Is our children learning? Hopefully not from Stonybrook Professor of Economics and Public Policy Stephanie Kelton. Check out her take on Alexandria Ocasio-Cortez’s Green New Deal:
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) February 7, 2019
Did we mention that she was also the chief economist for Democrats on the Senate Budget Committee?
This is some brilliant economic thinking right here. https://t.co/LfQph2SoWC
— Esoteric Jeff (@EsotericCD) February 7, 2019
Bet you guys can’t guess where this is going …
She literally — LITERALLY — goes onto endorse the idea of Federal government just "printing its own money" to pay for whatever it buys in the next tweet.
Professor of Economics & Public Policy!
— Esoteric Jeff (@EsotericCD) February 7, 2019
Yep:
Q: Are you saying the government can just "print the money" to pay for new spending?
A: Is there any other way?— Stephanie Kelton (@StephanieKelton) February 7, 2019
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.— Stephanie Kelton (@StephanieKelton) February 7, 2019
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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.— Stephanie Kelton (@StephanieKelton) February 7, 2019
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.— Stephanie Kelton (@StephanieKelton) February 7, 2019
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.— Stephanie Kelton (@StephanieKelton) February 7, 2019
Guys. Guys.
Do you not realize how self-damningly hilarious that tweet is? Handwaving away "inflation" as a mere "limit" is like saying, well, "gravitational acceleration is the limit" to how far you can fall without dying & then advocating jumping out a 10th floor window.
— Esoteric Jeff (@EsotericCD) February 7, 2019
Actually, jumping out of a 10th-floor window would still be less painful than Kelton’s thread.
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.— Stephanie Kelton (@StephanieKelton) February 7, 2019
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.*— Stephanie Kelton (@StephanieKelton) February 7, 2019
Q: But we're talking about trillions 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.— Stephanie Kelton (@StephanieKelton) February 7, 2019
Anyone else need a stiff drink after all that?
Start the money printing presses!
— heir of pomposity (@uncivilobedient) February 7, 2019
you’re a professor of economics?
— OHMS (@ohms___) February 7, 2019
Clearly she’s the embodiment of “those who can’t, teach.” Because she most definitely cannot economics.
Q: Do you think @SpeakerPelosi will read this?
A: I don't know, but I hope @AOC will.— Stephanie Kelton (@StephanieKelton) February 7, 2019
She very well may. And we have no doubt that if she does, she’ll be pleased to have found a kindred spirit in insanity.
She's a great follow. Her whole feed is 100% crazytown 100% of the time.
— ROB ELGAS FAN ACCOUNT (@jarvis_best) February 7, 2019
MMT rots brains, people.
— Esoteric Jeff (@EsotericCD) February 7, 2019
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