Wake up economists! - Currency-issuing central governments have no budget constraint

Philip Lawn

MPRA Paper from University Library of Munich, Germany

Abstract: Abstract: Despite what mainstream economists preach, currency-issuing central governments have no budget constraint. It is therefore incumbent upon them to use their unique spending and taxing powers to achieve the broader goal of sustainable development. Their failure to do so has meant that nations have fallen well short of realising their full potential. Rather than accept the neo-liberal myth that ‘small government is best’, the citizens of a nation should welcome the central-government’s responsible use of their unique spending and taxing powers to provide sufficient public goods and critical infrastructure, achieve and maintain full employment, resolve critical social and environmental concerns, and meet the requirements of an aging population. Should central governments fail in their responsibility to prudently use their unique powers, public disapproval is best registered through the ballot box, not through degenerative debates that distort the facts about the operation of a modern, fiat-currency economy.

Keywords: Keywords: Central governments; government budgets; fiscal and monetary policy; sustainable development (search for similar items in EconPapers)
JEL-codes: B50 E62 (search for similar items in EconPapers)
Date: 2011-01-05
New Economics Papers: this item is included in nep-cba, nep-mac, nep-mon, nep-pbe and nep-pke
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:28224

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