The huge coronavirus bailouts will need to be paid back. Or will they? — Philip Inman

Willem Buiter, the Columbia University academic who was a founding member of the Bank of England’s monetary policy committee before becoming chief economist at Citigroup, says the US and UK now have money on tap in almost limitless amounts. The funds can sit on a central bank’s balance sheet for as long as it takes.

Critics of MMT argue it can prove to be too much and overheat an economy. At that point taxes would need to be increased – something that until now few believed western governments were capable of doing.

But in a post-pandemic world, inflation is unlikely to feature, and if it does, the central bank can just rein in its lending, as and when it deems necessary to keep inflation low....

Mixing up monetary policy with MMT.

The Guardian
The huge coronavirus bailouts will need to be paid back. Or will they?

Philip Inman