September 9, 2021
There is an absolute limit to the growth of public debt
Comment on Mike Norman on ‘Absolutely idiotic hit piece on MMT by 3 clowns at the Richmond Fed’
“This core tenet of so-called ‘modern monetary theory’ ignores the fact that deficit spending is constrained in the long run by a government's ability to satisfy creditors.”
Except that it is not the government that satisfies creditors but WeThePeople. For the public debt holds We-The-People-Owes-It and Oligarchy-Owns-It. This cash cow produces interest for the Oligarchy which is taxed from WeThePeople in all eternity. So, deficit-spending/money-creation is always and everywhere a bad deal for WeThePeople.
The absolute limit to the growth of public debt is given by: total interest on public debt = total wage income of WeThePeople.#1 Practically, the limit is reached much earlier.
The 3-sector Profit Law Q≡(G−T)+(I−S)+Yd implies Public Deficit = Private Profit. If tax T goes to the minimum and spending G goes to the maximum, profit Q goes to the maximum. With their advocacy for deficit-spending/money-creation, MMTers are the profit maximizers for the Oligarchy.
In this capacity, they shred everyone who says that public debt has an absolute upper limit even the folks at the central bank who have supported since their founding the growth of public debt ― which, by the way, has always been their real job.
So, actually, the central bank clowns and the MMT clowns both push the agenda of the Oligarchy.#2
REPLY to Mike Norman
“Meanwhile, corporate profits are at a record with ‘nobody’ working.” (Mike Norman)
What a surprise!
Not really. COV is a godsend for the Oligarchy. The 3-sector Profit Law Q≡(G−T)+(I−S)+Yd implies Public Deficit = Private Profit. Therefore, the policy of increased deficit-spending/money-creation (= growing public debt) produces a profit explosion.
REPLY to Activist #MMT on 10 Sep
“It would also be nice if more people recognized the likely, literally, hundreds of times these exact criticisms have been explicitly and directly addressed over the years, not to mention the even more thorough treatments to be found throughout the academic literature..” (Activist #MMT)
It is NOT true that “criticisms have been explicitly and directly addressed” by MMTers. The opposite is true. MMTers ignore refutation#1 and systematically suppress it.#2
The MMT macrofoundations are provably false. Because of this, the whole analytical superstructure is false. Because of this, MMT policy guidance has NO sound scientific foundations. It is just brain dead agenda pushing for the advantage of the Oligarchy and disadvantage of WeThePeople.
#2 For more about #EconBlocker see AXECquery
REPLY to Ahmed Fares on 13 Sep
Kalecki, too, got macroeconomic Profit wrong.
For all about Egmont and Kalecki see AXECquery.
Yes, doing economics these days means dealing with people who are either stupid or corrupt or both. After all, economics is failed/fake science.
Twitter Jan 19, 2023 Ineffective limits