(https://twitter.com/wbmosler/status/985690226843635712)
A fundamental principle of MMT is that the imposition of taxes allows the government to manage the state of aggregate demand. So if nominal demand is outpacing capacity of the economy to respond in real output terms then tax rises withdraw non-Gov’t purchasing power.
Taxes are, in fact, “demand drains” and so reduce the capacity of the non-government sector to spend. Taxpayers do not fund anything. They just lose or gain purchasing power as the national government manipulates the policy parameter
Government spending puts money into economy. Taxes withdraw money. Fiscal is everything. The reality is that government injects net financial assets into nongovernment by spending or transfers and withdraws net financial assets from non-government using taxes, fees and fines.
2018 api. 15
Treasury securities, also known as the US National Debt, are US dollars that are voluntarily deposited in secutities accounts at the Fed. How is this supposed to be a burden to the federal government? Voluntarily accepting deposits isn’t the same as borrowing to spend.
Hauei erantzuten: @netbacker @Ydawtr
Tax liabilities precede spending.
2018 api. 15