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edX MOOC – Modern Monetary Theory: Economics for the 21st Century – Q&A

It’s Wednesday, and our edX MOOC – Modern Monetary Theory: Economics for the 21st Century – ended its four-week run today. We are exploring making it available again in the coming months as well as floating an advanced course (see below). Today, I publish a short video where I answer the questions posed by students in the MOOC as part of our last week ‘Bill Board’. We asked students to pose questions and vote on which ones they thought should be prioritised. I chose the top (almost) 3 to answer. And then we have some music, being Wednesday.

MOOC Modern Monetary Theory: Economics for the 21st Century

Our 4-week edX MOOC – Modern Monetary Theory: Economics for the 21st Century – comes to an end today (March 31, 2021) and I hope those who participated in it found the experience rewarding.

This is was our first – MMTed – venture and working with the highly skilled team at the University of Newcastle has helped us develop a range of skills that will be useful into the future.

We now have experience in putting together a digital on-line learning course which we are deploying to not only improve the introductory MOOC (just offered) but also offer a more advanced course in the coming months.

Filming for the advanced course has started already and it will offer more detailed modules in areas like bond markets, trade and foreign exchange, labour market dynamics and banking.

I am also in discussions with universities to explore the prospect of delivering teaching material to their programs that would allow students to take award courses within existing academic programs.

Of course, I continue to be grateful to those who have donated amounts to help get MMTed off the ground.

The MOOC was a sort of demonstration case of what we think can be achieved. We need more financial assistance but we are extremely thankful for what we have been able to garner to date as a result of the generosity of many.

More than 3,200 students took the course and we will look forward to seeing you all participating in our future offerings.

In Week 4, we posted a Bill Board – which gave students a chance to pose questions and then vote on the questions once posted. I made the commitment that I would choose the top 3 or so questions and answer them.

Here is the short video response I made as part of that commitment.

The third-placed question (according to the votes) was not answered because it related to quite complex issues about trade, which I could not reasonably answer in a few minutes and will be part of the next course we offer.

Music – For Free

This is what I have been listening to while working today.

One of my best friends is in hospital today, and, very sadly, will not make it through. He was a working class man with hardly any formal education and lots against him.

But he was able to self-educate himself, learn Spanish, read widely and become erudite in all sorts of areas. He has an advanced social conscience. He is also a very generous person and I will miss him terribly.

This song is about the unheralded people in the world who do great things but are often passed by for those who seek celebrity and the glitz.

It was written and first recorded by – Joni Mitchell – and was on her excellent 1970 album – Ladies of the Canyon (Reprise)

This version is on Lana del Rey’s new album – Chemtrails at the Country Club – which has some great songs on it.

The harmonies are exquisite. It features Zella Day (first verse) and Weyes Blood (third verse).

Take care Geoff!

And this is the Joni Mitchell – version.

That is enough for today!

(c) Copyright 2021 William Mitchell. All Rights Reserved.

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    This Post Has 19 Comments
    1. Very much enjoyed the course, looking forward to the advanced version.

      Sorry to hear about Bill’s friend, la vida es sueño as Calderon de la Barca wrote.

    2. Great course, Bill. Haven’t had time to comment more than once online. Very sorry to hear about your friend. Here are some observations and questions. I’ll understand if you can’t respond. But I wanted to set it all down for my own benefit.

      1. I know a young economist. Have tried to get her onboard with MMT – puzzled that she’s not there at all at the moment – obviously very bright. Will ring her tonight and ask her to do course (if it’s available now – if not, no worries). The mid-older age economists I know are a lost cause, as you say.
      2. I’ve noted a number of typos, if you’re interested in correcting them. I could do a more thorough job if of use.
      3. Loved foreign trade section – always been a bugbear with me (Ricardo). Loved Fadhel’s talk.

      4. Q1: JG mentions offering superannuation and there is another reference in the ‘Ageing Society’ section about the problems of saving for retirement. ‘Pensions’ also appears in the Just Transition framework. I would have thought an unconditional, non-contributory state pension was superior and necessary to kill the rent-seeking pensions industry. The legacy incomes could be drained away over time through taxation. Have I got this wrong?

      5. Q2: In Just Transition framework it mentions public banking. I’ve always associated this with Positive Money – US friends quote Ellen Brown so assumed it was not supported by MMT. I believe that LVT would force private banks to provide a useful service rather than just churn second-hand houses which has become their business model in UK at least since deregulation in the 80s. Does MMT consider that public banking is necessary?

      6. I’ve been asked to edit my colleague’s short explanation of MMT for our LVT campaign members (we’ve been trying hard to get them onboard and advertised this course) but I’ve hit a problem with MMT’s view on the purposes of taxation (which is the crux of the matter with regard to the LVT movement and MMT) . I noted from the course these: to address economic inequalities, create a demand for the currency, control inflation. We’ve been corresponding with Neil Wilson because I remember him saying that the only purpose of taxation is to ‘provision the state’. We’ve not been able to resolve the issue yet. I’d appreciate it if you could explain. I guess I’m looking for a mechanism for how taxation can provision the state.

    3. Hi Bill,

      I am glad I managed to rush through your course – it was very helpful. It coincided with some unexpected local activism I got involved in, but I still managed to work through the material and hope to see the ‘Season 2’ soon. And, thumbs up for the quality of video editing!

      Sorry for your friend.

      Here in Estonia there is no contemporary macroeconomics material available for the native language speakers and this is a shame. Only the classical/neo-classical theory and various self-help voodoo for getting quickly rich etc. If I wished to get a translation project running for introducing the MMT to Estonians, what materials would you recommend to start with?

    4. I very much enjoyed the course (struggled a bit with some of the quizzes, but mostly muddled through) and am looking forward to the next one.

      @Carol Wilcox regarding the “purposes” of taxation, I might suggest another — to prevent the emergence of plutocracy which always and everywhere is the enemy of democracy. I would also observe that some of the confusion around the topic (the purpose of taxation) is a result of what boundaries are chosen for it, which in turn may stem from contestation as to the boundaries around macroeconomics itself, or at the very least what is core as opposed to periphery.

    5. Thanks Bill (and team),

      This is an excellent course — all the more so given it is its first run!

      I’m eagerly anticipating a more advanced course on this topic. In the meantime, I’ll recommend this one to anyone who will listen :)

      Would you recommend any other edX courses on economics? UQx offer professional cert programmes for macroeconomics and microeconomics — the outline for the first sounds like all the same material you covered but from a mainstream point-of-view (more expensive, takes longer, probably outdated because MMT rules); the second seems like a good follow-on from your course, but obviously with a different scope.

      [Bill notes: edited out links to mainstream edX courses]

      Best wishes,
      Dan.

    6. Hi Carol,

      Re your young economist friend: it’s amazing she, and many others, don’t get MMT.

      It’s as if they WANT the economy to be a ‘harsh master’, and ‘punish them for their sins’….(an ‘original sin’ hangup, perhaps?…)

      Re Ellen Brown and public banking; last year she wrote an article entitled “the american dream is alive and well in China” (google it) in which she “supposed” (I think that’s the word she used) the PBofC is in fact spending the Chinese currency into existence to develop the nation, while successfully limiting itself to the actual resources available for purchase, for this development.

      That’s why I am following China closely (I regularly write comments to the “Global Times”); China might be the only government currently manifesting a form of MMT ….

      Re taxation: I suppose what Neil Wilson means by taxation “to provision the state”, is to allow
      the government to make a sufficient call on the nation’s resources to implement chosen public policy. China likely doesn’t have this problem, because the government has ‘first call’ on the nation’s resources….(aka “socialism with Chinese characteristics”).

    7. What I mean is what is in Macroeconomics s20.5 on p323.

      Taxes create real resource space in which the government can spend to fulfil its socio-economic mandate. Taxes reduce the non-government sector’s purchasing power and hence its ability to command real resources, leaving real resources for the government to command with its spending

      and

      Ideally, it is best if tax revenue moves counter cyclically, increasing in an expansion and falling in a recession. That helps to make the government’s net contribution to the economy countercyclical, which helps to stabilise aggregate demand. In this case the fiscal outcome operates as an automatic stabiliser

      #NotAnAprilFool

    8. At times I wonder if all this knowledge should have been named Missing Monetary Theory for modern economics. MMTME might have been able to shift the battlegrounds.

    9. Neil Halliday: That’s why I am following China closely (I regularly write comments to the “Global Times”); China might be the only government currently manifesting a form of MMT ….

      That’s how it works right now in the USA, the UK etc. All the stuff with bonds or whatever is just eyewash. That’s basic, crucial MMT. Unfortunately Ellen Brown is mostly but not quite there, a bit confused and has been confusing others by thinking foolishness with bonds and interest rates has any real meaning.

      Sure – it’s welfare for the bond dealers, for the financial class. But that is comparatively trivial economically. The main utility and purpose of that scam is drawing attention away from, hiding the infinitely bigger and realer scam. That the first scam just doesn’t mean anything, and that every government with its own currency is manifesting MMT, is spending it currency into existence first, taxing or playing bond games later.

    10. Hi Bill sorry to hear about your friend.

      A big thanks to you and the team for the Course. I was a bit rusty doing formal study, but by the second week I started to remember the old “Read the Question” adage, and I could focus on the topic in the module

      The Course helped me clarify my basic understanding of MMT that I had coming into the Course.
      It then helped me understand some things I had no knowledge of, or was struggling with. This was related to the External Sector, specifically, the basic mechanisms involved in Trade and “Foreign Currency Exchange Markets”.

      Look forward to more MMT Courses.

      Pete.

    11. @Neil Wilson:
      Your first paragraph (in quotes) confirms what I said.

      Your 2nd paragraph refers to the business cycle (“recessions”) evident in free markets.

      Obviously there need be *no* recessions IF government planning successfully oversees limited free-markets, as in China, or if an above-poverty JG is the law of the land, which is what we all want in our “democracies”.

      What I want to know is: is China aware it can ALWAYS have real full employment?

    12. @Some Guy,
      So Biden is shooting for a $2 trillion infrastructure spend, probably less than required or affordable.

      Meanwhile, China actually built the world’s largest HS rail network in a decade; Trump couldn’t even repair one bridge in the US. So obviously there is a vast difference in practice between spending money into existence in China and the US.
      But at least Biden is catching on, while the Repubs will look silly, and hopefully unelectable.

    13. Carol, former New York Fed President Beardsley Ruml addressed the purposes of taxation in a 1946 paper “Taxation For Revenue Is Obsolete.” He lists four purposes: maintaining the value of the currency, expressing public purpose in the distribution of income and wealth, expressing public purpose in encouraging desirable economic activities and discouraging undesirable ones (think charitable giving vs tobacco production), and funding certain activities with dedicated revenue streams (think gas taxes dedicated to highway construction).

    14. A very good course which helped my growing undersanding of MMT. I was especially enlightened by the interviews with Fadhel Kaboub and Ndongo Sylla. I’d love to know how you get a brand new sovereign currency off the ground.
      I’ll definately be interested in a second, advanced course but my real interest is how do we get an understanding of economics, conventional and MMT, into the minds of the broader public? All but an electorally insignifficant proportion of voters have no clue whatsoever about much of what politicians say about their proposed policies and the politicians know this and exploit it. Telling scaremongering lies to discredit the oposing side’s policies is an easy way to get elected, as we know in Australia. Persuading a mjority of the electorate that your ‘radical’ new view of how the economy should be run for the benefit of everybody would be much harder, as would getting yourself selected to stand by any party with the resources to back your campaign.

    15. Creigh, there are far better expressions of the purposes of taxation than Ruml’s. And MMT rejects them all as non macro.
      NeilH, China is having the same problems as the rest of the developed world with regard to unaffordable housing – and that’s under a Communist regime where presumably the land is not privately owned. But MMT does not see this as macro either.

    16. Bill, so sorry to hear of your friend’s demise, the “self educated” and making your own way in the world rings a bell as my dad was also one of these people and left me a rich matrix of learning that still has a place in my mind and heart.
      The only time I heard Joni Mitchell (not a relation I assume :-) ?) was on a trip to Australia and I crept into the back of a large hall in Sydney to hear a very distorted half hour (sadly) of her concert where the amplification had too many cross reflections – however she remained a continual inspiration.
      The course has been wonderful and I thank you for the decision to keep it open to all. After reading the Deficit Myth and then seeking and finding the roots of MMT in yourself and Warren Mosler it stimulated a great fascination with the Wilson\Healey era IMF debacle which i recall with sadness and of course the Thatcher household metaphor, still so easily (mis)understood by everyone and used so negatively by the Cameron govt here in UK.

      This morning on a BBC radio 4 program about the world effects of Covid had an section about Govt spending in US and South Africa, and yet again the simplification of mainstream Macro economics was invoked by an african economist and it struck me again how many times fiat currencies are discussed in these simplistic but not simple enough terms. How I wanted to offer your “lens” to that dialogue.

      So, thank you for opening another window AND door in my understanding of things that effect my UK 10 years plus of austerity as well as world money consciousness and for making this course available to musicians as well as economic-fluid people : lets hope this and the extended new course you talk of can add to the general growing understanding that your “lens” creates.

      Incidentally I was in Australia (ref above) doing a tour of Elizabethan Lute songs :-) so perhaps our musical sides have a special connection ? :-) :-)
      thanks again Nigel

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