The MMT Podcast with Patricia Pino & Christian Reilly

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#197 The Problem With Wealth Taxes with Steven Hail (part 2)

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May 2, 2025

Guest

Steven Hail

In a riveting discussion, economist Steven Hail, founder of Modern Money Lab, challenges the common notion of wealth taxes as a solution to fund critical public services. He urges a shift from tax redistribution to government money creation, highlighting the potential drawbacks of waiting for the wealthy to contribute. The conversation also dives into the complexities of tariffs, economic inequalities, and the political dynamics that shape our financial landscape, all while advocating for innovative strategies to ensure sustainability and community engagement.

01:10:15

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INSIGHT

Taxes for Revenue Are Obsolete

Taxes used solely for revenue are obsolete in modern monetary systems.
Wealth taxes should focus on reducing economic and political power, not on funding government spending.

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ADVICE

Practical Inequality Reduction Policies

Focus on realistic, practical policies to reduce income and wealth inequality.
Avoid complex, unlikely proposals like permanent caps on physical property ownership.

insights

INSIGHT

Cut Wasteful High-End Consumption

The top 1% waste resources through excessive consumption.
Reducing this consumption can create space for vital government investments and lower inequality.

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Reevaluating Wealth Taxes and Public Financing

02:18 • 24min

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Wealth Taxes and Economic Inequality

25:54 • 9min

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Understanding Wealth Taxes and Political Dynamics

35:14 • 3min

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Navigating Political and Economic Turbulence

38:19 • 16min

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Towards Trade Peace and Empowering Economic Engagement

54:00 • 4min

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Rethinking Capitalism: Workshops for Change

57:56 • 10min

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Exploring Economic Education and Public Service Funding

01:08:06 • 2min

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The Deficit Myth

Modern Monetary Theory and the Birth of the People's Economy

Stephanie Kelton

In this book, Stephanie Kelton challenges conventional economic wisdom by arguing that government deficits are not inherently bad and can actually strengthen economies. She dispels six key myths about deficits, such as the idea that governments should budget like households, that deficits harm future generations, crowd out private investment, and undermine long-term growth. Kelton explains that in a fiat currency system, governments are not constrained by the same budgetary rules as households or businesses. Instead, the real constraints are the limits of real resources and the threat of inflation. The book advocates for using MMT to address critical social issues like poverty, inequality, unemployment, healthcare, and climate change by shifting the focus from narrow budgetary questions to broader economic and social benefits.

Finding The Money

None

Stephanie Kelton

Part 2: Patricia and Christian continue their conversation with economist, author, and founder of Modern Money Lab Professor Professor Steven Hail about the well-intentioned (taxing the rich is good!) but counter-productive call for a wealth tax to “fund” life-saving support for vulnerable people (needlessly waiting for the rich to cough up while people suffer and die is bad!) and, of course - those beautiful tariffs.

Full conversation here: https://www.patreon.com/posts/126627127

Please help sustain this podcast!

Patrons get early access to all episodes and patron-only episodes: https://www.patreon.com/MMTpodcast

All our episodes in chronological order: https://www.patreon.com/posts/43111643

All our patron-only episodes: https://www.patreon.com/posts/57542767

LIVE EVENTS!

Modern Money Lab UK weekend seminars in London featuring Dr Steven Hail:

June 21st & 22nd (White City) - Rethinking Capitalism
June 28th & 29th (Finsbury Park) - Money, Government and the Public Interest - Beyond The Deficit Myth

Details and tickets: https://modernmoneylab.org.uk/events/

JOIN PATRICIA’S MMT ACTIVIST NETWORK (MMT UK): https://actionnetwork.org/forms/activist-registration-form

MMT: THE MOVIE!

“Finding The Money”, a documentary by Maren Poitras featuring Stephanie Kelton is now available worldwide to rent or buy: https://findingthemoney.vhx.tv/products/finding-the-money
Updates on worldwide screenings of “Finding The Money” can be found here: https://findingmoneyfilm.com/where-to-watch/
To arrange a screening of “Finding The Money”, apply here: https://findingmoneyfilm.com/host-a-screening/

STUDY THE ECONOMICS OF SUSTAINABILITY!

Details of Modern Money Lab’s online graduate, postgraduate and standalone courses in economics are here: https://modernmoneylab.org.au/

Relevant to this episode:

Episode 30 - Steven Hail: Understanding Government Bonds (Part 1) :https://www.patreon.com/posts/29621245
Episode 31 - Steven Hail: Understanding Government Bonds (Part 2): https://www.patreon.com/posts/29829500
“Federal Debt and Modern Money” by Steven Hail & David Joy: https://www.global-isp.org/wp-content/uploads/PN-121.pdf
"There is no need to issue public debt” by Bill Mitchell: https://billmitchell.org/blog/?p=31715
“How to Fight Back Against the False Idea that the Government is at the Mercy of Financial Markets” by Sheridan Kates: https://thealternative.org.uk/dailyalternative/2025/3/10/scotonomics-monetary-autonomy
Lecture: “The CFA Franc and Monetary Sovereignty in Africa”, by Dr Ndongo Samba Sylla: https://youtu.be/W3P14tpE70U?si=0Dv7dukz_bnQbIbN
“Who Is Ron Vara? The Truth Behind Peter Navarro's Fake Expert” by Brendon Beebe: https://brendonbeebe.substack.com/p/who-is-ron-vara-the-truth-behind
For more on the endogenous money view (the non-fringe, very mainstream view that bank loans create deposits, not the other way around), listen to episode 126 - Dirk Ehnts: How Banks Create Money: https://www.patreon.com/posts/62603318 and episode 43 - Sam Levey: Understanding Endogenous Money: https://www.patreon.com/posts/35073683
For more on the (Liz) Trussageddon, listen to Episode 147 - Dirk Ehnts: Do Markets Control Our Politics?: https://www.patreon.com/posts/episode-147-dirk-72906421

For an intro to MMT:

Our first three episodes: https://www.patreon.com/posts/41742417
Episode 126 - Dirk Ehnts: How Banks Create Money: https://www.patreon.com/posts/62603318

Quick MMT reads:

Warren’s Mosler’s MMT white paper: http://moslereconomics.com/mmt-white-paper/
Steven Hail’s quick MMT explainer: https://theconversation.com/explainer-what-is-modern-monetary-theory-72095
Quick explanation of government debt and deficit: “Some Numbers Are Big. Let Me Help You Get Over It”: https://christreilly.com/2020/02/17/some-numbers-are-big-let-me-help-you-get-over-it/

For a short, non-technical, free ebook explaining MMT, download Warren Mosler’s “7 Deadly Innocent Frauds Of Economic Policy” here: http://moslereconomics.com/wp-content/powerpoints/7DIF.pdf

Episodes on monetary operations:

Episode 20 - Warren Mosler: The MMT Money Story (part 1): https://www.patreon.com/posts/28004824
Episode 126 - Dirk Ehnts: How Banks Create Money: https://www.patreon.com/posts/62603318
Episode 13 - Steven Hail: Everything You Always Wanted To Know About Banking, But Were Afraid To Ask: https://www.patreon.com/posts/41790887
Episode 43 - Sam Levey: Understanding Endogenous Money: https://www.patreon.com/posts/35073683
Episode 84 - Andrew Berkeley, Richard Tye & Neil Wilson: An Accounting Model Of The UK Exchequer (Part 1): https://www.patreon.com/posts/46352183
Episode 86 - Andrew Berkeley, Richard Tye & Neil Wilson: An Accounting Model Of The UK Exchequer (Part 2): https://www.patreon.com/posts/46865929

For more on Quantitative Easing:

Episode 59 - Warren Mosler: What Do Central Banks Do?: https://www.patreon.com/posts/39070023
Episode 143 - Paul Sheard: What Is Quantitative Easing?: https://www.patreon.com/posts/71589989?pr=true

Episodes on inflation:

Episode 7: Steven Hail: Inflation, Price Shocks and Other Misunderstandings: https://www.patreon.com/posts/41780508
Episode 65 - Phil Armstrong: Understanding Inflation: https://www.patreon.com/posts/40672678
Episode 104 - John T Harvey: Inflation, Stagflation & Healing The Nation: https://www.patreon.com/posts/52207835
Episode 123 - Warren Mosler: Understanding The Price Level And Inflation: https://www.patreon.com/posts/59856379
Episode 128 - L. Randall Wray & Yeva Nersisyan: What’s Causing Accelerating Inflation? Pandemic Or Policy Response?: https://www.patreon.com/posts/63776558

Our Job Guarantee episodes:

Episode 4 - Fadhel Kaboub: What is the Job Guarantee?: https://www.patreon.com/posts/41742701
Episode 47 - Pavlina Tcherneva: Building Resilience - The Case For A Job Guarantee: https://www.patreon.com/posts/36034543
Episode 148 - Pavlina Tcherneva: Why The Job Guarantee Is Core To Modern Monetary Theory: https://www.patreon.com/posts/episode-148-why-73211346
Quick read: Pavlina Tcherneva’s Job Guarantee FAQ page: https://pavlina-tcherneva.net/job-guarantee-faq/

More on government bonds (and “vigilantes”):

Episode 30 - Steven Hail: Understanding Government Bonds (Part 1):https://www.patreon.com/posts/29621245
Episode 31 - Steven Hail: Understanding Government Bonds (Part 2): https://www.patreon.com/posts/29829500
Episode 143 - Paul Sheard: What Is Quantitative Easing?: https://www.patreon.com/posts/71589989?pr=true
Episode 147 - Dirk Ehnts: Do Markets Control Our Politics?: https://www.patreon.com/posts/episode-147-dirk-72906421
Episode 144 - Warren Mosler: The Natural Rate Of Interest Is Zero: https://www.patreon.com/posts/71966513
Episode 145 - John T Harvey: What Determines Currency Prices?: https://www.patreon.com/posts/72283811?pr=true