After going deep into the weeds, I present here my summary of what MMT really is and isn't saying
Please separate MMT vs the polices that some MMT Proponents propose; these are 2 separate things.
MMT is really just a description of our current monetary system and cannot be argued against. However, what policies you decide to undertake after you acknowledge that it is an accurate description of the system, or whether our current monetary system is good, are things that up for debate.:
This is a thread i wrote on Twitter which is a bit more condensed:
Here is a more full summary:
Money can be fixed to something with a supply constraint, or it can be freely floating. The choice between these two creates markedly different outcomes in terms of the monetary system.
People typically think of money system that is tied to a commodity like gold.
In this case, governments can only spend money when they have FIRST COLLECT enough gold to back the money they issue. Printing more money simply creates increased claims on a limited supply of gold, thus inflating the price of gold denominated in the money the government is printing.
However, when money system is freely floating, governments do not need to collect anything first, because they are the CREATOR of money in the first place. Government doesn't need to take money from you (tax) in order to spend it, this is backwards
A subway does not first collect subway tokens from... (More)