Day 1 | Government Revenue | Fiscal Policy Unit Plan Walkthrough

[@aubergineaura9441]

Cannot take seriously any discussion of govt spending that fails to recognize that the federal govt is the currency ISSUER and USER, while all other individuals and entities are only users. As such, taxes are not necessary to fund federal spending. At best, taxes received by the federal govt--irrespective of source--are an offset against govt spending. Art. 1, Sec. 8, of the US Constitution makes clear that the federal govt "spends money into existence." Once the money is created it is spent into the larger economy by way of direct contracts with/grants from the federal govt. The process of issuing federal govt bonds is merely a means of removing money from the system, which reduces demand pressure. While it's true this process creates "revenue" from funds received by the federal govt in exchange for govt bonds, this is not true "borrowing." True borrowing occurs when the borrower is otherwise unable to access funds, or is choosing to borrow at a lower rate than the return rate. But, because the federal government is the sovereign currency ISSUER, it never needs to borrow funds in its own currency. Any program not founded on this basic understanding is without merit.