I’d been stewing for a few months in the melange of blogs and YouTube videos and white papers that make up much of the M.M.T. world. Some intricacies lay beyond me—a hazy blur of literature about floating exchange rates and reserve currencies addled my brain. But the basic principle of M.M.T. is seductively simple: governments don’t have to budget like households, worrying about debt, because, unlike households, they can simply print their own money....
This illustrates a major difficulty in public education about MMT. On one hand, the financial and economic concepts are beyond many laypersons, while on the other, the body of literature with which one must be familiar is daunting to non-specialists. So the commonly held view is that MMT is about "printing money," which sounds irresponsible to much of the public.
I asked Ann whether she found Kelton convincing. “I mean, kind of!” she said. “I know what she said was brilliant, I just can’t believe her. She’s gotta be wrong.”
It's not just the public either.
Still, most mainstream economists view M.M.T. as the Cult of the Magic Money Tree, deriding what they see as its theorists’ preference for analogy over mathematical modelling or empirical evidence. “What most concerns me is I can’t actually quite figure out what it is,” Paul Krugman, the Nobel Prize-winning economist and Times columnist, told me. Krugman is a political progressive, and he agrees with many of the spending programs that M.M.T. proponents support. But, he said, “I’ll be damned if I can figure out what it is exactly that they think.”
But this is a whole article on MMT that focuses on Stephanie Kelton as MMT's chief media spokesperson, and "there's no such thing as bad publicity." Free publicity is always a gift, especially in an environment in which the media tends toward marginalization of politically incorrect ideas and people that espouse them.
Zach Helfand concludes on a hopeful note:
I asked Kelton if she worries at all about these fights, further over the horizon. “At the end of the day, what I really hope for is just a better debate,” she told me. “Let both sides put forward their best ideas.”
This is the ultimate dream of M.M.T.: freed from false financial shackles, we could debate, on honest terms, the most fundamental political questions. If money weren’t an issue, would we want to scrub carbon from the atmosphere? Pay for reparations? Expand ice? Maybe we just want to be left alone, with our tax money in our pockets and some Social Security checks when we age. M.M.T.’s architects describe their vision as encompassing not just a better economy but a better, healthier body politic—a goal that is, given the state of things, almost certainly doomed, but is admirable nonetheless. Deficits do matter—not just the financial ones.
The critique is "fair and balanced," with the proviso that the author admits limited knowledge of MMT as a macroeconomic theory. Actually, not a surprising limitation when Paul Krugman admits that he can't figure it out either, based on conventional economic training.
The hurdle seems to be MMT's simplicity: A currency sovereign funds itself through issuance; the real constraint is availability of real resource, and the financial constraint is price and exchange rate stability. Simple, but it seems to boggle minds. But it is not as simple as it may look, either. It contains the most salient features of macroeconomics as a policy science when unpacked through the theory.
Zach Helfand, New Yorker editorial staff member
