It’s an interesting debate

. . . and only time will tell who’s right.

Stephanie Kelton (MMT) says deficits don’t matter while Jim Rogers says they do:


The old discipline came from the supposed imperative to balance budgets and to back the currency with a real asset, like gold.

1950s: Keynesianism lifted the proscription of deficit spending; said deficits were OK as long the growth in governmental debt did not exceed the growth of GDP.

1970s: Dollar-gold convertibility abandoned. The currency became pure fiat.

1990s: Consistent Fed intervention to buoy the markets and bail out bankruptcies institutionalized.

During the following period (2000 to 2020) the absence of inflation seemed to indicate the veracity of the theories of the MMT advocates. But then inflation reared up.

Jim Rogers says that fiscal and monetary indiscipline has led to debt levels that will doom the economy and the markets.

Check back here in twenty years for an update on the controversy. We should have a sense of resolution by then.


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Steven Welzer

The editor of Green Horizon Magazine, Steve has been a movement activist for many years (he was an original co-editor of DSA’s “Ecosocialist Review”).