by Scott Ferguson
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 people and environs it subsumes and that the root form 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 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 and 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 immediate 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 retreats 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 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 unheard-of 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.