{"id":11432,"date":"2015-01-12T13:54:55","date_gmt":"2015-01-12T18:54:55","guid":{"rendered":"http:\/\/multiplier-effect.org\/?p=11432"},"modified":"2015-01-12T14:39:12","modified_gmt":"2015-01-12T19:39:12","slug":"oh-me-oh-my-mmt-is-about","status":"publish","type":"post","link":"https:\/\/blogs.bard.edu\/multiplier-effect\/oh-me-oh-my-mmt-is-about\/","title":{"rendered":"Oh Me Oh My! MMT Is About!"},"content":{"rendered":"
\n

Here\u2019s an unintentionally hilarious piece<\/a> by Tim Worstall at Forbes. Watch out, he warns, MMT has come<\/a> to Washington! Our nation\u2019s capital! No doubt ruin and wastage will follow.<\/p>\n

Why? Well. Nothing wrong with the theory of Modern Money Theory, he admits.<\/p>\n

\u201cIt\u2019s not actually that I disagree very much with the economics that is being laid out in MMT: indeed, I\u2019m terribly tempted to agree that they\u2019re actually correct in much of what they say.\u201d<\/p><\/blockquote>\n

He admits that MMT is right on budgets:<\/p>\n

\u201cIt\u2019s most certainly not obvious that MMT proponents are all barking mad or anything. Jamie Galbraith (who I\u2019ve had one or two very limited interactions with) is certainly a reasonable guy. And his insistence that a budget surplus, despite the ribbing he gets about it, is in fact economically contractionary doesn\u2019t seem to have anything wrong with it. Budget deficits are fiscally expansive, a surplus is fiscally contractionary, if there\u2019s any one statement at the heart of Keynesianism that\u2019s it.\u201d<\/p><\/blockquote>\n

And it is right on money:<\/p>\n

\u201cAnd their basic outline about money creation is true as far as I can see. If you\u2019re a country with your own central bank you can print as much money as you like.\u201d<\/p><\/blockquote>\n

And really nothing wrong with the policy, either. No, it is all politics.<\/p>\n

What he\u2019s afraid of is that if politicians understood that they cannot run out of money, they\u2019d spend like they cannot run out of money. And off we\u2019d go to Weimar and Zimbabwe land.<\/p>\n

It is the same line that Paul Samuelson took, when he argued<\/a> that the job of an economist is to lie. Or, better, to preach the old time religion and superstition. Put real fear into the politicians and the voters they represent.<\/p>\n

Government is just like a household, you know. Careful, Gov, you\u2019ll run out of money. You\u2019ll have to go hat-in-hand to Bond Vigilantes when you run out. Uncle Sam will have to go to the Salvation Army for a cup of soup.<\/p>\n

It is the same old fear mongering by someone who does not trust the democratic process and does not understand budgeting.<\/p>\n

The way we ensure that policymakers don\u2019t run up the spending to create hyperinflation is by subjecting them to the budgeting process, and then holding the administrative branch to approved budgets. It isn\u2019t religion, superstition, or fear mongering that forestalls accelerating inflation. It is accountability.<\/p>\n

And where-O-where do our blogging pundits get the idea that all politicians always and everywhere are pushing for hyperinflation? I see exactly the opposite.<\/p>\n

(cross-posted from EconoMonitor<\/a><\/em>)<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Here\u2019s an unintentionally hilarious piece by Tim Worstall at Forbes. Watch out, he warns, MMT has come to Washington! Our nation\u2019s capital! No doubt ruin and wastage will follow. Why? Well. Nothing wrong with the theory of Modern Money Theory, he admits. \u201cIt\u2019s not actually that I disagree very much with the economics that is […]<\/p>\n","protected":false},"author":208,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[112],"tags":[543,862,151,1135,142],"class_list":["post-11432","post","type-post","status-publish","format-standard","hentry","category-modern-monetary-theory","tag-budget","tag-hyperinflation","tag-mmt","tag-modern-monetary-theory","tag-taxes"],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/posts\/11432","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/users\/208"}],"replies":[{"embeddable":true,"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/comments?post=11432"}],"version-history":[{"count":6,"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/posts\/11432\/revisions"}],"predecessor-version":[{"id":11438,"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/posts\/11432\/revisions\/11438"}],"wp:attachment":[{"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/media?parent=11432"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/categories?post=11432"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blogs.bard.edu\/multiplier-effect\/wp-json\/wp\/v2\/tags?post=11432"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}