Will work with Democrats on Senate Budget Committee
Stephanie Kelton, associate professor and chair of the Economics Department at the University of Missouri-Kansas City, has been named the chief economist for the Democrats on the Senate Budget Committee in Washington. Each party has its own chief economist on the budget panel, which among other things oversees the Congressional Budget Office
“I’m delighted to have been asked to serve in this important position,” Kelton said. “As Chief Economist on the Democratic staff, I’ll be working with ranking member Sen. (Bernie) Sanders to secure a federal budget that expands Social Security, makes college more affordable and creates millions of jobs though much-needed investments in our nation’s infrastructure.”
Kelton has been at UMKC since 1999 and chair of the Economics Department since August 2012. Her research interests are modern monetary theory, employment policy, history of economic monetary thought, social security and European integration. Kelton assumed the new position on Jan. 5 and will be on a leave of absence from UMKC to work in Washington. Arrangements for her UMKC appointment are pending.
“We congratulate Stephanie on this appointment. It is indicative of the national and international significance of the work being done by Stephanie and her colleagues in our Economics department, and we wish her the best as she takes on this role,” said Wayne Vaught, Ph.D., dean, UMKC College of Arts and Sciences.
Kelton is a founder of the widely-read blog New Economic Perspectives, which is one of the leading voices for Modern Monetary Theory, also known as “The Kansas City Approach.” The blog states that the theory “builds on the work of Abba P. Lerner, John Maynard Keynes, Hyman P. Minsky, Wynne Godley and other important figures of the past. Above all, we are careful to provide analyses and policy recommendations that are applicable under a modern, fiat money system.”
The business news website MarketWatch reported: “Sanders has hired as minority chief economist one of the top proponents of Modern Monetary Theory, a post-Keynesian school of economics with some heretical views on the nature of money and the role of government finance.
“Stephanie Kelton is taking a leave of absence from the University of Missouri at Kansas City, where she chairs a department that has become a bastion of MMT, to supply some theoretical firepower for Sanders’ agenda on the committee … For Kelton and other MMT theorists, balanced budgets or budget surpluses can be harmful because they are necessarily balanced by deficits in the private sector. By the same token, government deficits are necessary and beneficial not only during downturns when they take up the slack from insufficient consumer demand but also in boom times because government deficit spending fuels a private-sector surplus.”
In an article headlined “Bernie Sanders opens a new front in the battle for the future of the Democratic Party,” the news site Vox stated: “new budget committee ranking member Sen. Bernie Sanders (I-VT) is poised to break dramatically from traditional Democratic views on budgeting, from Obama to Clinton to Walter Mondale and beyond. His big move: naming University of Missouri-Kansas City professor Stephanie Kelton as his chief economist. Kelton is not exactly a household name, but to those who follow economic policy debates closely, tapping her is a dramatic sign … She thinks that, in many cases, government surpluses are actively destructive and balancing the budget is very dangerous. For example, Kelton thinks the Clinton surpluses are nothing to brag about and they actually inflicted economic damage lasting over a decade.”
Kelton was one of four American experts asked by the United Kingdom newspaper The Guardian to weigh in on the 700-page economics book Capital in the Twenty-First Century by French economist Thomas Piketty. The book was a mass-market publishing sensation in 2014.
In her review Kelton said, “… it was Piketty whose meticulous examination of the evidence seemed to provide the impartial proof audiences were craving. The left was right. The wealthy owed their fortunes to their forefathers and the Congressmen who wrote the loopholes for their tax accountants to exploit.”
As a regular commentator on national radio and broadcast television, Kelton is sought-after for her expertise and consults with policymakers, investment banks and portfolio managers across the globe.
Kelton is a research scholar at both the UMKC Center for Full Employment and Price Stability, and the Levy Economics Institute in New York. She earned a Bachelor of Science Degree in Business Administration (Finance concentration) and a Bachelor of Arts Degree in Economics, both from California State University, Sacramento; a master’s degree in Economics from Cambridge University, UK; and a Ph.D. in Economics from the New School for Social Research in New York City.
Kelton is considered an expert in the areas of public finance, financial accounting and international finance. In 2011, she was invited to serve on a panel of experts to help Sen. Sanders (I-Vt.) draft legislation to reform the Federal Reserve alongside Nobel Prize winner Joseph Stiglitz, Jeffrey Sachs, Robert Reich, James K. Galbraith, Dean Baker and Robert Johnson.
She has published dozens of articles in professional journals including the Journal of Economic Issues, the Cambridge Journal of Economics, the Journal of Post Keynesian Economics, the International Journal of Political Economy, the Review of Social Economy, and Challenge Magazine. She is listed in Who’s Who in the World and was the recipient of a Rotary International Scholarship to study in Cambridge, England. Her book (edited with Edward J. Nell), The State, The Market, and the Euro: Metallism versus Chartalism in the Theory of Money, is available through Edward Elgar Press.