‘The nation of new mexico’ illustrates the principles of mmt s gashi


But it is useful to understand the pros and cons of having a separate currency and how that facilitates adjustments in ways that are easier than when one is constrained by the currency of a larger confederation such as in Europe. The article was not written to promote MMT, but my tracking of MMT played a key role in the development of this article. A subsequent article further illustrates the approach: New Mexico’s Economic Trends are Not Favorable and Result in a 20% Beauty Tax.

It may be that there are ways to gain the advantage of having a separate currency without actually seceding from a nation. That is a topic worth exploring. The alternative to having the ability to essentially depreciate the currency of a geographical area to become competitive is to have economic malaise or sustained recession. We have seen that in Canada with Quebec versus the rest of Canada. We have seen that in the North/South Divide in Europe, and we have historically seen that in the U.S. in New England when the garment industry moved south and more recently in the Midwest when the automotive industry went global.

The problem o gastronomo buffet in New Mexico is historical and related to the lack of connectedness with other more developed parts of the U.S. Fortunately, New Mexico is oil and gas-rich but this creates a disarticulated underdeveloped nation type of economy which one can read about in Marxist Literature relative to places that have been colonized, just as the West was colonized. But most of the West has progressed into the Post Industrial Age and New Mexico has not.

The land area which today we call New Mexico was part of the new nation of Mexico until it was basically seized In 1848 and became the United State Territory of New Mexico in 1850 and a State in 1912. It is the fifth largest state by land area in the U.S and has abundant natural resources. I am not advocating secession but simply wondering what the implications of nationhood would be for the people of New Mexico. Also this is an exercise in understanding how states within the U.S. are in many ways similar to nations within the Eurozone i.e. those Members of the European Union which do not have their own currency but instead la gastronomie use the Euro.

Some of the Federal spending is for two National Labs and multiple military installations which we could do without but currently provide income for many New Mexico residents. I have not gone through the exercise of netting out those Federal Expenditures which are in some ways intended to benefit the entire U.S. not just New Mexico so perhaps they can be subtracted from the receipt of funds to New Mexico.

Of course we know why Oklahoma and Texas are doing well. It is called fracking and horizontal drilling. These are concepts which are culturally anathema to many in New Mexico and Arizona so that could be an obstacle to confederation. But a good public relations campaign might overcome this and there exists some uniform culinary preferences of the residents of the Southwest and similar attitudes towards oppressive Central Government.

There may even be some reason for thinking that part of the northern tier of Mexico might fit in nicely with this new possible nation. There already exists pretty much free movement of people back and forth across the border between Mexico and 66 gas station three of the states in the Southwest. There is also considerable integration of the river and reservoir systems between the Southwest and Mexico. There is also to some extent for a substantial part of the population of the Southwest a shared language, religion, and cultural values. But I will leave the expansion of the discussion on the potential merger of the Southwest with part of Northern Mexico for a subsequent article.

Access to Federal lands would provide Southwest with a substantial amount of land currently owned by the U.S. Federal Government. This includes over 61 million acres or approximately twice the size of New York State. This might but would not necessarily spur development and increases in property tax receipts. U.S. control over subsurface oil and gas extends in some case beyond the amount of surface land owned by the U.S. and many minerals such as gold and silver are controlled by the U.S. Federal Government with the ability of citizens to stake and patent claims.

How this land became Federal Land is interesting as to some extent it is land stolen from the Mexican gas zombies settlers who became U.S. Citizens as a result of conquest by the U.S. of Northern Mexico. In the case of New Mexico the ownership of land was by the Treaty of Guadalupe Hildalgo intended to remain with those living in the conquered land but key entrepreneurs and other scoundrels enticed the Federal Government to essentially steal the land from the Hispanic citizens. This is a process that continues to this day.

Although one could argue that the major benefit of having a Central Bank is the ability to generate money out of thin air which can often be convenient, perhaps the major benefit of having a Central Bank is to have ones own currency. For the Southwest I have decided that our currency will be called the Desert Tortoise or Tortoise for short. For some short time there would be interchangeability of one Tortoise per U.S. dollar. After that transition period, the Tortoise would gas pedal lyrics float against all currencies.

One way or another, everything that enters a state within a nation or a nation must be paid for. That payment can be by money, borrowing, or seizure. To the extent it is money, workers must be willing to work for sufficiently low wages to make their products attractive to ones trading partners and wages must be sufficiently attractive to entice workers into the labor force. The U.S. is doing a poor job of handling this balancing act. Perhaps a smaller unit such as the Southwest would be able to achieve better performance.

Thus the devaluation or currency appreciation is the use of currency adjustments in lieu of other mechanisms to manage the trade balance. This occurs both naturally in the marketplace and by policy i.e. the Central Bank of the Southwest which I would structure to be a full service bank i.e. it would deal with both the state chartered banks and individual citizens. Thus if there was a need to stimulate the economy of the Southwest, there would be the usual option of stuffing money into the banks but also the option of bailouts directly of residents.

Presumably part of the motivation would be to improve the economy of the Southwest and create job opportunities and a better qualified work force than exists currently. This means enlightened fiscal and monetary policy. In general monetary policy is more effective than fiscal policy so having a Central Bank and ones own currency is critical.

But there remains the issue of legacy debt. Some residents of the Nation of the Southwest would owe money to others denominated in U.S. Dollars and some would own loans denominated in U.S. Dollars. So devaluing or appreciation the Tortoise,the new currency of the Southwest, would have certain implications. In general it is likely that the Remaining U.S. will be in a debtor position relative to the citizens of the Southwest who own U.S. Treasury obligations and will be exempt from any obligations with respect to the U.S. National Debt which clearly would not be very popular in D.C.

As just one example, it might be able to become a healthcare center especially if the U.S. were to accept ag gaston funeral home birmingham al Medicare claims filed with the Southwest or under current rules ( http://www.medicare.gov/Pubs/pdf/11037.pdf) there may be opportunities to develop medical centers close to the borders of the Southwest with the Residual U.S. Providing free or highly discounted medical services to U.S. Legislators might lead to the proper rules being put into place.

As an aside, secession is not the only way to create economic subregions within the U.S.. States can cooperate and negotiate Interstate Compacts that supersede State Laws and are enforced by the U.S. Supreme Court. It is not out of the question to create regional currencies and there may be other ways to achieve the same benefits without having separate currencies i.e. indexing of compensation of government employees to the trade balance of the region to make adjustments less difficult than the current process of using Detroit-style financial collapse to force a decline in labor electricity billy elliot instrumental rates.

With respect to governance, the concept of dividing Texas into a larger number of smaller states might have some appeal. Texas at one time might have had that right as part of their Treaty with the U.S. when they joined the Union but apparently they have over time surrendered that right and it is prohibited by the U.S. Constitution. But of course that would no longer be a constraint within a new nation of Southwest.

The large amount of Federally Controlled land complicates achieving border security in Arizona and New Mexico. Decisions on the former Federally held government land would have to be reviewed to determine the best use of this land. I have to assume that the citizens of the Southwest would prefer to have those decisions made locally rather than in Washington D.C.