Profile

Who: Kimball Corson. Text and Photos not disclaimed or that are obviously not mine are copyright (c) Kimball Corson 2004-2016
Port: Lake Pleasant, AZ
09 April 2018 | Pago Pago, American Samoa
An Informed Atheist Re-Addresses Christianity
10 March 2018 | Pago Pago, American Samoa
A Progressive Reform Program for America
10 March 2018 | Pago Pago, American Samoa
Supply Side and Libertarians Are Wrong and Not Supported by the Data
10 March 2018 | Pago Pago, American Samoa
How Income Inequality Injures People and the Economy
22 August 2017 | Pago Pago, American Samoa
A Democratic Reform Program for America
22 August 2017 | Pago Pago, American Samoa
The Supply Side Libertarians Are Wrong and Not Supported by the Data
22 August 2017 | Pago Pago, American Samoa
The Rise of Economic Ignorance
22 August 2017 | Pago Pago, American Samoa
The Rise of Corporate Dominance and the Rise of Income Inequality (Part VI)
22 August 2017 | Pago Pago, American Samoa
The Rise of Corporate Dominance and the Rise of Income Inequality (Part V)
22 August 2017 | Pago Pago, American Samoa
The Rise of Corporate Dominance and the Rise of Income Inequality (Part IV)
22 August 2017 | Pago Pago, American Samoa
The Rise of Corporate Dominance and the Rise of Income Inequality (Part III)
22 August 2017 | Pago Pago, American Samoa
The Rise of Corporate Dominance and the Rise of Income Inequality (Part II)
22 August 2017 | Pago Pago, American Samoa
The Rise of Corporate Dominance and the Rise of Income Inequality (Part I)
22 August 2017 | Pago Pago, American Samoa
Racial Hatred Is Confused
22 August 2017 | Pago Pago, American Samoa
What To Do About North Korea
22 August 2017 | Pago Pago, American Samoa
On Neoliberalism
22 August 2017 | Pago Pago, American Samoa
Ban Hate Marches and Assemblies
22 August 2017 | Pago Pago, American Samoa
On Miss Piggy and Mr. Pork
22 August 2017 | Pago Pago, American Samoa
The Demise of the Democratic Party
09 August 2017 | Pago Pago, American Samoa
On Elitism

On a Major Economic Folly

29 June 2016 | American Samoa
Kimball Corson
In a modern country with a sovereign fiat currency, more public debt is not a problem until the spending of the revenue from it begins to generate inflation. This is a key lesson of modern monetary theory (MMT) and of history. Another is public debt in a country that honors and services it has never caused a financial crisis or recession. Interest can always be paid by printing more money, if that is necessary, subject again to the inflation limitation.

Private debt is a different matter and the problem. Where it cannot be serviced, rolled over or repaid in large dollar volumes, financial crises ensue and recessions follow. This happened in 1929, in 2007 and at other times, too. This is also a lesson of economic history. But people confuse the two and rail on against debt generally, and many, against the public debt as well. Some even ignore private debt. They misunderstand economics and its history.

Often they are republicans, permabears, conservatives and some democrats who do not understand that a government with such a currency is not subject to a budget restraint like households, individuals and businesses are. They refuse to learn.

Here is a typical full blown nonsense rant:

"The public debt is not a problem (they say) until it is, but analysts project the U.S. will spend $880 billion per year to finance its debt in 2024. That is the equivalent of all federal revenue in 1987. The U.S. currently owes $60,000 per citizen.The federal debt now exceeds our national gross domestic product. Only 10 nations in the world, including Greece and Japan, have debt to GDP ratios worse than the U.S. The federal debt is projected to increase 50 percent--to $29.3 trillion--in a decade. All of these debt projections use "cash accounting" instead of "accrual accounting," which ignores unfunded liabilities to government entitlement programs such as Medicare and Social Security. Using accrual accounting, which is lawfully required by corporations, the current debt would be closer to $100 trillion.

"Our current Federal Debt conventionally measure is fast approaching $20 trillion?"

That is pretty much the unabridged rant. So what else is wrong with it beside what I have explained above. Two things, I submit.

First, it is a testament to MMT that such debt has risen to almost $20 or 100 trillion and NOT precipitated a SINGLE financial crisis or recession. Those who make this rant miss that point altogether.

Second, the contention that the debt "isn't a problem until it is" can be said or made at every dollar point along the way from $0 to $20 or 100 trillion. At some point one saying so should get tired of being wrong so frequently, or 20 or 100 trillion times, and should seriously wonder if "until it is" will ever come. Crazy is continuing to be wrong so often and and still making the rant, or perhaps that is just a chronic learning disability instead.

Regardless of which, many republicans, conservatives, permabears and not a few democrats still have the problem in spades, but then too few of them have a very good or decent understanding of economics. On matters economic, they flay about, like tall grass in the wind.
_____

MMT is not taught in top economics departments in the US because it offends the conservative and oligarchical controlled corporations and foundations that fund the research at such institutions. It is therefore a taboo subject. However econ students at such universities, knowing their educations are being slighted, not infrequently fly leading MMT scholars in from other universities to give guest lectures. This has happened several times at Harvard and other universities.
Comments
Vessel Name: Altaira
Vessel Make/Model: A Fair Weather Mariner 39 is a fast (PHRF 132), heavily ballasted (43%), high-aspect (6:1), stiff, comfortable, offshore performance cruiser by Bob Perry that goes to wind well (30 deg w/ good headway) and is also good up and down the Beaufort scale.
Hailing Port: Lake Pleasant, AZ
Crew: Kimball Corson. Text and Photos not disclaimed or that are obviously not mine are copyright (c) Kimball Corson 2004-2016
About:
Kimball Corson: I am a 75 year old solo sailor, by choice. However, I did take on a personable, but high maintenance female kitten, now a full grown cat, named KiKiPoo when she is sweet, or KatKatPo after she has just killed something like a bird or bat. [...]
Extra:
Although I was a lawyer and practiced law with good success for thirty years, creating significant new law, I never really believed in the law, the politics of law or in the over reaching self-interest of most lawyers I met. Too much exposure to Nietzsche and other good and seriously thoughtful [...]
Altaira's Photos - Main
No items in this gallery.

Profile

Who: Kimball Corson. Text and Photos not disclaimed or that are obviously not mine are copyright (c) Kimball Corson 2004-2016
Port: Lake Pleasant, AZ