No problem for this regime, they will simply dissolve the office that compiles and publishes those reports. Problem solved.
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The whole world changed on August 15, 1971 on what a government “deficit” means. The problem is 54 years later almost no one really has taken the time to actually understand what changed.
The US economy is absolutely nothing at all like your household, or even you local government’s economy - nothing at all.
Every single penny of the deficit is now a penny of wealth in the private economy - every penny.
No ones grand children will have to “pay” 1 penny of the government deficit.
The only restriction on government spending is inflation. The US has had exactly 2 periods of significant inflation since 1971, neither caused by government spending.
By far - the single biggest impact that the deficit has is its use by both parties as a boogie man to scare the heart of people who actually have no clue what it actually is - to get votes.
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Deficit after deficit leads to debt. It’s debt that’s the problem and you have $gazillions of it and are paying $gazillions in interest. Every taxpayer is paying that interest with no hope of ever paying off all debts.
Sounds like you encourage ever bigger deficits … them being so wonderful. Perhaps you should replace “wealth” with “waste” and try it again?
In a country with a fiat currency -
the government spends $ into existence and taxes it out of existence. The purpose of taxes is to control inflation by controlling the money supply. It does not need tax revenue to buy anything at all available in the market denominated in $. It can purchase anything at all available in the market denominated in $ with a key stroke on a computer.
Gov Spend - Taxes = surplus ( deficit) - deficits inject $ into the private sector, surpluses take $ out of the private sector.
Deficit spending is neither good nor bad - the role of government spending should be for full employment - without causing significant inflation.
This is quite literally less than the tip of the iceberg on this topic, and I won’t highjack the thread on it - and a board for sailors prob not the right forum for it.
But I highly encourage everyone to spend some time and evaluate MMT with an open mind. While doing so try to remember - it is not perfect, but neither is any other explanation , It’s also not a political prescription, but an economic description of how a fiat currency system operates.
Thanks - I always feel like banging my head on the keyboard whenever anyone tries to equate government spending with household budgeting. It is not remotely in the same universe.
Also as is blindingly obvious, the current party only cares about debt for things they don’t like, they’ll spend any amount of money on things they do.
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Perhaps you should explain to those who do not understand the difference between government deficit and debt.
pretty sure not many will take the time - but watching this is a great place to start for anyone interested
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Just like magic … except there are consequences to creating money out of thin air. Just like there are consequences in growing debt … which you evaded addressing.
Americans will not learn until they are required to pay debts in other currencies … or gold.
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Money supply is not controlled by taxation its controlled by fractional reserve lending which is how the gov puts money into an economy that it didnt have hence expanding the money supply if thats what the economy needs to either expand the economy or create inflation or both.
Gov love inflation it makes debt go away and the voters financial strength.
thanks - MMT would disagree. But understand the point - again - don’t want this to turn into a MMT thread. And not an argument that IMO works well on social media. There are no “perfect” answers, so every point has a hole in it someone can poke at. It is nuanced and nuance doesn’t work well in a forum like this. My only real point was to put out MMT as an idea worth taking a look at.
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I think the theories came after the facts and all just about right sometimes and just about all proved wrong other times
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