Stephanie Kelton: The big myth of government deficits | TED 

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Inflation strikes poor people more that rich. She don't look poor, that why she promotes polisy that ingore inflation.

you already know that she will say her theory is sound and blame someone or something else.

10:30 Ignoring inflation is why she would say we should focus on keeping inflation in check?

She explained inflation and how it happens. An imbalance in demand creates an imbalance in supply, which drives up prices. We didn’t cause inflation by keeping people employed, fed and housed; we caused inflation by refusing to tax excess capital out of the economy. Inflation is caused when people with excess spendable income buy luxuries, not when people living paycheck-to-paycheck buy food. Spending on infrastructure, for example, can increase economic growth, which then pays for the spending. Spending on another aircraft carrier doesn’t stimulate economic growth, in the long run, but does contribute to inflation by driving up demand for something that doesn’t equally drive growth.

@@Kazakor No, printing money drives inflation, as surplus of money in circulation diminishes its value. Her proposal will be detrimental do low and middle class. How that printed money gets in to economy is also very important.

MMT is a pipe dream. A govt that prints money is a cog in the wheel of the global economy, not the basis of the global economy. Every time the treasury “prints” dollars, the value of the dollar drops. Then we all have to accumulate more of them to retain buying power. The theory that you can create currency without harming the economy relying on it is false. All you’re doing is decreasing the relative value. The economy hasn’t grown, it has merely been scaled up, relatively. An economy only grows when new products and services are added. This activity creates jobs and increases the value of resources. Printing money only masks the true value. Govt doesn’t create anything. It is only a drain on the economy.

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Taxes are used to ensure we will USE the dollar and not some other means of trading. If you MUST pay taxes and you MUST pay your taxes in dollars you will NEED to find them. So you will insist that you're paid in dollars. And so will everyone else. Everyone using the same currency has HUGE advantages in an economy. Taxes are also used, albeit less often, to decrease the money supply and slow an over heated economy. There is disagreement about how well this works. Mostly because Congress has to increase taxes and we all know how Congress gets things done. So it isn't a "go to" solution we use.

@@mikec2582 Good response - taxation is mainly an incentive producer, but it also removes money from the economy, regulating the money supply and therefore inflation. To work really well, taxes need to be well targeted. On the other hand, in her book she is arguing that leaving it to the Fed (or other central banks) to exercise monetary policy alone (QE, interest rates, etc.) is not a "go to" solution either (although it is how things currently work). Even the heads of central banks are calling for a combination of both monetary and fiscal policy (the latter being government spending and taxation) in order to control inflation and unemployment. Taxation on really wealthy people is especially important, not because currency-issuing governments need tax revenue to fund their programs (according to MMT they don't), but because really wealthy people horde their money and don't circulate it as readily in the economy. They are effectively removing dollars from circulation...

No, the scary part is that she and the others who developed MMT are the ones running our economy.

​@@denniscarney5249No, the scary part is that it's actually working... Low unemployment, stock market up, GDP up and wages up. Government money is going more towards jobs and less on food stamps, unemployment benefits and other programs that are "hand outs".

@RemyJuju2 you have to be an absolute moron NOT to understand the way the unemployment data is manipulated. You *really* think that in a country of 330 million people, we only have 2-4 million unemployed at a time? Stock markets are projections based on anticipated revenue and have *nothing* to do with OUR economy (since all of the main corporations are international). Of course GDP is up... it's called inflation. What's your supposed explanation for wages not keeping up with inflation? The growth of the homeless rate? The number of Americans unable to afford $500 emergency or the number holding multiple jobs to make ends meet?

​@@RemyJuju2the only reason it may seem to be working is because foreign producing nations (China, Mexico etc) accept the USD. This woman is a gaslighter

@@RemyJuju2 Is it working? Inflation is killing us and causing the economy to fail. Lots of companies are increasing layoffs. GDP for 24Q1 was 1.4%, much weaker than the Administration expected. It had been 4.9% in 23Q3, more than a 70% reduction. The stock market is up because many corporations are still showing profits because they've been cuttings costs (layoffs). Go to your local car dealership and look what's happening -- they can't give them away. Americans are BROKE. High debt and inflation has killed the American family budget.

Due mainly to price gauging in the private sector and not government spending.

@@sotaquePrice gauging? Dumping billions in currency into the M1 is a large contributing factor in inflation.

@@ronobrien7187 no it wasn't. It was mainly price gouging and disrupted global logistics from the pandemic, which placed added pressure on the demand side. Her argument is completely correct.

@@sotaque So you're claiming that increasing M1 supply has no effect on inflation? You might want to look back in history, in particular Germany after WWI.

@@ronobrien7187 Not since we officially dropped the "gold standard" in 1973 (NIxon), which is what she mentioned in the TED talk at about the 4 minute mark.

Great question, I assume taxes were a form of kick starting an economy because only a government could collect them. And if no one had any money how could you collect taxes, so governments must have been the the first investor and issuer of currency and taxes were used to keep money circulating and thus keeping the perpetual monetary system we know as an economy going. Really I think taxes are just training wheels and can now be removed to really accelerate prosperity.

@@seanwalsh999 Yeah this. Establishing a money system goes hand in hand with the creation of taxes. It creates the demand for the currency. There's a difference between federal taxes and state taxes. The federal taxes could be removed. But the state gets it's budget from the fed and needs to manage it. Therefore States do rely on taxpayers money.

It's to keep the currency relevant. Without tax we could choose to trade in whatever currency the buyer and seller agree on. With tax reporting the government has control over ones transactions as they could ask to audit you and see receipts. Also tax has to be paid in the local currency thus adding to this. Tax is 100% not needed for spending by the government, but it does help with some wealth equality as tax bands get higher with income.

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Computer 🖥 by private banks that leans the money to public banks like chase ect ect

Not to mention the highest debt-to-GDP ratio since the end of the Second World War! 😱

No she said physical resources is the limit

@@newsoul.9 The very definition of inflation is too much currency chasing too few goods.....Physical resources. Your comment is a distinction without a difference.

@dcj3831 Yes, but she is explaining that inflation wouldn't be a thing nor should be the limit. By u saying: "Inflation" that puts our focus mainly more on the money supply, prices, taxes rather than physical resources supply pool The word/definition of "Inflation" is tied to more things like increasing prices or increased in living on a country (as the solution) or that (buying power is the problem) when it not. Is lack of production that needs to be increased. So when u say things like "inflation" instead of saying "the limit is physical resources*" it does not solve the problem on what the actual real limit is. I'll give u the actual definition on Google when u type "Inflation meaning" 👇🏽👇🏽👇🏽👇🏽👇🏽👇🏽👇🏽👇🏽👇🏽👇🏽👇🏽👇🏽👇🏽 "Inflation is the rate at which prices increase over a period of time. It's a broad measure that can include the overall increase in prices or the cost of living in a country." 👆🏽👆🏽👆🏽👆🏽👆🏽👆🏽👆🏽👆🏽👆🏽👆🏽👆🏽👆🏽👆🏽👆🏽

@@dcj3831: Inflation has very little to do with how much money is out there. Inflation rises when supply is smaller than demand. Inflation shrinks when supply is bigger than demand. That’s all there is to it. If supply is limited and demand is bigger than supply the greed of the seller rises the prices. Very simple. Instead of raising interest rates the government could tax the greedy to reduce the inflation. That would be the more intelligent way to keep inflation in check.

they don't care. I have never heard one of these modern economist explain how they are protecting anyone's actual worth. what hey are peddling is government control at the cost of independence and liberty from such nonsense.

your the one not understanding.....listen again

@@chev39rsh why would I want independence from free healthcare?

The FED adjusts the money supply as it is

@@ictia7036 Its not free. What they claim is free is you don't see the cost and there are no frictions you can apply to reduce it.

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It's pretty simple to understand. The whole "We the people" who should be actually participating in this government make a plan to do stuff, fix things and help each other, then they open the Fed's cash hose for a bit, and things start happening. Orrrrr... we don't do any of that. Then people start reverting to their animalistic selves, with people dying homeless on the street from easily curable waterborne illnesses in the middle of a giant famine-blackout where nothing works and nobody cares. The rich people who skipped out on their tax bills have enough to float around pointlessly on their golden parachutes for a while, but eventually even they will touch down and get thirsty. I see a lot of room for Capitalism to produce the things that Capitalism is designed to produce, like poverty, pollution, corruption, resource overshoot, market externalities galore... but I don't see any fallacy. You can either hit the brake or the gas... which one do you want here?

Watch until the end. She discusses the circumstances in which increased spending can't fix a problem without excessive inflation. It essentially is when the economy no longer has the extra capacity to produce goods and services with that money. We just went through a period of supply shocks, restricted immigration, and corporate price gouging that worked together to cause inflation. We simply didn't have enough goods and people to spend the money on, so prices rose. If we had just increased legal immigration and restricted M&A over the past few decades, there would have been very little inflation.

@@kyleolson9636 M&A?

@@mistercohaagen mergers and acquisitions

@@kyleolson9636 Ah, thanks... that makes a ton of sense now. Imagine how susceptible to inflation we're going to be when Amazon envelops every other business. Then again maybe their closed-loop ability to drive and anticipate customer demand, combined with the fact that they'll probably end up being the sole employer, educator and payroll for this nation's "governmental" regulators / legislators... maybe they can respond more quickly than any goofy notion of "The Free Market" ever could, since the only mechanism they ever had as feedback was pricing. Lol what a nightmare we made for ourselves, allowing Capitalism to continue long past it's obsolescence. I'm ready for NL/RBE at this point! I always thought inflation was due to hoarding wealth when there isn't enough competition due to patent trolling. The inflated cost of something producible by only one vendor, is provably the individual unit-sized component of what we actually mean by the word "inflation". Now I can see how that's actually true, as it artificially creates the exact bottleneck Kelton described in the final section of this talk. Allowing all that dynastic wealth to stagnate and congeal in it's own little pocket of corruption simply due to all the "yes men" that are hoping for a piece of it, with their meddlesome outreaching tendrils that break good-faith systems we've always assumed reliable. I guess the patent system never anticipated people who would be morally willing to ransom something all of humanity actually needs, like vaccines, fertilizers for growing food and battery technologies. While MMT is more correct than older theories, it doesn't suggest any solution to the corruption problem. I think this is @robertgillespie6890's "fallacy" he was looking for.

The people who want a higher defense budget believe it is in the general public interest. The people who want more social program spending believe it is in the general public interest. There are limited real resources. This woman is arguing for government central planning. No thanks

Foolish response, that demonstrates a child like understanding of politics and economics. 0 out of 5 stars would not reply again.

only because there's barely any money back from helping the poor

@@KenTheAdventurer what exactly is the ROI on giving rich more money to store offshore, or companies to buy back their own stock, or feeding the military industrial complex? The reason they were called "stimulus" checks was because they went to those that needed it and they turned around and spent it, "stimulating" the economy and preventing a recession. Capitalism doesn't work if no one has the money to buy what you're selling. Give people money, demand goes up, supplies have to be increased and jobs are created and the business owners get rich. Money flows up, not down. Giving money to the rich doesn't stimulate demand or create jobs it makes things worse.

War is terrible, but funding defense creates jobs and production. The issue right now is labor. Spending without labor is a problem.

Hit me on👆 I have something different and profitable to introduce you into.

That's how debt works, yep

It is fun to think about it for me, how the banks create money. Ironically banks create money when we borrow it. Oh the supply and demand curves of debt and money supply.

@@MrRichbc yeah we did that with the gold standard back in the day. Fiat money was a really important step in expansion and creation of our current economy

@@MrRichbc Nobody really forced their internal financial politics to hold on to them. They estimated that they would make a good deal for themselves holding bucks. Now, if you want a piece of the action with the big boys, you have to pay the price and take some risks.

Yes all deficits must be paid back as they are when the Treasury Bonds that are initially sold to fund borrowing that in turn fills the shortfall in the budget mature and are paid out. If they were not paid out nobody would have bought them in the first place.

​@Rob-fx2dw That incorrect, the government doesn't no longer need the "treasury bonds" because it has a [via currency $] that's not tied to physical resources. The creation of the [IOU] was just made when we where still living in Barater Economy...but somehow we still have it to this day because it give the United State Dollar more "value" by having wealthy investors and other governments lend you the money. That u can technically make yourself...

This is the basic misunderstanding. The national debt and the deficits do not have to be paid back. It's more about increasing and decreasing the money supply when necessary. The national debt is really just a record of how much money we've created. Here's my little analogy. Say that you and I are on an island and we each have $100. That's the whole economy. Now I say I like your shoes and would you like to sell them. You say OK and sell them to me for $10. Then you say you'd like a coconut but your back hurts and can't climb the tree to get one so will I do it for you. You say you'll pay me $20. So I say OK and climb the tree and get you a coconut. That's all well and good. Now you decide that you don't need your car anymore and ask me would I like to buy it? I say OK I'd like it. How much? you say $2000. I say not only don't I have $2000 but there isn't $2000 in the whole economy so it's not possible. But I have an idea. On a piece of paper I'll write an IOU for $2000 and give it to you for the car. Then each time I climb the tree to get a coconut for you we'll scratch $20 off of the IOU. Obviously the IOU is the same thing as money and I just created it. But the real point is, there needs to be enough money in the economy to accommodate all the transactions that people need to do. And the size of the economy can grow for a number of reasons. For one, the population grows. Also if it's reported that the GDP has grown say 3% over last year then that means there's more productivity and more transactions. So the government (or FED, whatever) needs to increase the money supply perhaps permanently. The government is not so worried about the money it created. The government is primarily concerned with whether we're being as productive as we can be or whether there's not enough production causing inflation. It just adjusts the money supply to stay within inflationary or deflationary spirals or to get us out of a recession or to mitigate a crisis. So as long as productivity increases over time the money supply needs to increase to accommodate it. So we run a deficit to do this. And naturally we will run deficits more often than surpluses. (As Robert Reich likes to say, this is why deficits don't matter except as related to GDP.) The national debt is not really a debt that needs to be paid back. It's just a record of how much money we created and that we needed to create. Yes we pay interest on the debt, but again, we could just create more money to pay that. The concern would not be that we're in debt even further and have to pay back even more. The concern would be that we're increasing the money supply too much and causing inflation.

@SolidAir54321 u explain it beautiful!!!!🤌🏽🔥💯💯💯💯👏🏽👏🏽👏🏽👏🏽👏🏽

​@@SolidAir54321 For many years I have heard the idea that "deficits don't matter" bandied about, but this notion doesn't survive scrutiny when some very obvious questions are asked. For example: Do we pay interest on this borrowed money? Given that several sources clearly indicate that we are now paying record amounts of interest on our national debt, then it is clear that Deficits Do Matter. If we had not been required to pay that interest on the country's debt, then could the money we are now paying in interest have instead been spent on other needs? If yes, then Deficits Do Matter. Would having little or no national debt send a message to our foes that we would be in a strong financial position to afford a lengthy war? If yes, then Deficits Do Matter. Does having little or no national debt contribute to the strength of the dollar against other currencies? If yes, then Deficits Do Matter. Are we not taught early on in the study of economics that "There is no free lunch."? If the perceived unimportance of a national debt is tacit to "something for nothing", then Deficits Do Matter. Very often the national debt is defended by the notion that the debt is compensated for by subsequent economic growth, and that we are simply borrowing against future prosperity. So long as any of our national expenditures are made for things that do not contribute to national economic growth, then Deficits Do Matter, Worse yet, the notion of debt-funded future prosperity is predicated upon the idea that the economy can grow infinitely. If this presupposition is a fallacy (and it is) then Deficits Do Matter. Until ALL of these questions are fully addressed, Deficits Do Matter. Those who think otherwise are simply not looking forward far enough to recognize that the butcher's bill will eventually come due, and at that point, it won't matter how big our GDP is.

100% right. We should all refuse to pay taxes and cite this retarded theory in court.

This is not what she's saying at all 🤦🏽‍♀️ taxation is necessary to take money out of the system to avoid inflation and to redistribute to those who don't have enough. Inflation is a fall in the purchasing power of money

Inflation is the only real limit to public spending however, if public spending of X amount leads to an increase in goods and services produced that is greater than X, then that spending was actually deflationary. The money circulating in the economy falls in comparison to goods and services produced, and costs fall making us all better off

You wouldn’t need to tax to take money out if you hadn’t printed too much previously, would you? But I appreciate your effort to tell us what she wasn’t able to say for herself.

@nadinefisher5871 you're an absolute moron if you believe any wealth is being 'redistributed' to people in need. Take a look at how much of our budget goes into social programs versus the amount awarded to DOD vis a vis "foreign aid" (like Ukraine and Israel) that is REQUIRED to be spent buying arms from our military industrial complex. Or how much is spent subsidizing "research" on behalf of big Pharma and "green energy." All of that crap winds up back in the hands of the Oligarchy and is exactly what is meant by the "upward transfer of wealth." *THAT* has become the purpose of taxation in our corrupt system.

She would tell you that she wouldn't care. Ultimately, the Treasury could simply borrow from the Federal Reserve Bank (who can effortlessly create money to buy Treasury Bonds). So, even if interest payments grow, the Fed can finance it. The only worry that MMTers care about are the political consequences of inflation, which could get their advocates thrown out of political office. That's probably what they are most concerned about now.

@@logosao88 The myth that the Federal Reserve Bank is an independent Agency from Treasury, appears to reflect the reasoning that Fiat Currency creates. When proposed the Currency change to the FED issuing Dollars, was presented as the value of the Federal Reserve Note, was supposed to be backed by the US Treasury selling equal value Notes to support the FED Dollars. I studied Econ in 1970 as the proposals to solve the currency crisis of 1967 that could not appropriate funds for the War on Poverty, because the Colonial Conflict in Southeast Asia had used up all the profits. We assumed Americans were too smart to fall for a system like we have today. But here we are..... If Treasury is incapable of demonstrating an equal value from their sales of Treasury Notes and Bonds, the Value of the FED Note falls. We are foolish enough to throw Balls at Targets at a Carnival to win a Teddy Bear. Even directing a Grenade Launcher at some Carnival targets will not dislodge them from their perch. But our faith in our hormones or our strength keeps Fools paying a Buck to throw some more. The Government or the Bankers, provide lovely Ladies like this one to assure us that the system is sound, the Dollar is secure. The fact that a complex web of Government Agencies and Bankers now shift the support among a multitude of Players to offer the appearance of stability. When Humans begin to doubt the stability of the Currency, the value plummets. The US Economy has become a Carnival, and Pickpockets and Carnival Barkers just take the money as they see fit. We have been too long at the Fair. The economy is simply an illusion supported by smoke and mirrors, as bright lights distract us. The Fact that the BRICS Trade group now has within their association around 70% of the available resources on the planet, and the US Threats of military power that can overcome any obstacle, are diminished by the appearance of Pentagon Audits, that indicate that corruption has stolen trillions from the money allocated to scare the Citizens of the World. The Carnival of US Economic supremacy, is about to fold up the tents and split for another Town...... The illusion is over.

You are 100% right, She lives in Lala land where the laws of physics & thermodynamics dont apply, Just because they print money, doesnt mean that goods and services are produced, An economy consists of goods and services, and a toilet paper they print is no longer valuable as they print more and more, buy Bitcoin or Gold, even stocks are issued by companies, the higher the price, the more stocks they issue, ridiculous, and We have to work for thay crap

​@@logosao88 I think you underestimate the consequences. To paraphrase a quote, when the poor can no longer afford food, they will eat the rich ... too bad she's so thin

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She writes a lot about taxes in her book. They're needed to make money valuable, manage inflation, discourage and encourage certain behaviors, and manage inequality.

The fact that academics believe this tells you all you need to know about academia….and I say that as an academic myself!!

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A lot of MMT economists advocate for permenant zero interest rate policy (ZIRP). They argue monetary policy is the wrong tool to combat inflationary pressures and much stronger automatic fiscal stabilisers are preferred (i.e. the Job Guarentee acting as an Employed Buffer Stock as opposed to the currently used Unemployed Buffer Stock which is far weaker a stabiliser).

Keynesian Economics versus Austrian/Free Market) Keyensine econovis always leads to boom and bust cycles. It was developed before and during WW2, and caused the Federal Reserve to be founded by the government, JP Morgan, and John Rockefellet at a hotel off GA’s Atlantic shore.

Print up infinite amounts of worthless money and buy up real assets with it. Quite a scam, yeah? Ask Jefferson said, eventually they print up enough money to own the whole Earth. Somebody famously said "Robbing a bank is nothing compared to owning one"

"the government's bank" does not imply ownership, any more than "Gary's bank" implies that you own the bank you use. One of your premises is correct, in the US the government does not own the central reserve bank. The other - that her choice of words implied ownership, does not.

Bingo, Stephanie Kelton believes the US govt can print money. it Cant

@gpdewitt ... and there is! The Federal Reserve IS NOT an American Entity, some refer to it as The London Connection. The book The Secrets of The Federal Reserve by Eustace Mullins delves into the point you made, which that IT IS NOT The Government's Bank. BTW that book was written in 1958 and by design was given a more boorish innocuous title to its name. In any event, the ingenious concept of The Federal Reserve in being able to print endless supplies of money, only works to control the global economy when that same currency is recognized as The World's Currency; also known as The Petro Dollar. In contrast to the USD being used as a global currency due to the arrangement the U.S. have with Saudi Arabia, there is now the BRICS new alliance and plan to establish their own currency. If Saudi Arabia jumps ship and aligns themselves with the nations of BRICS, we will be seeing an attempt to usurp the USD which WILL happen "if" the USD is no longer used as The Petro Dollar. Once that happens the paper that the USD is printed on will become worthless. In essence we may be witnessing in real time, the beginning of the end for America as we now know it, which will be inevitable, "barring a catalyst event such as WWIII". Hence the definition that "All Wars Are Based on Economics"

Exactly!😂

The difference is that MMT centers inflation as THE thing to avoid, whereas the CBO today tracks deficits which are unrelated to inflation. In other words, the CBO is saying "we can jump out of airplanes, as long as it's night time." If we can get Congress to focus on inflation, we would expose what spending contributes to inflation down the road, and what spending will not because we have the resources to provide the benefit we're spending on.

couldn't agree more!!!

On the contrary, high inflation generally leads to investors losing lots of money in the market. Just look at what's been happening to the markets since the Fed started talking about upwards of three interest rate hikes coming. Soon as the Fed changed their tune from transitory inflation to not transitory, the markets tanked.

@@maxmoser412sure that's true, but it still doesn't change the fact that people without disposable income are more heavily impacted by inflation than people who invest. Even with a downward trend in the market here and there your 401k will still outperform any sort of savings someone with no disposable income manages to build up.

@@jobegerlach87 totally agree, was just pointing out that inflation does impact every American, wealthy or not. Certainly not to an equal extent as you pointed out.

It depends where the money that cause the inflation went. (unless it's cost-push inflation, which is mostly what we are experiencing now, which sucks and has nothing to do with fiscal or monetary policy) If the money went to "people who don't have enough money to invest", then they win. If it went to someone else, they lose. Either way, it's just redistribution of wealth. Good for some, bad for others. Either way, wages will eventually catch up to inflation

Great comments. She didn’t mention that the UK and USA don’t produce the raw materials anymore, so a large portion of the money goes abroad, to China for example.

@@mymateian exactly

You are 100% correct and your comment is very intelligently written....cheers 😊

"if you squirt in excessive amounts of money into the system far and beyond what the country can produce then you're going to get inflation" This is fundamental to MMT. It consistently and explicitly places the real resource constraint at the front and centre of fiscal policy decision making. Mainstream macro obsesses over the red herring of arbitrary government balance sheet positions over an arbitrary time horizon when deciding on spending. THAT is the crazy one.

MMT is nothing new. Most people taking an economics 101 class can think up of something along the lines of "how about we don't tax people, and just print more money and tax them via inflation?" The real problem is who is doing the printing, and who they are giving that money to. Turns out people are corrupt, and they give that money to themselves and their buddies, and have everyone else pay for it via inflation.

A fortiori, why does the government tax or borrow? According to this econo-nincompoop all it has to do is print funny money to pay for everything. Taxes and borrowing could be reduced to zero and inflation would be beyond Argentine. Zimbabwean!

You've asked a very good question. Modern Monetary Theory actually proposes that we have it backwards on why we pay taxes. In the past taxes were used to bring money into the government to pay for services. Now under FIAT currencies it's more accurate to say taxes are actually used to remove money from the economy to prevent inflation. The roles flipped around once we took currency off the gold standard.

@@jackbrons4904and that’s the problem now isn’t it

Taxes were originally designed by sovereigns to prevent wealth hoarding. A handful of wealth hoarders could become hegemons and stage coups. Once these aristocrats took power they hoarded natural resources and charged an arm and a leg for them. The people thus became rent-paying plebeians, serfs and peasants. Nowadays not paying taxes lands you in federal hoosegows, unless you own a platoon of treacherous intellectuals trained in tax and corporate law who via lobbyists wrote tax law and understand tax havens and off-shore accounts. Thus, these hegemons pay little if any taxes. So they can become bigger and bigger "influencers." (or "powerful"). Ain't finance capitalism grand? Taxes should in theory only be paid to entities that can't print money such as states, counties and municipalities. Be well.

@@jackbrons4904 They tax you via inflation, and then they take your money to "keep inflation down" while you don't have the money to pay for goods and services that they supposedly kept inflation down for you to afford.

Then why am I paying a water bill every month?

Because it’s a limited resource. So you don’t use 4 times the amount you could get by on because it’s free. There isn’t enough for everyone to water their lawns for 3 hours a day all summer. Y

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Dave: that sounds like you're fundamentally (and fairly rudely and ignorantly) ignoring the core premise proposition (and factual reality empirically warranted by simply observing the actual extant data), that federal budgets aren't household budgets. Period. The only way to cling with a death-grip to that fallacious myth, that somehow something as complex as an entire state's financing is magically the exact equivalent (or even just a bigger version of same) as some relatively small handful of people, is to ignore how systems of every kind work, in nature, in human context, always -- and how that fundamentally differs by scale, because emergent properties increase, when you have more factors involved, more elements, more components, just plain more. Here the simplest debunking of the foolishness of the entire misplaced paradigm and ignorant way of thinking is this, inherent in your own off-base questioning's basis: as described clearly and hard to misunderstand in the vid (unless mired in a whole worldview that blocks even looking at the point and hearing any single word said), when the government spends money, and so increasing what is mis-named "debt" overall and each year's "deficit," it isn't borrowing from anybody, ever, not really, and certainly in no way whatsoever like when we individually do that, or as families, again, in households. Simplest to see, because that money "spent" is actually going into the very same *revenue* sources that pour in money *to* the government, and *not* by "increasing taxes" as in raising a rate (even though that of course could and should be done for certain very small and resource-hoarding subsections, extremely rich individuals, and incessantly profiteering-to-insane-levels corporations). But rather, simply because when *people* have more money, they can actually spend it, as well as afford to do other things that cost more money, including set up businesses, move to where higher paying jobs are, buy houses and other owned homes, not to mention just live longer, and be more productive, etc. etc. etc -- all of which, at the *same* tax rates will nevertheless pour *more* money into the federal (and state/province/etc.-sub-federal governing levels, city and county and so on as well) funding coffers. It's really as simple as understanding math, and knowing that the numbers mean nothing unless you correctly apply units, i.e. the names of whatever the numbers apply to, aka context. Of course you'll probably intentionally perpetuate your own misunderstanding by misreading this, per the obsolete legacy "gold standard" etc. bs paradigms (such as scarcity model, chicago model or whatever of economics, aka racketeering imposed on you by perpetrators past, and which you become the perpetrator of as long as you buy and swallow that feces continually as a sewn-together human-centipede segment). But hey, maybe you could become humanized again and stop pushing the lies and violence that protection rackets always peddle. Who knows? If so, welcome to the human race again!

@@avirichar4981 put the thesaurus down

@@avirichar4981 Your reply is just rubbish. You are ignorant of the fact that all of the money government spends is ultimately tax money. That is because the majority is tax money to start with and the remainder is borrowed money they get from selling bonds to the Federal reserve or to the public or overseas entities . All of this borrowed money has to be paid back when the bonds that were sold to get it actually mature with interest. The bonds All mature in time so eventually all of the borrowed money becomes a burden for the taxpayer. Ultimately there is no free money or non tax money. You say "when the government spends money, and so increasing what is mis-named "debt" overall and each year's "deficit," it isn't borrowing from anybody, ever, not really, and certainly in no way whatsoever like when we individually do that, or as families, again, in households.". This indicates you are also ignorant of the fact that since 1971 all the so called sovereign money is credit and your response displays this ignorance of the nature of sovereign money today .

@@avirichar4981 "understanding math". Yes, a negative number in your account means you've spent too much and the answer apparently is to steal the difference.

@@avirichar4981 Do you realize that you avoided answering the question with all that word salad you produced? Or was that your intention? What actually does happen--take the time to explain in fundamental mechanics--when the interest on the government debt becomes the largest item in the government budget? Suppose interest rates run to 15% on our current roughly $30 trillion. Let us readers know your answer please.

Sadly we are governed by a bunch of socialist lunatics who just don't care.

Exactly!!! Most people are even happy on that road, because sooner or latter it involves rise in salary, which feels good.. It's such a scam... :-((

So, you´re basically saying budget deficit is necessarily leading towards inflation. Although that´s been the neo liberal mantra for decades, empiric research in macro economics does not support that as a given or even as an automatism.

@@pnw_jordan That's the trap of simply believing someone, who knows a bit more than you. Of course, she has studied. Of course her work has been reviewed. And of course many of her peers strongly disagree with her. Economy isn´t always exact science. Generaly you have Deficit hawks, deficit doves and deficit owls, all sides sporting greatly studied names and coming to different conclusions.

@@8ace02 Please, which empiric research do you mean? Could you post some studies? Budget deficit doesn´t necessarily lead towards inflation. But financing it by non-existent money does. Naturally. If you raise an ammount of currency in existence, you lower the value of that, if the ammount of product created in the same society stays the same. Plain and simple.

It's not just other countries picking up the tab. The tab is picked up by anyone that doesn't drink directly from the teat of the US government.

Debts tend be bad, because there is an impatient creditor with the ability to force you to pay it back on their onerous terms. That does not apply to the United States federal government. The one issue that must be respected and accounted for is the strength of the dollar internationally. And this is largely kept stable by America’s military, which is widely welcomed and invited into every 1st world country. All those foreign governments that want US troops to keep them safe also have an extreme bias in favor of the US dollar remaining stable, so they will circulate the dollar which fights inflation.

Two things, no? Strength of the dollar and inflation.

Hit me on👆 I have something different and profitable to introduce you into.

@@MrRichbc Bitcoin was born as pure hate against the government. It is advocated by financial illiterates who ignores the fact that deflation is even worse than inflation. That doesn't prevent bitcoin from being attractive and it actually makes a great deal for some financial institutions. Simple business, easy money, the more anti-system idiots in the crypto game, the more profit for the big sharks 😁 Another great robbing tool 😁 ...fine, go ahead and buy bitcoin ! 😂

@@tudorioan5104 of course BTC was created for hate agains the government. Don't you hate those who rob 50% of your labor and destroy the currency you were forced to keep your saves in? I do. Bitcoin is only deflationary because dólar, euro and other fiat are inflationary. As long as it keeps decentralized and I remain vigilant on my private keys, no one can put the hands on the fruits of my work. And that is extraordinary, unprecedent and priceless

BITCOIN FIXES THIS

the establishment economists would not sign off on it because they tell lies lies lies

Even peer reviewed work can be bullshit even if it "passes." Just look at all of the junk science being put forth over the last few decades. Tons of bullshit to be found, and lots of scientists are in on the scam.

She is an empirical economist, a professor at the Levy Economics Institute, and has published many papers and books.

Except she's lying / completely out of touch with reality. Only one thing causes inflation, money printing. Without that, an increase in price of one thing would mean an equal and opposite decrease in price of another thing. Not in her world, we're getting increasing prices of almost everything, while paychecks aren't keeping up. So damaging.

@@pinewood6340 " Only one thing causes inflation". You don't think issues with supply lines cause inflation?

@@Mctazin Any increase in price of one thing causes a decrease in price of another, if money were real. Since our money is fake, prices for ALL things can go up. This is only due to money printing. No money printing, and any "inflation" is temporary and is with one sector / set of items, offset by decreases elsewhere.

@Pine Wood what are you talking about? Why would an increase in one price necessitate an equal and opposite decease in another price? Also the framing of this is bizarre. Obviously we are talking about the way inflation functions in the modern economy not whatever imaginary "real" money economy you are talking about. I feel like your first comment was wrong but almost made sense and now the wheels have come off and I'm just reading nonsense.

@@Mctazin Because if more dollars are being spent on one thing, less dollars would be being spent on other things, because of reality. The only way both things go up in price is if more and more fake dollars are printed out of thin air. Otherwise where would the dollars come from? The only thing that was nonsense was this TED talk. There's a reason it's called Modern Monetary 'Theory'.

Yes, that would be the banksters from 1913.

Implied in her scenario would be higher taxation of the rich (including elimination of the Social Security and Medicare caps), and some form of wage and price controls to keep a lid on inflation, which is a result of creating as much profit as the system will bear. Retained profits and accumulated wealth are uncollected taxes paid by all of us. So to tax profits is simply the return of the people's money to be used for purposes other than allowing people and corporations to become morbidly rich. Deficits and national debt are offset by the enormous assets, resources, financial power, and military strength of the nation. All together, it's called the wealth of the nation.

I like the use of the term " morbidly rich " not sure if you coined it, but I have never heard the term before. I just heard another new one today, " Cryptopia " @@palladin331

@@palladin331 Higher taxation of the rich only works as long as they play the game along. Many rich people have the means to easily move to another country and take their business with them.

Argentina denominated their debt in foreign currencies

@@grimaffiliations3671 they don't know what that means lol

A stable tax and political system is necessary for this to work. The US (in general) has that. Argentina doesn’t.

@@colbycalabrese8417 Uh huh. Sure, you keep telling yourself that.

@@grimaffiliations3671 exactly

You have it right. She briefly mentions inflation then drops the subject. This is propaganda expounded by a fool to confuse morons.

You could've made your comment shorter by just writing "I don't understand Modern Monetary Theory". Appealing to 'common sense' in a hyper-complex research discipline like macro-economics doesn't make any sense.

Dear TINA-ist, Madam Thatcher coined that disingenuous phrase. Please re-read your geo-political economics boosk. Please read my comment above. Be well.

@@jackbrons4904 Modern monetary theory is bullshit. Keep letting them take money right out of your pocket with inflation year after year while they lie to your face telling you inflation is under control. It's really showing us how much you understand mmt.

Inflation is part of the design. What she basically said was, the debt doesn’t matter as long as inflation is under control.

You need to learn more about mmt I guess. Many of the predictions of conventional economists turned out to be completely wrong. Why? Because the models they use are too simplistic. MMT models are more accurate. You know trying to run a budget surplus puts pressure on the private sector, which has resulted in a big increase in personal debt? If there is a massive increase in personal debt then there is clearly a problem here, and the market is not functioning. There is not enough money in circulation. There is not enough regulation either.

MMT is already being put into practice.

@@Lommyism I am certainly no expert. Your comment shows that neither are you. I agree that many classical models are not good enough. MMT models are not really any more accurate - they just use a different set of assumptions. I made no mention of running a surplus - and your point does not make really make sense.

@@gshooting Indeed it has. And indeed the consequences are starting to be felt - these will only grow and are unlikely to be sensibly controllable as the money has been "minted", asset prices inflated and the conditions for instability created

You are wrong. Printing money is only a problem when your debt is in someone else's currency. If you print Yen to pay US debt you had to buy US dollars, which lower the price of Yen, which then increase the price of the debt. This cycle cause hyperinflation. But this does NOT happen if the debt is in local currency. If you print US dollars to pay debt in US dollars, the debt gets paid off because it gets devalued WITH the currency. The key is to not have forign currency debt. Local Currency debt doesn't matter (at least not matter enough)

@@VallenChaosValiant Why am i wrong then? A lot of countries in south america have been printing money with disastrous consecuences.

@@jackprescott9652 Did you READ anything I wrote? The South Americans buy imports using US dollars, not their local currency. So the debt is in US dollars. And trying to print their way out doesn't work because the debt gets bigger that way. But if your debt is local currency like in Japan, or if you are the US of A, then it doesn't matter because the debt gets devalued by printing. and if you don't understand this then you don't understand hyperinflation.

@@VallenChaosValiant OF Course. I mean, USA can do that. Sadly my country can`t.

@@VallenChaosValiant So why don't all countries simply only issue debt only in their local currency? Then they don't have to worry about deficits?

Kelton would agree with you mostly, she mentions around @2:30 and again at @9:25 the key questions are about what resources the government claims? Kelton is all about _spending wisely_ how could you fail to hear that?

Check our her book.

Has she found inflation yet?

You already have central planning,which is being done by private wall street banks,not the government,because in our system private banks create new money supply when they give and create new loans(they don't lend fractionally or from reserves,they create it same way as central banks do,out of nothing),so there is posiblity for inflation not only if government create and spend money,but from private banks and sector also.everytime some bank decide to give loan to some client and company,they are increasing the money supply and engaging planning of economy and its direction.they it is just a question of in which system you want to live,one in which planing is being done by small number of privately owned banks who mostly lend for asset and financial speculation for short term capital gains and consumer purposes so people go into debt to consume stuff,all of which is not productive and don't add anything real to economy,it is wealth extraction actually,when you create money out of nothing and just buy assets in order to sell them at higher price or take the rent and dividend,you didn't create nothing,you extracted wealth from the real economy into FIRE sector(finance,insurance,real estate owned by banks)or you want to live in system where planning is being done by institution that at least have to pretend that work for the public,because there is election every few years and we have at least some control over what is being done there..

Some resources are scarce, yes, but many resources are abundant, at least for now. But our economic system worldwide, running on capitalistic infinite growth is a recipe for disaster. That's a key problem. We can't expect a sustainable environment using an unsustainable anti-economic system. So that means there should be short-term solutions and long-term ones as well. In the short-term, understanding the myth of deficits, and the fiat currency countries such as US, Can, UK, Aus, China and Japan that cannot run out of money, they should all be ensuring the basic needs of the people be met: no poverty, no hunger, no homelessness - using programs like a basic income and housing for all - and re-build infrastructure to be advanced, efficient and powered by renewable energy. Education should be free, healthcare should be free because they are human rights and promote general wellness in society. Long term, we need a sustainable alternative economic system to capitalism, like a Natural Law resource based economy, where Natural Law is how we collectively manage resources in an open-source, public access way. With local self sufficiency being a key goal to promote direct democracy and eliminate political roles. Politics is out of the way of resource management, replaced with logic and reason, Natural Law and various groups of experts in their field collaborating on problem solving and life improving projects.

No. It does not work in the simple-minded linear proportions way you suggest. Macroeconomics (unlike micro-econ for a single firm) is fundamentally a nonlinear dynamical system. Households can choose to save rather than spend (and spend to to do what, eat more? buy more houses? you cannot spend on goods that are not for sale, and firms hate raising prices when there is demand pressure, they pressure to map up output, until they run out of resources, typically only then, and only if they have a near monopoly, will they put up prices). Thing is, in an uncertain world households do save a lot of surplus income annually. All such savings are a demand leakage from _circulation_ so are a huge deflationary bias. It is thus not the stock of currency in existence that puts pressure on prices, it's the rate of circulation, and even then there is no deterministic causal path to inflation. To get inflation from excess demand firms have to run short of labour or machines to hire, since they tend to increase capacity rather than raise prices. Provided resource slack exists then , the general price level will not change linearly with increased governemtn net spending.

@@Achrononmaster Very good and clear explanation, I hope many people read it and understand this simple fact you mention: ''It is thus not the stock of currency in existence that put pressure on prices, it's the rate of circulation, and even then there is no deterministic causal path to inflation.''

@@Achrononmaster great breakdown, upvote

Yes, straight out of Milton’s memoirs. No one cared when Emperors diluted the gold in coins. And this theory is modern to boot.

@@clemfarley7257 🤌👍yes

yeah I liked most of what she said, but I don't get this part. maybe she didn't explain well enough because I'm thinking similar to you are. Did Zimbabwe and other countries like it lack the resources or something, is that why printing money destroyed them? flooding the market with money when there aren't enough resources drives the prices up? Is that what she's saying?

When the United States prints money, it does so by selling bonds. The US currency is backed by debt, and we've never defaulted on payments of it. Countries printing money into hyperinflation tend not to issue bonds. Today's short term inflation is largely driven by COVID triggers (supply chain issues, housing shortage).

It depends if your debt is primarily in local currency (USD) or foreign currency (Zimbabwe, Weimer Republic)

@@nathanbishop4771 yeah. more money has been printed, driving up demand to buy. but supply can't keep up so the prices go up driving inflation. hypothetically (in my mind at least), if things ever return to normalcy, then supply should go up and we may see deflation.

@@nathanbishop4771 You say "The US currency is backed by debt, and we've never defaulted on payments of it". The US defaulted in the great depression under FDR. There is guaratee that counties creating and selling bonds will not experience hyperinflation. It also depends on whom they sell the bonds to. If they are sold to the central bank who creted new money to pay for them and they are onsold to others before they mature there will be inflation pressures. If the money that pays for them is created out of nothing and not destroyed when they mature there will be inflation pressure.

We are finding out!

Yeah, like dismantling your own light industry and shipping it all of to China. That was a pretty bad idea.

it doesnt exist if your talkin household finances but if youre talkin about most western economies and governments then yes

Well, there is a magic money computer, not a tree and it only applies to the governments that control sovereign fiat currencies. Not your parents.

@@pjauthur9869 depends on how you define most. This doesn't apply to any country in the Eurozone, which is a lot of countries.

Some policies do end up long term. Just look at Obamacare. Something all Republican voters hated (for many odd reasons), but ended up wanting to keep it because getting rid of it would hurt them very much. When Trump tried to get rid of it, a federal judge shut him down knowing how much it would hurt the country. Obamacare was just a stepping stone towards universal health care. Obama knew there was no way he could get a universal healthcare bill to pass because there are way too many greedy people on both sides of the isle.

Long term economic policies depend upon sound economics, stability in markets, dependable energy, quality workers, low taxes etc...not MMT.

@@thomassenbart Low taxes my *ss. Tax the rich!

@@thomassenbart Your mistake is thinking MMT isn't already what is happening since the end of the gold standard. MMT doesn't CHANGE anything; MMT is just what real life is doing right now. You are already living in MMT even if you deny it. MMT is just describing the CURRENT monetary system. How money works NOW.

@@VallenChaosValiant No, I'm not. Gold has no more intrinsic value than paper, which has no more intrinsic value than trust in the federal govt... If the public loses confidence in any medium, currency crashes. MMT is something at another level because it asserts that there is no connection between public confidence and the value of money and that you can make as much as you want without consequence. You can't. The latest round of inflation is the tip of the proverbial iceberg. As govt. debt continues to increase, it crowds out all other expenditures and the only way to end this debacle is through inflation, which will destroy the debt but that only happens if govt. restrains spending, which it does not seem capable of doing. Gold is not the answer either and any attempt to go back to this standard would destroy the economy as quickly as MMT. What is needed is responsible governmental spending and taxation, roughly in balance. Such a formula allows for an ever more prosperous society, all things remaining equal.

that's MMT!

Actually the evidence for that is pretty shaky. The country that has run deficits the longest and has the highest debt is struggling with massive deflation.

Would that be Japan?@@MrMarinus18

Assuming the government is, this theory works perfectly. Big assumption

Yes it would be better if it had been much lower. The national debt she claims is an asset is really a debt for taxpayers to pay off when the treasury securities that were sold by government actually mature and have to be paid off with any interest and some large percentage has been sold overseas and they don't foot the bill for paying it off but resident taxpayers actually do without any other resident local getting the benefit of interest.

Thanks to Quid Pro Joe.

@@michaelcap9550that was Taliban trump that gave the money away. He spent almost a trillion dollars to keep people employed and still lost 2.8 million jobs. Pay attention.

Nothing is "free," including money. The Fed is stuck with the task of putting the fire out, and it has to do that by raising the cost of money; and the more the Govt borrows the harder that task becomes. Her solution is the same Keynesian nonsense that was practiced in the 1930s -- demand-side economics, stimulated by government tinkering and their exclusive power over the nation's currency. The minute Bretton-Woods collapsed was the minute we went from a save-and-produce economy to a borrow-and-consume economy, and we haven't looked back. That can only last so long before the bill comes due; and then what? Well, it's two years after her little Ted talk, and we've seen the answer -- which was as predictable as the day is long. Too many dollars chasing too few goods. What did they think was going to happen? What does the government care, frankly? All money is the government's anyway, don't ya know. And only by the benevolence of our comrades among the political elite are WE allowed to keep ANY of it. This Keynesian gobbledy-gook is what got us where we are now. A national debt 50% larger than the entire economic output of America. You could liquidate the entire economy and only pay off 2/3 of what the government owes. What happens when the dollar is no longer the world's reserve currency? Which of course will be the end result if we stay on this road? What then? The answer is shared misery -- and those responsible will never be held accountable because most of them will no longer be in office. What this lady is selling is snake oil. There's a limit to resources and labor, and if we're gonna have a fiat currency it needs to reflect the monetary balance between the two, otherwise the only beneficiary of this planned inflation is the government; the rest of the unwashed masses suffers for it.

NO, the inflation you see the US is the result of the food and oil supply problems due to the war in Ukraine. There was no inflation from the pandemic, that is simple data to see. The world inflation increased rapidly as Russion oil become restricted, that is trivial see in the data of inflation and cause and effect. The inflation we see now is supply side inflation which is decreasing now as there is more oil available on the market eases as less people are dependent on Russian oil There is high food inflation due to the lack of food from Ukraine that supplied most of the cooking oil and other food resources. That is why European inflation was much worse in food as much of the core food supplies comes from Ukraine. Now we have a current lifting of wheat embargo from Ukraine started to ease the inflation.

I clicked on the comments to post exactly this. You are spot on.

I would look to corporate greed, consolidation, and our lack of robust antitrust laws over the past 50 years as the main culprit.

But that's not the case at all. The current global inflationary pressures are primarily due to energy and food price shocks (largely attributed to Russia's invasion of Ukraine and the associated wheat and other raw material supply interruptions) and the more general global supply chain issues post covid-lockdowns - particularly China's zero-covid policies having ripply effects around the world. In short, the increased rate at which average prices are rising this year compared with last year has very little to do with increased deficit spending by lots of governments during the pandemic.

@@JGS2295 what about the American invasion of the world? Oh no not Russia again. Keep printing so Zewlenskys wife can to shopping in Paris. How much $ have usa printed for Ukraine? USA most corrupt government

Bankers enjoy Debt, they charge Interest to remove it and then your Debt becomes their income. The Ponzi Scheme of Capital requires us to now believe in the Digital Dollars that we never see. Economists enjoy the concept, it pays them to discuss it. We the People can actually stop participating in their Fiat Dollar scheme that was implemented by Nixon at the request of the Rockefellers, who now have made the Family Bank into the Nations Biggest. The Wealthy seem to be the ones who use Money to manipulate the rest of the Population, by using money as leverage to buy Politicians. It seems pretty simple to promote an Oligarchy when they make us all play their Game......

@@javierolguin2502 Was that reply to Janie Smith sufficient?

This is how I have always understood it, and though it is with kings, it scales to the modern world. Once, before machines and industry, wealth was exclusively land, because land grew food and the food drove the humans and animals that made everything. So to get wealthy, Kings had to conquer their neighbours and take their land. So they sent armies. The armies travelled to the neighbours and took their land. The soldiers were paid by what they stole from the neighbours (and the Lords who raised the armies got land). That works fine until you've conquered a few neighbours. Then the army needs to steal stuff along the way to get to the next nearest neighbours. But that's the King's land! No good will come of that. So, the king tells everyone that next year part of the annual tax will be not just food, but a coin that has a picture of the king on it. The king makes coins. Lots of coins. He doesn't actually want coins from the people. He literally just made them himself. Then he gives coins to the army and tells them that if they want food or other good on the way to battle, the villagers will swap coins for things. The villagers don't really want coins. You can't eat them. They're worthless... Except... They're going to need one for this year's tax. The tax is what gives the money value. Not this "proof of work" malarkey, or the "intrinsic value of gold". So the king makes coins, gives them away, then demands them back. Things get done. What she's taking about is just an extension of that. The "King" wants a new bridge/road/hospital or whatever. He creates money out of nothing and hands it to construction companies. They hand it to construction workers. Construction workers hand it to cafés, supermarkets, car dealers, they hand it to waiters, shop workers and salesmen. Each pays some tax, and over several transactions, the government gets it back. If there was no tax, that money would build up in the economy and eventually you'd need a wheelbarrow to carry the cash to the store to buy bread. The tax maintains the value of the money. So the limit isn't the supply of money, its the speed at which the money can circulate, with a little bit being removed each time it changes hands. But if the economy is going to grow, the government has to create money and give it way. That means more going out of the government than going in. That difference is deficit.

@@gasdive what if you could refuse to pay taxes to the king all together? What if the king's collector can't tell how many land, crops or coins you have. That's the crypto revolution. It's disrupting the government

@@rafaelborbacs then when the soldiers cross your land, and they're hungry, they kill you and take your stuff instead. Easy.

@@rafaelborbacs no, the crypto it's supported by speculation and it's not anonymous no more

Thanks fortaking the trouble to post that. I found it useful.@@gasdive

Total nonsense.

What makes you think MMT fixes the US government spending trillions on offshore wars????

@@SmashBrosBrawl that's not what they're saying. They're simply remarking that what she says in this talk is already true for military spending - that the US government prints money to resource wars. But it is unwilling to do the same to fund things that would actually help people

@@jaxoncanseeyou but it's not free, that's trillions of dollars that would've stayed in the tax payers pockets. The govt is not better an omniscient being that knows how to beat allocate resources. The private market with hundreds of millions are much better at doing so

@@SmashBrosBrawl well that has nothing to do to the comment you're replying to, and shows that you didn't watch or understand the video. What a troll

@@jaxoncanseeyou Japan already has pseudo-MMT, 0% GDP Growth for like 3 decades now. Great policy 😃👍

Perfect! The most lucid commentary ever.

When you say cut the budgets that are going straight to the 1% - what do you mean? Cut all government spending or just cut the wasteful elements?

@@pauljarvis902 start with the money going directly corporations: bailouts, interest-free/low-interest loans, subsidies, military industrial complex, etc. Move on to wasteful spending. Eventually, get to indirect funding that destroys markets and raise prices like Medicare, student loans, etc. Basically undo what the government did to ruin things like health-care, insurance, education, etc.

Which assumption does it challenge? And what do you think has caused the current high inflation?

@@HistoritorJimaldus 10:20 they should keep inflation in check.

@@AlexScorpionVn doesn’t the current high inflation prove that she was right and that governments should have focused more on controlling inflation?

Straight up proves what anyone should have been able to easily see: she is flat out wrong

@@HistoritorJimaldus what caused inflation? I dunno maybe printing trillions of dollars in the past few years? And yet we should have printed and spent more???? 🙄 Hmm

This is so basic that I'm flummoxed that I'm hearing this BS from a friggin' _economist!_ What makes her think that shrinking the value of the dollar makes ordinary people better off? It's pretty obvious that she sees government power as omnipotent, and they can call a dollar anything they want. They redefine it every single time it borrows from the Fed. Keep doing that and you've got the Wymar Republic -- Brazil. Argentina. This is snake oil. I'd like to hear her excuses today after what this profligate govt spending has done to the macro-economy today, two years later. Housing so overpriced people are literally out in the streets because they can't afford it. Gasoline at $6 a gallon, groceries 30% more expensive than two years ago because of those transportation costs. A blazing hot labor market that is continually putting inflationary pressure on businesses to pay the salaries demanded, at a time when inflation is just as hot. Her excuse is "Hey, we've got the Fed! The Fed controls employment! The Fed controls the currency!" This is madness.

MMT isn't a policy proposal, it's a descriptive economic model which aims to explain modern monetary systems in terms of how they actually work rather than the artificial concerns of orthodox economics.

​@JGS2295 how's that inflation treating you?

Money doesnt corrupt. Government does. Money is just a system of communication between individuals

Read my mind, K Stark..too bad our gov't (both dems and rinos) and electorate are peopled with the mindless...only emotions count, and thier digitized virtual reality..where the elite would like us all to habitate...

Exactly. She fails to mention this inconvienent fact.

Is it possible that a day could come where the interest owed on the debt starts increasing at such a rapid rate that the computer software won't be able to calculate the number?

No reason at all. Since the government has infinite money they spend as much as they want to spend. The thing is though that the US government is highly corrupt and usually capitalists don't want the government doing stuff. After all you can't sell people something they are getting for free. If the government were to create public healthcare that would cut into the profits of the insurance companies.

@@MrMarinus18 "government has infinite money." LOL

@@TyrianHaze They do. What would the limit be if you can print your own money? The answer is the limit is the real economy and the means within the borders of the country.

It is not. See 'religion' for proof of people doing stuff confidently wrong.