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Voodoo economic revisionism abounds – and it is not MMT doing the voodoo Bill Mitchell

Summary:
The epithets being used as put-downs for Modern Monetary Theory (MMT) are growing. But some of the good old terms – that one might actually apply to mainstream macroeconomics – are also in currency. An article in Project Syndicate (May 27, 2019) – Japan Then, China Now – declared MMT to be “the latest strain of voodoo economics” that is “alluring for the Trump administration”. The article by a Yale University lecturing staff member (and former investment banker) really just reminds us why students should avoid studying economics at that university. The voodoo, I am afraid is actually on the other foot! There are some fundamental errors in the logic in the article that highlight why MMT is a superior paradigm for understanding how the monetary system actually operates in comparison to the

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The epithets being used as put-downs for Modern Monetary Theory (MMT) are growing. But some of the good old terms – that one might actually apply to mainstream macroeconomics – are also in currency. An article in Project Syndicate (May 27, 2019) – Japan Then, China Now – declared MMT to be “the latest strain of voodoo economics” that is “alluring for the Trump administration”. The article by a Yale University lecturing staff member (and former investment banker) really just reminds us why students should avoid studying economics at that university. The voodoo, I am afraid is actually on the other foot! There are some fundamental errors in the logic in the article that highlight why MMT is a superior paradigm for understanding how the monetary system actually operates in comparison to the mainstream logic that the author uses against it.
A related article in the right-wing National Review (July 22, 2019) – New Budget Deal Puts Final Nail in the Tea-Party Coffin – covers a similar terrain from a different perspective.
The author is bemoaning the fact that Trump has wiped out the ‘tea-party’ by breaking with the “2011 Budget Control Act”, which was the centrepiece of small-minded conservative politics a few years ago....
I stopped posting articles critical of MMT here at MNE some time ago — unless the criticism is serious and informed. Why waster time on derp? However, there is almost no informed critiques and most are just rants. The only difference among the critical articles is how unserious and uninformed they are.

Bill Mitchell – billy blog
Voodoo economic revisionism abounds – and it is not MMT doing the voodoo
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Mike Norman
Mike Norman is an economist and veteran trader whose career has spanned over 30 years on Wall Street. He is a former member and trader on the CME, NYMEX, COMEX and NYFE and he managed money for one of the largest hedge funds and ran a prop trading desk for Credit Suisse.

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