Modern monetary theory

MMT is very controversial within the field of economics and is still considered to be on the fringes of public policy, so I am not all that surprised by the reaction that you received. The idea that taxes and spending are entirely independent is not mainstream and, more importantly, it does not reflect actual monetary policy.

I am by no means an expert on economics, but as far as I am aware, MMT is entirely theoretical (in that it has never been implemented by any government), and I am skeptical as to whether it would actually work in a global economy, where transactions often involve a spectrum of sovereign currencies.

In any case, I think that it would be more accurate to say, “Taxes and spending could be independent of each other if a government decided to run things that way (but we are not sure how that would work out).” In the strictest sense, I suppose that you could say that governments actually can spend money without making appropriations through taxes or debt issuance. The question is: should they?

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