true that Biden's administration was probably the most pro worker administration in a generation and that it was woefully inadequate given the moment in history and the potential to do more.

And I think that for some people that's if not a hard line to pass or a hard nuance to hold in their heads, it's certainly a useful shield for accountability because they can say, well, we did big fiscal and it didn't work. Well, we tried to be pro worker, we stood on a picket line, that didn't work.

But that goes back to my earlier point about the difference between a genuine power shift and power adapting under duress in a way that concedes what it must, but defends what it must.

You know, And I think this was an administration that was once again the last dying gasp of an ideology that knew it needed to change, tried to change just enough to not need to fundamentally change, and then we're where we are. To go back to your earlier point about the inflation regime being a pinky, first of all, Stephanie can only write so many books.

Pavlina and Randy and others were talking about inflation in live time when all the COVID stuff was happening and saying we have to be careful, we have to be centering production and the job guarantee.

But I mean, I remember in Congress when Biden got in, it was like, we're not doing the job guarantee, so just drop it, you know, and it was hard to hold any space for that. I've never had much faith that the politicians are going to be leading indicators of the left.

I have my, again, my problems with AOC as well and the squad in different ways. And that sort of silence in some ways on the genocide have been extremely disappointing.

Although at the same time I would say there are a few people that are really trying to take square aim at AIPAC in the way that AOC is. So I don't think that she's a complete stooge for the Israeli regime.

But they are fundamentally having to make compromises every day right inside the room.

They are fundamentally having to make extremely messy trade offs that mean that even if those are in fact the best moves for them to make are going to compromise them in the eyes of everybody who's got a larger game to play. Like their job is to make unpleasant compromises. You know, that's the sort of part of that role in the game.

You're not supposed to like everything that they do, but as a result of that, they also can't be the saviors. You're waiting for to sweep us off our feet, you know, outside of campaign season.

And I think there is partially a issue of fighting the last war when it comes to the issue of the deficit phobia versus inflation phobia.

I think whatever else, the fact that we would not have had the COVID responses that we did if not for mmt and you know, we've got people like House Budget Committee member, oh, I'm blanking on his name right now.

He was holding up Stephanie's book in Congress and saying, you know, we wouldn't have this without her and you know, Schumer and Schatz and all these other people kind of explicitly designing that without the standard pay flaws and not going into the deficit reduction stuff, while at the same time the last 18 months of the Biden administration basically pivoted from championing any of the effects of those early spending bills and did pivot to deficit reduction.

And if we do start from the premise that interest rate increases, I mean, we know from an MMT point of view that they are a bad tool in that they don't actually achieve the thing that we want in a very clear way. But if we start even beyond the kind of political economy of it, just to the pure raw politics of it, it's a loser, right? It's a loser.

Standing by Fed Independence saying I trust Powell to handle the inflation question is a loser.

And once again the Biden administration made some encroachments into talking about price gouging and antitrust and market power of big firms and all of this stuff. But it wasn't a full throated thing. It wasn't.

I'm going to sit down and create the equivalent of fsoc, you know, the Financial Stability Oversight Council and call it inflation stability, you know, Price Stability Oversight Council and have every major agency sit around a table and sort of work together. It was still this Fed first, you know, have you met Congress? I don't really want to exercise the executive power very aggressively.

And then yes, some people got higher interest income returns, but that does skew mostly to the higher level. Even when it goes to pension funds and things like that, it's still the money managers of the pension funds that get more out of it.

It's still a massive upward wealth redistributive way of dealing with inflation.

And again, the public doesn't have to be some technocratic kind of expert to feel that they just have to look at the fucking millionaire banker running the Fed. He didn't spend his life looking out for workers. He spent his life looking out for Wall Street. That's his job.

And we couldn't even get a clear progressive consensus that that wasn't good enough. Well, who else would you hire? Like, I don't care. Name somebody and tell the Biden administration it's on them to get that person elected.

It's not our job to carry water for political compromises, whether that's AOC or Biden.

And watching Trump, to your point, I think he is a Darth Vader Marxist in the sense that he does understand class conflict and is just sort of saying to people, you like to be ruled, don't you?

You know, you like someone who's got some strength better than these feckless beige bureaucrats who keep hand wringing while also plundering your pocket. And, yeah, I'm going to put the central plastic group in power. So Musk becomes the face of Silicon Valley. He does the cartoonish thing.

So all the serious money in Silicon Valley has cover to join the Orange Man Fascist.

After everybody agreeing for four years that he was a fascist, Ramaswamy is basically the high school debater whose job is to make all of this sound very reasonable. And all these bloody Ben Shapiro people who sit out of.

You've seen these things on social media where they, like, sit in a circle and then someone else comes up and runs up to the seat and sits next to them and tries to have these debates and everybody thinks, like, reason will prevail, or if you kind of like get a zinger on them, somehow it's going to change anything.

And it's the popular version of what the Federalist Society does, which is just normalize the encroaching fascism by forcing liberals to kind of sit there and debate it in good faith while they slowly lock up your family.

So I don't know if you're not willing to just sort of punch him in the face, you know, if you're not willing to punch a fascist, you're not really doing it, are you? And so all of this stuff that, yeah, Trump's an existential threat to democracy, but here's the nuclear codes.

Can I just say that is the funniest thing, because as I watch Mika and what's his name, MSNBC royalty. What is this? Joe Scarborough go Down to Mar a Lago to break bread with Trumpy.

Yeah, kiss the ring.

I mean, I mean this is just ridiculous. But more to the point, and I want to deviate too far from this, but I think it's worth the conversation.

You watched the student debt issue kind of blow up in our faces too. Yeah, I mean, everybody is being materially dented on top of inflation with suddenly having hundreds if not thousands of dollars a monthly payments.

The debt collective clearly showed Biden the way to the water.

You know, he used a deliberately weaker legal authority that was specifically around emergencies. When the Supreme Court struck it down, he deferred. You know, the only thing worse than central bank independence is bloody judicial independence.

And I can say that as a law professor, you know, if there was ever a moment to have a stand against the court, that's an incredibly popular issue. And nothing Dobbs being the other obvious one.

But there's a clear reason why they didn't want to do that, which is the Democrats get to fundraise off that interpretation perpetuity. But it wasn't even just the restarting of student debt.

It was also that happening at the same time as the expiration of unemployment insurance and the other Covid relief programs. You know, yes, you can sort of trace this moment or this period where all those relief programs expired.

Student debt restarts, interest rates go up and yeah, you put that all together and that's a serious hit to people's wellbeing. The pain is back on the worker.

We've decided, a la Paul Volcker, that the way to deal with inflation is to just, you know, smash average people until they stop spending. And if it wasn't Paul Volcker, it was Larry Summers. You know, Larry women who can't do math.

Yeah.

Nothing learned. And the minute that there was inflation, everybody turned running back to Larry Summers and apologizing for not taking him seriously.

And again, like this guy's skunk. He's scum. He should be called scum.

Progressives should call him scum if they want to have a serious debate about inflation and the overshoot of big fiscal spending. Like, don't bring that guy in the room. But we didn't do that. We did the other thing.

I mean, I wrote an obituary for Volcker when he died trying to bury that man, you know, and I had a line there that he claimed to be against financial corruption as much as he was against the unions.

But for some reason in his entire career, he really Only succeeded at one of those two things, you know, and it's sort of like that with the Democrats in general. They claim to be anti Republicans and certainly they're fucking anti left. Somehow they only seem to win in one of those two frontiers. Yes.

And so change begins at home, or whatever it is.

I wouldn't call myself a Democrat, obviously, but I do think that if we don't have a serious reckoning on that side of the aisle, there's no point pretending we can fight the other side of the aisle.

The last point on this that I want to make, because I want to get into these possibilities of the Fed and the crypto angle, et cetera. But you know, let's be fair. The Democrats forever have run on codifying Roe v.

Wade, have run on protecting bodily autonomy and so forth, but they also love it as a fundraising strategy, clearly, because when Biden was given the option of stacking or reforming the Court, which there's nothing that would have prevented him from doing that other than being a simp for the system to begin with, he said, yeah, you know, nah, not going to do that. The ending of the filibuster. Yeah, you know, I'm not going to do that.

Yeah.

And it's like, well, wait a minute, hold on. So in other words, every possible tool you have to make change, you're telling us all you're not going to do that.

And I know we said nothing will fundamentally change, but for Christ's sake, I mean, the idea of not reforming the court alone, just that one thing. I got more Normie Dem pushback. Oh, what do you want Biden to do? He's just one man. What do you want him to be, a dick tater?

Yeah, And I'm just listening to him and I'm just laughing and it's like, you guys might be the most pathetic creatures on the planet.

Fundamentally, it's. If not a deliberate avoidance of governance, it's analogy to power and politics.

I mean, I come from a parliamentary system and they have their own problems.

Especially, you know, once you get into kind of proportional representational systems, they end up with these sort of small ragtag groups of governing coalitions that have their own form of political inertia.

But at least in this traditional kind of first past the post political system like that, the theory is supposed to be that you win and then you have a majority, and then when you have a majority in Parliament, you get to do stuff. And then when the other side gets in, they try to undo most of the stuff you do and do their own stuff.

And then you do it again and again and it's sort of progress or change happens in this zigzag where undoing the previous guy's stuff is like part of the game.

It's part of the process right now, of course, you end up with someone like Keir Starmer in the UK and suddenly all this, all these bleedings about how we need to tack to the center to win elections and then they win the election. It's like, yeah, that and $2.50 gets you a coffee.

You know, I mean, to watch the complete collapse in any vision from those guys after a landslide victory against the most ineffectual conservative government in generation, the UK has just been such a condemnation again of the kind of intellectual and political and moral bankruptcy of liberalism.

But in the United States, partially, I think, for the design of Congress, and partially because of the way the Democratic Party has come to represent certain interests who don't really want fundamentally progressive change.

This idea that we can't do certain things because if they get empowered, they'll do it back is just, you know, it makes me want to hit my head against the wall until I'm unconscious.

It's so mind numbing as a theory of change, like, yes, what you do is you make big changes and then you get political benefits from those changes and then those keep you in power or become so popular that they can't be undone when they come back. This idea that we can't stack the court because then they'll stack it back, or if we get rid of the filibuster, then they'll use it against us.

Okay, like we shouldn't have a government at all. Because what if they win and then they'll get to govern the other way? Like it.

The logic is so obviously internally flawed and all it really justifies is inaction and helplessness. And to your point, I had someone saying, well, what was he going to do? How is he going to get over Joe Manchin?

It's like, I don't know how much of it's apocryphal, but even if it's apocryphal, it's part of the literary history. And that's obviously more important than the real history.

But like all the stories about LBJ kind of going up and sidling up to people in the bathroom and sort of like doing dick measuring contest and things like, I don't know what's the biggest, most public threat anybody made against Joe Manchin? You know, I, I don't know one. If that's hardball. What? We asked him nicely, we sent a floral centered letter saying pretty please and he said no.

And then we went home and cried. What is the actual visible evidence that there was a genuine attempt with this stuff? Fine. Try to pack the court. Lose. Fine. Right. Try to defy the Fed.

Lose. Fine. Try to threaten Joe Manchin and censor him. Lose. Fine. You know what you would show the public that you bloody tried.

You know, try to cancel student debt, have it opposed, delay opposing it. Delay enacting the court's reforms.

Let people say that you are anti court and say, well, which one of these two branches do you want to be representing? The future of this country instead? We don't do those things. And what it does, it doesn't actually preserve those institutions and norms. Right.

If the calculus was we have to preserve these institutions because they're important and because if we go to pure bare knuckle politics, people are going to get hurt. I would have some sympathy for that story if there was any evidence that what they were doing was actually preserving those norms and institutions.

But what they are actually doing is simply waiting for the other side to have the first move. It's saying, we know these people are going to come for our family. They've already indicated they will. We know that they want us dead.

But what we're going to do is we're going to wait for them to fire the first shot and then we'll get to retaliate. Maybe I don't think it's the smart way of doing things. I have a picture of John Brown on my office door.

You know that quote that he has when he was being hung and said, I'm now quite certain that the crimes of this guilty land shall not be washed away but with blood. Yes. I had previously flattered myself, now vainly I think that without much bloodshed it could be done.

Very performative.

None of that shit did anything until somebody. Yeah, very performative. Very transcendentally inward looking and it didn't free the goddamn slave.

Funny you bring up John Brown real quick. I, I was listening to this historical rendering which was really quite phenomenal.

I want to give Adi a shout out for bringing it to my attention on William Lloyd Garrison last night. And that's the kind of people I want to see. I want to see people that are willing to take 150 death threats.

I want to see people that are willing to have the lynchers come after them all because they believe and they fight. Even if they're radical or labeled contentious or whatever. We need that.

Imagine if Biden had tried to pack the court. He loses. Somehow the Republicans managed to censor him and they lock him up. And the next Democrat runs on, I'll pardon him. Done, Done.

You know, okay, now we've got a fight. Now when you say the word fascist, we can believe you.

That's right. That's right.

They didn't.

And in fact, the deep, deep insult to everybody who has died under those kinds of far right regimes that the cheapening of their pain and their death by using those words and then when the time comes, to actually mean it to be chicken shit.

Yep.

And it's so offensive to be happening against the backdrop of an actual genocide carried out in the name of people who experienced a genocide. Yes, again, the most maximally literarily ridiculous version of history. Like we are living in the most absurd timeline.

If this was an FX show, you would say it was too on the nose.

Yeah. Yep.

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So let's jump ourselves into the crypto slash Fed. Obviously, Powell swinging back and forth between the Fed and then. What is her name, the lady that took over the Treasury.

Janet Yellen.

Yeah, there you go, Yellen. I mean, we see the technocratic view of the world, we see the tone deafness, the absolute apathy for regular people.

And you hear Trump, who's taking what in some cases is a leftist position on ending the Fed, a libertarian perspective, Ron Paul, et cetera.

Ending the Fed. I wouldn't call it leftist, but I know what you mean. We can.

Exactly. Well, they may not know any better.

Right.

Because I don't think of that as.

But my point is, is that they, because of what they think the Fed is and because their imagination ends with how it is today instead of thinking how it could be if, let's say you had Jeremy Corbyn, just for the sake of saying it, working within the Fed, or more importantly, an mmt, er, working in the Fed, preferably not an investor grade mmt, or preferably a person that understands the plight of the working class. I think that would be magical. There's an opportunity there.

But talking about rolling the Fed into the treasury has been something that people in MMT even have wrestled with and said, you know, it's really not that big a deal. I mean, to quote Warren, which I don't do a lot anymore, but Warren made the point of the Fed is basically a spreadsheet. It would be meaningless.

Roll it in. Who cares?

Okay.

But obviously the Fed does a lot of things with the perceived independence that maybe politically speaking would be too distasteful if they said do this.

But Trump, suddenly with Ramaswamy and Musk, there is real juice for not only the Fed backstopping cryptocurrencies, but also literally possibly rolling it into the Treasury. That's one of Musk and Ramaswamy's things that they desperately want to do.

I think CNBC put something out about it couple days ago about how they radically want to change who controls money. This is one of the primary reasons why I asked you to come on because you have a great way of putting this stuff out there.

So what are your thoughts on this?

Well, you know, I got a lot of trouble, you know, quote unquote trouble a couple years back during one of the debt ceiling. The beatings will continue till morale improves. Debt ceiling back around fights. Yes, because we were talking about the coin again.

The coin, my favorite trillion dollar coin. And you know, it's, it's funny to go back to the Yellen point. Yellen dismissed the coin. She called it a gimmick. But they were doing so many gimmicks.

And again, what she really means is there are gimmicks that we think are acceptable that are sort of high finance, that only sort of smart bankers understand. And then there's gimmicks that like actually everybody else can understand.

So I was trying to bring the popcorn and you know, and the Showtime HBO story to the Treasury's gimmicks. Well, if you're going to have to turn the channel and hear about dumb debt ceiling politics, you might as well get a good show.

But, you know, Jeff Stein from the Washington Post was saying, well, what if the Fed refuses to accept the coin?

And Nathan did some very good analysis about how actually the Fed's fiscal agent legal responsibilities really don't give it the discretion to refuse to accept it from the Treasury.

I think there's a sort of meta political point that they just never would because it would probably signal the end of Fed independence if the treasury explicitly tried to do it and they explicitly refused, or at least it would put such a spotlight on it, they wouldn't want to do it. But I said, well, you know, send troops to the Fed, ignore SCOTUS if SCOTUS says it's unconstitutional and send troops to the Fed. Why?

Because the alternative that Yellen was seriously countenancing or at least pretending to seriously countenance in public discourse, was that they would default on the public debt. And the 14th amendment that says that the validity of the public debt shall not be questioned was, you know, the Civil War amendment.

There's a reason that it was part of the same amendment as equal protection because it was trying to prevent white nationalists getting into Congress again, you know, the Confederacy and trying to ex post refuse to pay the soldiers who fought in the Civil War.

So I said, look, if there's going to be a showdown, might as well have it to be defending the Union, winning the Civil War against the white nationalist opposition who is literally trying to destroy the economy. What better terrain to find? But I was called crazy.

And all my law professor colleagues said, well, you ignoring SCOTUS, you know, and I'd say a ridiculous position, no one's going to take you seriously. All right, cool. I'll just wait a few years for the world to get crazier and then see how ridiculous. Now it's.

But to your earlier point, I get what you mean. The left has got its own problems with technocratic governance.

And it's interesting because in the aftermath of Loper Bright, you know, the case that sort of got rid of Chevron deference, which is a standard of review of administrative agencies discretion to interpret their own statutory authority, which was considered for a long time to be the kind of constitutional bulwark for the administrative state's autonomy. That's the kind of issue that.

And you see this a lot in law, and if you're not a lawyer, maybe you don't know that, but you see it a lot in law where one position becomes associated with the progressive side for a generation and then becomes associated with the reactionary or conservative side for a generation. Right. The same principle, you know, judicial activism in the 60s was, was a progressive thing. It was Earl Warren and then it was Thurgood Marshall.

And now judicial activism is Samuel Alito. Right. So once upon a time it was the right wing that was talking about moderation and incrementalism and humility in the courts.

Now it's the so called center Left that is trying to harp on those values because they are the kind of antithetical values to whoever's in power right now doing other things. And so I have probably somewhat, hopefully nuanced, somewhat complex views on where I think the right line with administrative states should be.

I don't think that I'm particularly excited to see the way that it's going right now. But at the same time I don't think this sort of knee jerk, well, everything was great under Chevron is the right way either.

And so if you look at what is happening at the Fed in those terms, not in the kind of MMT macro terms, I obviously agree that a lot of what we do with inflation management and price stability would be best done through a coordinated series of government agencies headed by Treasury, not just the Fed. And I obviously think that the full employment mandate is should be done with a job guarantee through the Department of Labor, not through the Fed.

So I'm certainly not a big believer in central bank independence in the class interests of the people that comprise it alone. As part of the problem. You will get a more interesting, sophisticated take from Nathan [Tankus] about the pluralistic structure of the Fed.

The fact that they have these regional banks, which was originally a historical phenomenon that since the 30s has been somewhat dead letter, although not entirely, given the sort of centralization of power with the Board of governors in D.C.

you know, up until that point you can make a decent case that it was the New York Fed leading a sort of group of equals where the New York Fed was first among equals, prima inter pares, and then after that it really was a government agency based out of the D.C. board of governors and the FOMC. But if you were going to try to create some system of a network of job guarantee officers, right?

If you didn't want to centralize the entire administration of a program like that under one secretary or one D.C. centric agency, that could screw it all up.

You would do worse than to look at the way the Fed was originally designed as a sort of series of regional pluralistic entities embedded in the banking systems of those regions as a model for how we could do a similar thing for a job guarantee. Which again is not to say that we should have the people running the Fed running that program.

But it is to say that there are sometimes benefits in a more civil society vision or a more pluralistic institutional structure than just a pyramid with one D.C. agency at the top.

But the way that the Right is dealing with this, I would say has really been about this larger question of the quote unquote, unitary executive. And again, it's one of those funny things where even people like [liberal Supreme Court Justice] Elena Kagan were pretty pro unitary executive.

It wasn't exclusively a far Right ideological position, but the idea being that the executive power is vested in the President.

And so there shouldn't be very much wiggle room for Congress to create agencies and executive branch actors that are not at some point answerable, accountable, under the direct discretionary control of the President. And for a long time this was a Right wing part of the conservative Federalist Society.

We're originalists when it comes to the Constitution, we're textualists when it comes to the administrative state. So we want to pretend to make up history for the Constitution.

We want to pretend that the words themselves on the page have all the answers for statutes.

And then when it comes to the balance of power between the different branches, we want the executive power to be commander in chief, really is what it is. And so Fed independence was always this weird, awkward thing.

Funnily enough, you can find this in the writings of people like Stephen Calabrese, one of the founders of the Federalist Society, saying, we don't want administrative agencies. We associate that with FDR's New Deal liberalism. We don't want administrative agencies.

We don't want autonomous administrative agencies operating under their own specially delegated pockets of legislative authority. We want it all to be under one single president. But we also don't really want money to be politicized.

So maybe we can have like an asterisk for the Fed. Maybe the Fed can be the one institutional exception that proves the rule in general.

And it was a very funny moment of you could sort of see their own tortured pretzel logic or the limits of their own quote unquote principal position running right up against the raw politics of them really wanting to keep money out of the democratic accountability. And so I would say what this moment with Trump represents is them deciding to finally bite the bullet, right?

They decide to finally resolve that contradiction and say at this point in history, whatever the independence of the Fed, that was a Right wing, kind of more pro Right wing than not under Volcker. The thing that represented a reactionary turn to Frost, Alan Greenspan, to keep the bloody labor people at bay in favor of interests of capital.

Powell's woke, yeah, you know, these guys are all hyper educated liberals from universities, eh? Let's make the commander in chief in charge of all this stuff again.

And so they've finally decided to resolve this weird queasy one foot in, one foot out exception to a broader rule that they've been comfortable with for decades. And so that's why it's sort of funny to watch, because on one hand, obviously I don't want them to get political credit.

On the other hand, they're more consistent than the Democrats are now. You know, in their own worldview, they had a glaring inconsistency about the unitary executive and they've finally resolved, solved it.

And meanwhile, the people who literally call themselves Democrats are defending the idea that these issues that the Fed is in charge of, which increasingly are literally coextensive with the economy, right? Like what part of the economy is the Fed not the first responder to?

Now they get to make decisions about winners or losers, as Nathan's upcoming book, Picking Losers is all about. They get to choose whether or not municipal governments get credit supporting crises.

They get to create individual small business lending facilities that essentially give grants out, but they call them non recourse loans so that they don't have to call it fiscal policy. You know, I mean, this is a shadow government, this is a shadow budget, this is a shadow fiscal agency as much as it is a monetary policy agency.

And the Democrats are defending all of that. So I think it's not a Left wing position to want a commander in chief.

But there is rhyming between their willingness to be intellectually consistent with their own vision of a strong centralized executive and our willingness to be consistent in saying that these issues should ultimately be reverted back to more legislative control from very different sides of the spectrum. And the other part I think that's important to think about on that front is that Trump is a debt guy.

I'm not going to give him credit to say he's actually a businessman that does actual business, although he was pretty good at kicking black people out of apartments for a few decades. But he is more Main street than Wall Street. You know what I mean? He hangs around rich people, but he isn't Robert Rubin.

He's a guy that cuts big ribbons and wears stupid hard hats for photo ops and puts his name all over buildings and steaks and coins and stuff. He is not a guy that when he thinks of his own wealth, he thinks of it in abstract ethereal spreadsheets. You know what I mean? [Right].

He likes wealth that he can touch, as gauche as most of the stuff that he likes to touch is.

Which means that in the world of finance, he's instinctively a debtor because he usually borrows from people or promises to pay people and then screws them over. So if you're instinctively a debtor, then you understand the merits of low interest rates being cheaper for you. Well, who does that hurt?

It hurts creditors, right? He is instinctively somebody who lives leveraged. He's basically Adam Sandler from Uncut Gems in his political life, right?

Like he's one failed lawsuit quashing away from jail. He's one failed covering his ass away from the Mafia shooting him for most of his life.

And so he knows what it means to be leveraged and he knows what it means to be in debt.

He isn't the guy who thinks of himself as a patient saver who could get interest income, and he isn't the guy who thinks of himself as the creditor that is being starved of interest income.

So I think for him, he has a natural instinctual understanding of that point that we said earlier that higher rates are tantamount to higher inflation for most people. That is to say, they increase the cost of living. He is someone supremely sensitive to his own enjoyment of his own living.

And he doesn't like higher rates. And he knows that as different as the ants down on the ground are from him up in his penthouse, they also don't like higher rates. It's pain.

And he is offering, not pain. And so if the Fed is going to raise rates, he's going to say, screw you. I'm not going to let you define my presidency.

And again, I think not to give him credit, not to say I'm happy what he's about to do, but that's a smarter and more consistent political vision than Biden letting Powell screw his presidency, isn't it?

You know, as you were saying that, I sat there and I thought to myself, that's all anybody's looking for is somebody that will fight for the position they took, somebody who will really fight.

For the position everybody says, oh, Trump, he lies. How could you take him seriously? And sure, of course he lies. Like, they all lie. Politicians lie. It's part of the job.

If you said everything truthfully outside a negotiation room about what's going on in a negotiation room, it wouldn't be a negotiation room. It would just be the public hall. They're different for a reason.

So, yes, you don't have to believe everything he says, but you do need to believe that he is not going to be like, oh, well, guess I'll go home then. You know, he will fight. Maybe not fight for the things you want, maybe not even fight for the things he said, but damn sure he's going to fight.

He's backed up against the wall. This or a jail cell.

Very well stated. So one last final thing before we go, and I appreciate you coming on, Ron. I really do hope I can have you on more frequently.

You're one of my favorite guests. You spend a lot of time in the crypto world. I mean, I watch your discussions with great pleasure. It's fun to watch you do your thing out there.

But within this space, I mean, obviously the conversation is the Fed possibly buying up crypto assets. I'm assuming that is to stabilize them. I don't know, maybe to further enmesh public and private once again, deepening us into fascism.

Maybe.

I don't know. What are your thoughts on that angle and the crypto angle with the Trump presidency and Musk?

Yeah, thanks. And I also touch on the Doge stuff as well.

You know, half the Democrats were already bought by crypto, and the other half are now terrified by the war chest. And the Republicans are all bought by crypto.

And there was a very long New Yorker article about a guy named Chris Lehane who had done a lot of the, like, meta strategy for Airbnb, for Uber, for OpenAI, for Coinbase, one of the crypto platforms, after previously cutting his teeth as a spin doctor and strategist for the Democrats under Clinton. Yeah, the sort of third way Democrats. And he considers himself, you know, still fighting the same political fights now, just representing industry.

And I tend to believe him, frankly.

But they did a lot of work to kind of craft this idea of a crypto voter to sort of build a political ideology around being a single issue crypto voter, because, you know, freedom is at stake. You know, the future is at stake.

And I said in my talk that I think that the reason crypto is interesting, it's not like the first time we've had corporate industry, you know, political corruption. This is a story as old as time. Carnegie, Rockefeller, all that stuff. But crypto kind of represents the perfection of money's interest in itself.

You know, banking at least used to pretend they provided services to the public.

There's still that kind of image of Mary Poppins with these people wearing, you know, wiggish bougie, black coats, and respectable members of town who know everybody's name and all of this kind of stuff. Right. That's what banking was supposed to be. It's supposed to be high on trust and high on embeddedness in the community.

I mean, even the Federal Reserve model has regional banks that have regional accounts with regional feds, blah, blah, blah. But crypto is not that. Cryptos, a bunch of idiot punks in their basement half the time, right?

These people I wouldn't trust with my kid for an hour, let alone society. And it represents money completely abstracting itself from any social relation.

I sort of had some images on my slide of, like, alien from Aliens, you know, the kind of perfect organism. Or if you've ever seen that Seinfeld episode where he dates a woman that's basically him but a female version.

He's like, I've been waiting for me to come along, and now I've swept myself off my feet. And crypto is sort of like a dollar bill or, you know, digital dollar looking in the mirror and falling in love with itself.

There's no humans in there. There's no society. The world could collapse, and the AI machines would still be mining crypto and trading between each other.

And they're like, yeah, that sounds right. You know, there's not a single heartbeat on the planet, but money's still being made. And so there's something untethered about it.

There's something unapologetic about it that kind of fits the same tenor of the world that we're in, that kind of socialism or barbarism. We're playing for all the marbles. Which also has its echoes in the platform economy.

The business model of all the big digital platforms has been find the new frontier, monopolize the hell out of it, and be the only game in town. And I think crypto is trying to do that line of, if you want to change existing reality, don't fight it.

Build a new reality and render the old one obsolete. But it's not that they actually are trying to build a world without institutions and without old money and without Wall Street.

And it's not everyone's going to suddenly be a little populist yeoman farmer with 40 acres and a mule. That was just some sort of the true believers who got carried along for the ride by the cynical schmucks like Mark Van Driesen.

And the wire and those forms of telecommunication systems and that you can't really have a smooth transition from that to a Internet native version of the same system. You really do have to kind of build the other one in parallel and eventually kind of hot swap it over. Right.

And that's not, again, some populist revolution that's industry evolving. Sometimes you have to not take over your dad's company, but go build your own company and eventually acquire your dad's company.

You know, and so I think this election, I saw from inside, behind the scenes, that the degree to which it terrified even progressives running in primaries, just how much money was being thrown. And, you know, they got rid of Katie Porter, they got rid of Sherrod Brown. Right.

They've got some real heads on spikes and trophies for their efforts. And more importantly, even than the heads on spikes, they've absolutely terrified everybody else.

It's just not worth it to pick a fight with that industry. For most people now, it's unlikely you'll win. It's going to be one of the most bloody, bruising fights you're going to do.

And the public might not even thank you very much because the other side's done five, ten years of effective PR and propaganda. So they might actually think you're hurting them. You're not fighting against the big man. Right. This is disruptive.

Didn't you watch the movie with Seth Rogen about Gamestop? This is the little guy sticking his finger up. This is Robin Hood. You know, this isn't Citadel, even though it is Citadel.

So that's, to me, what the kind of crypto election represents. Now, to go to your question about the Fed and the strategic bitcoin reserve. I mean, Trump again. He started a Trump coin.

I'm not a betting man, but I would be extremely surprised if that thing ever actually does anything right. It wasn't about the product. It wasn't even a cheap fundraising strategy for Don Jr. To pretend he's got some skills.

It was a symbolic gesture to crypto that he was in. It was a symbolic statement of alignment. Oh, I see your game. I also want to sell face creams in a multilevel marketing scheme. Right.

I am open for business for anybody wanting to sell face creams. You know, I will be on your side if the bad guy on the other side is the scolding little Gary Gensler. Yosemite Gary. Pew, pew, pew, pew.

You know, I'm not that guy. I'm open for business. I'm open to capital. We're going to make money together, folks. And I think he made that very clear.

And he will get the benefits of that. Right. As a good industry.

They pretend to give the impression that they only care about their own stuff, but they were always going to be Republican anyway. They were always going to vote that way anyway.

They were just sort of dangling the tantalizing prospect of some votes, or at least less aggressive opposition in front of the Democrats, but they were never going to suddenly become Democrats. It's capital. It's a specific kind of capital.

But the strategic bitcoin reserve thing, first of all, the Biden administration, I think, has learned the lesson to have a strategic reserve of commodities to stabilize the value of commodities. The MMT has been talking about this for years. Right. Buffer stocks.

Yep.

Doing it with wheat, doing it with labor.

So there's a sense in which having a strategic bitcoin reserve could allow you to help stabilize the value of bitcoin if you have enough, and that having its own value, if you think that the constant instability of those markets has social downsides.

The other interesting thing about that, for some context, is because of all the scams, because of all the criminals, et cetera, the government has confiscated, like, hundreds of thousands of Bitcoin. So it would be, in part really just repurposing existing assets into a specific fund.

Now, currently, a lot of those assets are being held by regulatory institutions almost as like, the spoils of war. It's sort of like you find a bad guy and you get the money and you can use it to keep fighting the other bad guys.

So I don't know if there's a defunding angle.

I wouldn't be surprised if there was, that this was partially about taking away those assets so they couldn't be sold to help fund ongoing regulatory interventions. But the other thing is, it's not like this strategic reserve is going to be bad for the price of bitcoin. Bitcoin, you know what I mean?

So this is really, again, a symbol or a telegraphing that I am here to help bitcoin's price keep going up. I am not going to do things to hurt its price going down.

If you set up a strategic reserve saying you're concerned about stabilizing the price of this, then if you're doing other regulatory efforts and people say this is hurting the price, then now you have a conflict of interest, you know, now you have a reason to not do those other regulatory.

You know, it's interesting what you're saying there, because as I'm listening to you, my Mind is saying, wow, this should be like a glaring neon sign of hey, what is the difference between Bitcoin and the US dollar?

Well, I think it's like, what's the difference between Bitcoin and oil? Yeah, right, is a better starting point.

Yes, right.

We're not talking about holding Bitcoin. We're not talking about internalizing Bitcoin into the payments architecture of the United States government.

We are talking about taking an interest in stabilizing the price of something that is otherwise functioning as a commodity.

If the argument is that China is doing a central bank digital currency and that what the US's answer to that is the wild west of quote unquote free market currency innovation, then the more the world uses Bitcoin, the more American imperial interests remain hegemonic. Or not just bitcoin, but crypto in general.

It's still a very American phenomenon, even as crypto advocates like to point to people in the global south occasionally using it for a transaction or two. The vast majority of wealth and power is still, again, it's the Mark Andreessen's of the world.

It's microstrategy and all these people who are, you know, Wall street speculators who just sort of took a early bet on this stuff. It's Caitlin Long, Michael Saylor and all these kinds of people.

So having a strategic Bitcoin reserve is a way of saying we recognize that this whole industry is a project of American power and that we benefit from the rest of the world being infected with this stuff whether they want it or not, essentially. And it's not that China thing, is it? So in that respect, it's not that far away from oil.

If oil had been from day one an America centric resource, you know, recently with all the fracking that Biden supported, while also claiming to care about climate and with the Strategic Petroleum Reserve and decades of general national security strategy, America is like a massive producer of oil now, not an importer. Right? So it is an OPEC now. When you close your eyes and think of oil, the United States actually is its own player in that game.

Compared to say the 70s or something, Bitcoin is sort of starting there. It's not going to get there in 50 years. It's starting there.

And so this strategic reserve, if it even comes to pass, if it's anything more than another symbol, another telegraphing sign that we are on your side, even if we never actually do it, even if all we really do is just stop using the regulatory agencies at all to stop you from doing whatever the hell you want. It's much more about projecting the power and stability of those markets as a reflection of American capital interests, I would say.

Now, to go to your other question about DOGE and Department of Government Efficiency. I mean, first of all, funny meme, right? Second of all, if you actually look.

And it was quite telling that the musk released a list of like things that he thought that would be easy things to cut just recently. Right.

As part of like finding the quote, unquote, 5 trillion in government savings or whatever he's going to do, the single largest item on that was interest income from the Fed. Very telling. Very telling. So if that's the excuse used to pick a fight with the Fed.

And not only that, but given the stupid games around the Congressional Budget Office budget scoring and stuff that Stephanie and others have written at length amount, right.

The role that the CBO is, acts as this sort of gatekeeper for any legislative proposal because it has to be costed 10 years out and deficit neutral and all this stuff.

I've saved us from national debt extinction because the projections of interest ballooning on the national debt have gone away and anybody in the know is going to go, oh my God, you're hurting Fed Independence. And he'll go, so what?

There'll be a fight with Jay Powell and the liberals will have found themselves once again taking a bad position because it's the only one that's contrary to Trump in the moment.

Exactly. Sadly, yeah.

Yeah. So in, in that respect, I don't know what he's actually going to cut.

Ramaswamy had this idea that he loves to talk about, which again is like a high school debater move, which frankly, you know, I just saw a graduation speech of his from high school and he hasn't changed. He's. He's the same smug asshole that he was then. I know those people. I went to school with those people, you know, fuck em.

But his whole big idea was like, oh, we'll take the all. All people with an odd number at the end of their Social Security number will fire or keep the even number. That's 50% of the government gone.

And then we'll take people with an odd number at the start of the Social Security and fire them. That's another 50% of the remaining.

So that's 75% of the government gone in a way that's sort of fair and equitable and kind of almost sortition random based, to which someone responded. Actually, the first three digits of your Social Security number reflect the region you're from.

So you would be essentially discriminating against entire regions of country. But nice try, you idiot. This is not realistic. I mean, this is not a real proposal, right? I mean, you get rid of people randomly like that.

The one guy who's like the only person in the US government that knows how to keep a certain dam from breaking, you just fire him for no reason. I mean, it's one thing to say you're going after inefficiency and waste, it's another thing to say you're decimating Roman legions.

That word decimate comes from, you know, they used to shoot one in every 10 to make a point. Not shoot, kill. But you'd be damn sure that the people who killed one in every ten thought very carefully about which one they built.

And at least you'd hope they would use it as an excuse to get rid of the ones you already want to get rid of.

So it's very hard to imagine any whole scale reduction in the government budget and size that isn't a political witch hunt, which I assume is why they want to do it. But if so, it's going to be hard to claim that it's random and fair and structural and all that stuff.

But the other interesting thing is that the word "department" is doing a lot of work there, both for the meme and for the selling of this idea. As far as I can understand, it's a sort of advisory committee.

So there's a high possibility that this was just essentially a handout to big donors to shut them up and put them in a corner so that they get to kind of yap, yap, yap, yap, yap, and not actually do anything. It's not like Musk like particularly wants to do any work.

As far as I can tell, he loves, you know, taking over companies, but that's not really the same thing. It also allows them to avoid going through the confirmation process and particularly having all their finances become public.

Oh yeah.

So it could be that the reason that it's less formalized or proposed to be less formalized is because they want to keep it unaccountable which is a more savvy reason. It could be a combination of both.

Once again, it's not like I think Trump Coin is going to start operating like he talks a lot of big games about a lot of things and delivers on very few of them. So who even knows if this is going to happen the way that they're saying it's going to happen.

Elon Musk certainly wouldn't care if he walked away in the middle of a project like that.

But the other thing about it is, from my point of view, if you go back to the conversation we had earlier about the unitary executive, right, having a bunch of people who can make recommendations that Trump can then be the one to execute, you know, I've talked to some other people. I say, well, this doesn't look like this thing's gonna have any power. Does it need any power, or does the President just need to have power? You know?

Ah, yes.

So if they say, we're gonna cut from this agency or that agency, and you're like, well, you can't do that. You're not in charge of that agency. And Trump's like, well, I'm the President.

That was basically saying, when Congress says to spend, you have to spend, which was a big part of my coinage paper and some other research I'm doing. But again, why the hell would Trump care about that legislator?

Never met it, you know, so if he wants to stop spending on stuff that he sees as helping his enemies, if it's Vivek and Elon that are going to go out and sell that to the public on their, you know, media platforms, the little debater in chief and the guy who runs Twitter, then let them take the flak and I'll go and wholesale purge the government of my enemies. And I think, you know, the starting point of that is going to be the Department of Education, right?

This like, let's abolish the Department of Education thing.

First of all, nobody hates the federal Department of Education more than billionaire Betsy, and she was in charge of it for four years and she didn't get rid of it. So I don't think, again, they're actually going to shut down the whole department, but they are going to gut everything they think they don't like.

Right. Every dollar that's going to any group to help social mobility or any group to help anti discrimination. I mean, Trump's already dead.

He wants to provide, quote, unquote, reparations for white people who were not allowed into college because of diversity admissions.

Oh, my.

So we're going to get reparations for white people before black people in this country. And again, maximally literarily ridiculous storyline. Right.

We live in the most FX timeline, so I'm not sure that we are not going to see a thing called the Department of Education, but it might not resemble anything like it does today, or it might be completely gutted of half the things that we think it's doing that are good. And a couple of recommendations from Elon and Vivek about that before Trump sort of signs the order. Not outside the realm of possibility to me.

Yeah, yeah.

At the end of the day, the one thing that jumps out at me and, and I want to end on this note, and I'll let you have the closing word once you start gutting agencies. That's new money being spent into the economy to people, salaries, you know, et cetera.

Yeah.

We're talking about significant possibilities by eliminating the interest income channel and eliminating all these government jobs and slashing and burning. We're talking about the very real foundation for recessionary pressures. I mean, a money famine. How do you anticipate Trump navigating that?

Oh, come on. We both know the answer. It's tax cuts.

Yeah, exactly.

Tax cuts.

You know, Paul Krugman's out there saying it's going to be catastrophic and everybody's saying it's going to bankrupt the country and all this stuff. And it obviously wasn't. It was terrible for other reasons. But the people who said that stuff ended up just looking stupid and wrong.

They will pick up any tool to fight, even if it's a bad one, that undermines their own integrity and credibility.

So, yeah, the unstoppable force of carving a swath through public institutions meets this sort of immovable object of there's never a crisis so big that a tax card can't fix it. And that certainly also puts pressure on the Fed to lower rates. So Trump will be the guy that helped brought rates down. Engineer a little recession.

We can have a little recession as a treat for a minute. So I think what you were describing, it will not have to be a reduction [in] absolute terms. What it will be is a massive reorientation of resources.

They will go down over there and they will go up over here.

And we don't really have to even be particularly imaginative to see who is going to be hurt on the stuff that goes away and who is going to benefit from the stuff that's going to come in its place.

But to sort of go back and tie a bow from where we started on some of this conversation when we were talking about things like alternative to interest rate increases to manage demand. I'd love to tax billionaires out of existence. I'd love to nationalize the oil companies. I just wrote a paper about that. Right. And then sunset them.

I'd love to cap credit being extended to entire markets. Now, is some of that stuff going to be, if not deflationary, cause a drop in demand in investment? Yes. Well, how could we possibly fill the gap?

Wouldn't you be engineering recession? I'd love to be accused of the guy that couldn't find enough other good things to spend on.

Right. Yes.

That I couldn't offset any massive demand shock that any of that would cause.

So you know whether or not that's going to have the productive capacity to cause real resource production to improve people's material standard living. So that's politics, baby.

That's the actual hard work of governing and knowing whether or not you've got the right vision and direction for the steering wheel of the economy. But like, you got to close the door to open the window, right?

Well, Rohan, you've been amazing. I appreciate it. You've spent a lot of time with me today and I know that we both have a hard stop here coming up.

Tell everybody where we can find more of your work.

I mean, rowan gray.net my website.

I'm on the social media platform formerly known as Twitter on Gray and then, you know, the MOD Money Network, MMT Project, Public Money Action, our various nonprofit organizations.

Awesome, awesome. Well, listen, please do me a favor. I don't always get to talk to him, but definitely tell Nathan how grateful I am for all the hard work he's doing.

I mean, I'm reading it. Everything he's throwing out there, I'm trying to get my teeth into.

Well, he just finally announced a longstanding project we've been working on in its capacity as librarian and research Director, which is 30,000 pages of federal Reserve Board of Governor minutes that were previously not made available to the public. He's done more than most lawyers I've ever met. So he's making that database publicly available and needs your support. He's out there.

He doesn't have a cushy, posh law professor gig like I do, so he's living on individual donations and support like that. But yeah, it's a pretty amazing project.

And it's just been announced today, so probably be a few days by the time this comes out, but I encourage everybody to go check it out. He'll be doing a series of posts about all the implications of that and the key takeaways of it all.

But, you know, it's the most important liberal institution out there that doesn't even believe in sharing half of its governing minutes. So Nathan is bringing democracy to the Fed.

Amen. All right, Rohan. Well, look, thank you so much for joining us today. Folks, my name's Steve Grumbine.

I am the host of the podcast Macro N Cheese, which you've just listened to. We are part of Real Progressives, which is a 501c3 nonprofit.

We're a tiny little group of people, folks. So any support you can throw our way - you can go to our Patreon at realprogressives forward slash patreon.com. You can go to our substack, realprogressives.substack.com. You can find us at our website now, which had been down and out. Thank goodness for Jules and Josh. They got it back up. So our website is now back and functional.It's realprogressives.org.

And with that, I want to bid you guys a great day. Please share this podcast wherever you can on all social media angles. Definitely helps us get the word out there.

And Rohan, once again, thank you so much for your time, sir.

Yep, take it easy.

All right, on behalf of my guest and myself, Macro N Cheese, we are out of here.

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