Noah Smith

So a capital flight from the United States would be a truly apocalyptic economic event.

Modern monetary theory is the most poorly named idea since the Holy Roman Empire, which was famously neither holy nor Roman nor an empire.

Modern monetary theory is neither modern nor monetary nor theory.

It is a series of pronouncements by a small circle of people who will change their story on any given day, led by a guy named Warren Mosler and also Stephanie Kelton.

And these people, if you ever try to pin down exactly what the MMT people believe about something, unless you're one of the MMT people, they will say, no, you haven't gotten it.

And the only way to get it is not to read any papers or books or something like that.

This isn't the kind of knowledge like physics.

You can read a textbook and then you can understand physics.

Even if all the physics professors in the world died, you couldn't go ask them questions.

You could read a textbook and you could understand Newton's laws or electromagnetism or something like that.

Economics, orthodox economics, you could understand the models of supply and demand or whatever just by reading a textbook without asking a guru.

But with MMT...

There's no independent knowledge that they allow you to have.

You have to go ask them, is debt too high now?

What will happen to interest rates?

And they will give you pronouncements from their little mountaintop.

Oddly, in 2021, 2022, when people started worrying about debt, Warren, you know, before that, they had spent years saying like, you know, debt's not a problem.

Debt's not a problem.

Inflation's not a danger, blah, blah, blah.

Then inflation went up and people started laughing at the MMT people and listening to them less.