It would be refreshing to see just one article attempting to debunk MMT that showed a minimum effort to understand its premise and concept. Here's a clue: It isn't all about spending more. You also don't get to mix MMT with your heterodox econ at will. Pick a lane.
"The US dollar was created in 1785, and the country did not have any significant income taxes until the 20th century. Most of the government revenue came from import and export tariffs. The assumption that taxation drives up demand for the currency has not been backed by substantial proof"
The US was largely an agrarian society with little actual exchange of currency beyond its trade with other countries and it was a net exporter for most of those years. For considerably longer it relied on industry for its tax base. Are we really going to get into splitting hairs about the "type" of tax meant by MMT economists? The important thing is that the government only accepted its own currency in payment, allowing it to provision itself on demand.
"Suppose the government provides more than enough fiscal support to the economy, and now inflation is increasing. In this scenario, it will be prudent to increases taxes to lower after-tax income, thus lowering the purchasing power of consumers."
Where is this magic number you speak of? It must be somewhere between 150% and 275% of GDP given that Japan has been trying to weaken its currency for decades with no discernable inflation yet, or on the horizon. Our own Fed has been battling deflation for some time while naysayer politicians and orthodox economists have been railing against the "possibility" of inflation. Again, pick a lane.
"The Federal Reserve has an unemployment rate target and assumes that there will always be unemployment in the economy due to various factors, such as job transition. MMT argues that having any employment in the economy is harmful and such policies lead to certain people being permanently unemployed."
The MMT Job Guarantee doesn't force a job on anyone, but millions of people are involuntarily unemployed yearly by Fed policy, many permanently. The ruse of this being an "inflation" measure is rapidly reaching its self-life, especially given that no one at the Fed seems capable of defining what causes inflation in their own language. It's becoming more than obvious that the policy is aimed at keeping labor subservient to capital.
The Job Guarantee is the one prescriptive measure in an otherwise descriptive theory. It injects federal money as a backstop to the business cycle automatically while setting the floor for labor rates and benefits. It is not a multi-level program and business only needs to outbid the program to gain labor with their social and work skills intact. The program should be as locally managed as possible to avail municipalities of a free labor source that doesn't turn into make work.
"Instead of focussing on full employment, government can provide monetary incentive for private sector to boost hire people. If governments focus on spending on infrastructure, education, and healthcare, it will increase employment and income in industries that are already in need of massive reform. While these programs won’t ensure job guarantee, it does increase overall employment in the economy."
Why not do all of the above? The only limitation is the real resources and labor needed. There is actually very little about economics that is about money, but all you MMT detractors can focus on is an assumed increased spending. If the private sector can be incentivized to create enough jobs for everyone the Job Guarantee issue becomes moot. The ideal situation would be a Job Guarantee that was never needed.
"But when people interpreted the Federal Reserve and government’s action to ‘turning on the money printer,’ the narrative had a huge influence on stock prices."
This is the worst kind of privilege imaginable and it should be called out whenever it pops its ugly head up. The very concept that allowing people to pay rent and buy food in the middle of a pandemic should not have happened because of some imagined volatility in the stock market displays a callous and disconnected attitude that I have trouble getting my head around. I think the connection between the two is even less tenuous than your grasp of MMT
