III 

116TH CONGRESS 

1ST SESSION S. RES. 182 

Recognizing the duty of the Senate to condemn Modern Monetary Theory 

and recognizing that the implementation of Modern Monetary Theory 

would lead to higher deficits and higher inflation. 

IN THE SENATE OF THE UNITED STATES 

MAY 1, 2019 

Mr. PERDUE (for himself, Mr. BRAUN, Ms. ERNST, Mr. MORAN, and Mr. 

TILLIS) submitted the following resolution; which was referred to the 

Committee on Banking, Housing, and Urban Affairs 

RESOLUTION 

Recognizing the duty of the Senate to condemn Modern 

Monetary Theory and recognizing that the implementation of Modern Monetary Theory would lead to higher 

deficits and higher inflation. 

Whereas noted economists from across the political spectrum 

have warned that the implementation of Modern Monetary Theory (referred to in this preamble as ‘‘MMT’’) 

would pose a clear danger to the economy of the United 

States; 

Whereas, on March 4, 2019, former Secretary of the Treasury Lawrence H. Summers said that— 

(1) MMT is fallacious at multiple levels; 

(2) past a certain point, MMT leads to hyperinflation; and 


pamtmann on DSKBFK8HB2PROD with BILLS
2 

•SRES 182 IS 

(3) a policy of relying on a central bank to finance 

government deficits, as advocated by MMT theorists, 

would likely result in a collapsing exchange rate; 

Whereas, on February 26, 2019, Jerome Powell, Chair of the 

Board of Governors of the Federal Reserve System, said: 

‘‘The idea that deficits don’t matter for countries that 

can borrow in their own currency I think is just wrong’’; 

Whereas, on March 25, 2019, Janet Yellen, former Chair of 

the Board of Governors of the Federal Reserve System, 

disagreed with those individuals promoting MMT who 

suggest that ‘‘you don’t have to worry about interest-rate 

payments because the central bank can buy the debt’’, 

stating: ‘‘That’s a very wrong-minded theory because 

that’s how you get hyper-inflation’’; 

Whereas the March 2019 report entitled ‘‘How Reliable is 

Modern Monetary Theory as a Guide to Policy?’’ by Scott 

Sumner and Patrick Horan of the Mercatus Center at 

George Mason University found that— 

(1) MMT— 

(A) has a flawed model of inflation, which overestimates the importance of economic slack; 

(B) overestimates the revenue that can be 

earned from the creation of money; 

(C) overestimates the potency of fiscal policy, 

while underestimating the effectiveness of monetary 

policy; 

(D) overestimates the ability of fiscal authorities to control inflation; and 

(E) contains too few safeguards against the 

risks of excessive public debt; and 

(2) an MMT agenda of having fiscal authorities 

manage monetary policy would run the risk of— 


pamtmann on DSKBFK8HB2PROD with BILLS
3 

•SRES 182 IS 

(A) very high debts; 

(B) very high inflation; or 

(C) very high debts and very high inflation, 

each of which may be very harmful to the broader 

economy; 

Whereas the January 2019 report entitled ‘‘Modern Monetary Theory and Policy’’ by Stan Veuger of the American 

Enterprise Institute warned that ‘‘hyperinflation becomes 

a real risk’’ when a government attempts to pay for massive spending by printing money; and 

Whereas the September 2018 report entitled ‘‘On Empty 

Purses and MMT Rhetoric’’ by George Selgin of the Cato 

Institute warned that— 

(1) when it comes to the ability of Congress to rely 

on the Treasury to cover expenditures, Congress is, in 1 

crucial respect, more constrained than an ordinary household or business is when that household or business relies 

on a bank to cover expenditures because, if Congress is 

to avoid running out of money, Congress cannot write 

checks in amounts exceeding the balances in the general 

account of the Treasury; and 

(2) MMT theorists succeed in turning otherwise 

banal truths about the workings of contemporary monetary systems into novel policy pronouncements that, although tantalizing, are false: Now, therefore, be it 

1 Resolved, That the Senate— 

2 (1) realizes that deficits are unsustainable, irre3 sponsible, and dangerous; and 

4 (2) recognizes— 


pamtmann on DSKBFK8HB2PROD with BILLS
4 

•SRES 182 IS 

1 (A) that the implementation of Modern 

2 Monetary Theory would lead to higher deficits 

3 and higher inflation; and 

4 (B) the duty of the Senate to condemn 

5 Modern Monetary Theory. 

Æ 


pamtmann on DSKBFK8HB2PROD with BILLS