Modern Monetary Theory and its Critics

by Edward Fullbrook, Jamie Morgan

This collection of essays from leading economists in the MMT debate offers the reader a range of viewpoints from which to become informed about what is set to be a significant part of economic policy discussion in the coming years.“This stimulating book provides a clear account both of what Modern Monetary Theory entails and of the many objections to it. Its great value is that it will make readers have to think for themselves through many fundamental issues of macro-economic theory and policy.” - Charles Goodhart, London School of Economics“The merits of Modern Monetary Theory have become the most contentious issue in Post Keynesian macroeconomics. This remarkable volume presents the full range of opinions on MMT, from its enthusiastic proponents to its severest critics, with intermediate positions (critical support; sympathetic scepticism) also being set out. The book is essential reading for everyone with an interest in heterodox macroeconomic theory and policy.” - John King, La Trobe University & Federation University Australia“Recently Modern Monetary Theory has generated a lot of heat in newspaper columns and blogs, but relatively little in the way of light. This collection offers an urgently required, more considered treatment, challenging readers to think about the role, sources and implications of sovereign currency and money creation as social processes. The volume addresses the crucial question of what MMT would mean for practical workable policy agendas and the design and function of macroeconomic governance at an epochal moment when the future of the planet and social order is at stake.” - Andrew P. Baker, Sheffield University, UK“Modern Monetary Theory has found its moment in the sun. One advocate, Stephanie Kelton, is chief economic advisor to Bernie Sanders; Forbes, The New Yorker, and many newspapers, have published pieces on it. This balanced and readable collection is an excellent place to go for those wanting to understand this economic doctrine.” - Steven Pressman, Colorado State University & Co-editor, Review of Political Economy"So much has been written about MMT in the press that one gets at best a superficial understanding of its rich and penetrating implications. Criticism from this circle tends, as a result, to be ill-informed and misleading. Not true of the current volume, however. Here we find honest and carefully considered critiques and affirmations of what may stand as the foundation of a progressive and forward-looking transformation of advanced market economies." - Roy J. Rotheim, Skidmore College, USContributions L. Randall Wray, Trond Andresen, Phil Armstrong, Bruno Bonizzi, Annina Kaltenbrunner & Jo Michell, David Colander, Paul Davidson, Dirk H. Ehnts & Maurice Höfgen, Jan Kregel, Marc Lavoie, Tony Lawson, Anne Mayhew, Richard Murphy, Thomas I. Palley, Louis-Philippe Rochon, Malcolm Sawyer, Alan Shipman, Jan Toporowski, Jamie Morgan & Edward Fullbrook.

Genres: Economics, Business, Nonfiction

436 pages, Kindle Edition

Published February 25, 2020

Reviews

[Katia N · Rating 4 out of 5]

Periodically I “dive” into reading books about economy. I’ve never thought that economics was a science, definitely not in a traditional sense of the word. It has a very limited ability to come up with a predictive theory. Nevertheless, it is an important and interesting discipline to read about. So, this year with all the mess we are going through, I felt a “pull” to come back to these books again. Not surprisingly, I am interested how we could bear the cost of the pandemics and what risks it poses to our societies. But it is not only pandemics. The trends were there before as well. What is the role of the government? What are the sources of inequality and the policies to address it; the future of work; social activism; global development and the future of the globalisation; climate change… The list could go on.

But this particular review is of the book on the Modern Monetary Theory (MMT). I’ve first heard of it when someone mentioned the book The Deficit Myth: Modern Monetary Theory and the Birth of the People's Economy by Stephanie Kelton. Stephanie was the adviser to Bernie Sanders. The core theory is not particularly new. But it seems to have made a breakthrough into popular imagination, especially with the young socially-minded activists. I’ve decided not to read Stephanie’s book first. My decision was partly motivated by purely economic reasons - the cost of the hardback. But also I was thinking it would be more beneficial to read a book summarising the views from the wider spectrum of opinions. This collection of essays is very good for this purpose. It gives a platform to both the supporters and the opponents of the theory.

Additionally, this book has appeared to be indicative of another problem with economics and its role in the intellectual life of the society. Some of those essays were really badly written. And, it seems the economists are notorious in communicating difficult ideas in a simple language. If they do it, it is usually dumped down to such a level that the core is distorted. In fairness, it is not only economists who suffer from this.

MMT is the one theory though that has managed to overcome this problem party by active explanatory and marketing campaign and partly by its relevance. Though I still think quiet a bit of “dumping down” is taking place.

So what is MMT? That is how I understood it in its simplest form:

The government of a sovereign country does not need to tax in order to spend. This is because the government is a sole issuer of the thing we call “money”. Moreover, spending more than collecting in taxes is good as it creates surplus for the private sector of the economy. Taxes are required only after that to “suck out” redundant money from the economy in order to avoid inflation. Taxes also are important to have all this running smoothly. As if we would not need to pay taxes why would we want the money issued by the government at the first place? But as it stands, if we would refuse to pay taxes, the government have a coercive mechanism to put us to prison for example. We do not want to go to prison. So we would use the bills issued by the government. The bottom line is there is no financial constraint for the sovereign government. Only constraint is the availability of real resources such as labour, energy, technology etc.

As the one of the proponents put it (not from this book):

“is that while it remains emphatically true that we, as individuals, are financially constrained by the finite number of Dollars each of us can earn and save—as a collective society, working and cooperating together, we have all the financial resources necessary to pay ourselves to accomplish virtually anything we are capable of. This, in the end, is the astonishing “truth” that will solve the “unsolvable” dilemma of our National Budget.”

Another supporter (Dirk H. Ehnts Ch8): “Essentially, the currency issuing government faces no purely financial constraints. The only constraints a monetarily sovereign government faces are the availability and quality of its real resources as well as the risk of inducing inflation if total spending exceeds the productive capacity of the economy in some significant sector.”

The policy which is logically following is government should spend as much as it needs to without creating the price’s growth.

Specifically, the government could become “the employer of last resort” to eliminate involuntary unemployment. But there is even more popular version between the activists - any policy protecting the disadvantaged or common interest could be financed this way. One does not need to care about the employment that much at the end. And the taxes are not so important in this. They use the word “pre-distribution” instead of “redistribution” as the government spends correctly the first time around.

That sounds fantastic. And, actually the theory is not that simplistic as it might look. Famous Keynes was asserting that the government could increase its spending without the risk of inflation in the window until the economy reaches the full employment. But still, there is substantial amount of questions with this theory even from mine perspective of very limited knowledge.

The theory is based on the following assumptions: “the degree of monetary sovereignty depends on four conditions:

1) the government of a nation issues its own fiat currency,

2) it is able to enforce its tax liabilities denominated in its own currency,

3) it does not issue any (significant amount of) debt instruments not denominated in its own currency;

4) it does not promise to exchange its own currency into anything else at a fixed rate”.

The last two of those assumptions effectively exclude the major part of the world as no developing country posses such amount of monetary sovereignty with their external liabilities denominated in US$ and pegged exchange rates. So the theory might be OK for the US and a few other rich economies, but not for the majority of existing world. And this “double standard” for me is the major issue. It is to some extent the hidden continuation of colonialism. Generally, the theory is not focused on open economy. In fact, I’ve I found the only one MMT supporting economist who is dealing with developing countries and how MMT would apply to them - Fadhel Kaboub He asserts that in order to apply MMT the country has to become self-sufficient for food and energy instead of trying to develop export orientated economy. This is very good, apart from probably not very feasible. Even I can see that if food sufficiency might be possible (with huge efforts), the energy sufficiency requires at least access to the new technologies. This requires resources. Mr Kaboub thinks that the resources could be cultivated through investments in education. At this point I think we face classic “the chicken and the egg” problem. In general, I am very sceptical about recommending developing countries self-sufficiency in the post-colonial world.

Now, back to the US and the likes. I am bit sceptical in terms of MMT core philosophy of taxation. Based upon the fact that money can be printed in any volume the government wants (subject to the constrains of the real resources which are difficult to estimate in real time), the taxes become the instrument of inflationary regulation. But then, if everyone understand this, people and businesses might not want to pay any of it. Moreover, in ideal case, the taxes then are not required at all. I find hard to believe that such philosophy born on the left would not be loved by the libertarians. In practice though, the role of the taxation is not only financial. To some extent, it is a part of the coherent social contract. This might be in danger if everyone would see that they do not play any role in financing the needs of the society.

Another problem with MMT is that they do not consider the role of the central banks as essential. Specifically, as far as i understood they do not think that independence of this institution is required. I think it is fundamental as the government is subject to short-term political cycle while the central bank (or the Fed in the US) is not.

I find the argument that the state is not limited in printing money quite liberating. But taking to the extreme, it leads to interesting experiment. For example, the local authorities - they do not have “monetary sovereignty”. But if they would aspire to, they could follow the same logic and issue some “tugriks” which would be accepted as a payment of local taxes for example. Or in fact any community could do something similar and even establish some lending in “tugriks”. One can say it would be illegal. But if there is a will there is a way. I think the success or the lack of it of the alternative payment systems would be crucial to understand the limits of this point.

Back to the book, some of the fellow post-Keynesian economists in this collection have had some reservations in respect of the MMT. Some of them, even from the left of political spectrum, were seriously critical. This is the view of Jan Toporowski, the Professor at SOAS:

“The purpose of a radical economic policy is social and economic change, and not experiments in economic theory. Truly radical monetary theorists test their ideas against the possibilities of achieving that change, rather than using social and economic change to add radicalism to the thought experiments of academics and hedge-fund managers. Policies of environmental protection and improving the material conditions of working people through full employment and subsidy of workers’ consumption (such as health, education and welfare) challenge the social and political interests that govern society.

Modern Money Theory therefore represents a certain retrogression of monetary theory: a set of doctrines to reassure Gaitskell’s “plain man” that the money is always there, rather than a theory explaining how money circulates in a capitalist economy. The doctrines are naïve and the radicalism lies in the purposes for which the money will be spent, rather than in any new thinking about money.”

But many of them were more sympathetic. MMT is gaining a wide popularity between the people though. And I can see why. It is the first theory which is breaking the dogma of TINA (“there is no alternative” famously quipped by Mrs Thatcher) in the popular imagination. In the words of Luis-Philippe Rochon, another contributor the collection:

“For the past three decades or so, neoliberal or mainstream economists, their political leaders and princes of finance, have used the dominant doctrine and TINA to justify some of the most ruthless policies of austerity, deregulation and privatization, with very lucrative consequences. Such policies contributed to (growth of) the wealth of the 1%, and the development and institutionalization of a dual economy: austerity for workers and profits for the rest (Epstein, 2019). In other words, the policies of the last 30 years have been good for the economic, political and financial elites. It is in this sense that Queiroz (2018) calls TINA “an ideological and political subversion of liberalism” (see also Munck, 2003). TINA has become the first line of defence, and offence, against any conceived threat to the neoliberal order.”

So any argument understood by the masses and challenging this orthodoxy is a useful argument. I am happy that the tide is changing. I am sure the rich countries can afford to switch on the printing press for a bit. But I do not want a new TINA replacing the old one. I am personally sure there are better arguments and models out there. Especially, I think that the global consequences of any proposed national solution should be carefully considered and not overlooked.

[Sam Dotson · Rating 4 out of 5]

My introduction to Modern Monetary Theory (MMT) came from The Deficit Myth: Modern Monetary Theory and the Birth of the People's Economy. I thought Kelton's book was a phenomenal achievement and thoroughly convincing. My appetite for understanding was somewhat unsatisfied because, as a lay person with economics, I didn't possess the knowledge to critically assess The Deficit Myth - I wanted to prepare myself for people that disagreed with the teachings of MMT.

This book is a collection of essays that both expound upon, and criticize, the theory of MMT. I lightly skimmed the favorable essays because I had just finished Stephanie Kelton's book, focusing my attention on the critics. I found that critics of MMT fell under two broad categories:
1) Economists that agree with MMT (as it pertains to the U.S.) but disagree with its universal applicability.
2) Economists that conduct "normal science" in the Kuhnian sense and think MMT is a fad.

MMT represents a paradigm shift, a scientific revolution, in the exact manner that Kuhn wrote about in The Structure of Scientific Revolutions. The crisis for economics comes from the observation that governments with monetary sovereignty do not adhere to the same rules that apply to users of that money.

This comprehensive collection of essays curated by Edward Fullbrook and Jamie Morgan will certainly illuminate MMT for skeptical readers.

Suggested reading:
1. The Deficit Myth: Modern Monetary Theory and the Birth of the People's Economy
2. The Structure of Scientific Revolutions

[Cory Knipp · Rating 4 out of 5]

Prior to reading Modern Monetary Theory and its Critics, I read The Deficit Myth by Stephanie Kelton. Dr. Kelton is a leading advocate of Modern Monetary Theory (MMT) and does a great job explaining the framework and arguing for some of the policies that MMT favors. However, she did not really differentiate MMT from other Keynesian theories. This is why Modern Monetary Theory and its Critics is a great read after the Deficit Myth. This collection of essays provides a wide variety of viewpoints on MMT in order to see where it fits in the overall discussion.

As a review, MMT says that governments that issue their own currency and do not borrow in another currency, have no financial constraints to spending. The only constraint for this government is a resource constraint. Governments can spend too much into an economy that has reached its resource capacity, which would lead to inflation. Therefore, taxes do not fund government expenditure. Taxes, however, give value to a currency since each participant in the economy is obligated to pay taxes in that currency.

Very prominent and respected Keynesian economists such as Paul Krugman, Jason Furman, and Larry Summers are HUGE critics of MMT. Not only are they huge critics, but their negative rhetoric toward MMT economists is as heated as their critiques of crypto believers and conservative deficit hawks (This is saying a lot because Keynesians REALLy HATE these 2 positions). This was confusing to me. Many of these economists share a lot in common. All of them advocate for more progressive policies, dismiss worries about the deficit, and share inspiration from the same economist (John Maynard Keynes). Where does all of this hatred and disagreement come from?

First, I want to highlight the following essays that mention the best critiques of the MMT framework. These represent legitimate problems with MMT that need to be addressed.

Monetary sovereignty is a spectrum: modern monetary theory and developing countries:
- This essay argues that MMT is not very applicable to most developing countries. There are a lot of conditions that have to be met to be a completely monetary sovereign nation. Developing and Emerging Countries (DECs) are limited in their monetary sovereignty due to lower economic development. DECs have to borrow in foreign currency because they import food, energy, and industrial goods from countries that may not accept their currency. This is why some MMT scholars have noted that it is important to be food and energy-independent. But this is much easier said than done, especially with the new issues that come with climate change (which will hit DECs the hardest). If monetary sovereignty is a spectrum, then many DECs are at the bottom, facing binding external constraints on policy.

Are modern monetary theory lies "plausible lies"? - by David Colander:
- This essay deals with the issues of how MMT is being perceived in the public space. David Colander argues that many individuals interpret MMT to mean that governments can spend an unlimited amount whenever they want (MMT doesn't say this, but many people think it does). David believes MMT advocates are at fault for this apparent disconnect in understanding and argues that MMT advocates should focus much more of their efforts on explaining the resource constraint.

Money's relation to debt: some problems with MMT's conception of money by Tony Lawson:
- MMT says that money gets its value from a tax obligation, but Lawson argues that large social acceptance is what truly gives it value. I don't think Lawson is correct, but I do believe large social acceptance gives it more value. I believe a tax obligation is the greatest contributor and is necessary, but may not be sufficient.

Modern Monetary Theory: is there any value? by Malcolm Sawyer:
- Sawyer criticizes the Federal Job Guarantee (FJG) program that many MMT advocates argue for. This is the best critique of the FJG I have read. He argues that socially valuable jobs should be long-term and not transitory as MMT says. He also argues that FJG employment may be preferable to private-sector employment which would mean people may stay in the program long term. Lastly, he argues that it would be difficult to match workers to a specific job that is relevant to their training. All of these criticisms address the fact the MMT hopes for an FJG in order to measure whether we are at full employment. However, all of the arguments stated above make the FJG a lousy measurement.

These valid criticisms do NOT indicate that MMT is worthless. MMT has detailed the workings of how the FED operates better than any existing framework (These details are desperately needed in macroeconomic textbooks! I would have done so much better in my college classes had this been the case!). Also, MMT economists should be applauded for their ability to do what many mainstream Keynesian economists failed to do: simply explain why there is much more spending capacity for governments of modern industrial economies.

This leads me to the best paper in the book!

MMT and TINA by Louis-Philippe Rochon:
- Philippe Rochon says that MMT has been the first successful attempt at countering TINA economics. TINA is short for "There is no alternative" which was used by the conservative prime minister Margaret Thatcher. This phrase signified that fully free-market economics is the only system that works. TINA since then has been used to justify fiscal austerity, the shrinking of the welfare state, and the lack of union representation. Keynesian economists disagreed, but have struggled to align the public with their views. This struggle was more to do with a lack of simplistic arguments that the public could understand rather than a lack of economic evidence. However, MMT's framework has done what mainstream Keynesians have dreamed of doing, and now it's stealing some of their light! This explains the heated debates! Both MMT and mainstream Keynesian economists want credit for eliminating the TINA doctrine.

But this is not how it should be. Philippe Rochon says that " the strong/negative post-Keynesian critique will only reveal internal strive, and contribute in the same way as the mainstream critiques do, to undermine and discredit MMT....especially since there is a real potential in convincing some mainstream scholars of the credibility of MMT ideas..to wish for the downfall of MMT is also to wich for the downfall of post-Keynesian economics."

MMT has best explained how modern governments spend but it has legitimate shortfalls in their theory, but mainstream Keynesian economists shouldn't contribute to MMTs demise. Economists like Paul Krugman, Jason Furman, and Larry Summers should acknowledge MMT's significant contributions to macroeconomic thinking, and fill in the important gaps that MMT gets wrong to maintain the legitimacy of a great school of thought - Keynesian economics.

[Theodore Wright · Rating 4 out of 5]

I enjoyed it more than Kelton's book, and realistically either could be used as an introduction assuming the reader is acquainted with at least basic surface level terminology. But I would still recommend Kelton's version for a beginner, since this book is more formal in some areas with increased jargon.

[Steven H · Rating 5 out of 5]

A COLLECTION OF ESSAYS FAVORING MODERN MONETARY THEORY (MMT)

Editors Edward Fullbrook and Jamie Morgan wrote in the Introduction to this 2020 book, “According to its proponents, modern… monetary theory (MMT) is a new distinctive theory and policy position… MMT started to attract attention in the 1990s… However, in the wake of the decade of fiscal austerity following that Global Financial Crisis, and the apparent exhaustion of standard monetary policy strategies and the ever-increasing income disparity, interest in MMT has grown beyond academia… MMT proponents tend to focus on situations where a country has a SOVEREIGN CURRENCY… The government … dictates a money of account and denominates its currency in it and issues that currency… From the point of view of MMT, the corollary organization of the state framework creates a set of highly significant capacities and consequences: unlike a household the state CANNOT RUN OUT of money… it does not, therefore, face a ‘budget constraint’… It is the scale and characteristics of the economy, the efficacy of government and the institutional specificities of the state and its statutes, but NOT the capacity to finance, which, says MMT, dictates its current limits.” (Pg. 3-5)

In the opening essay, L. Randall Wray explains, “MMT argues that the financial situation facing a National government with a sovereign currency … is entirely different from that faced by a household, a firm, or a government that does not issue a sovereign currency. The sovereign currency issuer: *does not face a ‘budget constraint’… *cannot ‘run out of money’; *can always meet its obligations by paying in its own currency; *can set the interest rate on any obligations it issues.” (Pg. 10-11)

He continues, “MMT has always recognized that ‘too much spending’ or spending that is poorly targeted can cause inflation… There are no magic ratios that indicate that government spending is excessive. The correct measure I the magnitude of additional spending measured against the supply of idle resources that will be mobilized by the spending…. Fortunately… modern economies usually operate with sufficient slack that even large boosts to aggregate demand are not likely to put much pressure on wages and prices. Our critics continue to fight an inflation battle that was won almost two generations ago. When we say this, it is not because we ignore potential inflation but rather because we observe substantial slack is the normal situation.” (Pg. 13)

He states, “it is the current account deficit of the US (i.e. US surplus spending flowing to the rest of the world) that leads to dollar claims on the US, including claims on the US government---the safest assets in the world. This is not because the US needs to borrow dollars from abroad but rather because foreigners accumulate dollars as the stock of net wealth produced by net US spending abroad increases. If you’ve been worried that Uncle Sam has to get dollars from China to finance his spending, you can breathe a sigh of relief.” (Pg. 35)

Phil Armstrong says, “MMT… provides the key insight that the government must spend (or lend) BEFORE it can tax (or borrow). Taxes do NOT fund spending in a functional sense… MMT recognizes that although a government with its own sovereign currency under floating exchange rates faces no financial or revenue constraints it does face real resource constraints. MMT contends that it is access to real resources that determines—or limits---what the state is able to provide for its citizens.” (Pg. 68)

Bruno Bonizzi, Annina Kaltenbrunner and Jo Michell explain, “The prominence achieved by modern monetary theory (MMT) is remarkable for a set of ideas originating with heterodox economics scholars. This success is arguably due to a particular confluence: the growing realization that monetary policy in isolation cannot stabilize the economic system has provided an audience for ideas which have been promoted effectively through the use of blogs and social media.” (Pg. 97)

David Colander states, “MMT tells us that institutional trust is important, and it seems reasonable that some such restrictions are integrated into the monetary accounting system that MMT’s credit theories of money highlight. They are not rules that follow from economic theory; rather, they are rules that evolved to govern the competition of competing political interests. Those rules seem limiting to those in power. But, by accepting limits on their spending when they are in power, the tradeoff is that they get limits on the other side when they are out of power.” (Pg. 149)

Marc Lavoie observes, “Famous mainstream authors have argued that MMT-based policies would be a recipe for disaster or would pose a great danger to the economy, their opinion being based either on a misunderstanding of MMT or on they oversimplified version… on the web… Bankers and financial advisors sometimes provide a more nuanced opinion… as they felt the MMT story allowed them to understand what otherwise seemed like puzzling evolutions of the financial sector. Central bankers, to keep their respectability, tended to take the line of mainstream economists…” (Pg. 213)

He continues, “Through hard work and perseverant interventions, a small number of MMT authors have managed to attract the attention of social media, mainstream media, as well as that of politicians… they have been persistent in arguing that the main constrain on government expenditure, is not a financial one, and that, at least under certain conditions, there can be no default by a central government, thus providing additional legitimacy for expansionary fiscal policies… additional government expenditure, which, had been put on the backburner soon after the 2008 financial crisis.” (Pg. 228)

Anne Mayhew argues, “the MMT treatment of the government sector is seriously inadequate. The first, and most serious, reason for this has to do with the almost total absence of any discussion of the actual processes whereby federal government decisions to spend or to tax are made. That is, there is an almost total lack or attention to fiscal policy formation and to the political context in which such policy is formed… MMT advocates have proposed a Job Guarantee program and … a Green New Deal… But, to date, most of the MMT analysis has focused on the affordability of such programs rather than on the complexities of getting such programs adopted in the federalist system of the U.S.” (Pg. 289-290)

Alan Shipman concludes, “Although they are now often conflated… MMT remains a separate enterprise from the modern monetary theory to which its ideas and acronym now stretch. MMT remains a theory of what constitutes money, and how it is distinguished from such related terms as capital, currency and cash… It also highlights the difference between money-of-account and its representation as currency in circulation, whose importance will grow as corporations and governments begin seriously to consider replacing a decentralized money with one that returns transactions to a central viewable record… a government that determines the status of money can in principle create its own, just by crediting additional sums to itself… It has strengthened the challenge to the textbook economic warming that public deficits raise interest rates and ‘crowd out’ private investment, along with the idea that public investment or consumption are ‘unproductive.’” (Pg. 407-408)

This book will be of great interest to those studying MMT.

[Harry · Rating 5 out of 5]

Having never formally studied economics I had to read around a lot of the topics mentioned, so this book served as much to point me to other important aspects of economics to understand as to come to a conclusion on MMT. But it was very useful to hear arguments immediately followed by counter arguments in order to help build my own opinion.

[Alan · Rating 3 out of 5]

Comments here on Goodreads describe the ideas and contents of this book quite well. No need to rehash them here.
I've been a student of MMT for about a decade and found this book a useful if often dense and occasionally irritating addition to the discussions, of which there are many on the Internet.
I will say, though, the book is so very timely. The pandemic is shaking the economy and forcing a re-think about how it works, doesn't work, and ought to work.
And I will also suggest a few fundamental truths that are typically ignored by economists as they argue about MMT:
1. Going off the gold standard ("The U.S. came off the gold standard for domestic transactions in 1933 and ended international convertibility of the dollar to gold in 1971," says the Federal Reserve Bank of St. Louis) changed everything. And I would add the world economy is far too big now to be anchored to an insufficient supply of gold. There is no going back, nor should there be. There would be an international money shortage of disastrous scale.
2. The advent and refinement of credit cards [https://www.creditcards.com/credit-ca...] amplified and simplified the power of banks and consumers to create money, a power they and the federal government already had in a more convoluted way
3. Add the big one: the Internet and invention of digital money and digital banking. POW--you've got Modern Money Reality, not Theory.
These are the realities that bring us to a recognition that the United States of American can default on its debts only by a political decision to do so. It could pay every debt this afternoon with a keystroke on a computer.
The Debt Ceiling is a goofy artifact in the minds of those who haven't caught up to the reality that the money system isn't what it used to be.
The new money system isn't up for debate as to whether it should be adopted or not. It's already here.
How should it be used for the public good?
That is the question.

[Snorki · Rating 3 out of 5]

I recently read Stephanie Kelton's book about MMT, and found the ideas interesting, so thought perhaps it would be worth investigating the theory a bit further to understand some other points of view. This book is a collection of essays by different economists, with various perspectives - from the positive to the sceptical to the downright hostile. It is a bit dry and quite technical in places for a non-economist, and there is a lot of discussion about what money actually is - not really a question that I'd thought much about before! So moderately interesting in places, a bit of a slog in other places and rather too much theory-about-money stuff for me. I appreciate as an economist, this is all interesting stuff and makes sense, but not super-interesting for a layperson.

[Fred · Rating 2 out of 5]

When our government started spending trillions of dollars like it was Monopoly money, I wondered if they knew something about economics that I didn't. I read this book hoping for a deep dive into Modern Monetary Theory, what seemed like a too-good-to-be-true idea.

This book is a collection of essays illustrating how full of crap economists are. Most chapters quibble with the finer points of MMT, and some go on for pages without saying anything. No one comes out and declares the obvious - that MMT is an egghead rationalization for politicians destroying the economy to buy votes.

[Carter · Rating 3 out of 5]

This book, consists of essays, which lack a certain sophistication when it comes to economics; though Keynes work, which predominates, macroeconomic analysis, when it comes to public policy, is mentioned. The criticism, itself, raises some interesting issues, and perhaps a conundrum- by highlighting and criticising issue, you lend credibility to it. The dismissals, are however, indicative, that MMT, is not a theoretical position at all.

[Depatnaude · Rating 5 out of 5]

I've been a student of economics my entire life (well, since college anyway) and I have continued to self-teach myself about how macro and microeconomics work. If you are looking for an alternative view to traditional teachings of macroeconomics and want to get an understanding of MMT, this is a great gathering of various writings. My approach to this book was to keep my mind open and it has turned my understanding of the Fed, taxes, and our "dreaded" national debt on its head!

[Daniel L. Hiatt · Rating 4 out of 5]

Clear and understandable

Overall, the book was a clear representation of MMT and opposing views. I will keep it for reference as MMT becomes a more popular topic in the political arena.

[Richard Marney · Rating 4 out of 5]

Useful coverage of the debate!!!

[Steve Bottorff · Rating 5 out of 5]

A refreshing new look at economics and money. A must-read for political junkies.