6/2/2023 0 Comments The deficit myth keltonTherefore, tax revenues being structurally lower than expenditures for several years is not in and of itself a problem as governments can always issue more of its currency to spend further. This is because tax revenues, according to MMT, do not finance government expenditure. In The Deficit Myth, Kelton argues that government budgets are not like household budgets, and that governments with monetary sovereignty do not face a budget constraint as they cannot run out of the currency that they issue. This book challenges the most basic assumptions about government finances and the role of the government, by laying out the main propositions of Modern Monetary Theory and its related evidence. By laying out the insights of Modern Monetary Theory, Kelton questions the real limits to government spending, especially for the Federal Government of the United States. Kelton's work is especially relevant at this time when governments around the world have been engaged in substantial spending to respond to the Coronavirus pandemic. Stephanie Kelton's new book The Deficit Myth has stirred up a storm since its release and has generated a robust and interesting debate on the limits to government spending. The Deficit Myth: Modern Monetary Theory and How To Build a Better Economy by Stephanie Kelton.
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