Oct 8, 2020
Welcome to episode 49 of Activist #MMT. Today I talk with one of the original developers of MMT, Mathew Forstater (Twitter/@mattybram). Mat is a professor of economics at the University of Missouri Kansas City, or UMKC which, according to Sam Levey, who was my first-ever guest and is also a UMKC economics PhD. student, is where MMT was born. Mat is also research director for the Global Institute for Sustainable Prosperity and research associate for the Levy Economics Institute at Bard College.
In this first of a five-part episode, Mat and I first talk about how he grew up in Philadelphia, where I also grew up and still live near. He attended Temple University in North Philly and earned a bachelor’s degree in what was originally called Pan African Studies but came to be known as African-American studies. According to Mat, quote, "everything seemed to keep coming back to economics." He says he also decided on economics because economists and their theories "affects peoples lives” in a more immediate sense than other subjects. Although all subjects are important in their own way, there is a reason, he says, that every countries’ leaders have economic advisers.
Mat then talks about his long career as a heterodox economist and professor, and the difficulties he experienced and witnessed among the heterodox community, substantially due to the lack of support from (and benefit to) those in power. The infighting and factionalism he describes is similar to the concepts in his 1999 paper regarding Abba Lerner, called "Functional Finance and Full Employment." In it, he talks about how the artificial scarcity of jobs and funding imposed by the central government and currency issuer, causes bad behavior and decisions by workers and unions, in an effort to protect their artificially limited jobs at all costs. This understandably results in discrimination against the most disadvantaged. As Stephanie Kelton describes it, it is a cruel game of musical chairs. Mat calls Fred Lee an important figure in promoting and supporting a "big tent" for Post-Keynesians, in order to address some of these concerns. (This interview was partially inspired by Fred Lee's book, A History of Heterodox Economics.)
One of the primary examples Mat gives of discrimination by neoclassicals is how heterodox economists were told that if a concept could not be modeled or expressed in math, then it wasn’t really economics. I see this as a tool to make economics inaccessible to the general public, and also as a way to take the real world, which is complicated, difficult, and beautiful, and reduce it to meaningless numbers and formulas. This is not unlike focusing on a child’s report card or standardized testing grades and ignoring the child himself. This intentionally myopic view of the world obviously ignores real world suffering and also makes it very easy to justify not alleviating it.
For an overview of Modern Monetary Theory (MMT) with many reliable sources to learn more, here is a good place to start:
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