Economics claims since Adam Smith/Karl Marx to be a science but is NOT. Actually, it is political agenda-pushing that abuses the prestige of science.#1 However, in the political dogfight, the appeal to science can be counter-productive because a political argument must necessarily appeal to emotions and thus cut scientific thinking short.
So, the easiest method of ‘refutation’ is to take some bad examples from history and simply to associate them with the other side. This is how Tim Worstall ‘refutes’ MMT: “And then we’ve this cautionary little tale about how the end game plays out. There’re more than just the one of those cautionary tales of course, Zimbabwe and Venezuela come to mind. Or perhaps Argentina.”#2
This annoys Tom Hickey: “This passes for serious criticism now? In addition, Tim Worstall doesn’t seem to realize that MMT is not a policy proposal but rather based on how the existing monetary system operates currently.”
In other words, MMT is pure experience-based practice in the here and now. Here is the story of how Warren Mosler created what later became known as MMT: “The origin of MMT is ‘Soft Currency Economics’… which I wrote after spending an hour in the steam room with Don Rumsfeld at the Racquet Club in Chicago,… I had never read or even heard of Lerner, Knapp, Inness, Chartalism, and only knew Keynes by reading his quotes published by others. I ‘created’ what became know as ‘MMT’ entirely independently of prior economic thought. It came from my direct experience in actual monetary operations, much of which is also described in the book.”#3
The general public likes this steam-room approach and dislikes theory. Accordingly, the MMT propagandist Richard Murphy tries to make some bonus points by introducing himself as a practical realist who suffers from a false image: “Modern Monetary Theory does suffer from being called a theory.”#4
This annoys Bill Mitchell: “Specifically, there is a current out there that considers MMT to be incorrectly labeled because according to the argument there is no theory involved. It’s hard to imagine why anyone would think that but the fact that they do tells me that I should write this blog post. As I noted yesterday, our Macroeconomics textbook … is full of theory. It has a lot of description, taxonomy, accounting, history, and philosophy, but also a lot of theory that ties some of those other components together in a meaningful way. The T in MMT is not a misnomer.”#5
Clearly, MMTers want to have it both ways. The salespeople say that MMT is operationally true and nothing but common-sense policy, the academics insist that MMT is a superior scientific approach. And they prove this by relentlessly exposing the idiotism and failure of mainstream economics.
Clearly, MMT has to be judged according to well-established scientific criteria. Worstall’s attempt to ‘refute’ MMT by referring to recent historical examples of inflation is silly polemics. Unfortunately, more cannot be expected from the Senior Fellow of the Adam Smith Institute.
MMT has to be refuted scientifically by proving that it is materially or formally inconsistent. This has already happened.#6, #7
Retarded folks like Tim Worstall argue always politically and never can get out of their tiny left-right box. In his utter ignorance, Tim Worstall swallows the MMTers’ self-description as Progressives hook, line, and sinker: “As we know Modern Monetary Theory is the latest great new plan from the left.”
Tim Worstall does not realize that MMT is in fact “the latest great new plan” from Wall Street.#8 If he had done his scientific homework he would know how the monetary economy works and that the macroeconomic Profit Law implies Public Deficit = Private Profit. In other words, MMT is not left/progressive at all. MMT policy does not benefit WeThePeople but the Oligarchy. That is, the noisy left-right wrestling show distracts from the plain fact that MMT and the Adam Smith Institute push the same agenda.
#1 The real problem with the economics Nobel
#2 Continental Telegraph The End Game Of Modern Monetary Theory
#3 The Johnsville News, Modern Monetary Theory (MMT) in a Nutshell
#4 Richard Murphy: the MMT fraudster dressed up as realist
#5 Understanding what the T in MMT involves
#6 The final implosion of MMT
#7 MMT = Modern Monetary Trash
#8 How MMT enlightens Washington
Related 'MMT = Trumponomics' and 'MMT: for the record' and 'How MMT makes everybody happy' and 'MMT in a nutshell' and 'Fake religion, fake science, fake news, and false complaints' and 'Economics debate ― just another variant of hardcore wrestling'. For the full-spectrum refutation of MMT see cross-references MMT.
Immediately following Economists: Time to say goodbye.