Ken Greene interviews Dr. Phil Armstrong who explores the Modern Monetary Theory (MMT) and its implications for government spending, inflation, and the supply of goods. He emphasizes that external factors like global commodity prices, supply chain issues, and world events are more significant causes of inflation than simply creating money. Dr. Phil supports his argument with historical examples, like Weimar Germany and the Roman Empire. He clarifies that modern currencies are not backed by gold and encourages critical thinking about the subject. His insights on MMT offer a valuable alternative perspective on government finance and the causes of inflation, challenging conventional beliefs about the relationship between money creation and inflation.

Who’s the Guest? Dr. Phil Armstrong is a graduate of the universities of Leeds, Hull and Southampton Solent, the author of Can Heterodox Economics Make a Difference? Conversations with Key Thinkers, (Edward Elgar Publishing, 2020) amongst other publications and is currently working on what may be the definitive biography of economist and theorist Warren Mosler, one of the leading figures, if not the leading figure in the MMT world. Dr. Phil is also a regular podcaster and guest speaker. In addition, he also teaches at York College.

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Episode Highlights

• Dr. Phil’s background as a teacher and his work with GIMS and his interest in modern monetary theory
• The meaning of heterodox economics and its role as a counter to mainstream economic thought
• The ontology of money and how it is a system of credits and debits
• The government spending and taxation affect inflation and unemployment in an economy
• Modern monetary theory is not a theory but the way money has worked throughout history
• Relationship between price levels and money supply
• The influx of money during COVID and how it affected spending habits and market supply
• Example about how the money supply is an effect and not a cause of higher prices
• Importance of understanding the detailed chronology of events in the history of inflation and the money supply
• Incentives to stay home during the COVID pandemic and different perspectives on the situation
• Importance of recognizing counterintuitive ideas, like modern monetary theory, which explains how governments have always functioned
• Plans for future podcast episodes exploring more about monetary theory and setting the truth
• Brief discussion on the U.S. Civil War and how both sides printed their own currency to pay soldiers
• How the fiscal machinery of the Roman Empire eventually broke down and led to the decline in value of Roman coins
• Why Confederate currency became worthless due to the breakdown of the fiscal system and lack of tax collection

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