Should be read by every American. Snippet:
But federal government debt is a different story. Unlike private actors who don’t have the capacity to create money, the government can issue money at the tap of a keystroke, which means that debt service per se is never an issue. The federal government can always create the dollars to “fund” its spending. Consequently, it can spend much more freely to get the economy going. In troubled economic times, that’s just what government needs to do.
Wait—what about inflation? True, if the economy is running closer to full capacity and the government still continues to spend aggressively, this can lead to real resource constraints (and, hence, inflation). And we don’t want that. But this issue, while important, is distinct from the issue of national solvency in the U.S., despite the claims of many disingenuous economists and politicians to the contrary.
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