Danger - The Growing Popularity of MMT
Few things represent such a threat as the popularity of a flawed theory.
I just encountered another book about Modern Monetary Theory (MMT.) When I first encountered MMT several years ago I never thought such a boneheaded idea would achieve so much traction. Even within the growing environment of socialism, I believed that people would see through the flaws and fallacies of MMT. I actually believed that by seeing the problems with MMT, some people might see the dangers of using monetary expansion to finance the federal deficits.
I plan to write many articles about this flawed “theory.” It may actually provide a doorway to exposing the dangers of monetary expansion.
Taxation amounts to legalized theft. At least when the tax man robs you, you know it. We have laws against theft. So why do we allow the government to take so much of our money and redistribute it at the whim of the legislature? Have we lost the ability to attend to our own needs? I will spend more time later addressing the problems of redistributing resources through our misguided tax and “spend” policies.
Monetary expansion amounts to legalized counterfeiting. The government has set up a mechanism to rob people by legalizing counterfeiting. Monetary expansion represents a far more insidious form of theft than taxation. The victim does not realize at the time that he has accepted something that looks like currency for which no one has produced anything.
The government uses the mechanism of monetary expansion but keeps its dangers from the public by not even talking about it. When they talk about the budget deficit, legislators don’t mention that they will finance most of the deficit by “borrowing” money that does not yet exist.
The advocates of MMT take this fraud one step further by openly making false and misleading claims about the money expansion process. They claim that federal deficits simply amount to additions to a grand national savings plan. Nothing could be further from the truth. Deficits redistribute resources no matter how the government finances them.
MMT advocates claim that governments issue “money” for the purpose of taxation. They apparently believe that without government “spending” and taxation, the market would not need money. They either ignore or make short shrift of the truth that markets use money to exchange resources.
The list of flaws in this “theory” seems almost endless. The proponents of MMT disguise the fallacies by an incredible amount of writing and speaking that simply creates a smokescreen for flawed thinking.
Conclusion
Behind all the alleged “theory” lies a firm belief that government can do a better job at allocating resources than can a free market. Even if you’re an avowed Marxist, stay away from the hype known as Modern Monetary Theory. Stick to the redistributive process of taxing and “spending.” Until we can elect angels to the legislature, you’re still better off having them rob you in daylight than making you an unwitting part of the resource redistribution scheme.