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The Deficit Myth — Mark Dempsey

Summary:
Economist Stephanie Kelton’s new book about Modern Monetary Theory (MMT) explains the fundamental difference between governments that are currency issuers and households that are currency users. Rather than “tax and spend”—the household pattern—MMT says people need dollars to pay those taxes, so government must spend them first before it can ask for them to return in taxes. It’s not “tax and spend,” it must be “spend first, then retrieve some dollars in taxes.” This is exactly the right lede in explaining basic MMT. Conflating the currency issuer with currency users is the foundation of the deficit myth, as well as phobia about the public debt. LA ProgressiveThe Deficit Myth Mark Dempsey, former Realtor and member of a Sacramento County Planning Advisory Council

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Economist Stephanie Kelton’s new book about Modern Monetary Theory (MMT) explains the fundamental difference between governments that are currency issuers and households that are currency users. Rather than “tax and spend”—the household pattern—MMT says people need dollars to pay those taxes, so government must spend them first before it can ask for them to return in taxes. It’s not “tax and spend,” it must be “spend first, then retrieve some dollars in taxes.”
This is exactly the right lede in explaining basic MMT. Conflating the currency issuer with currency users is the foundation of the deficit myth, as well as phobia about the public debt.

LA Progressive
The Deficit Myth
Mark Dempsey, former Realtor and member of a Sacramento County Planning Advisory Council
Mike Norman
Mike Norman is an economist and veteran trader whose career has spanned over 30 years on Wall Street. He is a former member and trader on the CME, NYMEX, COMEX and NYFE and he managed money for one of the largest hedge funds and ran a prop trading desk for Credit Suisse.

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