(Bloomberg) -- President Donald Trump’s pick for the Federal Reserve Board of Governors said that modern monetary theory is a bad idea that won’t help support economic growth.
“This is the view that we can just print money and create growth. Of all the ideas I’ve ever heard in my lifetime, that’s one of the stupidest,” Stephen Moore said in a Bloomberg Television interview Thursday in Washington. “If you could create growth by printing money, then Zimbabwe and Argentina and Venezuela would be the richest countries in the world.”
MMT is an economic school of thought that says governments that print their own currency and borrow in it can never go broke -- so they can expand their deficits more than normally thought, particularly for programs that spur growth, so long as inflation is subdued.
Moore is the latest big name to weigh in on the doctrine, which is supported by progressive politicians including Representative Alexandria Ocasio-Cortez as a way to fund expansive programs such as the Green New Deal. Finance heavyweights from Warren Buffett to Fed Chairman Jerome Powell have denounced MMT, while billionaire investor Ray Dalio and some Wall Street economists have expressed support for aspects of it.
“Can you imagine the idea that we just keep printing money and somehow that’s just going to create growth,” Moore said. “The fact that people are actually taking that serious is disturbing.”
MMT economists, responding to similar critiques, have said that’s a misrepresentation of their thinking.
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