MMT is now a reality

MMT is now a reality, by Steven Saville.

Modern Monetary Theory (MMT), which isn’t modern and isn’t a theory (in the true meaning of the word), is now being put into practice in many countries, including the US. What’s happening isn’t being called MMT, but that’s what it is.

Under cover of the “coronacrisis”, we are now witnessing the introduction of MMT. Specifically, in an effort to alleviate the short-term pain associated with the economy-wide shut-downs that they are enforcing as part of history’s biggest ever over-reaction, governments are now promising to spend money as if they had access to an unlimited supply of the stuff. They can do this because with the help of the central bank they do have access to an unlimited supply of the stuff. …

The method of government funding appears to have changed in a permanent way. No longer will governments feel constrained by their abilities to tax the population and borrow from bond investors. From now on they will act like they have unrestricted access to a bottomless pool of money.

Money is how we motivate each other to do real work and real saving. It’s how we ration scarce goods and services. It coordinates the efforts of billions of people.

But the western money system has been systematically rorted and corrupted for a century now, first slowly but now more quickly. It is coming to a predictable climax. It’s going to bust “soon” — next year, next decade, or maybe even not for another 30 years. Watch that build up of debt.

With virus-inspired MMT, we have taken a large step towards the end. Money is losing its meaning, because it is no longer scarce enough, and because increasingly you no longer have to work or save to acquire it.