May 31, 2019

MMT: doom or survival?

Comment on Stephanie Kelton on ‘Modern Monetary Theory Is Not a Recipe for Doom’*

Blog-Reference and Blog-Reference

Stephanie Kelton introduces her rebuttal of Paul Krugman thusly: “Although he’s had almost a decade to come to terms with the approach, he is still getting some of the basic ideas wrong. This matters for two reasons: one, because people listen to Paul Krugman, who won the Nobel economics prize in 2008, and, two, because the approach he is discussing is at the heart of how to design economic policies that affect millions of Americans. I’d like to try to move the conversation forward by addressing his concerns.”

The conversation is pointless for the simple reason that both Paul Krugman and Stephanie Kelton are failed/fake scientists. Paul Krugman never understood how the economy works,#1 he is an agenda-pushing journalist on a large fake-news platform, and the economics “Nobel” signifies nothing because economics is a failed science.#2 Stephanie Kelton, on the other hand, promotes the profit-boosting MMT policy of deficit-spending/money-creation in a social/environmental bluff package.#3, #4, #5, #6

Stephanie Kelton’s critique of Paul Krugman’s policy blather hits the point: mainstream economics is a scientific Zombie ― dead but not buried. But Paul Krugman’s critique of MMT is entirely beside the point. The lethal effect of MMT policy is NOT on inflation or crowding out or on the monetary-fiscal tradeoff but on distribution.

The macroeconomic Profit Law entails Public Deficit = Private Profit which means that the Oligarchy’s financial wealth and public debt (currently $22 trillion) grow in lockstep. Hence the MMTers’ arguments for permanent deficit-spending/money-creation have a tangible use-value for the Oligarchy. The so-called free-market economy hangs already for a long time on the full life-support of the state, i.e. on a smoothly growing public debt.

On closer inspection, both Stephanie Kelton and Paul Krugman are in the same business, i.e. of helping the Oligarchy to survive for another day by brain-washing WeThePeople with academic snake oil.#8

Egmont Kakarot-Handtke

* BloombergOpinion
#1 Mr. Keynes, Prof. Krugman, IS-LM, and the End of Economics as We Know It
#2 Krugman and the scientific implosion of economics
#3 The Kelton-Fraud
#4 Stephanie Kelton’s legendary Plain-Sight-Ink-Trick
#5 Down with idiocy!
#6 No MMT illusions! YOU are going to pay for it
#7 The canonical macroeconomic model
#8 Just one more day: Howdeficit-spending delays the breakdown of Capitalism

Related 'Paul’s and Stephanie’s economic delirium talk' and 'The clock runs down on economics' and 'Mission impossible: economists join WeThePeople'.