THE PAST FEW YEARS have been good ones for Modern Monetary Theory (MMT). A decade ago, you would have been hard-pressed to find a mainstream economist who had even heard of this fringe school of left-Keynesian economics. But ever since Bernie Sanders made MMT proponent Stephanie Kelton a senior economic advisor for his 2016 presidential campaign, it has gradually trickled into the mainstream. In June, Kelton’s new book, The Deficit Myth: Modern Monetary Theory and the Birth of the People’s Economy, landed on the New York Times Best Sellers list, no small feat for a tome about monetary issues.
The meteoric rise of MMT may be surprising to its many detractors (Clintonite liberals hate MMT as much as Senate Republicans do), but it shouldn’t be. Its basic message — that the spending of currency-issuing governments is not constrained by tax income — is uniquely resonant in a moment when trillion-dollar stimulus packages and zero-percent interest rates are becoming the new normal. Most of us need money in our bank accounts right now. MMT tells us that the only thing keeping the federal government from providing the kind of fiscal support we need to weather this pandemic is that they don’t want to. There is no objective economic constraint, only a lack of political will....
Should-read. Interesting comparison and contrast of MMT with the contemporary Marxian and socialist left in the US.
Los Angeles Review of BooksMainstreaming MMT
Aaron Wistar. PhD candidate in History of Consciousness at UC Santa Cruz, who focuses on the history of central banking
The meteoric rise of MMT...
ReplyDelete... has gone unnoticed by the general population.
Its fall from grace may also be meteoric, in the sense that most meteors burn up in the atmosphere, without notice.
Because MMT is a distraction from their objectives, genuine Marxists have taken notice. No wonder they are critical.
“... has gone unnoticed by the general population.“
ReplyDeleteIt’s too arcane for general population... maybe the guy means within the cohort that has focused interest in this area...
But if someone (general population) doesn’t understand something properly understood via either figurative language or mathematical abstraction, then they reify it... think it’s real... hence they think “money is real!” and we can “run out of it!”...
Every time..,
Yes, the cohort known as the chattering class. Mainly comprised of pundits, policy wonks and political junkies.
ReplyDeleteWhat would be a reification of MMT?
Magic Money Tree?
Some people don't believe there is magic... how about... Munificent Money Tree?
ReplyDeleteMMT: nice try to paint it pink
ReplyDeleteComment on Aaron Wistar on ‘Mainstreaming MMT’*
Aaron Wistar recounts “The past few years have been good ones for Modern Monetary Theory (MMT). A decade ago, you would have been hard-pressed to find a mainstream economist who had even heard of this fringe school of left-Keynesian economics. But ever since Bernie Sanders made MMT proponent Stephanie Kelton a senior economic advisor for his 2016 presidential campaign, it has gradually trickled into the mainstream. In June, Kelton’s new book, The Deficit Myth: Modern Monetary Theory and the Birth of the People’s Economy, landed on the New York Times Bestsellers list, no small feat for a tome about monetary issues.”
Aaron Wistar makes it appear that MMT's “meteoric rise” is due to its scientific merits and to the final triumph of the true theory over old mainstream myths. This is NOT the case. The scientific value of MMT is zero. And is meteoric rise is a fine marketing success of Wall Street's Warren Mosler ― one of the two founding fathers of the MMT movement. It's an easy task for these folks to produce any New York Times bestseller they want.
The macroeconomic foundations of MMT are provably false.#1 Because of this, MMT is proto-scientific garbage.#2 And the claim that MMT benefits WeThePeople is a political fraud. MMT benefits Oligarchy.#3 The insane distribution of income and financial wealth between the 1% and the 99% is the direct result of the MMT policy of deficit-spending/money-creation.#4
The fact that Stephanie Kelton sells MMT as the Birth of the People’s Economy is breath-taking political infamy. That she is assisted by the mainstream media, Bernie Sanders, and a Ph.D. candidate in the History of Consciousness in selling a Wall Street agenda as a progressive/left project is just another proof of widespread political corruption.
Make no mistake, after globalization had run its course, the goal for Wall Street as the avant-garde of the Oligarchy is to “reclaim the nation-state” by bringing the Fed and the Treasury under their control and to produce as much deficit and money and profit as they ever need for their self-perpetuation according to the macroeconomic Profit Law that implies Public Deficit = Private Profit.
Egmont Kakarot-Handtke
* https://lareviewofbooks.org/article/mainstreaming-mmt/
#1 Wikipedia, economics, scientific knowledge, or political agenda pushing?
https://axecorg.blogspot.com/2020/06/wikipedia-economics-scientific.html
#2 For the full-spectrum refutation of MMT see cross-references
https://axecorg.blogspot.com/2017/07/mmt-cross-references.html
#3 Is MMT good for WeThePeople or for the Oligarchy?
https://axecorg.blogspot.com/2019/07/is-mmt-good-for-wethepeople-or-for.html
#4 Keynes, Lerner, MMT, Trump and exploding profit
https://axecorg.blogspot.com/2017/12/keynes-lerner-mmt-trump-and-exploding.html
The Magic Money Tree decried by the right-wing "magically" always turns in Financier of Last Resort when there's a major crisis that threatens the excessive wealth and power of a minority. Total hypocrites!
ReplyDelete"What would be a reification of MMT?"
ReplyDeleteWell maybe they would think our numismatic system was literally like "points on a scoreboard!" or something like that...
You would have to look at all of MMTs figurative language and then think possible some person not understanding would perhaps take those statements literally...
Its not really possible to do this via abstraction... or at least the tendency towards reification is seemingly trained out of the students pretty thoughouly by the time they are done with their training... eg nobody trained there is going all around thinking a kg is real and we can run out of them..
thats why Science has really took off since we established that methodology formally in the academe since about 1860... and we've really accelerated at least our material systems development and performance..
Sounds like the birth of a cargo cult.
ReplyDeleteCross-posting
ReplyDeleteJacob Richter
You say: “This is an excellent article on the *need* to incorporate MMT into any actual left reform planks of Marxist political strategy!”
The macroeconomic Profit Law for the basic three-sector economy reads Q=(G−T)−S, i.e. the public deficit G−T generates the business sector's profit Q. For the proof see here
https://axecorg.blogspot.com/2020/06/wikipedia-economics-scientific.html
The Profit Law tells everyone that the MMT policy of deficit-spending/money-creation is for the benefit of the Oligarchy. MMT's Stephanie Kelton, though, claims that MMT is the “Birth of the People’s Economy”. Obviously, just the opposite is the case.
Now you want MMT to be incorporated into a “Marxist political strategy.”
It is interesting to learn that it is “Marxist political strategy” to provide permanent free lunches for the Oligarchy.
Egmont Kakarot-Handtke