September 11, 2017

MMT: For the record

Comment on Ellis Winningham on ‘MMT and Politics: A Brief Explanation’


You say: “I dislike quibbling, but MMT is prefaced by an operational description of how monetary systems work, paying particular attention to the existing monetary system. This analysis reveals the policy space associated with policy choice regarding the monetary system and monetary operations.

MMT is based on this analysis of policy space.

Secondly, MMT is also a macroeconomic theory based on a specific method for approaching macroeconomics that differs from other methods owing to the operational analysis and other factors, such as attention to sectoral balances and stock-flow consistency.”

The fact is, the macroeconomic theory MMT policy proposals are based upon is false and has been refuted.#1 MMTers do NOT understand how the price- and-profit mechanism of the monetary economy works. For the general public, the essential points are
• MMT has NO sound scientific foundations,#2
• MMT’s sectoral balances equations are mathematically false,
• MMTers violate scientific standards on a daily basis,
• MMT is political agenda-pushing in a scientific bluff package,
• Because Public Deficit = Private Profit, MMT is money-making for the Oligarchy.

Egmont Kakarot-Handtke

#1 For the full-spectrum refutation of MMT see cross-references MMT
#2 For details of the big picture see cross-references Keynesianism

Related 'MMT: scientific incompetence or political fraud?' and 'What makes economics a failed science?' and 'Wikipedia and the promotion of economists’ idiotism (II)' and 'Solving Mill’s starting problem' and 'MMT ― the economics moron as problem solver' and 'The new macroeconomic paradigm' and 'MMT and the single most stupid physicist' and 'Down with idiocy!' and 'Stephanie Kelton on how to become fabulously wealthy' and 'MMT: The fusion of Wall Street and Academia' and 'The economist as useful political idiot' and 'There is NO such thing as “smart, honest, honorable economists”' and 'Bill Mitchell’s dishonorable discharge from the sciences' and 'The state of MMT? Stone-dead!'.

REPLY to MRW on Sep 11

(i) You doubt that “MMT’s sectoral balances equations are mathematically false.”
For the proof see Rectification of MMT macro accounting.

(ii) I said: “MMTers violate scientific standards on a daily basis”. You ask “What ‘scientific standards’ are those?”
• Scientific standards are well-defined: “Research is in fact a continuous discussion of the consistency of theories: formal consistency insofar as the discussion relates to the logical cohesion of what is asserted in joint theories; material consistency insofar as the agreement of observations with theories is concerned.” (Klant)
• MMT is axiomatically false, materially/formally inconsistent, and profit/income is ill-defined (see i).
• Because of material/formal inconsistency, MMT policy guidance has no sound scientific foundation.
REPLY to MRW on Sep 12

(i) The fact that you ask me what the scientific standards are, proves that you have NO idea of what science is. Let us fix this point first: you are a stupid and scientifically incompetent person.

(ii) The criterion of science is true/false with NOTHING in between. Truth, in turn, is well-defined by material and formal consistency. All this is known for 2300+ years: “When the premises are certain, true, and primary, and the conclusion formally follows from them, this is demonstration, and produces scientific knowledge of a thing.” (Aristotle)

(iii) Scientific knowledge takes the form of the true theory. All the rest of human communication is blather, storytelling, the-sun-goes-up common sense, wish-wash, and gossip, ALL of which can be refuted either as logically inconsistent or factually inconsistent or both.

(iv) MMT has been logically refuted, that is, the mathematical proof has been given that the MMT balances equations are false.#1 Because the formal foundations of MMT are false the WHOLE analytical superstructure is false. MMT is scientifically unacceptable.

(v) You maintain that economics is not a science. You are obviously NOT acquainted with the history of economic thought. Since Adam Smith/Karl Marx economics is explicitly defined as science. The general public is year after year reminded of this fact with the “Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel”.#2 And every economist learns in Econ 101: “Economics is the science which studies human behavior as a relationship between ends and scarce means which have alternative uses.” (Robbins)

(vi) Economics claims to be a science but is not. The four main approaches ― Walrasianism, Keynesianism, Marxianism, and Austrianism ― are mutually contradictory, axiomatically false, materially/formally inconsistent and all got the pivotal economic concept of profit wrong. MMT, too, is provably false and therefore scientifically worthless. Needless to emphasize that economists have come up with a virtually endless list of excuses for their manifest failure.#3

(vii) MMTers are in a state of incorrigible self-delusion/idiocy/corruption. They do not, to begin with, know what science is, or if they know, they ignore or even actively suppress refutation.#4

(viii) Because MMTers are substandard in all intellectual and ethical dimensions they have to be thrown out of science.

#1 For the full-spectrum refutation of MMT see cross-references MMT
#2 The real problem with the economics Nobel
#3 Failed economics: The losers’ long list of lame excuses
#4 Peter Cooper, Bill Mitchell, Dirk Ehnts, and other MMTers delete or block critique/ refutation from their blogs. From this tip of the iceberg, one can safely conclude that MMTers are definitively NOT committed to science. MMT is, like all political economics since Adam Smith, intentionally/unintentionally corrupting science, that is, undermining the integrity of the institution that is explicitly committed to provable truth.

REPLY to Tom Hickey on Sep 13

The social sciences in general and economics, in particular, is what Feynman called cargo cult science and he characterized it thus: “They’re doing everything right. The form is perfect. ... But it doesn’t work. ... So I call these things cargo cult science because they follow all the apparent precepts and forms of scientific investigation, but they’re missing something essential.”

What is missing is the true theory. Scientific truth is well-defined by material and formal consistency. Economics lacks this consistency: “So we really ought to look into theories that don’t work, and science that isn’t science. (Feynman)#1

When one looks at MMT one finds that it has been logically refuted, that is, the mathematical proof has been given that the MMT balances equations are false.#2 Because the formal foundations of MMT are false the WHOLE analytical superstructure is false. MMT is scientifically unacceptable.

And this is what Feynman said about the “educated guesses” of MMTers: “… the inexperienced students, make guesses that are very complicated, and it sort of looks as if it is all right, but I know it is not true because the truth always turns out to be simpler than you thought.”#3, #4

You can be sure that Feynman would have flushed MMT down the toilet without further ado because of manifest inconsistency.

#1 See also Tavares, E. (2014). The Farce That Is Economics: Richard Feynman On The Social Sciences. Zerohedge blog post.
#2 For the full-spectrum refutation of MMT see cross-references MMT
#3 First Lecture in New Economic Thinking