Stephanie Kelton@StephanieKelton ots. 7
(https://twitter.com/StephanieKelton/status/1093575470078148609)
Q: Can we afford a #GreenNewDeal? A: Yes. The federal government can afford to buy whatever is for sale in its own currency.
Stephanie Kelton @StephanieKelton
Q: Are you saying the government can just “print the money” to pay for new spending? A: Is there any other way?
2019 ots. 7
Q: Is there another way? Yes, you can raise taxes! A: That’s not how it works. Taxes remove some of the money the gov spends into the economy. You could spend & tax the same amount. But the gov normally spends more than it taxes so that the economy can keep the extra dollars.
Q: But that’s deficit spending, so now you have add to the national debt. A: Except the $ to buy the bonds comes from the deficit spending! It’s not “borrowing” in any meaningful sense of the word. When people swap $$ for bonds, they’re just holding another kind of gov money.
Q: But don’t we eventually have to pay back the debt? A: The government retires bonds all the time. It’s simple. You just debit (-) the seller’s securities’ account and credit (+) a reserve account. It’s all done using a keyboard at the NY Fed.
Q: But what about the interest payments? There will be less money available for everything else. A: Wrong. The gov makes interest payments the same way it makes all payments. It can always spend more on other things. Inflation is the limit.
Q: So interest on the debt can never be a problem? A: All spending carries inflation risk when the economy gets to full capacity. If people are receiving/spending too much interest income, the Fed can cut rates. Or Congress can cut spending or raise taxes.
Q: Are you saying we can have a #GreenNewDeal without *any* new taxes? A: It depends what’s in the GND and whether the US economy has the extra capacity to absorb the proposed spending *at the time it occurs.*
Q: But we’re talking about trillions1 of dollars over time! A: The GOP did well over $5 trillion in tax cuts and war spending without causing inflation to accelerate. And some GND spending will increase capacity, which gives you more room to spend safely.
Q: Do you think @SpeakerPelosi will read this? A: I don’t know, but I hope @AOC will.
Elkarrizketa berria
Honi erantzuten: @StephanieKelton
Q. Why can’t the government just print a million dollars for every American, so we can all be millionaires? A. Sure, why not!
1 Amerikar trilioi bat = mila milioi europar
