Debate: Modern Monetary Theory vs Austrian School

[David Ottinger]

http-~~-//youtu.be/cUTLCDBONok

DEBATERS

WARREN MOSLER is an early developer of Modern Monetary Theory (MMT), the President of Valance Co, Inc., and Senior Financial Advisor to Senator Ronald E. Russell, President of the 29th Legislature of the U.S. Virgin Islands. He is the founder and current manager of the III Funds, which peaked at over $5 billion AUM in 2007 and currently manages about $1.5 billion, as well as the Founder and President of Mosler Automotive, which manufactures the MT900 sports car in Riviera Beach, Florida. Mr. Mosler has written a number of academic papers on issues relating to macroeconomics and monetary policy, and is the author of Seven Deadly Innocent Frauds of Economic Policy (2010). He maintains a personal blog, The Center of the Universe (http://moslereconomics.com), and can be followed on Twitter at http://moslereconomics.com.


ROBERT MURPHY, Ph.D, is a Senior Economist with the Institute for Energy Research and an Associated Scholar at the Ludwig von Mises Institute, where he teaches at the Mises Academy. He is also an adjunct scholar at the Mackinac Center for Public Policy. From 2003 until 2006, Murphy was Visiting Assistant Professor of Economics at Hillsdale College in Michigan, U.S. From 2006 until early 2007, he was employed as a research and portfolio analyst with Laffer Associates, an economic and investment consultancy in New York. He runs the blog Free Advice (http://consultingbyrpm.com/blog) and writes a column for Townhall.com and has also written for LewRockwell.com. He is the author of a number of books including The Politically Incorrect Guide to Capitalism and Lessons for the Young Economist.

[Guest darkskyabove]

Excellent! Watched the entire "debate".

 

What struck me quite early, and was emphasized at the end, was that these guys were actually debating apples vs oranges. Dr. Murphy, the "Austrian", is arguing that the system is wrong. Whereas, Mr. Mosler is arguing: "this is the system we have, thus we should do X."

 

As an amateur "Austrian", I must give Mr. Mosler credit; he, obviously, knows the system is wrong, but he made a good argument for how to work within the system. And his pedigree shows that he damn sure knows how to make money, even if he uses the current state to his advantage.

 

Ultimately, what I took from this is that both sides understand the "gun in the room".

 

One side wishes to minimize, or eliminate, the gun; the other is working hard to continue working, even knowing its presence.

 

This has sociological implications. One can choose to protest, and agitate. Or, one can find ways to work within the system. I will not include apathy as an option.

[Formelyknown]

After reading his articles on his site I'm starting to look if there is something wrong with me when it come to my knowledge about the free-market. It is like murphy want to sabotage austrian economy when he talk about atheism and science.

[Guest darkskyabove]

I think sabotage is too harsh. What I saw was a situation where neither side wanted to make an extreme statement on their position. There was some good-natured banter. Remember, they were talking at Columbia, one of the many bastions of far-left ideology. The fact that Murphy wasn't boycotted is a plus.

 

As Murphy observed in his intro, there were sure to be those who would claim that he didn't represent the "Austrian" position correctly. What is the correct position? (Yes, that's a double entendre.)

 

I would say to any "hard-core" Austrians (which I am, almost, one myself), be thankful to even be represented at all. And, especially, note how the audience, except for the one guy, was, at least, accepting of Dr. Murphy's position, even if they disagreed.

 

@Formerlyknown: Please don't get caught up in the "cult of personality" thing. Murphy cannot speak for all Austrian economists, and is considered a rogue among his fellows.  As I touched on, previously, be glad that the Austrian viewpoint received a fair hearing in "enemy" territory.

[David Ottinger]

I think they both had fun with being radical views in that setting.  I don't think Prof. Murphey presented the Austrian School poorly at all.  Though, I agree they were definitely talking about 2 different things. 

 

The only thing I would like to point out is that (using Warren Mosler's terminology):  It's true that the "issuer" cannot default like the "user."  However, the issuer's equivalant of default is runaway inflation.  And, that's much worse!

[Formelyknown]

It is not about Murphy himself. If i share the same idea then a crazy guy. I think it is a good idea to make sure I 'm not insane for sharing the same conclusions.

[David Ottinger]

I'm curious, what's so crazy about Murphey's pov? 

[st434u]

My god, Warren Mosler is not only terribly wrong about a lot of what he says, but also plain evil!

 

(watch from 1:04:07 until 1:06:58)

[Rollout]

I haven't watched any of this particular debate, but what's with all you guys and Murphy? He's easily one of the best Austrian economists alive today. He isn't any sort of "rogue" that I know of among Austrians. He's very well respected actually, at least among the Misesean/Rothbardian branch of the Austrian school. I can't speak for the other variants.