4 ms·

The comments on The Famous Article are interesting, capturing the spectrum from "Spot on!" to "MMT is bollocks." I fall into the latter camp. I think the tidal

The comments on The Famous Article are interesting, capturing the spectrum from "Spot on!" to "MMT is bollocks." I fall into the latter camp. I think the tidal musical chairs is going to halt the sound, see the tide gonout, and expose copious corpulent cabooses in the buff.

AnimalMuppet 3y ago
Even Krugman says that MMT is bollocks. You can decide whether that makes you believe it less, or more ;-)
- dragonwriter 3y ago
  > Even Krugman says that MMT is bollocks. Krugman seems to be fully in line with the policy positions typically associated with policy advocates associated with MMT, his disagreement with MMT is that given the theory's position (he has shifted over time between characterizing this as an apparent and a clear position) on the limitations of traditional monetary, a strict application of MMT would actually come to a more conservative policy recommendation on government fiscal policy because MMT denies (or seems to deny) that traditional monetary policy can backstop fiscal policy if the monetary effects of such policy aren't what is intended. He agrees with MMT (both theorists and most of the MMT-influenced policy activists) that the only real constraints on fiscal policy are monetary effects (the positions most MMT critics take issue with), but disagrees with (what he sees as the position of) MMT theorists on traditional monetary policy being ineffective at its monetary goals. I'm not familiar with the source work in MMT to know if the position he takes issue with is actually the position of MMT theorists, but I'm familiar enough with the less academic policy advocates associated with the MMT movement that I've always considered their advocacy to be in line with orthodox Keynesianism more than even most policy advocates who rhetorically are Keynesian, because the latter tend to -- despite embracing the positions which clearly make it out to be a false constraint -- adhere rather strongly to the preference that the government play-act as if the finite public purse (the "fisc") were a real thing outside of the domain of monetary policy, though they'll embrace things like countercyclical deficits, whereas MMT-influenced advocates tend to embrace that a fiat currency budget doesn't have a fisc and is constrained only by the monetary effects of the money it creates by spending and destroys by taxing. But these MMT-influenced advocates don't generally advocate around the view of the uselessness of traditional monetary policy as currently entrusted to the Fed that Krugman takes issue with; they tend to prefer using traditional fiscal policy within its monetary constraints more actively for the purposes of traditional monetary policy because its easier to fine-tune the distributional impacts within the aggregate target, not because the Fed controlling rates doesn't work for macro-level monetary functions. So, in a sense, academic MMT may be a different thing that policy-world MMT, with the latter being mostly Keynsianism without fiscal policy cosplaying a commodity money constraint in a fiat money system.
  - btreecat 3y ago
    As someone "indoctrinated" with capitalism, your take on modern/policy MMT which is more of a blend than the older academic visions aligns with my understanding and advocacy.
  - smitty1e 3y ago
    > So, in a sense, academic MMT may be a different thing that policy-world MMT, with the latter being mostly Keynsianism without fiscal policy cosplaying a commodity money constraint in a fiat money system. Herb Sutter: "The difference between theory and practice is greater in practice than in theory."

AnimalMuppet 3y ago

Even Krugman says that MMT is bollocks. You can decide whether that makes you believe it less, or more ;-)

dragonwriter 3y ago
> Even Krugman says that MMT is bollocks. Krugman seems to be fully in line with the policy positions typically associated with policy advocates associated with MMT, his disagreement with MMT is that given the theory's position (he has shifted over time between characterizing this as an apparent and a clear position) on the limitations of traditional monetary, a strict application of MMT would actually come to a more conservative policy recommendation on government fiscal policy because MMT denies (or seems to deny) that traditional monetary policy can backstop fiscal policy if the monetary effects of such policy aren't what is intended. He agrees with MMT (both theorists and most of the MMT-influenced policy activists) that the only real constraints on fiscal policy are monetary effects (the positions most MMT critics take issue with), but disagrees with (what he sees as the position of) MMT theorists on traditional monetary policy being ineffective at its monetary goals. I'm not familiar with the source work in MMT to know if the position he takes issue with is actually the position of MMT theorists, but I'm familiar enough with the less academic policy advocates associated with the MMT movement that I've always considered their advocacy to be in line with orthodox Keynesianism more than even most policy advocates who rhetorically are Keynesian, because the latter tend to -- despite embracing the positions which clearly make it out to be a false constraint -- adhere rather strongly to the preference that the government play-act as if the finite public purse (the "fisc") were a real thing outside of the domain of monetary policy, though they'll embrace things like countercyclical deficits, whereas MMT-influenced advocates tend to embrace that a fiat currency budget doesn't have a fisc and is constrained only by the monetary effects of the money it creates by spending and destroys by taxing. But these MMT-influenced advocates don't generally advocate around the view of the uselessness of traditional monetary policy as currently entrusted to the Fed that Krugman takes issue with; they tend to prefer using traditional fiscal policy within its monetary constraints more actively for the purposes of traditional monetary policy because its easier to fine-tune the distributional impacts within the aggregate target, not because the Fed controlling rates doesn't work for macro-level monetary functions. So, in a sense, academic MMT may be a different thing that policy-world MMT, with the latter being mostly Keynsianism without fiscal policy cosplaying a commodity money constraint in a fiat money system.
- btreecat 3y ago
  As someone "indoctrinated" with capitalism, your take on modern/policy MMT which is more of a blend than the older academic visions aligns with my understanding and advocacy.
- smitty1e 3y ago
  > So, in a sense, academic MMT may be a different thing that policy-world MMT, with the latter being mostly Keynsianism without fiscal policy cosplaying a commodity money constraint in a fiat money system. Herb Sutter: "The difference between theory and practice is greater in practice than in theory."