At the moment we are in thrall to Sir Scammer and his minions one of whom, Reeves, happens to be Chancellor of the Exchequer. She said recently “I’m not going to be able to magic money out of nowhere”, as if she couldn’t possibly know how government really spends. She is effectively denying monetary reality and condemning people to more hardship. Is she a knave or an idiot? Possibly both.
She should read this but probably too hard for her. The Paradox of Debt, by the Tycho Brahe of Credit (substack.com)
She and Sir Scammer could also read this The empire of lies (and its consequences) – The Gower Initiative for Modern Money Studies (gimms.org.uk) but it does involve thinking and that can be hard.
And a couple of items from the Guardian which would send her into a spin: Readers reply: who is lending the British government all this money? | Economics | The Guardian and Coronavirus has destroyed the myth of the deficit | Yeva Nersisyan and L Randall Wray | The Guardian
A couple of quotes from the Vulcan:
“I have not been worried about the state deficit for sometime, ever since Mr Brown found out that the UK state can literally print money to pay its bills”.
“Most of the state debt we owe to each other anyway. The government owes it to taxpayers who own the debt in their pension funds and insurance policies. The state can always raise enough money to pay the domestic bills backed by the huge powers to tax, and as we have just seen when credit expansion and inflation are low it can also use liquidity created by the monetary authorities.” John Redwood.
(Note that whereas the Vulcan is often wrong he is not always wrong)
I often feel that the struggle against Neoclassical economics is like the struggle by believers in the Heliocentric model of the solar system against the then dominant Geocentric model of Aristotle and Ptolemy