Odd Lots

Stephanie Kelton On MMT and the Inflation We're Seeing Today

May 19, 2022

In this engaging discussion, Stephanie Kelton, a Stony Brook University professor and a leading mind in Modern Monetary Theory (MMT), dives into the current inflation crisis. She challenges traditional views on deficits and spending, arguing that real resources limit government expenditures, not household-like debt constraints. Kelton explores the causes of today’s inflation, critiques political responses, and emphasizes the need for strategic investments in areas like climate change. With insights from the Milken Conference, she sheds light on the Federal Reserve’s role and the ongoing economic recovery.

49:15

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Episode guests

Stephanie Kelton

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Episode notes

Intro

2min

Inflation Insights from the Milken Conference

2min

Navigating Inflation and Economic Policy

9min

Navigating Resource Constraints with Modern Monetary Theory

6min

Unpacking Modern Monetary Theory

20min

Modern Monetary Theory and Economic Challenges

7min

Inflation Perspectives During COVID-19

9min

For years, economists of the MMT school have been arguing that the way we think about deficits and government spending is all wrong. Whereas many people warn about the unsustainability of the national debt -- likening it to a household credit card bill -- the MMT view is that real resources are the constraint on government spending, and that inflation is the sign that real resources are being stretched. So what about now? We had substantial fiscal support during the pandemic, and now we have the highest inflation in over four decades. On this episode we speak with Stephanie Kelton, a leading proponent of MMT, a professor at Stony Brook, and the cohost of the Best New Ideas In Money podcast. We discuss the causes of the current inflation, and how to think about it through the MMT lens. This episode was recorded in Beverly Hills at the Milken Institute Global Conference.

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