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Economics

‘Modern Monetary Theory’ Is a Joke That’s Not Funny

Yes, a government that issues its own currency can pay its bills. But piling up debt for no urgent reason is lunacy.

By
There’s a theory behind it.

There’s a theory behind it.

Photographer: Eva Hambach/AFP/Getty Images

If you follow the debates over U.S. economic policy, you had probably heard of modern monetary theory well before freshman Democratic Representative Alexandria Ocasio-Cortez spoke favorably about it earlier this month.

If you thought from the start that the whole idea sounded like lunacy, you were right, even if it’s possible to admit some sliver of sympathy for it. So why is MMT, as it is known for short, generating such intense interest now?