Before going any further let’s make sure you know what MMT is. Or at least what the letter stand for.
MMT = Modern Monetary Theory. Wait. Don’t go. It might be interesting!
The next in our Mibbes Aye Series goes on April 18th. It features a conversations between myself and Fiona for the podcast team and Jim Byrne who is a fan of our podcasts. Click on the image to go to the video.
Jim offered to come on and talk to us about MMT. He’s a firm believer in Scottish independence and he thinks a lot about what kind of nation we might aspire to, and how to become that. He also thinks a lot about what’s gone wrong with Union we are currently a part of and how to make sure we don’t fall into the same traps. He’s not an economist but he’s interested in the economic options for a newly emerged, well re-emerged, nation.
We were very quick to take up Jim’s offer because MMT economics is one of the topics we are frequently asked to cover in our podcasts.
Introducing MMT Thinking
Jim has written a series of articles for Byline Scotland about various aspects of economics, MMT and Scotland’s economic option. We’ve read then and think they are a good starting off point on the mechanics of running a nation’s economy. So we want to point you to them.
Deficits are not a good thing, Mrs Thatcher said so.
Mrs T said running a country was just like running a household, and that has become ingrained in our heads. And of course if a household runs up a load a debt then the bailiffs arrive and turf us out. But that doesn’t happen with a country. Not convinced? Read more here:
Then there’s currency…
We’ve had a few guests on to our podcasts to talk about currency. You’ll find them in our Currency & Economics category. Jim’s thinking is that we will have ambitious goals for our new nation and we’ll need as much economic freedom as possible to pursue our vision. To that end, we’ll be creating our own currency and our own central bank ASAP. And yes of course we are going to have a Unicorn on our bank notes….
Next is Taxation.
I bet you think that a government can only spend what it raises in taxes? and that’s what taxation is for? It’s to fund government spending and services, isn’t it? But it turns out that’s not what actually happens. Eh? has Jim gone mad?
And finally….. Government Spending. It doesn’t work how you think it works.
Mrs T’s brainwashing of the UK has left us believing that deficits are a bad thing, that a government can only spend what it can raise in taxes, and if it spends more then it’ll have to make up for that with a programme of austerity. Nope, think again. Or at least have a go at understanding the MMT approach to government spending.
If you’re still here after all of the above, give yourself a pat on the back. You’re showing a lot of grit!
Fiona and I explore more of these ideas with Jim in the Mibbes Aye Episode 15 out on 18th April. Thanks Jim for your writing and your conversation. Economics will never be the same again!