Accurate information is anathema to those who wish to deceive. Staying on top requires exploiting the rest, which in turn requires deception. Modern Money Theory, or MMT, strives to be an accurate representation of our economic and legal systems. Like anything that threatens power, MMT is the target of many bad-faith critiques. (There’s no other way to critique accurate information!) This post first provides my definition of a good-faith critique and then briefly describes several of the common tactics of bad-faith critics of MMT. More broadly, these are the things simple bullies do, when they would prefer their followers to think they’re not bullies.
This post is largely based on parts two and three of my 2022 interview with Brian Romanchuk. In the interview, Brian and I connect many of these techniques to various anecdotes and academic criticisms. The interview itself was inspired by chapter five of Brian’s 2021 book, Modern Monetary Theory and the Recovery, and my own post documenting several good-faith critiques of MMT, and the MMT responses to them.
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Disclaimer: I have studied MMT since February of 2018. I’m not an economist or academic and I don’t speak for the MMT project. The information in this post is my best understanding but in order to ensure accuracy, you should rely on the expert sources linked throughout. If you have feedback to improve this post, please get in touch.
My definition of a good-faith critique
In my view, a good-faith critique of MMT is one that assumes the MMT economists and academics to be themselves of good faith. They care and are smart, and their work is worth reading. MMT is defined by their work.
Brian makes the point that it’s important to consider the critique on its face, and to let go of any insulting attitude or concerning motivation of the author. I would argue their attitude and motivations are inseparable from the academic arguments. This is Michel Foucault’s assertion that knowledge is inseparable from the power of the person or institution expressing it. At the same time, it’s important to have allies who can see beyond the attitude and motivations, so both the argument and its author can be better understood. All problems must be attacked from multiple angles, and different people prefer to address different angles in different ways.
Bad-faith technique #1: “MMTers ignore X”
Most of the techniques in this post have two messages: the ostensible, direct one, and another that is hidden and indirect. “MMTers ignore X”, such as “MMTers ignore the external (or foreign) constraint”, says, first, that the critic believes the external constraint to be important, and they would like to better understand MMT’s view on the topic. This is a legitimate concern that should be encouraged and responded to.
However, when stated as “MMTers ignore the external constraint”, it changes from a question to an accusation. According to the Oxford American Dictionary, the word ignore is defined as “refuse to take notice of or acknowledge; disregard intentionally”. The statement can easily be interpreted, along with many of these other techniques, as not an effort to learn, but to destroy. For those with enormous platforms, it serves as a dog whistle to their followers to discriminate.
Bad-faith technique #2: “MMTers are deliberately deceptive and keep changing their position”
This is explicitly stated by Thomas Palley in his 2019 critique MMT, and strongly suggested by Paul Krugman when he accused [original, archive] Stephanie Kelton and MMT of “Calvinball”. So, is MMT not understandable, or are these prominent neoclassical economists not understanding it? Their words strongly imply the problem to be 100% with MMT and it’s economists, and 0% with them. In reality, virtually no problematic relationship is 100% the fault of one party only. Especially important additional context is the overwhelming dominance of neoclassical economics.
(There is an enormous difference between inconsistent and “deliberately deceptive”.)
Bad-faith technique #3: “MMT is wrong, because if it were right, then it would be bad.”
As Brian states, an example of the crude version of this critique is when MMT is dismissed out of hand as “just another funny money scheme”. The more sophisticated version is the concern, such as from Ray Dalio, that it is unacceptable for the power of money creation to be placed in the hands of our hopelessly incompetent and corrupt politicians. Dalio [emphasis in original]:
The big risk of this approach arises from the risks of putting the power to create and allocate money, credit, and spending in the hands of politically elected policy makers. In my opinion, for these [proposed policies] to work well, the system would have to be engineered in a way that decision making would be in the hands of wise, not politically motivated, and highly skilled people.
The even deeper fear is having that power in the hands of “the unwashed masses”, who are, supposedly, simply incapable of understanding how to properly manage a society. Therefore, according to Dalio, the only possible solution is to place that power into the hands of unelected officials, who he says are “wise, not politically motivated, and highly skilled”. The unspoken realities are that the unwashed masses are kept deliberately unwashed, our hopelessly incompetent and corrupt politicians are kept deliberately incompetent and corrupt, and the idea that unelected technocrats are somehow outside the influence of politics, is more accurately stated as, they support the politics of those already on top.
Bad-faith technique #4: Killing the messenger because you don’t like the message.
This technique is exemplified by the persecution of whistleblowers such as Julian Assange, Edward Snowden, and Steven Donziger. This is related to the previous technique merely for the fact that it’s a tool to keep the unwashed masses unwashed.
Bad-faith technique #5: “You don’t define you. I define you.”
The final technique Brian and I discuss is the most insidious. This is when neoclassical economists make false assertions about MMT and its economists, and then blast MMT because of those assertions. This technique is colloquially called a strawman.
More broadly, it’s the dehumanization of those with less power, by those with more power, as a way to justify the terrible behavior necessary to stay in power. In fact, this is what makes the strawman arguments into not strawmen, because under this assumption, The MMTers and their work are genuinely worth dismissing entirely and out-of-hand.
Here’s a real-world example, documenting my own experience with the popular and highly-exclusionary Reddit group r/AskEconomics. Here’s another real-world example: imposing highly unrealistic prerequisites onto the less-powerful figure, making it impossible for the conversation to even begin.
Economists use models and present their research. Unless you want to present something about economy make sure it is from AER, QJE, JPE, RESTAT or RESTUD, and I assume you don’t know what any of those words are short for. Here:
- American Economic Review
- Quarterly Journal of Economics
- Journal of Political Economy
- The Review of Economics and Statistics
- The Review of Economic Studies
So present your MMT research or whoever the researcher is there, and show me a peer-reviewed research in any of those reputable places I just mentioned.
As detailed in Fred Lee’s 2006 book, A History of Heterodox Economics, these journals are highly ranked precisely because those who rank them are those who benefit the most from sidelining dissenting ideas. The same is true of highly ranked universities.
Essentially, this person has redefined the term “reptable” to mean “that which the powerful have pre-approved”.
This final technique, “You don’t define you. I define you”, is just another flavor of the dehumanization of slaves by their slaveowners and Jews during the Holocaust. Having just read about Emmett Till, and re-read Elie Wiesel’s Night, right around when reading Brian’s book, this particularly struck me. Those in power and their economists pretend to act dignified and empathetic as they justify depriving millions of desperately needed policy. It’s “unfortunate, but necessary” because, you know, how you gonna pay for it?