Thanks to “The Deficit Myth” hitting the NYT bestseller list, MMT is back on the Twitter menu. I’m going outside to write, but I just want to comment on what I’m seeing here.
If we look at tweets, we can split the MMT critics between “serious critics” and “trolls.” I follow a lot of the “serious critics,” but what I mainly see are “trolls” who get dragged into my timeline. My suggestion is to not give trolls oxygen; create a “bad MMT takes” account.
As for the serious critics, it all revolves around the “nothing new” charge. After seeing that debate 1,000 times, I’m bored of it - as I imagine any bystanders on Twitter are.
The “something new” debate is an academic debate, and should only be of interest only to academics.
The “something new” debate is an academic debate, and should only be of interest only to academics.
The problem with the “is MMT debate?” is that most of the time, people are often talking about the Functional Finance parts of MMT. Functional Finance goes back to Lerner. For fiscal policy, the issue is more why was the mainstream consensus so wrong on Japan, etc.
The problem is that a particular mainstream economist can correctly say “I was not wrong on Japan/US being the next Greece/bond vigilantes/etc.”
So the question is really not whether MMT is “new,” rather why neoclassical theory allows for wildly incorrect predictions.
So the question is really not whether MMT is “new,” rather why neoclassical theory allows for wildly incorrect predictions.
The debate about novelty has to move away from discussions about Functional Finance. For example, the Job Guarantee. But the academic debate there is not about the policy (e.g., is it a good policy?), rather, the difference is in how the policy is analysed.
The discussion of the theory behind the JG might not be of interest to an activist. But for someone with an interest in economic theory (like myself, or macro investors), that is an interesting topic.
