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Rhetorical Question

03/11/2021

I’m glad Congress has approved the President’s recovery plan, even though we’re borrowing the $1.9 trillion from our children.  A big deficit to pull us out of last year’s “flash-depression” is justified, but the normal annual deficits are not.  Republicans believe tax cuts are guaranteed to jumpstart the economy.  Democrats believe increased spending is guaranteed to jumpstart the economy.  They’re both wrong . . . such simplistic thinking!

Currently, Washington is enjoying a love affair with Modern Monetary Theory, which may quickly become a shotgun marriage.  That theory believes that nations with a reserve currency have no limit on their debt because they can always “print” enough money to pay off their debt.  That may be true in the academic world . . . but not in the real world.  Watch the “dollar index.”

Here’s my rhetorical question:  Just because there are no limits to our national debt, does that mean we should issue infinite amounts of debt?

 

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