Political Crossfire Forums

There's nothing to respond to because my claim has nothing to do with anything you've said. My claim works for numerous nations around the world, like Japan.

You are discussing a completely different topic, altogether.

It's related because it explains why the government can't just print up money and spend, as you are saying they should. (Chartalism)

When your currency is simultaneously your country's domestic currency (which you want to remain stable and uninflated) and the worlds reserve currency (which requires the ability to add more cash at will, inherently unstable) you are dealing with two aspects of the same system that are mutually exclusive to each other.

The idea behind chartalism is that fiat currency can be inflated without consequence, but that is not correct. Even fiat currency is supposed to represent a specific unit of work. If it doesn't you are going to have trouble enumerating the results of your accounting in light of spending power.

This feature is useful if you are cooking the books (we are) but not if you want a functioning economy. According to Keynes the way to correct this is to introduce the Bancor as the world's reserve currency and retire the dollar. This is what Bergsten meant when he said the argued the Chinese suggestion would be in best interest of the world as well as the US.

I never argued fiat can be "inflated without consequence." Straw man. And yes, you are talking about something else entirely.

You're talking about the consequences of things. I'm not talking about that at all. Let's review what I said again:

"The gov't can pay for whatever it wants whenever it wants. That's not to say it should, but if the US gov't doesn't fund something, it's out of choice not because it cannot do it (state and local gov'ts don't have this luxury)."

There is no single scenario you can come up with where the US gov't can't fund say NASA because it "ran out of money." Triffen Dilemma and international policy has absolutely nothing to do with my claim.

My claim is that there is no such thing as an "unfunded liability" when it comes to gov't finances when they control their own currency. There is only gov't expenditures. nothing more, nothing less. I'm not talking about the consequences of those expenditures.

Yes, but the factor that makes that so has a subtle yet profound effect on the users of our currency. I agree with what you are saying, in essence, but am interested in pointing out the consequences.

My intent is not to disrupt vital social programs that now exist or have the potential to exist because in this broken system they are needed. But I doubt the efficacy of reforming the current system. It seems to be inherently flawed. I really think if we introduced a neutral reserve currency things would be better for everyone in the long run. Possibly we wouldn't even be having this argument because social spending by the state would be unnecessary. That's not even a big change, it's just using the Bancor that Keynes designed for the purpose it was designed for.

I'm thinking the world's unresolved political issues will take a few more centuries to resolve. But I would still like to see activities that hasten the coming of that day. The financialization of our economy that has taken place in the decades since the Nixon shock mark that political action as probably the most politically significant in the last century in terms of shaping today's world. (excepting the decision to enter WWII, I rank them on the same level of historical importance in that regard.) We, humanity, have to become cognizant of the problems our actions are causing and take measures.

We have no plan, all our actions seem to be damage control. Our golden era was probably post WW2 to the mid 70's. After that the concept of finite has done more to shape our economy then anything we ever did. Even the world markets are finite, couple that with exploding population and expanding automation brings us to where we're at now. We never drew any lines between enough, excess, and absured excess. And just like ancient times, the wealth stays here when we die. That will never change.