The Deficit Myth

This one’s by a member of the home team—a former student, colleague, collaborator, and fellow MMT conspirator.

Kelton was an advisor to Bernie Sanders, served as chief economist for the Senate Budget Committee, and is a frequent guest on all the important media outlets. She explains the basics of MMT and why they are important—especially right now as Congress is hog-tied trying to figure out what to do to prevent Uncle Sam from defaulting as we broach the debt limit.

Another book debunking a popular myth. 

The classical explanation of government finance says that governments collect taxes and then spend that money on public services and if they do not collect enough in tax they have to borrow to cover the gap.

Stephanie Kelton explains that modern economies, where money is money only because government says it is, work the other way around. Governments create money (from nothing) and spend it into the economy and they collect taxes, not to finance spending, but to control inflation. Effectively, when they collect tax they are destroying the money they previously created.

I… show more.

Governments frequently claim that they haven’t enough money to protect the environment, provide social housing, fund public education or provide high-quality public health services. The Deficit Myth refutes the notion that a national economy has to be run like a household, with expenditure balanced by revenue. Drawing upon Modern Monetary Theory, economics professor Stephanie Kelton argues cogently that governments with monetary sovereignty – such as the USA, UK, Japan, China, and Australia – can create debt-free money with no constraints apart from ensuring that money retains its value. In particular, they can fund a job guarantee for everyone who… show more.