Lars P. Syll— MMT perspective on Biden’s $1.9-trillion big spend

The size of public debt and deficits is not — as already Abba Lerner argued with his ‘functional finance’ theory in the 1940s — a policy objective. The size of public debt and deficits are what they are when we try to fulfil our basic economic objectives — full employment and price stability.

Governments can spend whatever amount of money they want. That does not mean that MMT says they ought to — that’s something our politicians have to decide. No MMTer denies that too much of government spendings can be inflationary. What is questioned is that government deficits necessarily is inflationary.

Lars P. Syll’s Blog
MMT perspective on Biden’s $1.9-trillion big spend
Lars P. Syll | Professor, Malmo University