Time again to (lovingly) complicate MMT 101 to make MMT the best it can be. This time, we're talking about the distinction between the federal government as a currency issuer in contrast to sub-federal governments as mere users, which allegedly only recycle scarce funds. 1/x
As I & others have pointed out elsewhere (see the "Uni,"eg), MMT's post-Keynesian theory of endogenous money requires us to let go of all models grounded in physics, which means logics of "re-distribution" hold absolutely nowhere, including at sub-federal levels. 2/x
With this in mind, we can appeal to Hockett & Omarova's "finance franchise" argument to give to shed better light on what is actually going on at the sub-federal level from a deep MMT perspective. 3/x
In truth, sub-federal governments are not at all passive "users" or "recyclers." Instead, they're active legal participants in the federal taxation process, doing important & necessary work of ensuring a currency's ongoing receivability across regional & local levels. 4/x
In this way, sub-federal municipalities can be said to be "franchisees" of federal taxing power. Yes, the federal government taxes directly. But sub-federal government do so as a function of their dependence upon the federal level. 5/x
The problem is that we have tragically split money's full tax-issuance circuit into two seemingly unconnected institutions and streams. 6/x
Whereas private financial institutions like banks are licensed to actively issue credit on behalf of the federal government at the municipal level as needed, sub-federal governments themselves are charge primarily with taxation & yet restricted in their issuance powers. 7/x
We pretend these are two separate entities with their own natural powers & limits. But this is false. Both participate in the same broad tax-issuance circuit. 8/x
In separating these institutions & naturalizing their alleged functions, we reify private over public power & concede local credit creation to capitalists. 9/x
To politicize & transform local credit creation, then, we must move beyond the MMT 101 language of issuers & users. We need to vocally challenge how the tax-issuance circuit has been structured. 10/x

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More from @videotroph

3 Feb
This critical response to @dlondonnyu's recent @DissentMag article not only mischaracterizes MMT. It also reifies the deep orthodox assumptions MMT exposes to be at once epistemologically nonsensical & politically reactionary. 1/

Bottom line: MMT rejects any approach to political economy that begins with a self-subsisting market where finite values must be recycled by private & public actors. It also rejects the notion that "money printing" is an exceptional & always-potentially inflationary excess. 2/
From an MMT perspective, such assumptions are flatly false. Money is routinely "printed" from nothing all the live long day. This occurs through federal appropriation & legally charted financial institutions. Money creation, then, is nothing like an exception; it's the rule. 3/
Read 15 tweets
21 Nov 20
In this ep of @thedigradio, Wendy Brown & Dan Denvir insist that the left needs to confront the "age-old question of socialism": How can we radically empower people through the state, when the state itself must rely on exploitative capitalist growth? 1/x

The unquestioned assumptions here are: 1) Private capital is/can be the only agent of production, 2) the capitalist mode of production is the sole source of extant value, & 3) the left today can only ever hope to redistribute extant value in the form of progressive taxation. 2/x
This framing is false. It undermines all left projects. And it also reveals the bankruptcy of most left accounts of political power. 3/x
Read 19 tweets
6 Nov 20
I wish someone would hook you up with some good eats while I explain that this folk theory of MMT is incorrect. It is a common mistake to presume MMT only applies to the U.S. due to its military-backed dollar hegemony. 1/x
MMT's argument is that money is not & has never emerged from private barter-like exchanges. Money is, rather, a creature of governance & law, understood in a very broad sense that includes e.g. Incan "knot" accounting as well as the medieval Church's taxation & banking. 2/x
Money on MMT's analysis, then, is a credit/debt instrument that is widely receivable & can be used to settle public debts first, private second. In the nomenclature, we say "taxes drive money" or "money is a tax credit." 3/x
Read 18 tweets
18 Jul 20
I had a great time yesterday participating in the Manchester Summer Academy on Law, Money & Technology: Transforming Political Economy. I typed out my own short remarks summarizing my research & 2018 book.

Here they are in 25 tweets: 1/25
Over the last several years, I've sought to rethink the critical theory and aesthetics inaugurated by the Frankfurt School and carried on in diverse ways by many others by re-grounding this project in the public money approach developed by Modern Monetary Theory (or MMT). 2/x
Historically, critical theory has upheld various versions of the Marxist ontology of money. 3/x
Read 26 tweets
1 Jan 20

One of the amazing things about this moment is witnessing several self-avowed leftists such as Doug Henwood explicitly defend and lean further into the reactionary logics of sound finance against Modern Monetary Theory. 1/9

As @NMarxism has been pointing out, this gesture is taken to a new self-flagellating extreme in the above piece by @meadwaj, former economic advisor to @UKLabour's Shadow Chancellor @johnmcdonnellMP. 2/9
In opposition to "plenty of 'Keynesians' out there" (read "MMT"), Meadway claims that Labour must frame their message to voters in zero-sum and tightly-costed terms in order to win future elections. 3/9
Read 9 tweets
20 Oct 19
THREAD on #decolonialMMT:

Vital for any decolonial MMT/Green New Deal project will be to problematize entrenched binary oppositions between modern Western and indigenous peoples, particularly concerning money and various contrasting modes of governance. 1/x
Of course, we must both critique & resist the modern West's instrumental rationality & systemic exploitation of social & ecological relations. 2/x
When it comes to the social & ecological ontologies that ground such contestation, however, we cannot take the modern West's word for it, as if what it says about its own modern monetary societies actually coincides with how modern money is structured, what it does & can do. 3/x
Read 16 tweets

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