What is MMT? (III) ― Rectifying Bill Mitchell

Comment on Bill Mitchell on ‘Booming growth in Britain (Brexit?) but child poverty rises (austerity)’

Blog-Reference and Blog-Reference

“Social media is, of course, awash with Modern Monetary Theory (MMT) and a host of different characters have made it a goal to become MMT proponents, which is a good thing in some respects.”

It is pretty obvious that “MMT proponents” on social media and elsewhere are overwhelmingly agenda-pushers/applause-trolls/useful idiots/sales-reps and #EconBlockers.#1, #2, #3

“MMT is an economic framework for understanding how the macroeconomy works and the role of the currency-issuer in the monetary economy.”

MMT got macrofoundations wrong. Because of this, the whole analytical superstructure is scientifically worthless.#4

“But MMT is not a ‘movement’, nor, is it a progressive agenda.”

MMTers present themselves as Real Progressives when it suits them, e.g. when they fight UK Labour. Actually, MMT is a movement of and for the Oligarchy.#5, #6, #7

“I keep reading things like ‘MMT advocates taxing the rich’. It doesn’t.”

No, MMT advocates deficit-spending/money-creation which is (because of the 3-sector Profit Law Q≡(G−T)+(I−S)+Yd) to the advantage of the Oligarchy and to the disadvantage of WeThePeople.#8, #9

Egmont Kakarot-Handtke

#1 Economics, communication, disinformation

#2 Economists ― the Oligarchy's agenda pushers

#3 Links on MMTers push Wall Street’s agenda

#4 The unassailable formal refutation of MMT

#5 How Bill Mitchell stalks Jeremy Corbyn

#6 MMT: Corbynism is dead, British Labour is next

#7 Mission accomplished: Economists as useful idiots of the Oligarchy

#8 MMT, money creation, stealth taxation, and redistribution

#9 MMT pushes the Oligarchy's agenda ― and they push MMT

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Twitter Jul 30

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Bill Mitchell

• Deceiving WeThePeople ― the case of MMT/Bill Mitchell
• Bill Mitchell says that economists are fake scientists ― true, but MMTers are NOT different
• Proving Bill Mitchell wrong ― burying MMT for good
• Bill Mitchell cracks the spending whip over the Swabian housewife
• Bill Mitchell, MMT, Progressives: economists as Oligarchy hacks
• Mainstream vs MMT ― another clown show
• Economic backstabbing: Bill Mitchell hits again
• Bill Mitchell’s pure MMT teachings for British Labour
• Bill Mitchell’s dishonorable discharge from the sciences
• Bill Mitchell ― Wall Street’s hitman keeps an eye on MMT defeatists
• MMT, Bill Mitchell, and the lack of basic scientific integrity
• How Bill Mitchell stalks Jeremy Corbyn
• MMT is dead: An unfriendly critique of Bill Mitchell
• Bill Mitchell, MMT’s fake scientist
• Cryptoeconomics ― the best of Bill Mitchell’s spam folder
• The final implosion of MMT

MMTers at the end of their wits

Comment on Bill Mitchell on ‘Intergenerational Report ― the past is catching up with the government and the game is up’*

Blog-Reference and Blog-Reference

Bill Mitchell comments the 2021 Intergenerational Report as follows: ridiculous, smokescreen-creating, jam-packed with scaremongering, latest nonsense, madness, designed to deflect the damage that the government surpluses were creating in the mid-1990s, embarrassing for Treasury workers to be coerced by their bosses into producing this garbage.” and “What parades as economic analysis is just the usual neo-liberal mainstream nonsense that currency-issuing governments have run out of money and fiscal deficits are dangerous.” and “We have also seen that the government can spend what it likes without taxes going up and without bond markets declaring the government insolvent. We have now lived with large deficits as a result of the pandemic and the game is up on the deficits are bad and the sky will crash down story line.“

All this, of course, is not a scientifically valid argument but desperate political shit throwing. As such it is just another example of the abysmal level of academic economics. To this day, economists are too stupid for the elementary algebra of macroeconomics.#1

MMT has been refuted by the proof of its inconsistency. Because the foundational concepts of MMT are false the whole analytical superstructure of MMT is scientifically worthless.#2 That is, MMT's policy guidance has NO sound scientific foundations. It is just political agenda pushing for the benefit of the Oligarchy. The claim that MMT policy is for the benefit of WeThePeople is a political fraud.#3

MMTers debate every crappy argument that comes their way but has never attempted to refute the proof of the inconsistency of the MMT sectoral balances equation.#4

MMT is refuted on all counts and a sure sign that MMTers are at the end of their wits is that all that they do is to repeat their thoroughly refuted silly slogans of the harmlessness of a continuously growing public debt.#5

It is a mathematical certainty that the macroeconomic Profit Law implies Public Deficit = Private Profit. By the same token, it is a political certainty that MMTers are agenda-pushers for the Oligarchy and false Friends-of-the-People.

Egmont Kakarot-Handtke

* Bill Mitchell's blog

#1 Wikipedia, economics, scientific knowledge, or political agenda pushing?

#2 MMT has been conclusively refuted and MMTers can do NOTHING about it

#3 For details of the big picture see cross-references MMT

#4 MMTers still don't get the foundational sectoral balances right

#5 No MMT illusions! YOU are going to pay for it

Related 'Links on Austerity' and 'From the debt economy to the gift economy: how America is brainwashed to love budget deficits' and 'Hype does not help: MMT is toast' and 'Clueless economists / Macrofoundations'.

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AXEC118d

Orthodoxy is refuted ― but MMT also

Comment on Bill Mitchell on ‘The Cambridge Controversy ― a fundamental refutation of orthodox economic theory’ *

Blog-Reference and Blog-Reference on May 2

It goes without saying that what Paul Krugman says about the CCC and Joan Robinson is abysmally stupid. In Bill Mitchell's words: “Paul Krugman is either a liar or didn’t really get the point, or both.”#1 The fact that he is still a member of good standing of academic economics tells one all about the subzero level of scientific competence/ethics of the profession. In Bill Mitchell's words: “The import though is clear ― orthodox economics, which is still taught on a daily basis in our universities and which people like Krugman use to make money by writing textbooks about is based on a series of myths that cannot be sustained, both logically, in terms of their own internal consistency, and, in relation to saying anything about the real world we live in.”

Neoclassical economists do not understand profit and by consequence distribution. Bill Mitchell argues that Karl Marx did: “The major insight provided by Marx’s theory of surplus-value was that capitalist profits are sourced in the production of surplus-value. In turn, surplus-value is produced by unpaid labour and so under capitalism workers remain exploited (as they were under previous modes of production).” The fact is, that Marx, too, got profit wrong.#2

From this, one may infer that Bill Mitchell and the MMTers have no idea about what profit is. And this, too, is a provable fact.#3

Conclusion: Walrasianism, Keynesianism, Marxianism, Austrianism, MMT are mutually contradictory, axiomatically false, materially/formally inconsistent, and ALL got profit wrong. What passes as economics (“economic sciences” according to the EconNobel) is the pluralism of idiotism.#4

Because the foundational concept of economics ― profit ― is ill-defined and not understood to this day, economic policy guidance has NEVER had sound scientific foundations but has always been brain-dead agenda pushing. In their scientific incompetence, economists have always been a hazard to their fellow citizens. If humanity has made some progress it was NOT because of economists but despite them.

Egmont Kakarot-Handtke

* Bill Mitchell's MMT Blog Part 1 Part 2

#1 Links on Paul Krugman, proto-scientific impresario

#2 Profit for Marxists

#3 For those who want to check the refutation of MMT in greater detail here are the relevant references:

ad Mitchell: Proving Bill Mitchell wrong ― burying MMT for good

ad Kelton: The page where Stephanie Kelton gets macroeconomics wrong

ad Mosler: MMT: The one deadly error/fraud of Warren Mosler

ad Keen: MMT: fraudsters united

ad Wray: MMT: Agenda-pushing and money-making for the Oligarchy

ad Godley: Do economists finally wake up from their methodological delirium?

ad Kalecki: MMT: How mathematical incompetence helps the Kelton-Fraud

ad Minsky: Profit is the key

ad Textbook: Refuting MMT’s Macroeconomics Textbook

#4 For the reset of economics and the correct macroeconomic Profit Law see Profit

Related 'The CCC ― a monument of economists’ utter scientific incompetence' and 'One entirely sufficient reason for the shutdown of economics'. For details of the big picture see cross-references Failed/Fake Scientists.

Proving Bill Mitchell wrong ― burying MMT for good

Comment on Bill Mitchell on ‘The income-expenditure relationship in macroeconomics ― graphic treatment’*

Blog-Reference and Blog-Reference

Bill Mitchell introduces his macroeconomic approach: “Over the last several months by way of advancing Modern Monetary Theory (MMT) education initiatives, we have been involved in development a MOOC, i.e. Modern Monetary Theory: Economics for the 21st Century.” and “As part of the planning I have been thinking of simplified frameworks for teaching rather complicated concepts and relationships.”

In his course material, Bill Mitchell deals with nominal flows only; real flows and connecting variables like wage rate, price, and productivity are left out of the picture. This ends up in a lethal mistake that invalidates the whole of MMT.

Here is the proof.

The elementary production-consumption economy is defined with this set of macroeconomic axioms: (A0) The economy consists of the household and the business sector, which, in turn, consists initially of one giant fully integrated firm. (A1) Yw=WL wage income Yw is equal to wage rate W times working hours. L, (A2) O=RL output O is equal to productivity R times working hours L, (A3) Ec=PX consumption expenditure Ec is equal to price P times quantity bought/sold X.

Under the conditions of market-clearing X=O and budget-balancing Ec=Yw in each period, the price as the dependent variable is given by P=W/R. The elementary production-consumption economy is shown on AXEC31a.#1

This graph is a bit more complex, but with regard to nominal flows, absolutely identical with Bill Mitchell's graph, which simply says Yw=Ec.#2

So the starting point of the analysis of nominal flows is identical.

For the time being, real balances are excluded, i.e., it holds X=O. The condition of budget balancing, i.e., Ec=Yw, is now skipped. The resulting monetary saving/dissaving of the household sector is defined as S≡Yw−Ec. The monetary profit/loss of the business sector is defined as Q≡Ec−Yw. So, the balances of the two sectors are complementary, i.e., Q≡−S. In other words, the balances add up to zero, just as they are supposed to do according to the rules of accounting.

The mirror image of household sector saving S is business sector loss −Q. The mirror image of household sector dissaving −S is business sector profit Q. So, Q≡−S is the elementary version of the macroeconomic Profit Law.

Macroeconomic profit, though, is entirely missing in Bill Mitchell's presentation of the income-expenditure relationships. Now, any presentation of the elementary economic system that does not contain the foundational economic variable profit is scientifically worthless. From the fact that the conceptual foundations of macroeconomics are provably false follows that the whole analytic superstructure of MMT is false.#3-#6 This is all one needs to know about Bill Mitchell and MMT.

Egmont Kakarot-Handtke

* Billy Blog

#1 Graphic AXEC31a

#2 Income-expenditure flows

#3 The GDP-death-blow for the economics profession

#4 Wikipedia, economics, scientific knowledge, or political agenda pushing? 

⇒ Section Provably False/MMT

#5 Controlled demolition of MMT ― an exercise in elementary logic

#6 Refuting MMT’s Macroeconomics Textbook

Related 'Debunking MMT’s hallucinatory income-expenditure model' and 'Economics, MMT, and the capture of science by the political mob' and 'Refutation of MMT: All proofs and arguments you ever need'.

For more on Bill Mitchell, see AXECquery.

For more on proof, see AXECquery.

For more on sectoral balances, see AXECquery.

For the full-spectrum refutation of MMT, see cross-references MMT.

For an extended discussion about defective MMT macrofoundations with Peter Cooper, see AXECquery.

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AXEC118d

Economics, MMT, and the corruption of science

Comment on Bill Mitchell on ‘If it quacks!’*

Blog-Reference and Blog-Reference

The political fact of the matter is this: currently, there is NO Democracy and there is NO Autocracy. The currently prevailing form of government was called an Oligarchy by the ancient Greeks.#1 The first problem of the Oligarchy is to keep up the appearances of democracy, that is, political measures should appear as the faithful execution of the will/best interest of WeThePeople. This applies in particular to economic policy. So, one important activity of the Oligarchy has always been to produce public opinion and populist pressure. Needless to emphasize that the term Oligarchy does not denote something homogenous and fixed, but a temporary institutional arrangement. Neither does the term imply a moral valuation.

The economic fact of the matter is this: the market economy has already been dependent on the life support of the State for a long time. The economy runs on profits, and macroeconomic profit is mainly produced by public deficits. The axiomatically correct macroeconomic Profit Law reads Q≡Qm+Qn with Qm≡Yd+(I−Sm)+(G−T)+(X−M). This Law tells one, among many other things, that Public Deficit G−T>0 = Private Profit Qm, which means that the Oligarchy’s financial wealth and public debt grow in lockstep, or, in a formula: Financial Wealth of the Oligarchy = Public Debt of WeThePeople. The beauty of the situation is that people think that public debt is somebody else’s problem. This is true, of course, until it is no longer true, that is, until the debt stops growing or goes into reverse. The market economy lives literally on borrowed time.

The Oligarchy, in turn, uses the opulent deficit-produced free lunches to nudge the State’s legislative, executive, and judiciary institutions in its favor. Much of the money goes into the production of public opinion. Without knowing the details, one can assume for a mature Oligarchy that key opinion producers like journalists, entertainers, priests/preachers/ gurus, writers, filmmakers, and academics are, with few exceptions, directly or indirectly sponsored/supported/controlled by the Oligarchy.

And here is the problem: in the political realm, anybody can talk any bullshit whatsoever; in the scientific realm, this is NOT admitted. Science is committed to the growth of knowledge, and scientific knowledge is well-defined by material and formal consistency. At least, this was the idea before science became politically weaponized. This happened in economics at an early stage. The founding fathers considered themselves political economists, which is to say useful idiots for the (then-) Oligarchy.

“That Political Economy is a science which teaches, or professes to teach, in what manner a nation may be made rich. This notion of what constitutes science is, to some degree, countenanced by the title and arrangement which Adam Smith gave to his invaluable work. A systematic treatise on Political Economy, he chose to call an Inquiry into the Nature and Causes of the Wealth of Nations; and the topics are introduced in an order suitable to that view of the purpose of his book.” (J. S. Mill)

To this day, economics is at the proto-scientific level. The major approaches — Walrasianism, Keynesianism, Marxianism, Austrianism, MMT — are mutually contradictory, axiomatically false, and materially/formally inconsistent. Economics does NOT satisfy scientific criteria. This would be no problem because, under the license of free speech/ freedom of the press, anything goes in the political realm. However, economists claim from Adam Smith/Karl Marx onward to the “Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel” to do science. This is NOT the case; the representative economist is NOT a scientist but a political fraudster.

The actual case is MMT. Academic MMTers like Bill Mitchell and Stephanie Kelton are currently extremely busy spreading the gospel of deficit-spending/money-creation. This runs in perfect harmony with Mr. Trump’s policy.

The exact point where the fraud kicks in is when MMTers tell the general public that MMT is for the benefit of WeThePeople and that MMT helps to solve almost all problems, from unemployment to the survival of humanity.

Bill Mitchell argues: “… the current challenges are different to a military threat but an existential threat no less and require urgent and significant response from the public sector. … The broader point is that the ‘means’… cannot be constructed in terms of financial aggregates. To do so is to construct the currency-issuing government as being financially-constrained in the same way a household is. A household has to earn income or borrow or run down prior savings, or sell previously acquired assets (financial or otherwise) in order to spend. A currency-issuing government is not financially constrained and can purchase whatever is for sale in that currency, including all idle labour.”

This is true in the same sense that a counterfeiter always has the ‘means’ to buy whatever he wants. However, from the fact that this is technically possible does NOT follow that it is a good policy. Taking the economy as a whole, it is a bad policy for WeThePeople and a good policy for the Oligarchy. Bringing money into the economy at the demand side amounts to robbing WeThePeople.#2, #3

There is NO way around it: MMT policy is a political fraud and MMT academics are stupid/corrupt scientists. Science is built on the ethics of individual integrity and self-government of the scientific community. As MMT proves, economics is politically corrupted, and the mechanisms of scientific self-government do not function properly.

MMT is false theory, MMT is false policy, MMTers are fake scientists and agenda pushers for the Oligarchy.#4 The rest of economics, though, is NOT any better.

Egmont Kakarot-Handtke


*   Billy Blog
#1 Wikipedia Oligarchy
#2 Criminals and the monetary order
#3 Q: How are you going to pay for it? MMT: By stealth taxation!
#4 MMT: How the Oligarchy communicates with WeThePeople

Related 'There is no truth in political economics' and 'Keynes, Lerner, MMT, Trump, etc. and exploding profit' and 'Another MMT shitshow' and 'Bill Mitchell, MMT, Progressives: economists as Oligarchy hacks' and 'Cryptoeconomics ― the best of Bill Mitchell’s spam folder' and 'Bill Mitchell cracks the spending whip over the Swabian Housewife' and 'MMT, Bill Mitchell, and the lack of basic scientific integrity' and 'MMT: Academic snake oil for the people'. and 'Very busy these days: Wall Street’s agents' and 'The problem with economics as a discipline' and 'Trust in science? Yes, but economics is NOT a science' and 'Exploding the Household Fallacy' and 'Stephanie Kelton: “All deficits are good for someone” Yes, Someone=Oligarchy' and 'Mr. Wray goes to Washington' and 'Deficit cheerleaders ― the Oligarchy’s useful idiots' and 'How to spot economics trolls' and 'Show first your economic axioms or get out of the discussion' and 'Links on the Economics Nobel' and 'Economics and corruption'.

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Philip Mirowski, Money and the Unflappable Economist

MMT: Corbynism is dead, British Labour is next

Comment on Bill Mitchell on ‘An evolving 6-point plan for British Labour’*

Blog-Reference and Blog-Reference

MMT policy boils down to deficit-spending/money-creation. According to the macroeconomic Profit Law, it holds Public Deficit = Private Profit.#1 So, MMT policy is for the benefit of the Oligarchy. The natural enemy of the Oligarchy is WeThePeople and all institutions that promote their interests. The logical thing to do for MMTers is to weaken or destroy these institutions. In the case of British Labour this means to drive a wedge between members/voters and the party’s leadership. This is what Bill Mitchell as academic loudspeaker of MMT has done with considerable intensity for a long time.#2, #3

Bill Mitchell’s method has not been very subtle but consisted in the main of presenting himself as a true Progressive and smearing the Labour leadership as closet neoliberals who torture the working class with Austerity. #4, #5

Whether Bill Mitchell’s interference in UK affairs made any effect on the anti-Corbyn coup is open to anybody’s guess, what is remarkable is that the agent of the Oligarchy is not yet finished with undermining British Labour.

The Corbynism corpse not yet cold, Bill Mitchell comes forward with the 6-point plan for a Labour Party that suits the Oligarchy:

“3. Sack/ignore all the advisors who advocated neoliberal fiscal rules as being clever. They were stupid and unworkable and the fact that the Labour Party changed the Rule in the weeks before the election when the IFS pointed out that they were incompatible with the Manifesto, a view I had presented when the Rule first came out, is testament to that.

4. Maintain the progressive Manifesto without the neoliberal frames and structures.#6

5. Begin this 5-year period of isolation by mounting a massive education campaign to allow British voters to truly understand the capacities of the currency-issuing government which will make it much easier to disabuse arguments that start with ‘How will we pay for it?’. In that sense, I advise the British Labour Party to commission a series of workshops on Modern Monetary Theory (MMT), starting February when I will next be in the UK.”

Note that MMT is (i) refuted on all counts, (ii) scientifically worthless, (iii) against the interest of WeThePeople, (iv) for the benefit of the Oligarchy, and (v), that Bill Mitchell as an Australian academic has neither any scientific nor any political legitimacy to interfere with what is exclusively the business of the Legitimate Sovereign of the UK.#7

Note further that economics is NOT a science and economists are NOT scientists but for 200+ years now the useful idiots of the Oligarchy.

Egmont Kakarot-Handtke


* Billy Blog
#1 Q≡Yd+(I−S)+(G−T)+(X−M) ⇒ Q≡G−T Legend: Q overall monetary profit, G−T>0 public deficit.
#2 Mission accomplished: Economists as useful idiots of the Oligarchy
#3 How Bill Mitchell stalks Jeremy Corbyn
#4 MMT Progressives: The knife in the back of WeThePeople
#5 MMTers are false Progressives and false Friends-of-the-People
#6 MMT: The communicative war on budget-balancers
#7 MMTers are false Progressives and false Friends-of-the-People

Related 'Bill Mitchell’s pure MMT teachings for British Labour' and 'Totally schizo ― MMT and policy' and 'Economic backstabbing: Bill Mitchell hits again' and 'Very busy these days: Wall Street’s agents' and 'MMT: A Trojan Horse for Labour courtesy of the Oligarchy' and 'MMT’s true program' and 'Thinking about economic policy for future PM Corbyn'. For details of the big picture see cross-references MMT and cross-references Political Economics/Stupidity/Corruption.

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Billy Blog Dec 19

Billy Blog Nov 26, 2020, British Labour remains unelectable

Source: Twitter

Twitter May 7, 2021

Twitter May 12, 2021

Twitter Aug 18, 2021 Finished off by business consulting

Twitter Jan 4, 2023

Twitter/X Jul 5, 2024 Five years later

Mission accomplished: Economists as useful idiots of the Oligarchy

Links on Bill Mitchell on ‘My brief comment on the British election’

Blog-Reference and Blog-Reference on Dec 15 and Blog-Reference and Blog-Reference on Dec 19

Bill Mitchell summarizes the UK election outcome: “The information we have at present is that that position on Brexit is probably going to cost them [Labour] office. Which means the Tories survive when they should not but finish the Brexit process which they should. Then Labour will have to reinvent itself to take advantage of the renewed sovereignty that Brexit will bring. To do that it has to expunge its ranks of the neoliberals.”

Until proven otherwise, one should take it for granted that an economist is on the payroll of the Oligarchy. This applies obviously to think-tank economists but in many/most cases also to self-styled Progressives who claim to fight for WeThePeople.

Economics is NOT science. Economics is a failed/fake science. Most economists are NOT scientists but useful political idiots. The pertinent example is MMT but all goes back to the founding fathers who described their job as Political Economy.

The MMT policy of deficit-spending/money-creation clearly benefits the one-percenters but is sold as a benefit for the ninety-nine-percenters. The scientific proof is in the macroeconomic Profit Law which says Public Deficit = Private Profit.

Accordingly, MMT’s mission in the UK was to undermine the Labour Party by attacking its economic program and by smearing its leadership as closet neoliberals.

If any proof were needed that academic economics is fake science and covered political agenda pushing, MMT has delivered it in the run-up to the historical election of Dec 12. For details see

► How Bill Mitchell stalks Jeremy Corbyn
► Thinking about economic policy for future PM Corbyn
► MMT Progressives: The knife in the back of WeThePeople
► MMTers are NOT Friends-of-the-People
► MMT: Academic snake oil for the people
► Economic backstabbing: Bill Mitchell hits again
► Bill Mitchell’s pure MMT teachings for British Labour
► Is MMT good for WeThePeople or for the Oligarchy?
► Deficit-spending/money-creation is ALWAYS a bad deal for WeThePeople
► Are MMTers stupid or corrupt or both?
► MMT: The fusion of Wall Street and Academia
► MMT’s true program
► How to spot economics trolls
► Links on Neoliberalism
► Just one more day: How deficit-spending postpones the breakdown of Capitalism
► Trust in science? Yes, but economics is NOT a science
► There is NO such thing as “smart, honest, honorable economists”

Egmont Kakarot-Handtke


Related 'MMT: A Trojan Horse for Labour courtesy of the Oligarchy' and 'MMT and the overall political corruption of economics' and 'MMT and grassroots movements' and 'MMT: Corbynism is dead, British Labour is next' and 'MMT undermines democracy'. For more details, see cross-references Political Economics/Stupidity/Corruption.

For more about Oligarchy see AXECquery.

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AXEC158a

Twitter/X Jul 10, 2024 Captured ― or how the separation of science and politics was undermined

Twitter/X Nov 3, 2024 The Great Awakening

Twitter/X Feb 18, 2025  Support of Oligarchy

Economic backstabbing: Bill Mitchell hits again

Comment on Bill Mitchell on ‘Impending British Labour loss may reflect their ambiguous Brexit position’

Blog-Reference

The macroeconomic Profit Law implies with regard to the government sector Public Deficit = Private Profit. As a consequence, the MMT policy of deficit spending/money-creation ultimately benefits the Oligarchy and NOT WeThePeople. However, this is not obvious because it happens in an indirect manner via the price mechanism.#1 Running budget surpluses hits the ninety-nine-percenters directly by increasing unemployment and the one-percenters indirectly by reducing macroeconomic profit.

The political consequence is this: The one-percenters and their useful academic/ journalistic spokespersons should consistently argue FOR deficit spending and the ninety-nine-percenters and their academic/journalistic spokespersons should consistently argue AGAINST it. In the political debate, though, logical consistency is not the primary concern, but propagandistic success is. So we see representatives of the one-percenters arguing for budget-balancing and representatives of the ninety-nine-percenters arguing for deficit-spending.#2

MMTers claim to be the real Progressives and fighters for the interests of WeThePeople. The economic fact of the matter, though, is that the MMT policy of deficit-spending/money-creation is for the benefit of the Oligarchy.

One of the most aggressive agenda pushers is Bill Mitchell. In the run-up to the election, he first  denounced the Labour leadership as crypto-neoliberals for their Fiscal Credibility Rule, i.e. the commitment to balance the budget over the business cycle and their intention to reduce the public debt in the longer term.#3, #4 In their new Manifesto, Labour announces massive deficit spending on infrastructure. This is in line with MMT policy guidance but does not end Bill Mitchell’s fight against British Labour.

• “As I have noted many times in the past, there was always a problem with the statements that British Labour were making prior to the election in terms of its spending promises and maintaining that it would be also be bound by its Fiscal Credibility Rule. I was vilified by Labour apparatchiks a the related academic hacks for maintaining this position but as time has past it is obvious I was correct.”

• “Apparently the ‘Rule’ has been changed. You don’t change a ‘Rule’ that is seen to be workable. The point that have made often is that, by tying themselves into this neoliberal straitjacket, the British Labour Party limited the political space they would have to operate in.”

• “We have seen many times in history, how fortuitous fiscal interventions … are stopped in their tracks with damaging consequences, because of media and political pressure over the rising deficits, all because the public have been conditioned by these neoliberal fiscal rules to think the deficits signal an impending catastrophe. In the British case, the ‘Rule’ is unnecessary. It reflects an irrational paranoia among the Left in Britain about the relative strength of the financial markets vis-a-vis the legislative and regulative capacity of the elected government.”

In conclusion, the elected Labour leadership still does not satisfy the demands of the self-declared progressive academic Friends-of-the-People: “There is a lot to like about that Manifesto from a progressive perspective. However, in my mind, there were two unresolved tensions that I think damage the Party’s credibility. The first, is its, yes, continued embrace of neoliberal macroeconomic frames, epitomised by its so-called Fiscal Credibility Rule that has already had to be changed because so-called independent analysts agreed with my assessment that the manifesto and the ‘Rule’ were inconsistent.”

The economic fact of the matter is that public deficit-spending/money-creation is a free lunch program for the Oligarchy. The market economy is already for a long time on the life support of the State.#5 Profit is in the main produced by public deficits, financial wealth roughly equals public debt. The Oligarchy, in turn, uses the opulent free lunches to corrupt the State’s legislative, executive, judiciary institutions and ― not to forget ― academia.

The political world is upside down: the legitimate representatives of WeThePeople are smeared as crypto-neoliberals by fake Progressives who push the agenda of the Oligarchy.#6

Egmont Kakarot-Handtke


#1 Q: How are you going to pay for it? MMT: By stealth taxation!
#2 Links on Austerity
#3 Bill Mitchell’s pure MMT teachings for British Labour
#4 How MMT disgraces itself
#5 Keynes, Lerner, MMT, Trump, etc. and exploding profit
#6 How Randall Wray takes the piss out of the House Budget Committee

Related 'Swabian housewife vs Wall Street loan shark' and 'Is MMT Alt-Right? No, it is fake science' and 'Bill Mitchell’s dishonorable discharge from the sciences' and 'MMT, voodoo, and dead horse beating' and 'Bill Mitchell ― Wall Street’s hitman keeps an eye on MMT defeatists' and 'Bill Mitchell’s pure MMT teachings for British Labour'.

Bill Mitchell’s pure MMT teachings for British Labour

Comment on Bill Mitchell on ‘Invoking neoliberal framing and language is a failing progressive strategy (British Labour)’*

Blog-Reference and Blog-Reference

Bill Mitchell claims to be a Progressive. In this capacity he fights British Labour: “I have never supported so-called ‘progressive’ parties that choose, for ‘political’ purposes, to lie to the electorates by adopting neoliberal framing and language as a way of minimising any difficulties that might arise, initially, from the dissonance that accompanies exposure to the truth, after years of believing in lies.”

At some point, Bill Mitchell tells the world, he has realized that British Labour plays a con game: “Over the years it’s been clear to me that we live in a fictional world when it comes to economic matters. … Which tells you that he [Paul Mason] either doesn’t understand what MMT is about (ignorance) or deliberately deceives his audience (fraud).”

To make the matter short here, it is Bill Mitchell and his MMTers who are the fraudsters.#1, #2

Proper economic analysis shows beyond any doubt that the MMT policy of deficit-spending/money-creation is to the advantage of the Oligarchy and to the disadvantage of WeThePeople. The macroeconomic Profit Law entails Public Deficit = Private Profit and this entails that financial wealth is roughly equal to the public debt. In the fictional world of economics, the fictional Progressives are the real agenda pushers/useful idiots of the Oligarchy.

This should be pretty obvious, Bill Mitchell argues vehemently against budget-balancing and taxing the rich and tells Labour that they are stuck in neoliberal thinking.

• “This is the classic ‘soft’ mainstream macroeconomics that assumes the government is financially constrained and is thus not dissimilar to a household. It is ‘soft’ because, unlike the hard mainstream positions, it allows for deficits (‘funded’ by debt) to occur in a non-government downturn but proposes them to be offset by surpluses in an upturn, irrespective of the overall saving position of the non-government sector.”#3
• “The incomes of the rich are therefore essential to provide the capacity for the government to fund the provision of services to health care and welfare.”
• None of this framing or language is what I would call ‘progressive’.

According to MMT, budget-balancing is unexcusable but taxing the rich is of the devil: “It is false to claim that it is virtuous to ‘tax the rich’ in order to fund essential health and welfare services. This is one of the worst frames that the progressives now deploy.”

Obviously, the whole MMT thing is a shell game with the word progressive.#4

Political take-away for British Labour: MMT is bad science, MMT is bad policy, MMTers are bad people. Bill Mitchell’s MMT teachings for British Labour are a gaslighting exercise.

Egmont Kakarot-Handtke


* Billy Blog
#1 For the full-spectrum refutation of MMT see cross-references MMT
#2 MMT Progressives: The knife in the back of WeThePeople
#3 Exploding the Household Fallacy
#4 Mr. Wray goes to Washington

Related 'The sectoral balances obfuscation: stupidity or corruption?' and 'A beginner’s guide to MMT' and 'How Bill Mitchell stalks Jeremy Corbyn'.

Econogenics: economists pose a hazard to their fellow citizens

Comment on Bill Mitchell on ‘The evidence from the sociologists against economic thinking is compelling’*

Blog-Reference and Blog-Reference

Bill Mitchell summarizes: “One of the stark facts about the academic economics discipline is its insularity and capacity to deliver influential prognoses on issues that affect the well-being of millions with scant regard to the actual consequences of their opinions and with little attention to what other social scientists have to say. The mainstream economists continually get things wrong but take no responsibility for the damage they cause to the well-being of the people.”

And this is how it is done “So we get a formulaic approach to publications in macroeconomics that goes something like this

• Assert without foundation ― so-called micro-foundations ― rationality, maximisation, RATEX.
• Cannot deal with real world people so deal with one infinitely-lived agent!
• Assert efficient, competitive markets as optimality benchmark.
• Write some trivial mathematical equations and solve.
• Policy shock ‘solution’ to ‘prove’, for example, that fiscal policy ineffective (Ricardian equivalence) and austerity is good. Perhaps allow some short-run stimulus effect.
• Get some data ― realise poor fit ― add some ad hoc lags (price stickiness etc) to improve ‘fit’ but end up with identical long-term results.
• Maintain pretense that micro-foundations are intact ― after all, it is the only claim to intellectual authority.
• Publish articles that reinforce starting assumptions. Knowledge quotient ― ZERO ― GIGO.”

Not only mainstream economics, though, is proto-scientific garbage. The major approaches — Walrasianism, Keynesianism, Marxianism, Austrianism — are mutually contradictory, axiomatically false, materially/formally inconsistent and all got the foundational economic concept profit wrong. With their provably false theories, economists pose a hazard to their fellow citizens. However, the same holds for MMT, the approach Bill Mitchell represents.#1-#13

Bill Mitchell is right in his critique of what passes as economics but he has drawn the wrong conclusion from obvious scientific failure: “A mainstream professor who was supervising my economics graduate program once said to me: ‘Bill you are a bright boy but you should be doing sociology’, which was an example of the negative control mechanism designed to weed out dissidents (like me). It didn’t work. But I always considered the disciplines of sociology and anthropology (not to mention psychology, political science, social welfare etc) to be important in my journey to become ‘well read’.”

The correct conclusions from the lethal methodological blunders of economists are

• Leave sociology to the sociologists and psychology to the psychologists.
• Take their findings whenever needed.
• Focus instead on how the economic system works.
• Economics is NOT a social science but a systems science.#14, #15
• Economists are responsible for the social devastations that result from the application of provably false theories.

From this follows that economics needs a full-blown Paradigm Shift. In concrete terms, this means that false microfoundations#16 have to be replaced by true macrofoundations#17.

Walrasianism, Keynesianism, Marxianism, Austrianism, and Bill Mitchell’s MMT have to be buried at the Flat-Earth-Cemetery.#18

Egmont Kakarot-Handtke


* Billy Blog
#1 Econogenics in action
#2 How the representative economist gets it wrong big-time
#3 Economics: The greatest scientific fraud in modern times
#4 Economics ― worse than fake
#5 Economics ― a doctor worse than the disease
#6 Economists and the destructive power of stupidity
#7 MMT: The economics moron as problem solver
#8 Mass unemployment: The joint failure of orthodox and heterodox economics
#9 No culpa, only stultitia
#10 As Napoleon said: don’t listen to economists
#11 Why do workers not tar and feather economists?
#12 Circus Maximus: Economics as entertainment, personality gossip, virtue signaling, and lifestyle promotion
#13 Scrap the EconNobel
#14 PsySoc — the scourge of economics
#15 Homo oeconomicus: the never-ending folk-psychological shitshow
#16 Microfoundations are verbally given by: “HC1 economic agents have preferences over outcomes; HC2 agents individually optimize subject to constraints; HC3 agent choice is manifest in interrelated markets; HC4 agents have full relevant knowledge; HC5 observable outcomes are coordinated, and must be discussed with reference to equilibrium states.” (Weintraub)
#17 The true Macrofoundations are given by (A0) The objectively given and most elementary systemic configuration of the economy consists of the household and the business sector which in turn consists initially of one giant fully integrated firm. (A1) Yw=WL wage income Yw is equal to wage rate W times working hours. L, (A2) O=RL output O is equal to productivity R times working hours L, (A3) C=PX consumption expenditure C is equal to price P times quantity bought/sold X. See True macrofoundations: the reset of economics
#18 The real trouble with Capitalism: stupid/corrupt economists

Related 'Economists: scientists or political clowns?' and 'Economists ― medics or barber-surgeons?' and 'False economic theory makes bad economic policy' and 'Economics is indefensible' and 'The real trouble with Capitalism: stupid/corrupt economists' and 'Economic policy has gone wrong because economic theory has gone wrong'.

For more about iatrogenic economics see AXECquery.

Bill Mitchell’s dishonorable discharge from the sciences

Comment on Bill Mitchell on ‘Spending equals income whether it comes from government or non-government’

Blog-Reference and Blog-Reference

The well-known problem of economics is that it is a failed/fake science. The major approaches ― Walrasianism, Keynesianism, Marxianism, Austrianism ― are mutually contradictory, axiomatically false, materially/formally inconsistent, and all have gotten the foundational economic concept of profit wrong.

Bill Mitchell is right in summarizing that not only the credibility of the mainstream is “in tatters” but also that of the “self-proclaimed Left”. How does MMT fit into this picture of overall academic failure/fake/fraud?

MMT, too, has no sound scientific foundations and therefore MMT’s economic policy guidance, too, is nothing but brain-dead agenda-pushing. From the scientific standpoint, MMT is not qualitatively different from mainstream garbage. MMT shares the lethal methodological blunder with the rest of economics.

Bill Mitchell enumerates the basics of MMT as follows:
“1. Aggregate demand is total spending in the economy.
2. Given the way we measure economic activity (as an aggregate of output and income produced per period), nominal (money) values of spending must equal income as an accounting statement.
3. If inflation is stable, then increased spending equals increased real income.
4. …”

The blunder is in “nominal (money) values of spending must equal income as an accounting statement.” NO! Economists are too stupid for the elementary math that underlies macroeconomic accounting. Keynes is the most prominent example. He wrote in the GT: “Income = value of output = consumption + investment. Saving = income − consumption. Therefore saving = investment.” (p. 63)

Income is NEVER equal to the “nominal (money) values of spending”. Here is the proof.
1. Premises: The elementary production-consumption economy is given by three macroeconomic axioms: (A1) Yw=WL wage income Yw is equal to wage rate W times working hours. L, (A2) O=RL output O is equal to productivity R times working hours L, (A3) C=PX consumption expenditures C is equal to price P times quantity bought/sold X.
2. Logical implications: In the elementary production-consumption economy, THREE configurations are logically possible: (i) consumption expenditures are equal to wage income C=Yw, (ii) C is less than Yw, (iii) C is greater than Yw.
• In case (i) the monetary saving of the household sector S≡Yw−C is zero and the monetary profit of the business sector Q≡C−Yw, too, is zero. The product market is cleared, i.e. X=O in all three cases. For a start, the market-clearing price as the dependent variable is given by P=C/X=W/R for any employment level.
• In case (ii) saving S is positive and the business sector makes a loss, i.e. Q is negative. The market-clearing price P is less than W/R.
• In case (iii) saving S is negative and the business sector makes a profit, i.e. Q is positive.

It always holds Q≡−S, in other words, the balances of the business and the household sector always add up to zero. This is the Fundamental Law of Macroeconomic Accounting.#1

In other words, the business sector’s loss is equal to the household sector’s saving. Vice versa, the business sector’s profit is equal to the household sector’s dissaving, i.e. the growth of the household sector’s debt. The non-equality of “nominal (money) values of spending” and wage income is the very cause of profit/loss. Profit/loss is the difference of flows and not a flow like wage income. Wage income and profit are NOT two different forms of income. So the lethal methodological blunder of the representative economist consists of confusing a balance with a flow.

3. Conclusion: Elementary algebra tells one that the premise of macroeconomics, i.e. “nominal (money) values of spending must equal income as an accounting statement”, is provably false since Keynes.

Because MMTers in general and Bill Mitchell, in particular, are too stupid for elementary math they have to be expelled from the sciences just like their mainstream colleagues. Economics, including MMT, is failure/fake/fraud from the curriculum to the peer-review of journals to the faux Nobel Prize.

Egmont Kakarot-Handtke


#1 Macro for dummies (II)

Related 'Economists/MMTers: agenda pushers, distractors, blockers, muters, censors' and 'Mission accomplished: Economists as useful idiots of the Oligarchy' and 'Economics ― the science that never was'.

How MMT disgraces itself

Comment on Bill Mitchell/Tom Hickey on ‘When the Left disgraces itself’

Blog-Reference and Blog-Reference

Tom Hickey argues: “The number of serious critiques of MMT are few and far between and well-informed one are even rarer. In fact, I can’t recall even one that demonstrated familiarity with the body of MMT literature. Sad state of affairs.”

Fact is

1. The foundational MMT sectoral balances equation (I−S)+(G−T)+(X−M)=0 is provably false.#1 Therefore, the whole analytical superstructure of MMT is false.
2. MMTers purposefully deceive people.#2
3. MMTers violate scientific standards and systematically block/suppress refutation.#3
4. MMTers are NOT scientists but agenda pushers for the Oligarchy.
5. The MMT policy of deficit-spending/money-creation undermines Democracy.#5

The philosopher Tom Hickey is a disgrace for the community of philosophers which defines itself through the voluntary commitment to high ethical standards.

Egmont Kakarot-Handtke


#1 For the full-spectrum refutation of MMT see cross-references MMT
#2 MMTers are false Progressives and false Friends-of-the-People
#3 Economists/MMTers: agenda pushers, distractors, blockers, muters, censors
#4 Very busy these days: Wall Street’s agents
#5 MMT undermines democracy

Related 'Trump and MMT: Make profits great again' and 'The decisive reason to worry about government debt' and 'MMT, voodoo, and dead horse beating' and 'Bill Mitchell ― Wall Street’s hitman keeps an eye on MMT defeatists' and 'How Stephanie Kelton brain-washes a lovely young English girl' and 'Prophet Stephanie divines the seizure of the means of production of currency'. and 'Is MMT good for WeThePeople or for the Oligarchy?' and 'Is MMT Alt-Right? No, it is fake science' and 'Bill Mitchell’s dishonorable discharge from the sciences'.

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REPLY to Calgacus on Jul 31

The fact is that the foundational MMT sectoral balances equation (I−S)+(G−T)+(X−M)=0 is provably false. Therefore, the whole analytical superstructure is false. Therefore, MMT inflation theory is false by implication.#1-#6 Historical examples are NO substitute for the true theory. Conversely, the true theory is the precondition for understanding history.


#1 Gov-Deficits do NOT cause inflation
#2 Attention: there are THREE types of inflation
#3 Settling the MMT―Inflation issue for good
#4 MMT, money, value, and transcendental Capitalism
#5 Dear idiots, government deficits do NOT cause inflation
#6 Economics as tireless production of proto-scientific garbage: inflation theory as an example

MMT, voodoo, and dead horse beating

Comment on Bill Mitchell on ‘Voodoo economic revisionism abounds ― and it is not MMT doing the voodoo’

Blog-Reference and Blog-Reference

Science is about true/false and NOTHING else. Economics is supposed to be a science and by consequence it is about how the monetary economy operates and NOT about what journalists, politicians, trolls, tweeters, Mr. Trump, Rush Limbaugh, or any other brain-dead agenda pusher in the Circus Maximus hallucinates.

From an economist one expects to learn the true (= materially/formally consistent) theory and NOT that economic policy guidance in the incarnation of Walrasianism, Keynesianism, Marxianism, Austrianism is voodoo. Everybody knows this by now. No need for  Bill Mitchell to repeat the same old folk-psychological crap over and over again.

• “Both articles … are rehearsing the growing angst that the deficit terrorists who were dominant in the 1990s up until recent years are now feeling as their anti-government, anti-fiscal policy message ― their continued prophesies of doom ― but most of all, their relevance ― is evaporating before their very eyes ― exposed by too many predictions of doom and disaster which have never been realised.”

• “The angst these conservatives are now going through is mirrored by the obvious fact that mainstream macroeconomics is growing in irrelevance itself. Which is why many of the ‘big’ names are attacking MMT so relentlessly.”

• “The MMT economists are delivering the alternative paradigm in macroeconomics. No other challenge to the mainstream has succeeded and the heterodox tradition just became lost in peripheral issues. MMT is front and central macroeconomics and the mainstream cannot deal with it.”

• “And when a character like Trump comes along who doesn’t play by the script the world of these ‘free market’ liars is blown apart.”

• “And Trump is demonstrating by his fiscal actions that the main weapon the Republicans used to kill off any progressive policy dreams is now defunct.#1 No one believes the deficit horror stories any more.”

• “Nobody is a fiscal conservative anymore … All this talk about concern for the deficit and the budget has been bogus for as long as it’s been around.” (Limbaugh)#2

• “How many years have people tried to scare everybody about the deficit? The years, how many decades of politicians tried to scare us about deficit the national debt, the deficit, any number of things. And yet, here we’re still here and the great jaws of the deficit have not bitten off our heads and chewed them up and spit them out.” (Limbaugh)

In sum: “Cover blown.” and “… all the deficit terrorists … are now running around like headless chooks because their lies have lost traction.”

As far as the failure of mainstream economics is concerned,  this is accurate, of course, but from this he-said-she-said-I-said gossip does NOT follow that MMTers “… are delivering the alternative paradigm in macroeconomics.” The fact is that MMT macroeconomics is refuted on all counts.#3

MMT is the academic cover for a straightforward political agenda: to push deficit-spending/money-creation. Bill Mitchell’s message is simple: government deficits and growing public debt are good, there are no risks to speak of and the residual risks can be easily handled and everybody who says otherwise is a liar and deficit-terrorist.

There is not the smallest snippet of science in this talk. Obviously, Bill Mitchell has moved from serious scientific research to Orwell’s propaganda ministry.

MMT is provably false, i.e. materially/logically inconsistent, and therefore, MMT policy guidance lacks sound scientific foundations. MMTers deceive the general public because they never address the toxic distributional effect of their policy.

The policy of deficit-spending/money-creation benefits the Oligarchy because it increases macroeconomic profit according to the Profit Law which entails Public Deficit = Private Profit. MMT is a free lunch program for the Oligarchy. Financial wealth and public debt grow in lockstep and the fabulous financial wealth in the USA is roughly equal to humongous public debt ($22 trillion and counting). The Profit Law explains how billionaires are able to accumulate that much money and why they can buy all the bonds the Treasury issues and cash in the ultra-safe interest that is reliably taxed from WeThePeople as long as the debt is rolled over which can be very long indeed. MMT policy is a Ponzi scheme that works as long as public debt grows. But infinite growth is impossible on a finite planet. This holds also for public debt. The fact that things went fine so far proves NOTHING about the future. And it does NOT prove the scientific validity of MMT.

While it is true that mainstream economic policy is voodoo, the same holds for MMT policy.

Egmont Kakarot-Handtke


#1 Keynes, Lerner, MMT, Trump, etc. and exploding profit
#2 Links on Austerity
#3 For the full-spectrum refutation of MMT see cross-references MMT

Related 'Economics debate ― just another variant of hardcore wrestling' and 'Economists: scientists or political clowns?' and 'Economics: A pointless left-right wrestling show' and 'Debunking idiots does not prove that MMT is valid' and 'Econogenics in action'. For details of the big picture see cross-references Failed/Fake Scientists.

Immediately preceding Bill Mitchell ― Wall Street’s hitman keeps an eye on MMT defeatists.

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REPLY to Bob Roddis on Jul 25

Fiat money, or evil fiat funny money as you call it, is not the basic problem of the monetary economy but how it is injected into the system. See The right and the wrong way to bring money into the economy