Stephanie Kelton: designing the economic system that serves everyone.
We live in a society that’s being run by money. The news is full of ongoing debates about affordable healthcare, squabbles over student loans and the inability to get a satisfying mortgage rate in today’s economy. And that’s not even mentioning non-existent saving rates and debt imposed through a system that has seen better days. It’s clear that if we want to change the direction our society is heading for, we need to act. And in order to act, we have to start considering viable alternatives. Our first story worth sharing by Stephanie Kelton offers such an alternative.
The professor of economics and public policy at NYSU advocates the modern monetary theory (MMF), a fresh outlook on how society can overcome current and future adversities through re-imagining what actually holds value, and which deficits actually matter. Rather than thinking about how we can afford to tackle society’s challenges, Kelton argues that we should start seeing deficits and debt in relativity to what is necessary to spark changes. This implies re-imagining the ways in which our society as a whole is using available resources.
“Deficits do matter, but not the way we’ve been taught to believe.” – Stephanie Kelton
Her radical view on the matter exposes a great deal of experience, accumulated over the years as her broad resumé already suggests. Not only has she been regarded a “prophetic economist”, but in the US she was also one of Politico’s fifty most influential people on the political debate of 2016. No small feat, considering the political turmoil in 2016 (a certain president was elected, the war in Syria reached a boiling point and the Brexit referendum took place).
So, what is different about this modern monetary theory? For starters, it exposes government deficits for what it really is: a means of expressing debt in exchange for a different value, whether it’s in the shape of a service or a product. In the same light, money, debts and deficits are all nonsensical and irrelevant in the grander scheme of things. The theory implies that we shouldn’t have to worry about deficits threatening our financial wellbeing in the future, as not all deficits are created equal; some simply outweigh the others. Playing the debt-game smart allows us to trade in risks for general prosperity.
“Deficits can be used for good or evil. They can enrich a small segment of the population, driving income and wealth inequality to new heights, while leaving millions behind. They can fund unjust wars that destabilize the world and cost millions their lives. Or they can be used to sustain life and build a more just economy that works for the many and not just the few.” – Stephanie Kelton
Realising this and acting to make a change lies a bit more difficult, as so many of us are dependent on this same system. However, Kelton’s theory allows us to fundamentally reimagine the way we look at money and deficits, and to move past the worries of being able to afford something – allowing us to act. She tells an inspiring story worth sharing and saved the best part for the stage. Join Planet Act and learn how to start making a change.