This was a frustrating book to read. The book itself is not frustrating – it’s a as clear and straightforward as it can be about such a counterintuitive subject – but I found myself frustrated while reading it. Firstly, if Modern Monetary Theory is correct then why does literally no-one in power use its insights to help solve our problems? Secondly, since I want it to me true how can I trust my own understanding of it?
Economics is a tricky subject to read about as a lay person (and I use that term advisedly) because on the one hand the mainstream consensus adopted by political leaders in the West has held sway for over forty years, but on the other hand it seems to have led us down a dark path politically and, at best, a bumpy path economically. And you can’t move in the economics section of a book shop for convincing explanations of how this consensus is all wrong. This book is one example, but a selection of others I have read over the years would include The Value of Everything by Mariana Mazzucato, What’s Wrong With Economics? by Robert Skidelsky, Doughnut Economics by Kate Raworth, and 23 Things They Don’t Tell You About Capitalism by Ha-Joon Chang. Those are just the ones I can see from my desk.
So MMT sounds great, if confusing, and old-school monetarism seems to be nonsense, given that the massive quantitative easing programs in place for over a decade after 2008 led to years of 0% interest rates, and austerity seems like a policy choice designed to exacerbate inequality. And yet everyone in power, left or right, is steadfastly certain that nothing can be done and things cannot be made to improve. I read books like this, avidly, and am left more convinced than ever that most of the people who have their hands on the levers of power have no idea how anything works (and neither do I) but an enormous amount of energy is expended in covering up just how much they don’t understand.