Jeff Deist on the allure of MMT

MMT is the perfect economic proposal for those who sincerely and deeply believe wealth simply exists in America, and will continue to exist, regardless of incentives. All we need to do is figure out how to more fairly divvy it up—and so why not through government spending?

The promise of something for nothing will never lose its luster. MMT should be viewed as a form of political propaganda rather than any kind of real economics or public policy. And like all propaganda, it must be fought with appeals to reality. MMT, where deficits don’t matter, is an unreal place.

~ Jeff Deist, "Not Modern, Not Monetary, Not a Theory," LewRockwell.com, June 26, 2020

Jeff Deist on MMT and government spending

It’s easy for those of a free market bent to dismiss MMT out of hand, but the impulse to create something from nothing resides deep in the human psyche, and politics is where this impulse finds expression. We should not underestimate the allure of MMT in the midst of our current upheavals, because it appears to make possible every left progressive program: unlimited public works and federal jobs, useless and uneconomic green energy schemes, reparations for black Americans, Medicare for All, free college, free housing, and a host of others.

~ Jeff Deist, "Not Modern, Not Monetary, Not a Theory," LewRockwell.com, June 26, 2020

Robert Murphy on Stephanie Kelton’s new book 'The Deficit Myth'

Stephanie Kelton’s new book The Deficit Myth does a very good job explaining MMT to new readers. I must admit that I was pleasantly surprised at how many different topics Kelton could discuss from a new view, in a manner that was simultaneously absurd and yet apparently compelling.

The problem is that Kelton’s fun book is utterly wrong. The boring suits with their standard accounting are correct: it actually costs something when the government spends money. The fact that since 1971 we have had an unfettered printing press doesn’t give us more options, it merely gives the Fed greater license to cause boom/bust cycles and redistribute wealth to politically connected insiders.

~ Robert Murphy, "A Review of Stephanie Kelton's The Deficit Myth," Mises.org, June 23, 2020

Stephanie Kelton: "We could safely increase the deficit by another $500 billion"

We could safely increase the deficit, let’s say by another $500 billion or so, before we begin to see inflation accelerating to something that we would consider problematic.

~ Stephanie Kelton, professor at Stony Brook University in New York and economic adviser to the Bernie Sanders presidential campaign, interview with Erik Schatzker, Bloomberg TV, January 30, 2020

(Kelton cited research by investment firm GMO for the numbers.)

Sonal Desai debates Stephanie Kelton on MMT

People always point to Japan over the past several decades to justify the case for low and even negative yields forever...  To take the leap from Japan's experience to assume that the Fed can keep printing money forever is a problem.  It is very seductive to populist politicians, and that's one of the reasons it gets me really nervous.  I debated Stephanie Kelton, who has become the face of modern monetary theory.  She feels the choice between universal health care, forgiveness of student loans, and increased spending on infrastructure is a false one, because, in fact, you can have them all.  It's a problem to assume that the U.S. has no budget constraints; it does.

~ Sonal Desai, 2020 Barron's Roundtable, January 6, 2020

James Montier on Modern Monetary Theory and fiscal policy

MMT is aligned with functional finance, which simply says fiscal policy should aim to generate full employment rather than a balanced budget. There’s this fallacy that what’s true for a household is true for government. So you hear from all sorts of policy wonks that the U.S. and XYZ nation are running out of money. Well, that’s just not possible.

~ James Montier, strategist, GMO, "In Defense of Modern Monetary Theory," Barron's, July 27, 2019