2 responses to “MMT and Ideology

  1. Pingback: MMT and Ideology | Modern Money Mechanics | The...

  2. The descriptive aspect of MMT is as value-neutral as economics can be, which is “only to a limited degree.” See Joan Robinson on this, for example. MMT’s approach to economics is based on the system we now have, which is capitalism. Capitalism is by definition right-wing as opposed to socialism as left-wing. But within that context, MMT seeks to set forth the operational realities and their implications.

    The implications of operational realities bear on policy formulation. Macro is a policy science, and some have claimed that it is more properly named “political economy.” Politics is about power, and policy is about distribution, institutional arrangements, and welfare. Policy is based on politics and is inherently performative rather than descriptive. Differences in prescription are often based on normative factors.

    With respect to policy, MMT can be viewed as left-wing, since it takes full employment in the sense of a job offer being extended to all willing and able to work as a goal in determining policy efficiency and effectiveness, as well as meeting the welfare requirement of public purpose. In that sense it is “Keynesian,” in the way that the right defines the left since they equate Keynesianism, socialism and communism.

    However, in that MMT’s approach is within capitalism and seeks to make capitalism work more optimally wrt distributed prosperity and public purpose, it cannot be called socialism, which is about public ownership of the means of production. MMT does no advocate public ownership of the manes of production.

    We can conclude then that wrt to policy recommendations, MMT is toward toward the left of an essentially right wing paradigm called “capitalism.” So we could say that MMT is centrist wrt to the left (socialism) and right (capitalism) dichotomy, but being in the capitalist camp it is center-right.

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