MMT and the real issue of money and debt

18 Mar, 2019 at 18:17 | Posted in Economics | 3 Comments

Austerity policies throw millions of people out of work … The lower level of output caused by austerity means there are fewer goods and services available to distribute. Society becomes objectively poorer in material production terms. How can that be helpful? …

Some readers may object: what if there just isn’t enough money to buy people? If there’s just no money, it’s no good going ever further into debt.

Wrong. Money is not actually a limited resource. Money is a scorekeeping tool, nothing more. Governments and central banks can no more run out of money than the scorekeeper of a basketball game can run out of scoring-points …


Unless debts are denominated in a foreign currency, a government and the banking system it ultimately controls cannot ‘run out of money’ …

The real issue is the distribution of money and debt — not its inherent availability or quantity.

Dirk Ehnts


  1. C. H. Douglas was saying this in the 1930s. You don’t need MMT and its insufferable personalities to see money as points.

  2. One can easily make the ethical case that the debt of a monetary sovereign, being inherently risk-free, should yield no more than ZERO percent MINUS overhead costs – to avoid welfare proportional to account balance. That would include bank reserves too but citizens should be exempt from negative interest on their personal accounts at the Central Bank (when those and other non-bank accounts are finally allowed) up to a reasonable account limit since SOME risk-free savings are legitimate and do not constitute fiat abuse.
    Then, with the debt of monetary sovereigns properly priced, that debt would be a revenue producer and self-extinguishing too and thus far less susceptible to criticism.

  3. “Government Debt and Deficits Are Not the Problem – Private Debt Is”- Michael Hudson

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