I haven’t done a post specifically about Modern Monetary Theory (MMT) for a while now, although that is the perspective from which I approach a lot of the issues I blog about. With that in mind, I thought I’d go back to basics and write a beginner’s guide to MMT as I see it. Any errors that follow will be mine alone. Please let me know if you spot one!alittleecon
The Basics of Modern Monetary Theory
Alex Little
(h/t Andy Blatchford)
3 comments:
Hi Tom. I thought that was a really good high level summary of MMT, but it also has a familiar weakness: The conflation of the monetary theory and the wish list.
One of those things is not like the other. Seven of them describe how money works in an economy and what a government *must* do to make a currency viable - "the government shall" etc.
But #7 is a policy prescription, and look at the language: "the government SHOULD." That's a very different thing, and has nothing to do with how the monetary theory works.
Anyway, I've taken one final stab at making my reservations with MMT as plain as possible.
https://www.pruningshears.us/pruning-shears/2014/6/4/trying-to-make-sense-of-a-manic-monetary-theory.html
The previous two have produced some pretty contentious and unproductive exchanges with MMTers though, so I'm not sure if this will go any better. Time to step away for a bit!
danps,
"Calling for austerity with “we don’t have money” is factually wrong; those who say it should be made to look foolish. Pushing back against that line, emphatically and persistently, until it gets discredited, is a tall order."
Well I (for one anyway) have to strongly agree with your assertions here...
I think what you are running into is a "left/right" thing... where typically the "left" type of people are involved with MMT and not many of the "right" are involved at this time due to the current heavy libertarian bent of the current political right....
Warren often will assert "that depends on your politics" which I believe Warren is correct when he says this...
But again I would point out, the key "spectrum" to focus on wrt "MMT" is not the "left/right" spectrum (which imo you are getting caught up in here..) but rather the "authority/liberty" spectrum that runs across the "left/right" spectrum...
rsp,
darps,
For what it's worth, the primary MMTers often express ambivalence toward the names Modern Monetary Theory/Modern Money Theory/MMT. I've heard them describe it as a name they wouldn't have chosen; one they're sort of stuck with because of how and when it caught on.
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