**Every episode of Macro N Cheese is accompanied by a full transcript and an “Extras” section with links to further resources. Check them out at realprogressives.org/macro-n-cheese-podcast It’s been two years since Bill Black was last on with Steve. We’ve invited several guests to talk about the collapse of Silicon Valley Bank, so it only makes sense to ask our whistleblower friend to weigh in. Bill and Steve discuss what it means to be too big to fail. When an institution is too big to fail, the creditors get bailed out, but then, Bill says, “really really bad things have happened.” “...they hold the economy hostage. And nowadays they hold the global economy hostage. And if you hold the global economy hostage, you hold global politics hostage. So that needs to be fixed. And the way to fix that is not to allow such institutions, right? Duh,” The episode looks at the capture of government by the financial industry. Bill talks about his experience during the savings and loan crisis and the transition from somewhat effective regulatory apparatus to a fully cock-blocked system. (Our words, not his.) Bill Black is a professor of Economics and Law at the University of Missouri – Kansas City (UMKC) and the Distinguished Scholar in Residence for Financial Regulation at the University of Minnesota Law School. He is a serial whistleblower and authored The Best Way to Rob a Bank is to Own One.

Author Dan Kovalik talks to Steve about his recent book, Nicaragua: A History of US Intervention and Resistance. His perspective includes his own experiences in Nicaragua and the personal connections he made there.From the 1910 occupation and eventual ouster of US Marines, through the dictatorships of several members of the Samosa family, the conditions for revolution were ripe. Dan describes the 1979 revolution as a David and Goliath story. The Sandinistas inherited a country steeped in poverty, with no infrastructure. The US-backed counterrevolution began almost immediately. Ronald Reagan and the Contras are just a small piece of it.Dan grew up believing the US was the beacon on the hill, committed to spreading democracy and freedom. His first trip to Nicaragua changed his politics and his life.Dan Kovalik is a labor and human rights lawyer and peace activist. He teaches International Human Rights at the University of Pittsburgh School of Law. He is the author of several books, including The Plot to Scapegoat Russia and Nicaragua: A History of US Intervention and Resistance.@danielmkovalik on Twitter

C. Derick Varn is a poet, teacher, and “arm-chair theorist” (his words, not ours), but Steve called on him for his deep knowledge of history, specifically the history of revolutions.Varn takes a realistic and nuanced look at some of the popular myths about the brutality of key figures, like Stalin and Mao. He suggests placing them in the context of historical geopolitical economic conditions.I'm also just going to remind people that both the Bolshevik Revolution and the Chinese Revolution, in particular, come out of the context of world wars. They happen when they happen during the world wars for a reason. You have highly traumatized societies where the power has been broken because of the consequences of world war, even when the powers at hand are actually allied with the winners.Steve asks whether one should excuse abandoning civil liberties in order to protect the gains of a revolution against very real internal and external threats. “What civil liberties?” asks Varn. Some revolutions never even got rid of their monarchies.The episode considers Bolshevism, Trotskyism, and fascism. Varn talks about why both socialists and capitalists were attracted to fascism, looking, again, to the conditions of the time.C. Derick Varn is a poet, teacher, editor, podcaster, and broadcaster. He is the host of VarnVlog and co-host of Gaming Materialists. According to his Patreon, Varn Vlog is a podcast and YouTube channel dedicated to delivering high-quality interviews and analyses on philosophy, art, political economy, culture, geopolitics, pop culture, and history. Support his work at patreon.com/varnvlog@skepoet on Twitter

When you learned of the run on Silicon Valley Bank, did the image of George Bailey come to mind, facing the mob demanding full withdrawals from Bailey Building & Loan?“You’re thinking of this place all wrong, as if I had the money back in the safe. The money’s not here. Why, your money’s in Joe’s house that’s right next to yours. And the Kennedy house and Mrs. Maitland’s house, and a hundred others. You’re lending them the money to build, and they pay it back to you as best they can. What are you gonna do, foreclose on them?” (It’s a Wonderful Life, 1946)Steve’s guest is Brian Romanchuk of Bond Economics, here to break down the conditions and events leading to the collapse of SVB. Spoiler alert: there’s no Jimmy Stewart, no uplifting message, no sentimental tears.Brian explains how the American banking system is unusual relative to other developed countries. In Canada, where he lives, the Big Five banks are an oligopoly, but they’re diversified. They deal with all the nation’s banking needs.SVB is a relatively small bank, specializing in venture capital. This focus affects expectation of profits and the decision to invest in long-term Treasurys. When the Federal Reserve, fighting inflation on the backs of the working class, raised interest rates, the ultimate result was the bank’s collapse.Brian and Steve discuss how the Fed’s policies have led to a decrease in savings and an increase in debt, leading to greater inequality. They touch on Credit Suisse as well as pension funds in the UK, and try to clarify our understanding of bankruptcy and “bail-outs.”Real life is more complicated than it’s presented in movies. Don’t expect any angels to get their wings.Brian Romanchuk is the author of several books, including Modern Monetary Theory and the Recovery. He is the writer and publisher of bondeconomics.com. His writings can be found in his substack, The BondEconomics Newsletter.@RomanchukBrian on Twitter

Steve always says the beauty of MMT is “it takes the most convoluted spaghetti diagram and turns it into a straight line.” When it comes to banking, the financial industry, financial technology, and privacy, has the MMT community developed that straight line yet? Today’s guest, Raúl Carrillo, thinks we can get there:“I don't think we quite have, but I think the straight line flows right through everything else we've done. Just as we don't want banks to be heavily involved in the public provisioning process... We have to pay just as much attention to Silicon Valley, and then start thinking about what it looks like to actually build a democratic public money system that operates on MMT principles.”It’s been two years since we’ve had Raúl on the podcast, but the conversation is continuous, and it includes our episodes with Rohan Grey and Brett Scott.Steve and Raúl discuss Raúl’s recently published white paper, "Seeing Through Money: Democracy, Data Governance, and the Digital Dollar." It is essentially an intervention in the discussion about the future of money. It includes analysis of the way government agencies use financial technology today and how it is linked to a broader public money story and an MMT story. Currently, banks are intermediaries between the public and the state. In other words, banks are part of the plumbing. But what’s to stop the government from using financial technology for the public purpose and cutting the middlemen?Today, however, it’s more than just the banks.“The inclusion of new technological partners in the plumbing changes many, many things. If a Silicon Valley firm – whether it's a big stablecoin firm like Circle or PayPal – gets a master account at the Fed, we're living in a different terrain for MMT analysis ... I think it's just very important that we keep an eye on Silicon Valley in this sense and take the time for self-assessment when we talk about what kind of public money systems we're building.”The conversation goes into privacy issues where, again, the lines are blurred between the private sector and the government. Or maybe “blurred” is the wrong word. Their lines of communication are not necessarily visible to the public. What has been blurred is, in some cases, the distinction between left and right.Some take-aways from the episode. Financial surveillance can have extreme consequences. Think of a state with draconian anti-abortion laws. If the government can’t get a hold of your medical records, they can simply track your payments. After the Dobbs ruling, some suggested using cryptocurrency to pay for abortion, but guess what? It turns out blockchain is not private in the way most people think it is. That’s another take-away from the episode.Whatever the idealized intentions of the early developers of digital currency (remember how it would address the racial wealth gap?) it has mutated into a world of grifters and fraud. As Raúl says, “It’s not a cool party anymore, if it ever was. When you’ve got the cops and the bankers there, it’s time to leave.”Raúl Carrillo is the Deputy Director of the LPE Project (Law and Political Economy) and an Associate Research Scholar at Yale Law School. He is on the board of Modern Money Network and the chair of Public Money Action.@RaulACarrillo on Twitter

Austerity is a potent weapon of class warfare. Political economist David Fields talks with Steve about the ways austerity serves to discipline labor, as it has been doing since the Bolshevik revolution. They touch on the reasons capitalism cannot risk full employment, as explained by both Karl Marx and Michal Kalecki.David wants people to read Adam Smith’s The Wealth of Nations or The Theory of Moral Sentiments. Even Smith, the father of the “invisible hand,” said government is instituted for the security of property — for the rich against the poor.The discussion touches on the current inflation, comparing the true causes to the mainstream narrative.“There's been a very coordinated, calculated campaign with well-known economists. Call it neoliberalism. Call it what you want, financialization... The concepts, terms, economic principles that we take for granted are not value-neutral.”We are embedded in a system of winners and losers and we’re meant to believe there’s no other way. Workers must be prevented from understanding the trifecta of austerity – fiscal, monetary, and industrial.Bio: David M. Fields, Political Economist, Utah. From a critical realist & genetic structuralist ontology & epistemology, David's scholarly work centers on the intricacies concerning the interactions of foreign exchange & capital flows with economic growth, fiscal & monetary policy, and distribution, whereby attention is paid to the nature of money and international political economy. He has published in the following journals: Review of International Political Economy, Review of Political Economy, American Review of Political Economy, the Review of Keynesian Economics, and the Review of Radical Political Economics. Additionally, he has provided book chapter contributions to The Encyclopedia of Post-Keynesian Economics, The Encyclopedia of Central Banking, and the Wiley-Blackwell Encyclopedia of Globalization. David received his graduate degree from the University of Utah; his bachelor's from the University of Massachusetts, Amherst.@ProfDavidFields on Twitter

Dr. Fadhel Kaboub was recently appointed Under-Secretary-General for Financing for Development of the Organisation of Educational Cooperation (OEC), an international intergovernmental organisation founded by countries from across the Global South. In honor of Fadhel’s new position, we’re releasing Steve’s very first interview with him from back in the day when we live streamed onto Facebook. Steve thinks his questions are very different today — more disciplined. Some of us can’t get over how young he sounded. It was only five years ago!Fadhel and Steve discuss the spectrum of monetary sovereignty from full sovereignty to completely non-sovereign. Fadhel explains the structural debt traps developing nations find themselves in. They have deficits related to lack of sufficient food or energy production, forcing them to rely on imports.“Those are things that, no matter what you do as a central bank, you're not going to eliminate those structural issues unless as a country you start investing in renewable energy so that you don't have to import fossil fuels anymore or you invest in a sustainable agricultural policy to let you have food self-sufficiency.”The hole in their trade deficit leads to depreciation of their exchange rate.“And then the next morning or the next month when you as a country try to import food or fuel, you're going to import it at a higher price. So you'd be importing inflation into your domestic economy ... The inflation is related to a weakness of the productive capacity of the domestic system plus the imported inflation that happens because of the depreciation of the exchange rate.”Fadhel and Steve also discuss the devastating effects of unemployment and the potential of a Job Guarantee Program for developing countries.Dr. Fadhel Kaboub is Under-Secretary-General for Financing for Development of the Organisation of Educational Cooperation (OEC). He is an Associate Professor of Economics (on leave) at Denison University and President of the Global Institute for Sustainable Prosperity.@FadhelKaboub on Twitter

Historian Harvey J. Kaye joins Steve to talk about the complicated legacy of Franklin Delano Roosevelt. Kaye acknowledges many points in our criticism of FDR but goes on to discuss what Roosevelt was up against, and why he should be respected.“Because Gramsci, I think it was, said, when you judge the past, don't forget, you too shall be judged. I'm paraphrasing … When socialists start winning elections, then they can start telling me about how inadequate FDR was.”Them’s fighting words! But speaking of socialists – or rather, social democrats – and elections, the episode also includes discussion of Bernie Sanders’ presidential campaigns, and the lessons Bernie could have taken from FDR. After all, they both faced serious opposition within the Democratic Party.At a time when the American capitalist class were enamored of Mussolini, Harvey lays out FDR’s achievements and maintains that those policies prevented a revolution. Listen to the episode and see whether you agree.Harvey J. Kaye is a Professor Emeritus of Democracy and Justice at the University of Wisconsin, Green Bay, and an award-winning writer who has authored and edited 18 books, including Thomas Paine and The Promise of America, Take Hold of Our History, FDR on Democracy, The Fight for the Four Freedoms, and The British Marxist Historians.@harveyjkaye on Twitter

Recent episodes of this podcast have looked at the many ways in which the US attempts to maintain global hegemony through the deep state, the banking system, NATO, and the unholy trinity of the IMF, WTO, and World Bank.This week, Steve talks with Daniel Conceição about the possibility of a supranational currency for Brazil and Argentina. Daniel points out some potential benefits, but it’s hard to avoid comparisons to the Eurozone and the crippling loss of monetary sovereignty. Nevertheless , if successful, such an agreement has far-reaching implications not only for these two nations but potentially throughout all of Latin America, helping promote greater economic integration while providing increased stability.Steve and Daniel revisit the issue of the petrodollar. Traditional MMT wisdom would say it’s no big deal; it’s merely a numeraire. Daniel suggests there’s more to it, “because when we claim that taxes are the main driver of currency acceptability, what we really mean is that necessity is the main driver.” Just as taxes put us in need of the currency,“...in the exact same way, if there's a commodity that is hugely needed for your economy to function—everyone needs to purchase it—and if that commodity is only purchasable in a particular currency, then it also necessarily will give acceptability to that currency.”The episode considers the accuracy of books such as ‘’Confessions of an Economic Hitman.” Daniel points out that mainstream economics is a tool to preserve the interests of the ruling class both domestically and internationally. It’s a mistake to think the economic hitmen are working to secure American interests. Just as we’ve heard from Aaron Good, Michael Hudson, Clara Mattei, and other guests, it’s not a case of country against country, but of a ruling class working against the interests of everyone else.Daniel Negreiros Conceição did his undergraduate studies in Economics at the Federal University of Rio de Janeiro in Brazil and his postgraduate studies at UMKC (under Professors Wray, Kelton, et al). He is a professor of macroeconomics and public finance at the Federal University of Rio de Janeiro. He helped create the Institute for Functional Finance and Development (iffdbrasil.org), where he currently serves as president, and he helps run the Brazilian Modern Money Network (https://mmtbrasil.com/) aimed at producing more easily accessible material for teaching MMT to the wider public.@stopthelunacy on Twitter

We revere venture capitalists, don’t we? Without their brave acts of derring-do — AKA investing in uncertain ventures — how would society achieve progress? Just kidding.If you are a regular listener to this podcast, you’ve heard guests speak about the horizontal contradictions within the ruling class. Industrial capital and finance capital can each be affected differently by foreign, domestic, fiscal, and monetary policies. They may sing from the same hymn book but sometimes their interests diverge.Steve’s guest, Dr. Julia Ott, teaches the history of capitalism at the New School. She and Steve focus their discussion on venture capitalism and its implications on policy changes, inequality, and the racial wealth gap. They explore how venture capitalists have been heavily involved in lobbying for capital gains tax breaks, leaving them more to invest and pass on to their children, exacerbating the extremes of generational wealth and generational poverty, especially for people of color.They also observe how venture capital is assumed to create a virtuous cycle by reinvesting in multiple new companies. Historically, however, the state has been more consequential to economic growth and job creation than venture capital. For all the anti-government rhetoric flying around, especially during conservative or laissez faire periods (hello, Mr. Reagan and Mrs. Thatcher), the federal government is heavily involved in capital markets and infrastructure. Far from interfering, the state is a willing and consistent facilitator in the amassing of private wealth.Dr. Julia Ott is Associate Professor of the History of Capitalism and Co-Director of the Heilbroner Center for Capitalism Studies at the New School for Social Research.