Modern Monetary Theory and the Public Purpose — Dirk H. Ehnts & Maurice Höfgen (2020)

This paper examines how Modern Monetary Theory (MMT) understands the idea of public purpose. The authors argue that governments should use their monetary and fiscal powers to pursue democratically chosen social goals, with universal access to the material means of survival serving as the minimum standard.

1. Public purpose should guide economic policy, not balanced budgets or other financial targets.

2. The meaning of public purpose is determined democratically and changes with society’s values and circumstances.

3. Universal access to the material means of survival is the minimum standard of public purpose.

4. Monetary sovereignty gives governments the ability to pursue democratically chosen public goals.

5. A Job Guarantee is MMT’s central policy for advancing public purpose through full employment.

6. Taxes, spending, and banking should be designed to serve the public purpose rather than private interests alone.

7. MMT provides a framework for evaluating economic policies by how well they improve society, rather than by financial outcomes alone.

🧠 Conclusion

The authors argue that Modern Monetary Theory places public purpose at the center of economic policy.

Rather than judging governments by balanced budgets or other financial targets, MMT evaluates policies by whether they improve people’s lives, promote full employment, and advance democratically chosen social goals. ⭐

They conclude that while the exact meaning of public purpose changes with a society’s values and democratic choices, universal access to the material means of survival is a minimum standard that should always be met. ⭐

In this framework, monetary sovereignty gives governments the capacity to pursue these goals, while fiscal policy, taxation, banking, and a Job Guarantee become tools for serving the public good.

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