By Rohan Grey
[Part I] [Part II] [Part III] [Part IV] [Part V]
“Don’t be confused by surfaces; in the depths everything becomes law.”
– Rainer Maria Rilke
As noted at the end of the previous section, I found the debate engaging but ultimately frustrating, as Murphy’s critique of the coercive nature of our modern monetary system, while morally seductive, begged the question: “Ok, but what is your alternative?”
Posted in Guest Blogger
Tagged austrian economics, debate, MMT, Modern Monetary Theory, rohan grey
Marshall Auerback interviews Warren Mosler for the Institute for New Economic Thinking.
Posted in Marshall Auerback, warren mosler
Tagged Great Financial Crisis, MMT, warren mosler
By Rohan Grey
[Part I] [Part II] [Part III] [Part IV] [Part V]
As mentioned at the end of the preceding section, Murphy’s major outstanding critique of the MMT analysis was that it presumed the existence of a state with a currency monopoly by virtue of its taxation power – or, as Murphy’s described it, MMT was “in favor of robbing liquor stores” in order to ensure a demand for its currency. In my opinion, this critique was underdeveloped, since it did not articulate why the problems identified were worse than the problems of any other feasible system.
Posted in Guest Blogger
Tagged austrian economics, debate, MMT, Modern Monetary Theory, rohan grey
By Rohan Grey
[Part I] [Part II] [Part III] [Part IV] [Part V]
As will be clear to anyone who watches the entire thing, there was very little clash by the end of the debate on the operational mechanics of the modern monetary system:
Murphy: In particular, what makes the Austrians different from other schools of thought, even other nominally free market schools like the Chicago economists – Milton Friedman, guys like that – the Austrians have a very particular view of what interest rates do.
So the Austrians say “look, the interest rate is a price, and in that respect it is like any other price – it communicates information about the real world. It’s not an arbitrary number – it really means something – and if the market interest rate is supposed to be 7 percent and the Federal Reserve makes it 0.25 percent, that’s going to screw things up.
Posted in Guest Blogger
Tagged austrian economics, debate, MMT, Modern Monetary Theory, rohan grey
By Rohan Grey
[Part I] [Part II] [Part III] [Part IV] [Part V]
[If you are interested only in the substantive analysis of the debate, skip directly to Part II]
On July 4th, the New York Times published a profile written by economics journalist Annie Lowry on former hedge fund manager and maverick economic theorist Warren Mosler. The school of thought Mosler subscribes to, known as “Modern Monetary Theory” or “MMT,” has been covered by a number of journalists (see, e.g. here, here, here, and here). MMT purports to combine insights from a range of historical monetary theorists with an understanding of contemporary monetary operations to construct a progressive meme for money that drastically differs from most standard economics textbooks.
Posted in Guest Blogger
Tagged austrian economics, debate, MMT, Modern Monetary Theory, rohan grey
One of the most important parts of the collective effort to spread the good news about the Modern Money Theory approach to macroeconomics is popularization of MMT views. We need short simply-stated cultural artifacts that tell people what MMT has to say and what some of its policy implications are for fiscal policy that can deliver a greater measure of economic and social justice to people.
Three months ago, Frank Newman sent me a book entitled Freedom From National Debt. I finally got around to reading it — all 89 pages. It’s a little book, packed with evidence that America is being held back by incorrect assumptions and misguided fears about the national debt and government finance in general. Here’s the takeaway:
I presume Alex Little put this together after reading the NY Times piece on Warren Mosler and MMT in which I was (mis)quoted as saying that MMT has no footprint in the academic press. It’s not an exhaustive list, but you’ll be exhausted by the time you reach the end.
Follow: twitter.com/deficitowl
Economists of nearly every flavor believe in the concept of “revealed preferences.” What matters is not what people say they will do in a hypothetical situation, but what they actually do. Their actions speak more credibly than their words. In this column I announce a related concept: “revealed biases.”
Posted in William K. Black
Tagged Control Fraud, krugman, Lowrey, MMT, Modern Monetary Theory, Thoma
The blogosphere and Twittersphere are buzzing over today’s NYT article on Warren Mosler and the proponents of Modern Money (or Monetary) Theory (MMT). This isn’t the first time MMT has been featured by a high-profile mainstream media outlet (see here, here, here) and, as usual, there are some editorial inaccuracies.
Warren has responded to the mistakes that affect him personally, and Randy Wray followed with some quick thoughts of his own. I spent close to 30 minutes on the phone with the journalist who wrote the latest NYT piece, so let me offer a further correction of (and for) the record. I was quoted as saying:
These ideas definitely aren’t disseminated through published academic journals. It’s all on the Internet.
Um, no. What I said is that we — the academics who helped develop the literature on MMT — started blogging as a way to get our ideas out more quickly than through traditional channels, where it is customary to wait two years or more before an article is finally published. The notion that MMT has no academic footprint is astonishingly inaccurate, for there are, quite literally, hundreds of publications including: peer-reviewed articles, books, chapters in edited volumes, encyclopedia entries, working papers, policy briefs, etc. in print. Suggesting otherwise supports the general tenor of the NYT piece — i.e. MMT is an Internet phenomenon that hasn’t been vetted through traditional peer-reviewed channels. That is patently false.
Has the Internet helped to generate a following? I’d say so.
And it seems to ruffle a lot of feathers.
Follow: twitter.com/deficitowl
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