John Atcheson summarizes: “In short, we are essentially creating debt for future generations and calling it wealth creation.”
That, of course, is true because Public Deficit = Private Profit. But who is “We”?
“We” that are the Deficit Owls on Twitter, that is Stephanie Kelton et al. in the yellow press,#1 Warren Mosler et al. in the financial community,#2 Bill Mitchell et al. in academia,#3 that is the philosopher Tom Hickey in the econblogosphere, one Konrad in the spiritual parallel universe, that are the deficit-spenders/money-creators from the history of economic thought,#4 and many others. “We” that is first and foremost the MMT agenda pushers.#5
Capitalism works because of the macroeconomic Profit Law Qm≡Yd+(I−Sm)+(G−T)+(X−M) which, oddly enough, economists do not understand since the founding fathers.#6, #7 The Profit Law tells “Us” also that Capitalism will eventually break down.#8
The MMTers’ assertion that debt does not matter and that the sovereign money creator cannot go bust is somewhat beside the point. Capitalism lives literally on borrowed time.
#1 The Kelton-Fraud
#2 MMT: The one deadly error/fraud of Warren Mosler
#3 Bill Mitchell, MMT’s fake scientist
#4 Keynes, Lerner, MMT, Trump and exploding profit
#5 For the full-spectrum refutation of MMT see cross-references MMT
#6 Truth by definition? The Profit Theory is axiomatically false for 200+ years
#7 Wikipedia and the promotion of economists’ idiotism (II)
#8 Mathematical Proof of the Breakdown of Capitalism
“In order to tell the politicians and practitioners something about causes and best means, the economist needs the true theory or else he has not much more to offer than educated common sense or his personal opinion.” (Stigum)
The true theory states that macroeconomic profit is given by Qm≡Yd+(I−Sm)+(G−T)+(X−M).#1 Because all variables are measurable with the precision of two decimal places the Profit Law is testable.
The Profit Law is free of all Human-Nature factors.
The minimum condition for the monetary economy to work ― Capitalist, Socialist, Communist does NOT matter ― is that macroeconomic profit is greater than zero. Otherwise, the monetary economy breaks down.
According to the axiomatically correct Profit Law, one way to produce profit is deficit-spending/money-creation, i.e. Qm=(G−T), i.e. Public Deficit = Private Profit.
• MMT’s economic policy guidance boils down to deficit-spending/money-creation.
• MMT agenda pushers promote the production of profit.
• Ultimately, MMT policy is causal for the unequal distribution of income/financial wealth.
It does not matter how MMTers see themselves or present themselves in public ― that’s all in the imagination ―, objectively they secure the perpetual self-financing of the Oligarchy.
#1 Wikimedia AXEC143d Profit Law and Sectoral Balances Equation