Debunking Deficit Myths

This chapter explores misconceptions about government deficits, particularly in relation to Modern Monetary Theory, arguing that federal financing should not be likened to household budgets. It challenges the traditional narrative by emphasizing that government deficits can serve beneficial purposes within the economy while cautioning about inflation rather than insolvency. Additionally, the chapter examines the historical context of budgetary policies and how the legacy of the gold standard affects contemporary economic discussions.