Modern Monetary Theory: A Cargo Cult

By Keith Weiner – Re-Blogged From Gold Eagle

Newly elected Representative Alexandria Ocasio-Cortez recently said that Modern Monetary Theory (MMT) absolutely needed to be “a larger part of our conversation.” Her comment shines a spotlight on MMT. So what is it? According to Wikipedia, it is:

“a macroeconomic theory that describes the currency as a public monopoly and unemployment as the evidence that a currency monopolist is restricting the supply of the financial assets needed to pay taxes and satisfy savings desires.”

It is uncontroversial to say that the Federal Reserve has a monopoly on the dollar. So let’s look at the second proposition. Unemployment, MMT holds, is evidence that the supply of dollars is restricted.

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Cargo Cult US Policy

cropped-bob-shapiro.jpg   By Bob Shapiro

Melanesia includes island countries like Vanuatu, the Solomon Islands, Fiji, and Papua New Guinea. During World War II and other colonization eras, there developed what is called the Cargo Cult.

One main idea of the Cargo Cult was that it was the building of runways for airplanes which brought all the planes, which brought all the riches from the outside world. They believed that the cause of the planes coming was the existence of the landing strips.

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