This archived content originally appeared at, the predecessor site to, and does not carry the sponsorship of the Cato Institute.

Debate this evening (June 3)

"Modern Monetary Theory versus the Austrian School." The antagonists are Robert Murphy (Mises Institute) and Warren Mosler ("modern monetary theory" school, who has a blog with the wonderful title "The Center of the Universe"–it turns out to be the U.S. Virgin Islands, where he lives).

6:15 p.m. (Eastern Daylight Time), room 103, Jerome Greene Hall, Columbia Law School, New York City.

Here is the link. The debate will be live streamed on video.


  • Remarkl

    Worst "debate" ever. No structure, no preparation. Both men were embarrassing. I have to admit that I turned it off before it was over, so if something interesting happened, I missed it. But the odds sure seemed slim forty-five minutes in.

    I'd have to say Murphy "won" because he was audible and often intelligible. But there was no substance to the exchange, at least in the time I watched.

    Full disclosure: I am more sympathetic to the MMT camp and was very interested in seeing our "champion" Warren Mosler. He is an inarticulate spokesman at best. Fortunately for me, I came to MMT with the usual "Say what?" attitude, and don't I hold any of its defenders in particularly high regard as thinkers. The ideas just resonate with me.

    Prof. Murphy struck me as more a free banker than an Austrian, He seemed to reduce Austrian economics to "Let it burn." He was not very articulate on behalf of free banking, but in all fairness, free banking wasn't the subject of the debate. (I'm still not sure what WAS the subject of the debate.) His response to Mosler's ramblings about the unique status of a monopoly money issuer was that the government shouldn't BE the monopoly money issuer. Perhaps not, but it is, so now what?

    Anyway, my thanks to Mr. Schuler for the heads up.

    • Remarkl

      "and don't I hold any of its defenders in particularly high regard as thinkers."

      Make that "and I don't hold any of its most prominent spokesmen in particularly high regard as thinkers."

      I'm used to blogs with "Edit" and "Preview" buttons, so I am prone to premature you-know-what.

    • So now what? End the monopoly. What else can an opponent of a monopoly say?

      "Let it burn" sounds like the explicit policy of the National Park Service sanctioned by a consensus of forestry scientists. Ironically, if these forests had private owners losing valuable timber to wildfires, the owners presumably would advocate a different policy, and we'd have a reversal of the tragedy of the commons.

  • Remarkl

    "What else can an opponent of a monopoly say?"

    Then why was he there? Not every debate is about free banking. The Fed has decisions to make. QE or not QE, that is the question. "End the monopoly" is not a responsive answer, whether or not it is a useful suggestion.

    I did not mean that "Let it burn" is or is not good forestry. But if I ask one of those forestry scientists to describe his school of thought, he would not say "Let it burn." He would say how he came to believe that Let it burn" was a good idea. Prof. Murphy never explained the mechanism whereby not letting the economy burn produced better results than pouring money on the fire. He merely asserted a sort of "Pay me now or pay me later" position, as if they were discussing thermodynamics. I'm open to his arguments. I just wish he would have made some.

    I believe you have the tragedy of the commons exactly backwards. If "Let it burn" is good forest management, then the selfish refusal of individual timber owners to let it burn would result in a weaker forest, i.e., a tragedy of the commons. Letting it burn may be a bad idea, but, if it is, it's just a bad idea; it is not a tragedy of the commons. Have I misunderstood your point?

    • I don't agree that "end the monopoly" is not a responsive answer. The Fed may declare itself more a hindrance than a help and call for its own dissolution while either pursuing or not pursing a centralized policy of QE.

      I haven't seen the video, so I can't comment on Murphy's presentation. I believe you when you say that it's not well structured, and that's disappointing, but I don't expect Murphy to tell you how he'd act as a central monetary authority when he's there to oppose the whole idea of a central authority.

      Selfish refusal of individual timber owners resulting in a weaker forest is not a tragedy of the commons, because a forest with individual owners is not a commons.

      A sporadic wildfire harms the interest of an individual timber owner even though it benefits the forest more generally by making wildfires less frequent and less destructive overall. That's the theory anyway.

      An owner of timber unaffected by the particular wildfire might favor "let it burn" when his own timber is not at risk, because letting other timber burn makes a fire affecting his own timber less likely. Insurance against wildfires might ameliorate this problem, but then individual insurers could lobby the state to limit wildfires.

  • Remarkl

    "Selfish refusal of individual timber owners resulting in a weaker forest is not a tragedy of the commons, because a forest with individual owners is not a commons."

    I believe that you are literally mistaking the forest for the trees. The trees are privately owned. The forest (the ecosystem that by hypothesis is weakened by dowsing all fires) is a commons. How that plays out – not all commons are destroyed – is another matter. But a commons is an existential thing arising from a game-theoretical dilemma.

    A particular forest may be a commons is a number of contexts – national park – coop timberland – animal habitat – but eliminating one aspect of commonality (shared ownership) merely causes the forest to be commons in that context. It may or may not continue to be such in others.