'The Deficit Myth: Modern Monetary Theory and the Birth of the People's Economy' by Stephanie Kelton challenges conventional economic beliefs, arguing that governments do not need to tax their people for money and that deficits can be beneficial. Kelton explores the idea of optimizing economic systems for human development rather than exploitation and advocates for setting priorities based on human needs. delves into Modern Monetary Theory (MMT) and its implications on government spending, monetary policy, and societal well-being.

Writing/Prose:

The writing style is accessible and engaging, using clear language and anecdotes to make complex economic concepts understandable.

Plot/Storyline:

The book explores Modern Monetary Theory and its revolutionary approach to government deficits and economic policy, challenging long-held beliefs about monetary management.

Setting:

The setting is contemporary, centered on current economic discussions and the historical context of monetary policy.

Pacing:

The pacing is structured and logical, keeping reader interest but may feel repetitive at times.

In 2015, I took a leave of absence from my job teaching economics at the University of Missouri–Kansas City and moved to Washington, DC, to serve as the chief economist for the Democrats on the US Sen...

Genres:

Topics:

modern monetary theory

challenging assumptions

reforming the system

citizen empowerment

Notes:

Modern Monetary Theory (MMT) argues that currency is a public monopoly managed for the public good.

MMT suggests that a country can never 'run out' of money since it issues its own currency.

Traditional economic indicators often focus too much on jobs and inflation, overlooking the primary purpose: people.

The idea of 'national debt' creates unnecessary anxiety around federal spending, according to Kelton.

Money is described as a social construct rather than a material resource, making it adaptable.

Countries like the US, UK, and Japan enjoy high monetary sovereignty, enabling independent control over their currency supply.

Kelton proposes a guaranteed federal job for anyone who wants work, which could enhance economic stability.

Corporate lawyers earn more than teachers but may not lead more meaningful lives, showcasing the discrepancy between income and fulfillment.

Budgetary allocations reflect societal moral priorities, which can often be unequal and unjust.

Fiscal deficits are seen as tools that can help stimulate the economy, not just emergencies to avoid.

Kelton emphasizes that federal government debt is not a true debt, but a way to control money supply based on fiscal needs.

The book argues against viewing the economy as a family budget; governments can create money as needed.

Kelton contests that taxes are not necessary for government operations but instead create demand for currency.

The history of the gold standard limited monetary flexibility and led to frequent economic recessions.

MMT teaches that if a nation has the resources, it can always make money available to meet its goals.

Inflation risks need careful monitoring when increasing spending, but are manageable under MMT principles.

Guaranteed employment could shift focus from survival to meaningful work, enhancing individual and societal development.

The current budgetary mentality often neglects to address wealth inequality and essential social spending.

From The Publisher:

A New York Times Bestseller

The leading thinker and most visible public advocate of modern monetary theory - the freshest and most important idea about economics in decades - delivers a radically different, bold, new understanding for how to build a just and prosperous society.

Stephanie Kelton's brilliant exploration of modern monetary theory (MMT) dramatically changes our understanding of how we can best deal with crucial issues ranging from poverty and inequality to creating jobs, expanding health care coverage, climate change, and building resilient infrastructure. Any ambitious proposal, however, inevitably runs into the buzz saw of how to find the money to pay for it, rooted in myths about deficits that are hobbling us as a country.

Kelton busts through the myths that prevent us from taking action: that the federal government should budget like a household, that deficits will harm the next generation, crowd out private investment, and undermine long-term growth, and that entitlements are propelling us toward a grave fiscal crisis.

MMT, as Kelton shows, shifts the terrain from narrow budgetary questions to one of broader economic and social benefits. With its important new ways of understanding money, taxes, and the critical role of deficit spending, MMT redefines how to responsibly use our resources so that we can maximize our potential as a society. MMT gives us the power to imagine a new politics and a new economy and move from a narrative of scarcity to one of opportunity.

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The Deficit Myth: Modern Monetary Theory and the Birth of the People's Economy

Stephanie Kelton