Modern monetary theory opens range of economic possibilities - Independent Australia — Stephen Hail

NEARLY 30 YEARS AGO, a New York fund manager named Warren Mosler noticed a discrepancy between what he saw day-to-day in his interactions with the Federal Reserve and the way almost all academic economists write about money. The way they write, you would think currency-issuing governments need to tax before they can spend — Mosler noticed it is the other way around.

Getting this wrong is not trivial. It biases policy narratives. It misleads politicians into thinking that there is something inherently good or sustainable about budget surpluses. It misleads them into worrying about finding the money to meet their commitments when that is the wrong question to ask.

Independent Australia
Modern monetary theory opens range of economic possibilities

Stephen Hail, Lecturer in Economics at the University of Adelaide