‘Epic Feats’ Of US Government Dysfunction

The House passed Joe Biden's social spending plan on Friday, clearing the way for Joe Manchin to torpedo the legislation in the Senate. I'm just kidding. Or maybe not. The vote followed what, at least if you rank government dysfunction by time wasted, was a singular feat of abject absurdity. "Personally I didn't think I could go this long," Kevin McCarthy said, marveling at his own stamina some eight hours into what ultimately ranked as the longest continuous House speech in modern American hi

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9 thoughts on “‘Epic Feats’ Of US Government Dysfunction

  1. Love your writing! Question; are there no negative consequences to creating large amounts of USDs? I’m trying to learn why the belief of deficits mattering to the issuer of the world’s reserve currency is an internally inconsistent argument. I am the guy that doesn’t understand why, that’s me “harboring”that belief. I’d love to learn and feel secure in parking my wealth in USDs and calling it a day. As always, thanks for what you do!

    1. There are always negative consequences to oversupplying economies with a fiat currency. However, with the USD being the global reserve currency, how many USD’s does it take to actually have a meaningful negative impact? All other currencies (or things of value for that matter) are weighted against their value in USD’s. The World Bank transacts in USD’s. An empire as large and globally located as the United States is, transacts everywhere people exist. We buy and sell land everywhere, goods everywhere, and businesses everywhere. Other nations buy our currency and trade with us using that currency. Other nations make investments in our currency and trade with other nations using our currency. So a few hundred billion or even trillion dollars in increase doesn’t actually inflate prices as much as it would seem if you just looked at the United States as the maps we teach children on the wall. We are an empire with 50 states, 14 territories, and contracts for 750 military bases in 80 countries.

      1. Appreciate your thoughts. I’m mainly curious as to what TheRealHeisenberg’s opinion was on the matter. But I do feel like you confirmed my thoughts…there are always negative consequences to oversupplying economies with a fiat currency and secondly no one knows the actual amount of creation would cause the negative.

    2. This is the core of MMT – basically, the US could create whatever amount of USD it wanted, to be used however it wanted and since it’s a fiat currency, not pegged to anything, there would be no consequence on the government or its ‘finance’.

      So why don’t we do it that way? Well, first, treating the government finances as that of a family is a left over of the peg to gold. And the Treasury-Fed arbitrary separation and refusal to ‘monetize the debt’ as well.

      The only real limit for fiscal largesse is inflation. If you give people lots of money (COVID relief) and they all go out and spend that money, you’ve printed it and distributed it for naught. It materializes as inflation as your real-world production capacities can’t match the demand.

      Essentially, what we’re seeing now, with the added twists of supply constraints due to COVID supply chain disruptions.

  2. Imagine you are Joe Manchin or Kristen Sinema. Your whole life, you have wanted to be important, you have wanted everybody’s attention, you have wanted to have YOUR opinion heard. At last, the entire country finally understands how truly important you are. Are you really going to roll over and allow attention to fall somewhere else? Hell, no. You will do whatever it takes to keep everybody guessing. Expect more stunts from J and K.

    1. I saw a fine example of this the other night when Manchin figured he’s now important enough that the world is anxious to know how he feels about the Fed chairman. I suppose this Sunday he’ll feel he needs to tell us who he thinks will win the Super Bowl or explain for us the best ways to bathe a cat. It’s good to be the king.

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