To me, the important variable is the money supply. If increased government spending is financed by the Federal Reserve increasing the money supply and inflation is not a consequence of that spending, I don't see the harm from a fiscal debt perspective.
From what I've read so far in Stephanie Kelton's "The Deficit Myth", inflation is the fundamental control variable. As she points out in a separate interview with The Australia Institute's Richard Dennis, the conventional preoccupation with "deficit vs surplus" arguing means that any proposal for a fedral program must FIRST go through the question "What new taxes and/or spending cuts will fund the program?" BEFORE any merits of the program will even be considered. And we all know that as soon as you tell a politician hears they has to campaign for a new tax or a services cut, they run for the hills - and the bill is dead in the water. But the MMT approach allows a country with sovereign currency to consider the program on its human need and public interest merits, before considering the ONLY constraint necessary: inflation. So the aim is to stop lazy politicians from prematurely calling the "Show me the money!" bogeyman, and talking to voters as if the country's budget works the same as the household budget, when the country can issue money (in the appropriate real economy circumstances!) whereas the household cannot (without jail time!)
An interview she did on Feb 8, 2024 titled “Was MMT right about inflation?” at 12:25 she says, “We are getting real GDP numbers that are eye popping”---She is ignoring the elephant in the room which is, how much debt was incurred to get those “eye popping numbers”? In 2023 the US government borrowed $3.2 Trillion, of which only $2.4 Trillion of GDP was recorded. The remaining $800 Billion generated ZERO economic activity whatsoever. She talks about the “multiplier effects” yet every 5 year period since 2006, GDP grew by much less than the increase in the debt which means that money vanished without generating any GDP activity. We would have been far better off taking the entire $3.2 Trillion borrowed and spent it entirely on battle tanks and aircraft carriers. We would have gotten at least $3.2 trillion in economic activity from such wasteful spending and that is with no economic multiplier effect, which is pretty hard to do. This consistent, horrific economic multiplier effect of less than 1, for the last 18 years goes against MMT theory. This theft from the US populace shows that government cannot, and should not manage all but the smallest amount of public money since they are evaporating money in a way that not even the Mafia could do.
How IT works:- "What goes around comes around", elemental e-Pi-i sync-duration numberness congratulations in connectivity function, THE pure-math relative-timing rates fact. Aka Calculus. Input output budgets are economic, in ecology and "Physics is Everything" in temporal superposition cause-effect. (I know nothing, because it's all temporary) The AM-FM economy is shifting shaping empirical laws of logarithmic coordination metastability.., it goes around in sync-duration continuity with the viewable objectives of the Cosmological Universe in entirety. (Get used to it)
In an emergency, such as the covid pandemic, spending to rescue the economy from further decline is warranted. If the same thing had happened at the time of 1929 financial crises, we would have avoided the economic depression of the 1930s.
The difference between War and preparation for Defence seems to have eluded the audience? The inherent value of what is being defended is what appears to prompt money creation and assumed deficits. It's a mystery why warmongering is a substitute for Health and Education when those are what the Defence of all values creates and relies on. Or, What is the significance of "Dark Money" and the availability of defence services for reiterating education and health problems on the National level. Eg the Captain of a Nuclear Powered Aircraft Carrier gets punished for his primary duty of protecting his Crew so that he can protect the ship and the world against.., what?
Another Australia Institute video on policies, ones that are "Designed to Fail" is overly specific to current events, when a more complete analysis of all the contributions to the observed MMT Provisioning concept it is really obvious actions that shows how it is composed of a collective predatory misinformation philosophy that's always held in Pirate-d Empire, (never a Jubilee), frozen hierarchy of mafia-like silence, or covering glory of war-wining stories that are totally inverted truth. The Observable result of which gives us the result that a good theory applied to a reverse process is obviously totally superficial and inadequate to correct the empirical shaping laws of Authoritarian Empire, the same mechanism is of the "legalisation" required to make an inverted "right-left winging it" militaristic system appear democratically legitimate. You can't win if winning is the privileges of individuals in reciprocal to collective gain, Actuality is a metastable zero sum, Recursion to the Mean of Absolute Zero.., balance of probabilities, and so for all theory that has this requirement to be Observable proof-disproof sustainable in the holistic ecologically, ie in the Gaian Planetary Perspective Principle common sense objective. Stephanie's answer to the money supply question and how it's created as a promise to pay for Civilization at the collective expense of the people subject to Government Rule/Policy is "where it all goes wrong" if Governing Accountability, Policing, is not prioritised. In the QM-TIME Completeness cause-effect Universe, Physicists are automatically Quants in the pure-math origins of this Ecology. We have "massive reserves" of thinking power to be applied to Transactional Actuality. Our politics of Conquest for privateering profits, at all costs to everyone not in the "pretend to defend" Great Game, drives us MAD.
Good one Ebony Bennett - You have made a fool of yourself or exposed your incompetence and inability to see through what is pure rubbish. One wonders whether you did any homework on the subject at all or you are so financially incompetent you couldn't make head or tail of what you read. You took seriously a whacky theory like MMT that defies simple arithmetic and belongs in the world of dreamers. The whole theory is full of contradiction and confusion of terms and obeys no consistent set of concepts or definitions. Example - One minute surplus flows between sectors are flows then they are surpluses then they are savings. The next minute taxes put value into money then later they are not needed and if you don't believe there is a problem with that then you need to see the historical failure of taxes to put any value into the money of countries where inflation made the money worthless.
@@lepidoptera9337 Lepi Doptera- the person who dare not consider the explanations of the institutions who actually create money nor look at the mathematics or the historical evidence of government spending lest it reveal the fallacies of MMT.
@@herbalfleece8821 What should I be in the face of such rubbish that anyone with a genuine motivation would test by considering other explanations that fit the real world rather than politically biased badly thought out ideas that are presented as alternatives to rational understanding?
@@herbalfleece8821 No. Those who make bold statements that challenge the proven facts and then have the audacity to repeat their claims on line with the same proven false information have no genuine motivation to put across proven facts.
@@lepidoptera9337 did you not read? I said federal taxes. Social security is separate. The jobs are funded by the government giving them whatever they want. Otherwise our inflation would be much more serious since we spend more than we take in
