And don’t let Modern Monetary Theorists dupe you into believing that the Feds will just print money to buy those bonds so it’s no big deal.
"Printing money" is terminology that Modern Monetary advocates avoid because it only perpetuates the myth of government as a "user" of the currency that must obtain it from somewhere to enable spending. The money must exist before it can be collected or borrowed and only one entity has the legal right to create it, so bonds are not even a true "funding" mechanism for our federal government. It would be more accurate to state that spending "funds" bond purchases than the reverse.
“Hey debt peon, I’ve got these monopoly corporations and billionaire sponsors who don’t want to pay taxes, so I’ve just gone ahead and added $9,000 in debt to your tab without your permission.
There is certainly a problem with the distribution of our government's spending, but that doesn't change the fact that every dollar of it becomes someone's monetary asset in the private sector. The debt is our money supply and simply represents all dollars created that haven't yet been collected and applied to a federal tax obligation.
Because we, and all other non-currency-creating entities, must find or borrow money before spending it becomes quite easy to conflate our spending and budgeting processes with those of the currency-creating federal government. However, that can only lead to false assumptions that do not accurately portray economic realities.
"We" (taxpayers) are not responsible for repaying the debt of our federal government, even if it were possible to do so without eliminating all US dollars from the private sector and defaulting on all obligations to foreign investors (it is not).
That’s $80 billion a month that could be invested in schools for our kids, hospitals for our sick, care homes for our elders, and renewables for our energy independence.
Instead, your money will go straight to the pockets of people who add ZERO to society.
It would be more obvious if the requirement to issue Treasury bonds to match deficit spending were not so easily misunderstood, or that doing so greatly favors bank lenders who use the general econ illiteracy in the US, including most of our representatives, to generate trillions in loan interest. Many MMT advocates and economists believe that the generalized misconceptions surrounding our federal budget and our money would be less harmful if Treasury bonds were eliminated and interest was paid on excess reserves in the system instead.
There would certainly be less incentive to conflate the issuance of bonds with "funding" for the one entity that needs no funding because it isn't revenue constrained. Creating the currency for the "general welfare" is mandated by our Congress and is not dependent upon the balance of payments or revenue position. Bonds and taxes are both reserve drains, one being temporary and the other permanent, and should never be considered "revenue" in the first place.
Restricting spending on the public purpose (austerity) is the goal of those who would promote the misconceptions surrounding federal spending in the general public. Assuming you are as progressive as your stated objectives would suggest, you should not frame the argument in the language of the oppressors and promote their fear porn. Making the wealthy irrelevant to the public purpose will result in much higher taxation for them than will the misconception that we need their money. The latter requires that they remain wealthy enough to fund our society and gives them incentive to pervert our political system.
