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Appreciate @RobertJShiller engaging MMT here. If I may push back just a bit, I think the novelty is being understated. Prior to MMT, deficits were mainly justified (by Keynesians) as temporary, counter-cyclical measures to prime the economic pump. MMT goes beyond this. 1/6
MMT has not embraced capital budgeting, which seems mostly about making deficits appear smaller/more palatable. We're trying to advance public understanding. Instead of drawing parallels w/private business practices, we're advocating better public understanding of deficits. 2/6
What we want is a fundamental overhaul of the federal budgeting process itself. We don't want lawmakers relying on CBO scores based on the anticipated budgetary effects (deficits or debt ratio). 3/6
We want inflation risk formally integrated into the federal budgeting process and we want offsets (so-called “pay-fors”) to be chosen with an eye to mitigating inflation risk, not as “revenue raisers.” 4/6
One can imagine a tax that raises substantial revenue but mitigates little-to-no inflation risk. Relying on such a tax to "pay for," say, a massive roll out of Green New Deal infrastructure could be (highly) inflationary. 5/6
This is just one area where MMT goes beyond the conventional approach. There are many others, but we also share things in common with our Keynesian allies. 6//6 ☮️
