Modern Monetary Theory: Miracle or Mirage?

Modern Monetary Theory: Miracle or Mirage?

Author: New Politics September 17, 2025 Duration: 10:14
In this bonus episode of the New Politics podcast, host David Lewis unpacks Modern Monetary Theory (MMT) – once dismissed as fringe but now at the centre of global economic debate. We explore its intellectual roots, from Georg Friedrich Knapp and Abba Lerner to modern voices like Warren Mosler, Bill Mitchell, L. Randall Wray and Stephanie Kelton, and examine how MMT shapes today’s policy battles over climate change, unemployment and inequality. From Japan’s record debt levels to US COVID stimulus, Canada’s healthcare experiments and China’s infrastructure spending, real-world tests are mounting, sparking fierce clashes between advocates who see MMT as a tool for resilience and critics who warn of runaway inflation. Is it the future of economic management or a dangerous illusion?

#ModernMonetaryTheory #MMTExplained #EconomicsPodcast #FiscalPolicy2025 #GreenNewDeal #GlobalEconomy

Reading list:
  1. Kelton, S. (2020). The deficit myth: Modern Monetary Theory and the birth of the people’s economy. PublicAffairs.
  2. Knapp, G. F. (1905). The state theory of money. Macmillan.
  3. Lerner, A. P. (1943). Functional finance and the federal debt. Social Research, 10(1), 38–51.
  4. Levy Economics Institute. (2025). The rise of the modern monetary system (Working Paper No. 1234). Levy Economics Institute of Bard College. https://www.levyinstitute.org/publications/the-rise-of-the-modern-monetary-system
  5. Mitchell, W. (2025, August 8). The failure of austerity and the construction slowdown in the UK [Blog post]. Bill Mitchell – Modern Monetary Theory. https://billmitchell.org/blog/?p=62704
  6. Mitchell, W., Wray, L. R., & Watts, M. (2019). Macroeconomics. Red Globe Press.
  7. Murphy, R. P. (2025). MMT: Dead wrong [Audio podcast episode]. Mises Institute Podcast. Mises Institute. https://mises.org/library/mmt-dead-wrong
  8. Palley, T. I. (2019). Modern Monetary Theory (MMT): A policy polemic for depressed times. Real-World Economics Review, 89, 147–160. http://www.paecon.net/PAEReview/issue89/Palley89.pdf
  9. Phys.org. (2025, May 15). Economist: Modern Monetary Theory could benefit Canada. Phys.org. https://phys.org/news/2025-05-modern-monetary-theory-economist-canada.html
  10. Tcherneva, P. R. (2020). The case for a job guarantee. Polity Press.
  11. Wray, L. R. (2015). Modern Monetary Theory: A primer on macroeconomics for sovereign monetary systems (2nd ed.). Palgrave Macmillan.

Eddy Jokovich and David Lewis host New Politics: Australian Politics, a podcast dedicated to cutting through the noise of the daily news cycle. Their conversations go beyond the headlines and parliamentary theatre, digging into the stories and power dynamics that often get sidelined. They focus on the issues that mainstream coverage tends to gloss over or ignore entirely, driven by a commitment to the kind of accountability many journalists shy away from. Each episode is built on thorough analysis and direct discussion, offering listeners a deeper understanding of the forces shaping the country. You’ll hear them dissect policy, political strategy, and the real-world consequences of decisions made in Canberra, all with a serious and critical eye. This isn’t about soundbites or partisan point-scoring; it’s about examining how power operates and who it serves. For anyone tired of superficial political reporting and looking for substantive commentary, this podcast provides a necessary and regular dose of clarity. Tune in for their unflinching take on Australian politics, where the conversation always aims to hold power to account.
Author: Language: English Episodes: 100

New Politics: Australian Politics, News, Analysis & Commentary
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