Comment MMT: new wine in old bottles or ‘voodoo economics’? - The pursuit of modernism Nuts and bolts

Thus, the core inference and contention of MMT is that the budget deficit and public sector indebtedness should be allowed to adjust to the level necessary to secure full employment. [...] Judgements on the appropriateness of a policymaking framework cannot usefully be made without regard to the state of the business cycle, or the strength of private-sector animal spirits. [...] The devil is in the detail As always, however, the devil is in the detail. [...] The disruption of the connection between government decisions on the size of its budget deficit and the willingness of the private sector to fund that deficit at interest rates that it deems reasonable destroys at a stroke one of the most important disciplines the market imposes on politicians. [...] As a show of good faith, it might also make sense to combine the stimulus with the announcement of a programme of structural reforms that would be applied over a number of years, and which would help to render the subsequent expansion more durable.