An economics, investment, trading and policy blog with a focus on Modern Monetary Theory (MMT). We seek the truth, avoid the mainstream and are virulently anti-neoliberalism.
One way to take the wind out of the debt-phobes’s sails is to move towards the scenario advocated by Warren Mosler: that’s a set up where the government / central bank machine issues no interest yielding debt at all. The only liability it issues is monetary base (which pays no interest). See second last paragraph of Warren’s article here:
It would be easy to move to such a system: just print money and buy back debt (or cease rolling it over). As to any excessive stimulatory effects, counter that by raising taxes.
Even just TALKING ABOUT that system would undermine the debt-phobes’ arguments.
By way of setting a good example, I’ve just placed a comment on the blog of an Oxford economics professor, saying that a monetarily sovereign country can by its debt back whenever it wants. And woe betide anyone trying to contradict me..:-)
Over here right now, the Peterson/"Fix the Debt"/Simpson-Bowles people are ALL OVER THE PLACE putting on a blitzkrieg in all the old/new media to meaningfully cut so-called entitlements before the next US budgetary deadline in January...
You would not believe it they are showing up everywhere... hard to counter for us over here as there are so many of them and not many of us...
3 comments:
One way to take the wind out of the debt-phobes’s sails is to move towards the scenario advocated by Warren Mosler: that’s a set up where the government / central bank machine issues no interest yielding debt at all. The only liability it issues is monetary base (which pays no interest). See second last paragraph of Warren’s article here:
http://www.huffingtonpost.com/warren-mosler/proposals-for-the-banking_b_432105.html
It would be easy to move to such a system: just print money and buy back debt (or cease rolling it over). As to any excessive stimulatory effects, counter that by raising taxes.
Even just TALKING ABOUT that system would undermine the debt-phobes’ arguments.
By way of setting a good example, I’ve just placed a comment on the blog of an Oxford economics professor, saying that a monetarily sovereign country can by its debt back whenever it wants. And woe betide anyone trying to contradict me..:-)
See: http://mainlymacro.blogspot.co.uk/2013/10/is-currency-crisis-bad-for-you-at-zlb.html
Ralph,
Over here right now, the Peterson/"Fix the Debt"/Simpson-Bowles people are ALL OVER THE PLACE putting on a blitzkrieg in all the old/new media to meaningfully cut so-called entitlements before the next US budgetary deadline in January...
You would not believe it they are showing up everywhere... hard to counter for us over here as there are so many of them and not many of us...
rsp,
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