MMT turns conventional thinking about money on its head. What looks like a convention for enabling exchange or a commodity like gold is, in reality, something very different. Money defines authority and mobilises resources. And it is government that decides through its political decisions the conditions in which citizens live and shape the nation’s economic success or failure. In the words of the author, Scott Ferguson: ‘Unlike money’s private users, […] only government wields the capacity to furnish all persons with meaningful employment and sufficient access to the common store of wealth. A thought-provoking blog and a recommended read.
The article was originally published on the Arcade website here
Money is the root form of representation in bourgeois society. Threats to monetary value are threats to signification in general.
—T. J. Clark, Farewell to an Idea (1999)
The unheard-of center … draws all things into the boundless, and draws them for the center. … To be secure is to be safe in the drawing of the whole draft.
—Martin Heidegger, “What are Poets For?” (1946)
After Modern Monetary Theory or “MMT,” nothing looks the same: not political economy; not everyday caretaking; not paintings, pop songs, or porn sites.
Everyone knows that money makes the world go round. Yet MMT shows us that, far from being a private and finite commodity or an unwieldy network of global exchange, money operates as a centralized political architecture that is public, limitless and, above all, answerable to social needs and contestation. Thus critique after MMT assumes a singular aim, which is to make money’s answerability perceptible.
Both historically and ontologically money arises from the polity that issues it. Government establishes a money economy, MMT avers, by demanding taxes be paid in a currency that it alone supplies. And because political governance remains the source of money’s abstract value, there are no limits to how much government can spend toward the public purpose. As MMTer Warren Mosler will variously put it, demanding to know whence a political union will procure the funds it requires to support its population is tantamount to the absurdity of querying a sports referee regarding the source of the points she intends to award during a match. With this, MMT reveals that every currency-issuing government can “afford” to take care of the peoples and environs it subsumes and that the cause of modern economic mystification is not money’s mediation of commodity production, as Karl Marx famously argued, but the commodification of money as such.
(See here, here, and here for MMT’s understanding of so-called hyperinflation. Though multipart and complex, MMT’s argument is that inflation is always and everywhere a political phenomena, rather than a narrowly economic one, and that the conventional fear-mongering used to justify interest-rate hikes and spending cuts is as wrong-headed as it is pernicious.)
MMT is by no means an innocuous description of modern monetary operations, as both its supporters and detractors frequently claim. Rather, it spells a complete topological inversion of the money form as traditionally conceived. I envision it this way: MMT turns customary economic reasoning on its head by folding the conventional image of money outside-in. That is to say, whereas Left and Right orthodoxies situate money in a quasi-autonomous marketplace and envision the nation-state as a sideline enforcer of private exchange, MMT positions the state as the grounding center of economic relations and frames the market as an internal supplement to monetary governance. Money, then, is resolutely interior to formal political power. A governing body may employ monetary technologies directly or indirectly, through immediate public spending or through bank lending and so-called “market mechanisms.” However, in no way should monetary power be reduced to private power nor should money’s governing center be mistaken for the market’s decentralizing and often destabilizing effects.
Needless to say, the history of modern money is the history of this center’s ongoing repression. This process begins in the late seventeenth-century when the English bourgeoisie invents the legal ruse of public debt and continues today with the crushing obligations and austerity perpetuated by the Troika in the Eurozone. Still, no matter how intensely money’s political interior is neglected or disavowed, MMT reasons, government continues to condition economic relations and shape their recurrent failures and excesses.
By inverting money’s conventional topology, MMT clears the way for an unprecedented mode of critique: a practice that reads social formations through money’s political center and does so in order to make money’s answerability palpable.
Money is an infinite public reserve that has been choked off at its source. The state, on MMT’s view, maintains the money relation as a variable infrastructure of laws, ledgers, dispensations, qualifications, and cancellations. This maintenance requires constant retooling in response to extant crises and antagonisms. Unlike money’s private users, moreover, only government wields the capacity to furnish all persons with meaningful employment and sufficient access to the common store of wealth. To choke off this power, MMT insists, is not a de facto consequence of a money economy—there is no such thing as a natural rate of unemployment, for instance—but, rather, a political decision to maintain populations in conditions of poverty, violence, and despair.
Critique after MMT must hold open money’s unlimited reserve by tending at once to the political infrastructures that sustain economic activity and to the social emanations such forms condition.
It is precisely in overlooking money’s political center, meanwhile, that the Marxist critical tradition meets its limit. Marxism remains indispensable for tracing the contradictions and injustices precipitated by private exchange relations and, for this reason, it plays a significant role in MMT’s ongoing interventions (see here, here, and here). However, the Marxist tradition reifies economic negligence and cruelty every time it declares capital, rather than monetary governance and public spending, the proletarian’s primary horizon of contestation. One must never condone the brutal history of what Marx termed primitive accumulation. But we also should not allow our condemnation of state violence to block the path to a more equitable future.
Folding the conventional image of money outside-in, MMT attunes critique to what I shall henceforth call the unheard-of center of modern life. (I borrow this expression from Rilke via Martin Heidegger and admittedly turn it toward purposes not originally intended.) By unheard-of center, I mean money’s deep political architecture and the social expressions to which it variously gives rise and responds. MMT points the way to this unheard-of center. However, since MMT is essentially an economic discourse and one that, by its own admission, struggles in addressing the cryptic site where monetary and social production meet, the critical attunement it makes possible necessitates a total cultural reorientation: one that turns the entirety of cultural production irreducibly outside-in.
This means resisting the Marxist impulse to reduce the complexities of cultural production to a dance with private exchange value. Presently, no cultural artifact is a pure effect of decentralized financial technics. Both the artifact and financial media are paracentric phenomena, conditioned by the deficiencies and excesses of a public utility. This is not wishful thinking, but a brute operational reality. As economist Zoltan Pozsar has shown, even the so-called “shadow banking” sector operates wholly within state-insured monetary systems. This sector not only regularly anchors its complex private bets on the security of U. S. Treasury Bills (and ever riskier instruments fashioned in the image of Treasury Bills), but also immediately circles back to the sovereign monetary base during financial crises.
For this reason, critique after MMT must mind the strivings, irresolutions, and repressions that inhere within money’s centrally-conditioned social orbits and leverage such discoveries toward a more just future.
The critic animated by MMT assumes that the center does not hold, but insists that it nonetheless persists as so many holding patterns: patterns that no social actor can presently think or act without. Government austerity, permissive financial laws, massive private debt, uncompensated care work, racialized incarceration, the phenomenology of CGI blockbusters, the subtleties of aesthetic criticism: these forms realize the money relation under neoliberalism and keep our fallen world afloat. They give us our bearing. They hold us in tension. They condition our futurity. Money’s holding patterns comprise the grounds in which we dwell and hence constitute the only bases from which critique can proceed.
I agree with media theorist Steven Shaviro: the only way out is through. Where I part with this familiar appeal to critical immanence, however, concerns the aperture through which it imagines itself passing. In holding up private exchange value as a porthole to the future, Marxist modes of immanent criticism mire us in the contradictions of the global marketplace, while reducing the riddle of tomorrow to the enigmas found in capital’s fantastical expressions. Critique after MMT, by contrast, shifts the plane of immanence to the political center that conditions social expression and treats money’s holding patterns as an interior threshold onto better days.
No matter how centrifugal or aleatory, every sensuous exchange in modern society bears the mark of the center’s opaque rhythms and sway. To make money answerable to politics, one must not only mind these historical registrations, but also problematize how orthodox visions of abstract value have come to order appearance itself.
La nouvelle gauche
By revealing that money is a boundless public reserve, MMT offers means to socialize everything from banking and electoral campaigns to higher education and non-commercial artmaking. But the lynchpin of MMT’s intervention is its commitment to full employment and what its adherents call “the Job Guarantee.”
The appellation “Job Guarantee” is cringeworthy, to be sure. At best, its reduction of social labor to a “job” demonstrates a lack of critical savvy. At worst, its promised “guarantee” conjures neo-Puritan fantasies of salvation through work.
Yet the implications of MMT’s ill-termed proposal could not be more radical. MMT’s Job Guarantee involves the permanent financing of community-organized public works programs, which would give every person the right to non-corporate living-wage employment, compensate and reorganize much feminized and unpaid care work, and force service sector employers such as Walmart and McDonalds to outdo the public sector’s wages and working conditions. Hence, far from a neoconservative prop for capitalist interests, the Job Guarantee is designed to involve people in the labor of serving communal and ecological wellbeing, while transforming the social totality from below.
When a governing body elects to maintain even a small percentage of its population in conditions of unemployment and moneylessness, it sends capital into global tailspins in search of cheap labor and profitable investment, shackles disparate classes to unredeemable private debts, prevents alienated communities from addressing local crises, and debilitates everyone’s capacity to demand a better world. In its neoliberal instantiation, this Liberal gambit then shores up the fallout with punishing fees and taxes, paltry welfare checks, an out of control prison industry, and vast informal care networks.
In contrast to this frenzied and inadequate supplementation, MMT’s Job Guarantee aims to endow local councils with funds to furnish every market reject with living-wage employment (say $25 per hour plus health care, to start). The program would expand and contract countercyclically with market fluctuations and would involve its participants in meaningful social and environmental projects. Drawing upon non-profits and existing informal support networks, such projects might include child and elderly care facilities that socialize what Marxo-feminist Nancy Fraser has called capitalism’s hidden abode; sustainable gardens and public beautification services that bring dignity and vitality to the other side of the tracks; and art and cultural centers that help communities simultaneously imagine and shape the transformations the Job Guarantee makes possible.
The Job Guarantee would not be beset by financial constraints. Unlike the ludicrous America Works program proposed by President Underwood on Netflix’s House of Cards, MMT’s proposal does not require draining funds away from FEMA or dismantling the Social Security System. Instead, the Job Guarantee is to be limited only by real resources, the collective imagination, and political will.
Some participants may make a life in the public sector. Others will elect to join the private domain. But no longer will market activity be predicated upon a moneyless underclass or will it be acceptable to pass off systemic abandonment as the vagaries of nature.
Undoubtedly, MMT’s Job Guarantee is no cure-all or quick-acting salve. It will not eradicate injustice or turn the greedy into saints. What the Job Guarantee will do, however, is introduce a radical new directionality into the present totality, which shall drastically curtail systemic poverty and shift the structural foundations of economic life. It will set the agonies and ecstasies of the marketplace atop a resilient care economy and give every member of society basic access to the combined yields of public and private labor. It will force today’s low-paying service sector to either offer better wages and working conditions or risk losing laborers to local public works projects. But the Job Guarantee is by no means a total loss for capital either. Creating a stable consumer base that in turn increases private profits, the Job Guarantee would soften the blow of its wage increases, while making socially productive business investments far less risky. With this, the Job Guarantee promises to lessen the structural need for hazardous speculation and private usury. Surely, this increased stability and reduction in indebtedness would amplify everyone’s capacity to demand better living conditions.
If such a program were implemented by a global hegemon such as the United States, moreover, threats of mass emigration and economic collapse elsewhere would impel other governments to follow suit. The result will not immediately liberate Chinese factory workers or stop corporations from looting African mines. Nor will it reign in Wall Street or the City of London overnight. But it will reorganize global supply chains and multinational finance by confronting them with new pressures and prospects. For example, an international political economy driven by robust full employment programs would decouple problems of employment and social welfare from capital’s erratic global trajectories in addition to mitigating the market hazards that condition such movements in the first place. Supplanting what economist Abba Lerner once termed the myth of world money with an interdependent politics rooted in strong public spending regimes, the MMT Job Guarantee would thus begin to turn neoliberal financial capitalism outside-in and expose the constricting paroxysms of present social production to more congenial and commodious orbits.
Though seemingly unromantic and bureaucratic, MMT’s Job Guarantee offers today’s Left an ulterior erotics of struggle, which avoids the twin pitfalls of “no alternative” zealousness, on one hand, and the disastrous exits proposed by accelerationists, autonomists, and communisation advocates, on the other. While neoliberal apologists promise capitalist renewal with the same monetary imagination in view, radicals imagine bohemian coalitions leading the multitudes through the rubble to a moneyless beyond. MMT’s proposal lacks the allure of both visions. Yet as I wish to argue, it courts the future in a manner that is at once more stirring and far-reaching than either.
Oriented toward a sublime everydayness, the Job Guarantee promises to arouse the center anew without obliging quotidian relations to adopt the colors of particular vanguards or to suffer the injuries of infrastructural disintegration. The excitement of this intervention is that it manages to address the contemporary as an ineluctable totality, while making room for the stubborn facticity of incongruous ways of getting by and along. Rather than delimit the future to a neoliberal nightmare or to contingent rebel poetics, then, the erotics of struggle ushered in by MMT’s Job Guarantee embraces the present totality in all its heterogeneity, horror, and gaucheness.
Fashion contest, or, what is to be done?
In disclosing what I am calling money’s unheard-of center, MMT attunes us to previously unimaginable possibilities for social transformation and liberates the politics of public spending from the ill-fated drama of tax collection and capital flight. Yet perhaps most important, I wager, MMT makes perceptible a hitherto repressed horizon of demand that opens existing economic relations to immediate and potentially radical politicization.
The contemporary Left forecloses this horizon whenever it takes the Liberal ontology of money for granted. In treating a public reserve as an alienable global commodity and the state as a revenue-constrained debtor, present leftists reduce politics to a doomed crusade against multinational corporations and naturalize the ideological fiction that government would have more money for education, social security, and crumbling infrastructure if it only spent less on detention centers, bombs, and drones. We can neither pardon nor dismiss the military industrial complex. However, the Left must radically unlink resistance to military spending from demands for collective caretaking. Such demands would unshackle social transformation from the false either/or logics of economics and address neoliberal cruelty on resolutely political terms.
Today, the Liberal vision of money stymies the protests of small-l liberals and radical critics alike. For instance, mainstream leftists such as Bernie Sanders and Elizabeth Warren regularly depict money as a zero-sum game, worry about inconsequential federal deficits, and cast politics as a Robinhoodesque morality play that vilifies the wealthy for not paying their fair share.
(See here and here for Modern Monetary Theory’s critique of the Left’s redistributive approach to monetary politics.)
While National Public Radio warns that the federal government will soon run out of money for disability benefits and that problems of fiscal sustainability shall haunt the U.S. for years to come, jokes proffered by John Stewart and John Oliver assume that so-called “money printing” precipitates hyperinflation and that the U.S. government borrows dollars from China to fund its operations.
When the Left’s most trenchant and imaginative critics demand justice, meanwhile, the Liberal image of money functions as an impassible horizon for thought and action. Consider the great Frances Fox Piven’s address to the General Assembly at Occupy Wall Street in 2011.
Piven’s impromptu speech is eloquent, impassioned and uplifting. However, Liberal presumptions about money’s alleged privacy and finitude shape her oratory from beginning to end. Wall Street is the ever de-centering center of neoliberal capitalism, according to Piven. From there, financiers siphon funds away from the body politic, evade taxation necessary to sustain that body, and push a revenue-starved government ever further into debt. As a consequence, the state is forced to impose life-sucking austerity policies on young and old alike, as Wall Street’s cannibals flee to financial havens abroad.
The problem with Piven’s discourse is not its excoriation of the financial sector’s exorbitant power and sociopathic behavior. The trouble owes to Piven’s tacit Liberalism, which paints political economy as a closed system comprised of so many private flows that variously fill up and drain from government and the social body. As a consequence, this historic critic of Milton Friedman and the neoliberal onslaught not only constrains politics to a thermodynamics of power in which private capital will forever have the upper hand. She also unintentionally legitimizes the logics of austerity she lambasts and conceals the political answerability we seek.
Money is not an alienable substance that government amasses and hemorrhages. It is an unlimited public instrument, which the Left must labor to make perceptible as such. In so doing, we ought to decry capital’s death grip on monetary governance and expose how private interests incessantly obstruct public spending. If the Left continues to envision money as a private stockpile that labor must wrest back from capital, we shall only cripple our efforts from start.
The same goes for local struggles, where city, county, and state budget constraints hide and shield money’s inner boundlessness like the nested ramparts of a medieval fortress. Take political theorist Wendy Brown’s 2010 intervention into the ongoing battle surrounding public education in California. Addressing a group of student protesters atop the steps of the state capitol building in Sacramento, Brown offers listeners the following words:
In the face of little political will and zero government accountability, Brown critiques the continuous depleting of public funds from California’s school system and lays out the broad social consequences of such privatizing efforts. Yet in presuming that public education must rely on state-level revenues and, what is more, that the fate of democracy hinges upon the taxability of powerful entrepreneurs and industries, she portrays the politics of public spending as a zero-sum contest, which reinforces the neoliberal governance we wish to transform. Brown bravely denounces the neoliberalization of public education and underscores its legislative, instead of merely economic, origins. However, because her appeal implicitly regards money as a finite thing that government must spirit away from the rich, it inadvertently subordinates state politics to false economic constraints and forecloses our capacity to directly politicize what is, in reality, an inexhaustible public utility.
Tax California’s elite. Tax them hard. But untether such efforts from contests over state spending. Local budgets are needed to respond to local needs. However, because local spending constraints routinely act as alibis for systemic privation, we must overtly politicize the false logics of finitude upon which local spending decisions often rely. If the state of California alleges it lacks funds to serve the general welfare, then we must insist the U.S. federal government deploy its limitless fiat currency to finance education and “make democracy real.” The buck does not stop in Sacramento and neither should our politics.
To every wail declaiming the unaffordability of our demands, we should appeal to the slogan proposed by Modern Monetary Theorist Stephanie Kelton. When it comes to public spending, explains Kelton, money is no object. By this, she means not only that money is a boundless public reserve rather than a flow of finite things, but also that a governing body can afford any social project it is compelled to undertake.
Every political demand propagates a particular image of money. Thus political struggle must always be doubly imaginative. It must fabulate a better future based on extant capacities and imagine a form of money that can bear such a transformation. To assume this dual charge is not to discourage efforts to envision a future without money. It is, rather, to fashion contestation anew by expropriating the most powerful instrument currently available.
21st-century Marxisms
Its unparalleled insights notwithstanding, MMT is still terribly limited. Its terms are rationalistic. Its historiography is narrow. It stumbles when thinking through social contradiction and has little to say about the psyche, culture, or aesthetics.
Given these limitations, Marxist engagements with the contradictions and surfeits of neoliberal culture remain both vital and urgent. No other critical discourse penetrates so deeply and vividly into capitalism’s antagonisms and sensuous investments, which is why Marxist critical theory remains crucial for the road ahead.
The texts Arcade has gathered together for its 21st-century Marxisms Colloquy prove no exception. Yet in diagnosing the complexities of today’s debt- and finance-based economy, I contend, each text retains a residual Liberalism, which contracts the field of critique and narrows our sense of the possible. McKenzie Wark, Edgar Illas, and Joseph Vogl, for example, ask what it means to inhabit, feel, and represent what Fredric Jameson once described as the bewildering world space of multinational capitalism and do so in order to gain critical traction within this regime’s ever-shifting contours. But like Karl Marx before them, these thinkers not only problematically subordinate money’s ontology to private commodity circuits and credit instruments; they also obscure money’s publicness and plasticity by figuring it in quasi-substantialist terms.
Wark, Illas, and Vogl never gesture to the inert computers humming away at treasuries and central banks. Nor do they show how failures to draw upon these abstract instruments to provision labor and social services actively shape the private dynamics they lay bare. Instead, they imagine money as capital’s abstract vehicle and its allegedly dematerialized movements as the object-cause of so many fugitive flows. Today, money remains capital’s prime mover and capital’s transfigurative circuits are as riddling as they are real. But to restrict money to capital’s movements and, in turn, to the paradoxical pathways implied by Wark’s information vectors, Illas’s aleatory survivalism, or Vogl’s itineraries beyond graspable geographies, is to overlook the centers that govern capital’s ambulations as well as to asphyxiate money’s curative power.
Meanwhile, contrary to familiar claims that algorithms and packet-switching make money more abstract, historically speaking, most money has existed as abstract marks on a balance sheet rather than as physical coins and bills. It is money’s institutional, not material, moorings that matter most for politics. And Marxism’s fascination with whizzing abstractions too-often conceals the origins of neoliberal devastation as well as ways to overcome it.
In David Palumbo-Liu’s essay, it is the Liberal image of the state that troubles critique. Palumbo-Liu goes far in resisting the false moralism of the neoliberal debt economy. He is right to blame the neoliberal state for making the 99% pay for the sins of the financial class. He inspires when proposing an explosive countermorality, which rebuffs the guilt-inducing forms of subjectivization that legitimize neoliberal debt consciousness. Yet a more insidious moral drama subtends this countermorality, one that Palumbo-Liu seems unable to detect.
That drama positions the nation-state as a debt-burdened market actor, which must either balance its books like a private business or displace its burdens onto the citizenry. We need to disabuse ourselves of this bogus dilemma and its bad-faith morality if we are to overcome the debt-consciousness Palumbo-Liu implores us to resist. Government establishes a system of credits and debits by levying taxes in the currency it authorizes. And government is singularly implicated in this system because it is exempt from the market’s internal rules and limitations. The state spends ex nihilo and, as Alan Greenspan has publically admitted, it can forever service debts administered in its own unit of account. Let us, then, not shame government for failing to keep its economic house in order, as Palumbo-Liu suggests, but rather insist that the state deploy its boundless public reserve to prevent unjust forms of usury and debilitating private debt obligations.
A similar difficulty impedes Nancy Fraser’s important contribution. In her talk, Fraser politicizes the hidden background of non-monetized care work and ecological provisioning that sustains capitalist commodity production. But an enduring Liberalism prevents Fraser from installing what I call the problem of care within the money form itself.
The possibilities and limits of Fraser’s intervention are clearest during the Q&A session that follows her talk. In the session, Fraser sketches out a path toward a post-capitalist future wherein surplus allocation becomes democratically determined and matters of social and ecological reproduction are taken up as overriding concerns. On one hand, she suggests that a major step toward realizing such a future would result from a politicized return to a kind of midcentury Keynesianism, which implies progressive taxation, financial regulation, and deficit spending. This alternative would, of course, be less than ideal, as Fraser admits. Still, she maintains that it would represent a significant transformation in the context of the present neoliberal debacle. On the other hand, Fraser calls for a radical coalitional politics, which would strive to overturn the current system and replace it with a post-capitalist order. This option is preferable, but less probable, Fraser tells us, since it currently lacks conceptual and infrastructural supports.
This cleavage between neoclassical Keynesianism and an underdetermined coalitionism is familiar to the Leftist imagination and has long made meaningful transformation unimaginable. Yet the split is neither innocuous nor inevitable. It is structurally produced by an orthodox ontology of money and quickly vanishes when we refuse its Liberal premises.
Envisioning money as a private technology and government as dependent on the market’s limited funds, the Left presumes that the state is de facto incapable of wholly transmuting capitalism’s disavowed background into a foregrounded mode of concern. As a consequence, care is demoted to the status of money’s external supplement and the future splits into two unpromising alternatives. Either we can tax, spend, and regulate, leaving society permanently hamstrung by private power, or we can imagine more just and non-monetized modes of association, which are at present neither intuitive nor totalizable.
With MMT, however, we learn that money is a boundless public center, that caretaking is internal to money’s constitution, and that there is an immanent alternative to the Left’s doubly damned futurity.
Money is not only the root form of representation in bourgeois society, as T. J. Clark has eloquently written. It is also the crux of caretaking in modernity. Money is the basis of cultivation in the modern world and its own ongoing maintenance grants quotidian forms of care-taking their orientation, pace, and value. In this sense, all work is care work and money is care’s gravitational center. As a center without limits, moreover, the money form does not force us to choose between neoclassical pump priming and money’s obliteration. Money can be immediately and even radically deployed to meet communal and environmental needs. This is not an apologia for money or a disavowal of its limitations. Instead, it is a plea to install the problem of care at the heart of the money form and right the injuries committed under the guise of a false Liberal ontology.
Liberal man discovers himself by treating money as a little mirror. Securing a fantasy of autonomy, while denying his dependency on others, he imagines money as a peer-to-peer compact, which largely takes care of itself. Marxo-feminists have made a habit of exposing this charlatan and politicizing the off-scene labor that supports his self-reflection. But they have left his orienting object essentially in tact. Now is the time to smash Liberal man’s little compact so that a grander image of money can appear.
Occupational hazards
If MMT needs the capaciousness of Marxist critical theory to redeem its broad social promise, 21st-century Marxism requires MMT to purge the residual Liberalism that haunts leftist critique. The result makes way for a new critical praxis, which as of yet knows no name or institutional home. In the meantime, we must work to realize money’s curative powers by occupying the unheard-of center that presently organizes collective life.
Occupy Wall Street and Main Street. Occupy school in addition to prison. Occupy face space as well as the database. But by all and every means, occupy the center that configures such spaces and bring money’s imminent answerability into visceral contact with a shared contingent reality.