Michael Hudson — The Rentier Economy is a Free Lunch

Video and transcript. Covers a lot of ground, mostly things that appear in his books.

Some representative quotes:

...unless you have a study of economics as an economic system – understanding what’s causing the polarization and the poverty in the United States – you’re not going to be able to have a reform movement to change the system.

The role of economics departments is to dumb down the understanding of the economy.….

Again, you want to look at the economy as a system. You don’t want to reduce everything to one-dimensional “here’s the price level”. You want to look at the multi-layered economy. What are the cost prices? What are the economic rents? What are the monopoly prices? What’s the tax system? You have to look at the economy as a system, not in a one-dimensional way. So, I can’t untangle all of the jumble any clearer than that.…

The point of MMT is that just as banks create endogenous credit on their own computers, the government can create credit. The government doesn’t have to borrow money from the 1% or from bond holders in order to spend it; the government can simply print it as it did under the greenbacks.

The government can create its own credit. And there’s nothing wrong with running a budget deficit because a budget deficit does not have to be paid by taxpayers paying taxes. A government deficit can be funded by simply creating the money on your own computer – not by taxes. That’s the point that Stephanie Kelton has been making again and again in what she writes.

And that really is the essence of MMT….

While Michael Hudson is an MMT ally, not all of his ideas are compatible with MMT. But he does seem to agree with MMT founder Warren Mosler's fundamental insight that a sovereign currency issuer has a public monopoly on the currency. One of his contentions is that this public monopoly has been monopolized under financial capitalism. On the other hand, his work represents a unique school of thought in political economy and he is difficult to categorize. There are many influences on his work that are different from MMT. 

Michael Hudson — On Finance, Real Estate And The Powers Of Neoliberalism
The Rentier Economy is a Free Lunch
Real Progressives interviews Michael Hudson