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> Mmt has the best description of how fiat money works. Are you sure about that? As far as I know, MMT is considered an "unorthodox" theory (i.e. crackpot the

by lottin 5y ago

> Mmt has the best description of how fiat money works. Are you sure about that? As far as I know, MMT is considered an "unorthodox" theory (i.e. crackpot theory) by mainstream economists. https://en.wikipedia.org/wiki/Heterodox_economics https://en.wikipedia.org/wiki/Heterodox_economics

dalbasal 5y ago
It's certainly got some animated detractors. Notice though, that a lot of "orthodox" economsists tend to accuse mmt of being both crackpot and trivial. The trivial shot implies that it's trivially derrivate of Keynes. I'm not sure where mmt begins and ends. Currently, a lot of mmt is associated with guaranteed jobs ideas. I don't like that policy idea at all. That's why I caveat with "mmt's description of fiat money." Their description of central banking is far superior to monetarism and other "orthodox" theories of the past few decades. It's simpler, less abstract, more universal and more parsimonious with major, observable reality in more places. By comparison, all neokeynesian models if central banking are cludgey minstrosisies.
chrisco255 5y ago
I suspect that MMT is correct on a theoretical level, but on a pragmatic level, it's unenforceable and ignores certain realities, such as the fact that inflation is not evenly distributed yet tax rates are (across income levels). I also think that it does dangerously absolve policymakers of responsible deficit management under the banner of "deficits don't matter". It encourages a sort of drunken disregard for expenditures, with little attention paid to productivity of capital expenditures. But it is not a crackpot theory among central bankers.
- dalbasal 5y ago
  Mmt's core doesn't have anything to enforce. It's a description, not a prescription. I agree that it's tangential to a lot of half baked ideas. So now, with inflation... Mmt explains why it is happening now, but didn't happen (eg) following the 2008 bailouts.

by lottin 5y ago

dalbasal 5y ago

It's certainly got some animated detractors. Notice though, that a lot of "orthodox" economsists tend to accuse mmt of being both crackpot and trivial. The trivial shot implies that it's trivially derrivate of Keynes. I'm not sure where mmt begins and ends. Currently, a lot of mmt is associated with guaranteed jobs ideas. I don't like that policy idea at all. That's why I caveat with "mmt's description of fiat money." Their description of central banking is far superior to monetarism and other "orthodox" theories of the past few decades. It's simpler, less abstract, more universal and more parsimonious with major, observable reality in more places. By comparison, all neokeynesian models if central banking are cludgey minstrosisies.

chrisco255 5y ago

I suspect that MMT is correct on a theoretical level, but on a pragmatic level, it's unenforceable and ignores certain realities, such as the fact that inflation is not evenly distributed yet tax rates are (across income levels). I also think that it does dangerously absolve policymakers of responsible deficit management under the banner of "deficits don't matter". It encourages a sort of drunken disregard for expenditures, with little attention paid to productivity of capital expenditures. But it is not a crackpot theory among central bankers.

dalbasal 5y ago
Mmt's core doesn't have anything to enforce. It's a description, not a prescription. I agree that it's tangential to a lot of half baked ideas. So now, with inflation... Mmt explains why it is happening now, but didn't happen (eg) following the 2008 bailouts.