Modern Monetary Theory with Andres Bernal

Denizen

In this episode we do a deep dive on Modern Monetary Theory (MMT). MMT stems from an alternative story of money which has significant implications for governments in countries that have sovereignty over the currency it issues. Under MMT, spending does not face financial constraints, taxes and bonds do not fund government budgets, federal deficits and debt are not problematic, and the lines between fiscal and monetary policy blur completely.

We were fortunate to be joined by Andres Bernal, leading MMT proponent and former advisor to help us understand the essential topic.

In this conversation Jenny and Andres cover:

• Two stories of the origin of money [3:04]
• Money as a social construct [9:58]
• MMT defined [12:46]
• Currency issuers vs. currency users [15:15]
• Spending and its relationship to taxes [16:00]
• Reconsidering federal deficits[16:44]
• Monetary sovereignty and MMT [17:21]
• Hyperinflation and productive capacity [20:15]
• MMT and the role of taxation [23:36]
• MMT and bonds [26:41]
• MMT and monetary policy [30:15]
• Rejecting the monetarist view of the inverse relationship between unemployment and inflation [33:43]
• MMT and inflation [35:55]
• Drivers of today's high inflation rates [41:55]
• MMT and a Job Guarantee [50:17]
• Job guarantee vs. guaranteed income [55:04]
• De-growth vs. post-growth [59:39]
• Current MMT landscape [1:01:53]
• Common misconceptions about MMT [1:03:14]

Resources

• Stephanie Kelton’s Ted Talk
• The Deficit Myth, Stephanie Kelton
• L. Randall Wray - Modern Money Theory for Beginners L. Randall Wray lecture gets into the origin story of money
• L. Randall Wray’s introductory lecture from an economist’s perspective.
• “Seven Replies to the Critiques of Modern Monetary Theory” Eric Tymoigne, December 2021
• The Case for a Job Guarantee, video with Ravlina Tcherneva a main advocate for the policy which is a major component of MMT
• www.MoneyontheLeft.org is a useful resource for podcasts and essays