We need to rethink our understanding of fiscal responsibility from "summary" of The Deficit Myth by Stephanie Kelton
Our current understanding of fiscal responsibility is deeply flawed. We have been conditioned to believe that the government must tax and borrow in order to spend, that deficits are always bad, and that balancing the budget should be a top priority. But what if I told you that this way of thinking is not only misguided but also harmful?The truth is that the government, as the issuer of the currency, has the power to spend without the need for revenue. This means that deficits are not inherently bad – in fact, they can be necessary to support a growing economy. By rethinking our understanding of fiscal responsibility, we can begin to see that the goal of government spending should not be to balance the budget, but to achieve full employment and price stability. When we focus on balancing the budget, we limit the government's ability to respond to economic downturns and invest in the future. Instead of worrying about how much money we owe, we should be asking ourselves whether we are using our resources in a way that benefits society as a whole. This means investing in healthcare, education, infrastructure, and other areas that will make us more prosperous in the long run. By shifting our thinking on fiscal responsibility, we can create a more equitable society where everyone has the opportunity to thrive. We can ensure that no one is left behind and that our economy works for all of us, not just the wealthy few. It's time to let go of outdated notions of fiscal responsibility and embrace a new way of thinking that puts people first.
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