This is the Cato Daily Podcast for Wednesday, February 13th, 2019.

I'm Caleb Brown.

The proponents of modern monetary theory argue that money is uniquely the province of government and

that assertion drives many of the advocate's ideas about spending, taxing, inflation, and

other public concerns.

The Cato Institute's George Selgin discusses the new slash old ideas

encapsulated in modern monetary theory.

For those who are new to this, I know that monetary discussions often don't attract the attention.

We think they ought to.

But for those who are unaware of it, there is an idea floating around and it is known simply as modern

monetary theory to the extent that there is a description that you can offer that

would be fundamentally fair to its more

reasonable proponents and its more reasonable critics. What is it?

Well, modern monetary theory isn't just one theory as its name suggests.

So it's a combination of a number of theories and beliefs.

And they range from beliefs about how monetary policy should be conducted, to beliefs about the origins of money,

and to beliefs about what the right role of monetary versus fiscal policy is for achieving low inflation and so on.

So let me discuss a few of these elements.

Regarding the origins of money,

the new monetary theorists are so-called chartalists.

They believe that money is a creature of the state, that only the state can confer moneyness

to various entities, whether they're coins or pieces of paper.

...