The government can spend much more money than it currently does, even given a swelling national debt that frequently makes headlines. That’s the argument that has put Modern Monetary Theory (MMT) at the center of macroeconomic discourse over the past few years—the idea driving often heated debates between some of the most prominent voices in mainstream economics and the band of rebel academics who have brought MMT to prominence. Alexandria Ocasio-Cortez gave MMT a boost this year, citing it as an idea that should inform some of the spending assumptions behind the Green New Deal and other progressive priorities.

Endorsements like hers have helped MMT take on a profile that seems to surpass the accessibility of some of its theoretical details, but its main tenets can be summed up fairly easily for laypeople: A government that issues its own currency cannot run out of money in any real sense and needn’t rely on taxation or budget cuts to make up funding shortfalls. The true limit on spending isn’t the numbers on federal balance sheets but inflation, which MMT proponents argue can be managed by taxation and other policy mechanisms. The implications of this are controversial enough that MMT has been the subject of criticism not only from mainstream economists but also voices on the left wary of undermining the case for progressive taxation and wholly abandoning economic consensus on the risk of inflation. Earlier this year, Doug Henwood joined a growing chorus of socialist voices condemning MMT, in an essay in Jacobin that called the theory “snake oil” and “a weak response to decades of anti-tax mania.”



The most significant speech given at last weekend’s Third Modern Monetary Theory conference was made not by an economist or financial wonk, but by a pastor.

Where one falls on the particulars of this debate is a matter of how one conceptualizes, among other things, the abstract origins of money itself. Yet the most significant speech given at last weekend’s Third Modern Monetary Theory conference at Stony Brook University was made not by an economist or financial wonk, but by a pastor. (The New Republic was one of the conference’s sponsors.) During a panel on “Money, Race, and Civil Rights,” Delman Coates, senior pastor at Maryland’s Mt. Ennon Baptist Church and a former candidate for Maryland lieutenant governor, described his journey to heterodox economics to the MMT enthusiasts in attendance as a spiritual one informed by the history and sociopolitical commitments of the black church.



“The black church for me represents that subset of African American sacred spirituality that has been on the side of the fight for freedom, justice, and equality,” he said. “The second influence really has a lot to do with my understanding of the economic justice roots of the civil rights movement. To a large extent people focus on themes and issues around racial reconciliation as a key constituent element of the civil rights movement. But what is very formative to me is my understanding of the economic justice roots of the civil rights movement.”



Specifically, Coates credited Martin Luther King’s Poor People’s Campaign, which included demands for full employment and a basic income, as one of the influences that motivated his interest in Modern Monetary Theory, as did the experience of offering assistance to parishioners in the wake of the financial crisis. “I knew as a leader that I had to play a role in helping to build a movement that addresses our unnecessary and imprudent reliance on commercial bank money,” he said, “because it enabled commercial banks to receive profits off of credit money that they created out of nothing—causing wealth extraction, destabilizing our economy and hurting the communities that I serve.”

