Once again, there is significant talk and energy going into deciding how much money the federal government should spend. Conservatives keep repeating the same old line that the federal budget is like a household budget and that federal debt is like a credit card.
This is not how federal spending works. We talk about that on today’s podcast and live stream.
Often referred to as MMT – Modern Monetary Theory, we will come to understand that the federal government spends money into existence, and when it taxes it removes money from the economy. However, the federal government does not use tax dollars as its revenue.
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