The always insightful Tom Hickey at Mike Norman Economics has linked to an excellent presentation and Q&A session featuring Randall Wray and Bob Jessop. The video goes for about an hour-and-a-half, but there turns out to be four minutes or so that are particularly relevant for present purposes.
In an earlier post, Ongoing Debate Over Currency Value, I wrote:
My interpretation of MMT has been that enforceability of taxes (or fees or some other obligation to the state) is sufficient but not necessary (i.e. that other factors could conceivably be sufficient) …
In the ensuing discussion there was some uncertainty on this point. Randall Wray happens to touch on the same point (at about 1:11:10 in the linked video):
Let me start from the general claim, which is that from inception you need an obligation, and it needs to be denominated in some unit of measurement. And so, in shorthand, what we say is “taxes drive money”, okay. And, of course, that can be a little more broadly defined to say that you need fees, fines, tribute, tithes, taxes, some kind of an obligation that is denominated in a unit of account. …
… However, we are not trying to claim that, um, taxes drive money, that that is necessary. It is merely sufficient. Taxes will drive a money. That’s a sufficient condition. Um, it’s perfectly conceivable – and people have many stories about this – of private entities creating a unit of account, denominating liabilities in that unit of account, and then exchanging those liabilities and using those in payment. It works pretty well in theory. It’s just that in practice we don’t find these.
Okay, so I guess this shows that heteconomist has not always exemplified loose cannon MMT, but rest assured, I do my best.