Is Modern Monetary Theory just Keynes rebadged? Many think so—but they’re wrong. This video compares Keynesian ideas on borrowing and balanced budgets with MMT’s claim that governments create money when they spend. Understanding this difference changes how we think about debt, inflation, and what governments can really do.
0:00 – Introduction – Overview of MMT vs Keynesian economics and why understanding the difference matters.
1:10 – Common Ground – How both theories emphasize government’s role in the economy.
2:30 – Origins of Keynesianism – Context of the Great Depression and Keynes’ General Theory (1936).
4:15 – Keynes on Government Finance – Borrowing, fiscal stimulus, and debt repayment under Keynesianism.
6:20 – Origins of Modern Monetary Theory (MMT) – Emergence in the 1990s and shift to fiat currency.
8:05 – MMT Fundamentals – Government creates money, taxation controls inflation, borrowing is optional.
9:50 – Key Differences: Debt – Keynesian debt as liability vs MMT debt as private sector savings.
11:30 – Key Differences: Inflation – Keynesian focus on money vs MMT focus on real economy capacity.
13:25 – Policy Tools: Keynes vs MMT – Fiscal & monetary policy vs fiscal-focused, near-zero interest approach.
15:10 – Full Employment Goals – MMT’s job guarantee and prioritization of real economy output.
16:45 – Critique of Neo-Keynesianism – Household analogy, focus on balanced budgets, and austerity issues.
18:00 – MMT Framing & Sectoral Balances – Wynne Godley’s sectoral balances and government as economic driver.
19:15 – Summary & Takeaways – Key contrasts, why MMT is better suited for modern economies, and concluding thoughts.
20:22 – End / Outro – Call to action, blog link, and support options.
Credit to : Richard J Murphy