Paul Romer published an article, Mathiness in the Theory of Economic Growth in the American Economic Review.

Mathiness is a term he coined to describe the misuse of mathematics in economic analysis. Mathiness is not intended to clarify, but instead to mislead. According to Romer, some researchers use unrealistic assumptions and strained interpretations of their results in order to push an ideological agenda and use a smokescreen of fancy mathematics to disguise their intentions. This is my view of MMT.

I see no evidence of a causal connection between the ability to print money and the ability to take on greater debt. Frankly, I doubt that they have anything to do with one another. And in that sense, I see MMT as nothing more than sleight of hand — a card trick.

In my view, a simpler explanation is available — and it intuitively makes more sense.

Global economic actors make daily decisions on the creditworthiness of borrowers. And one of the obvious factors that they no doubt take into consideration, when assessing the risks of borrowers who are nations (as opposed to corporations or individuals,) is the ability of any nation to print money.

However, all nations can print money. So, when assessing the creditworthiness of the U.S. or Japan vs. Venezuela, Argentina, and Weimar Germany, that assessment would have very little to do with the ability to print money. Hence, the explanation offered by MMT doesn’t hold up.

Simply put, The U.S. and Japan have probably been assessed, by the global markets, to be capable of taking on a greater level of debt than certain other countries, while remaining “credit-worthy”. And “creditworthiness”, I’m sure has its own tortured meaning in the new global economy — in which everyone and everything is interconnected.

Greece, for example, received loans that they clearly had no ability to repay. Why? It wasn’t because they had the ability to print money as MMT would suggest, it was because they had assets to secure the borrowing, which their creditors coveted — and which are now owned by their creditors.

In the new global economy, the appetite for lending to the U.S. may be extremely high — but it has very little to do with our ability to print money. And I believe that those who say it does, are not looking out for long-term U.S. interests. They are either trying to make money, by stimulating the economy in the short-term — with little if any regard for the long-term economic consequences or risks. Or they are trying to “push an ideological agenda” and use MMT as “a smokescreen”, as Romer suggests.

I suspect that the appetite for lending to the U.S. has much more to do with other major considerations. The first is our status as an essential player in the global economy. The second is our overall perceived economic sustainability (one or two trillion to bail out the banks makes sense under that analysis — if you think it will right the ship.) And the third, and most important factor is our collateral. Like Greece, we have assets the world covets and they will continue to lend — so long as our borrowing is secured by those assets.

So, if you’re ok with seeing the Chinese own the port of New York like they now own the port of Piraeus in Greece, then fall for the card trick that MMT proponents and their Wall Street backers are now pushing — vote Democrat and line up for your free lunch — while it lasts. https://www.npr.org/2018/10/09/642587456/chinese-firms-now-hold-stakes-in-over-a-dozen-european-ports

Personally, I'm not buying it.