Deficit Fear

Deficit fear is a gimmick to limit the benefits of democracy, used by people who oppose government. By scaring people about deficits they undermine support for government doing things to make our lives better.

But when it comes to their own spending priorities – military, etc. – the sky is the limit. They get it. They understand that deficits are not a problem, but are to be used to scare the public.

The US issues its own money. It can spend as much as it wants to on things that make our lives better. Taxes are NOT “revenue” that is used to fund things. (Note that this is federal, not state budgets. States do not issue their own currencies.)

Taxes limit inflation and redistribute the gains of the economy. Tax cuts for the rich redistribute to the top, making inequality worse.

Deficits grow the economy, with inflation being the concern if too much $$ is pushed at too few resources.

This is known academically as “Modern Monetary Theory.”

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