THE DEFICIT MYTH

THE DEFICIT MYTH, by Stephanie Kelton

This book explains why Modern Monetary Theory will work to free up our economy from misguided concerns over budget deficits.

MMT is not a blank check for government spending. Instead it a way to provide for the necessities of life for all of the people, including health care, retirement, housing and jobs for all who can and who want to work.

Kelton shows how government spending does not depend on taxes collected. Taxes are used to control inflation. If production of goods and services remains high there is no limit on spending. FDR proved this with his New Deal. Because of war production we had no problem maintaining full employment. And before that the WPA provided jobs. Trails were built, lodges errcted, artists employed, stc.

The key to MMT is good paying government jobs. Which in turn depend upon the government willing to spend money that it can simply print This would cover the cost of a Federal Job Guarantee program. Jobs would pay a living wage and would be vital to the community. Jobs would go up and down as full employment adjusted for inflation/recession.

During a recession more money must be spent (printed). On the other hand as inflation rears its head, taxes need to go up to reduce spending. This process is automatic under full employment.

https://www.nytimes.com/2019/02/25/opinion/running-on-mmt-wonkish.html

https://stephaniekelton.com/paul-krugman-asked-me-about-modern-monetary-theory-here-are-4-answers/