A Different Perspective on Deficits

In this brief, L. Randall Wray and Yeva Nersisyan explain why much of the hysteria over the federal deficit is misplaced.  They conclude by offering that if we are to promote a prosperous and democratic future for the US then we need to get past some myths that hamper our ability to engage in fiscal activity that serves a stable posture for growth.  They sum up their intent nicely in the final passage of the brief:

“We accept that there are real differences of opinion regarding the proper role of government in the economy. Some would like to see the functions of government curtailed; others would like to see them expanded. These are legitimate political stances. (italics added for emphasis)  

What is not legitimate is to use fear over deficits to restrain government from achieving the public purpose that is democratically approved. A debate that is freed from the constraints imposed by myths about how government really spends would allow us to move forward to gain consensus on the public purpose the American people expect government to pursue.”