Steve Keen's New Economics: Debt and Thermodynamics

This article provides a profound analysis of Steve Keen's economic thought, challenging traditional paradigms. The author explains that fiat money and bank credit are fundamental to the economy, incomprehensible without considering nonlinear dynamics and double-entry bookkeeping. A key element of the argument is the connection between economics and thermodynamics—the recognition of energy as an essential factor of production, which exposes the fundamental flaws of neoclassical climate models. The text also addresses issues of monetary sovereignty in the spirit of MMT and proposes radical solutions, such as a debt jubilee, to avoid systemic collapse. This is a manifesto for a new science of finance that, instead of abstract equilibria, examines real flows and the physical limits of the planet.