At worst, it is a dangerous delusion – one that the labour movement and the left should reject.

Rather, it is, at best, a rehashing of the reformist and liberal ideas of John Maynard Keynes – of government stimulus and ‘demand-side management’. MMT is neither particularly modern, nor much of a theory. In truth, however, as we have explained in-depth elsewhere, there is nothing new or radical about MMT, nor about the ideas in Kelton’s book. And, in turn, a previously unimaginable world of possibilities opens up before us. With this new “lens”, Kelton says, we can undergo a “Copernican shift” in how we view the economy. MMT, the author informs readers, “is a nonpartisan lens that describes how our monetary system actually works”. In her new book, The Deficit Myth, Kelton outlines the fundamental tenets of MMT, attempting to provide suggestions on “how to build a better economy” in the process. In her new book, The Deficit Myth, Kelton outlines the fundamental tenets of MMT / Image: Paul Thomas And one of the most prominent proponents of this ‘new perspective’ is Stephanie Kelton, a professor of economics and a former advisor to Bernie Sanders in the USA. This is exactly what supporters of MMT espouse: for governments, in the face of a slump, to print and spend. $3.7 trillion, however, has come from expanding the balance sheets of central banks – that is, from the creation of new money. $4.2 trillion of this has come from public borrowing. As per their advice, governments across the world are pumping money into the global economy, in a desperate bid to prop up the system.Īn estimated $8 trillion in state support has already been spent or pledged by the advanced capitalist countries. But the limits of a new book by a leading MMT proponent show why we need the ideas of Marxism.Īdvocates of Modern Monetary Theory (MMT) must feel vindicated. Modern Monetary Theory has become in vogue on the left, as a supposed answer to the austerity agenda pursued by big business politicians.

The deficit myth review