Blog-Reference and Blog-Reference
Bill Mitchell criticizes the MMT critic Martin Höpner: “But I expect researchers, especially those associated with highly credible institutions such as the Max Planck Institute in Köln, to first of all do their research before they make public comment. Many of the issues raised in the Makroskop article have been ‘done to death’ over the last 25 years.”
Indeed, the whole discussion is standard MMT stuff. Over the last 25 years, MMT has conditioned the public parrot with a handful of catchy slogans:
• There is a fundamental difference between currency issuer and currency user.
• The household analogy holds neither in the short nor in the long run.
• Tax revenue is not required to fund public expenditure.
• A currency-issuing government is not financially constrained.
• The government never runs out of money.
• Taxes make people accept fiat money.
• Government spending is the precondition of taxation.
• Inflation can at any time be contained through taxation.
• Public deficits supply the economy with money.
• Public deficits create financial assets for the non-government sector.
• Growing public debt is no problem, the currency issuer can never go bankrupt.
This set of slogans is only 50 percent economically true but 100 percent politically effective.#1
Against the MMT promise of a bright future for the people, Martin Höpner argues psychologically that if the public realizes that the government is not financially constrained all hell will break loose, with the result of reckless spending, inflation, and ultimate economic collapse. This, of course, is soapbox economics. Consequently, Bill Mitchell has no difficulty debunking Martin Höpner as a useful neoliberal idiot.
In essence, MMT argues that public deficit is good for the ninety-nine-percenters and for democracy. The fact of the matter is that public deficit is good for the one-percenters and the Oligarchy.#2 The macroeconomic Profit Law says Public Deficit = Private Profit and here lies the fundamental scientific error/political fraud of MMT.#3
This is why the spectacular MMT vs Neoliberalism wrestling has NOTHING at all to do with economics but only with mob entertainment in the political Circus Maximus.
#1 For the full-spectrum refutation of MMT see cross-references MMT
#2 MMT is dead: An unfriendly critique of Bill Mitchell
#3 Keynes, Lerner, MMT, Trump and exploding profit
Related 'MMT is NOT an alternative to Neoliberalism' and 'MMT and grassroots movements'.