> Stop me before I mention Modern Monetary Theory.
Au contraire! Please continue!
Au contraire! Please continue!
Here's his latest video: https://youtu.be/mKWfEQlcDoU
I encourage everyone to read about it if you're a person who absorbs info via text better.
Here's the Wikipedia entry: https://en.wikipedia.org/wiki/Modern_Monetary_Theory
It's worth a read. I wish there was a single volume "MMT for Dummies," but to get the full read on it, you currently have to read a bunch of different texts. I like the Wikipedia article because they include some of the critiques as well as the supporting arguments.
My take on economics is there are few theories that are universally applicable. Keynes is applicable to some situations as is Hayak and even E. F. Schumacher. The hard part is figuring out which theory is good for which situation (and how to tell if your assumption about applicability was wrong.)
What I find surprising about modern Americans is they really want to elect someone who has all the answers. FDR was somewhat famous for f*king up a couple times and changing course when the data didn't match the theory. We're so tribal these days we refuse to admit that even good leaders can get it wrong once and again and having an honest discussion about why the error occurred and how they're going to fix it might lead to better outcomes.
I am reminded of J. R. "Bob" Dobbs' quote "Act like a dumbsh*t and they'll treat you like an equal." Perhaps I should run for office on the platform of "I'm probably as dumb as you are, which makes me smarter than my opponents."
Got my vote!
Now that inflation is high and MMT says "increase taxes / reduce spending", it sounds far more reasonable.
I don’t think the people that were appalled at loose “fiscal”—more specifically targeted—policy from Congress as a substitute for loose “monetary” policy from the Fed (under the MMT model that the real constraint on “fiscal” policy are its monetary effects rather than fiscal balance) would be any happier with tight “fiscal” policy substituting for tight “monetary” policy from the Fed.
I don’t think they would be happy for the “who pays the bill” when tightening is needed to be one members of Congress have to defend to their constituents anymore than they want “where does stimulus go” to be.
They may like selective appeals to constraints to avoid discussing the specific merits of spending proposals they don’t like, and dislike losing the myth of fiscal constraints, but they still don't want to subject the distributional impact of m monetary tightening to real policy debate.