Modern Monetary Theory

What is MMT and how could it completely change your perception of life in a nation with a sovereign fiat currency?
MMT - What is it anyway??
"I've heard it called the Magic Money Tree"
"If we just keep printing money, we'll devalue the dollar!"
"Printing money will cause inflation!"
"OhEmGee the National Debt!!"

We've all heard loads of rumors...now it's time to get the truth!

Use the arrows or swipe through the slides to learn more.
Modern Monetary Theory or MMT
MMT is just a description of how sovereign fiat, floating exchange rate currencies like the US dollar actually work. MMT helps us move past the outdated gold-standard thinking that hasn't been right for decades.

It's not something to implement someday, it is exactly how our money works TODAY!!
Sovereign currency issuers...
Many governments issue their own currency. The sovereign issuer of a nation’s currency is nothing like the users of its currency - such as households, businesses, or state and local governments.

The currency issuer is not constrained to balanced budgeting in the same way as a currency user.
Government Solvency
Sovereign governments can never run out of the currency they issue.

No matter what politicians or talking heads on TV say, when a country issues its own sovereign currency, it can never run out.

That would be like the scorekeeper in baseball running out of points! Crazy, right?
Taxes and Federal Spending
Federal taxes are not collected in order for the government to spend later. They are actually deleted out of existence!

As a matter of fact, in order for us to pay taxes in the first place, the government, the CURRENCY ISSUER, has to create (or spend into existence) the money. Then, we CURRENCY USERS have to find a way to get some money to pay our taxes.
The National Debt
It is not possible for a currency issuer to go broke.

Most governments, most of the time, will run fiscal deficits. This is not a matter of concern, and is indeed a good thing, as it means most private sectors will be able to run the financial surpluses they wish to add to their net savings.

The government’s deficit is our surplus – we should be glad all that money hasn’t been taxed out of the economy!
Where Do I Learn More?
Look through our collection of articles below to learn more! They are conveniently categorized and there are plenty of resources from MMT Beginner to Macroeconomics Expert level.
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  • All Articles
  • Federal Debt
  • MMT Academics
  • MMT Rebuttal
  • Taxation
All Articles
  • All Articles
  • Federal Debt
  • MMT Academics
  • MMT Rebuttal
  • Taxation

Framing a Job Guarantee

Ms. McArdle is being disingenuous in planting the idea that everyone who is paid with federal dollars is a federal employee; it’s an idea that immediately discredits the JG program, and it should be proactively discredited itself.

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The Federal Reserve is Not a Private Bank – A Response to Counterpunch

Calling out the omission of facts from a recent Counterpunch article concerning the U.S. Federal Reserve.

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THE SHIFT: Understanding and Using Americas Fiat Money

The importance lies in a profound conceptual shift about what money isand how a modern, democratic society can use that new understanding to address public needs and pursue collective goals.

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Permanent Cures for Debt Ceiling Crises

While our attention is on the chaos and consequences of debt ceiling crises, is a good time to consider how we might eliminate them entirely. Here’s a rundown on the four most important methods one can use.

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Canada: Flagellation Letter in National Post

So-called “fiscal anchors” instituted in peacetime are simply ideological vehicles intended to limit government spending, much as medieval monks recommended flagellation as a means of curbing unwanted desires.

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Yes, We Need to Start Taxing the Rich More: Here’s Why

Higher taxes on the rich are a means by which to slow the process of the accumulation of wealth. By slowing the process of accumulated wealth, higher top marginal taxes increase income equality.

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Let’s Get Down to Business and Understand Some Practical Economics

It’s time for you to stop allowing yourself to get sidetracked with old thinking.

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Why we need to debunk the 'deficit myth' - BBC REEL

Government spending is increasing at an unprecedented rate to deal with the effects of the coronavirus pandemic. Many people worry this could burden future generations.

However, economist Stephanie Kelton, author of The Deficit Myth, argues that we need to rethink our attitudes towards government spending.

Could Modern Monetary Theory help us navigate our way out of this crisis – and even help build a fairer economy?

Producer: Dan John
Animation: Jacqueline Nixon

(Republished with permission from the BBC)

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