You said you understand that our currency is sovereign, and then you attempt to deny that in every other assumption you make.

No. I simply do not assume that the US will always possess the reserve currency, forever and into the future. To believe that “nothing will change because it hasn’t changed” is a logical fallacy. Therefore, I believe we should behave as if we are very fortunate to have the reserve currency, and not because it’s our god-given right to have it. Because it’s not.

This is simply dual entry balance sheet accounting. It is not political or have an attached ideology. It is just how it works. It is just how it works.

Obviously. And I should have used the term “receipt” rather than “revenue”.

The economy isn’t the budget. It is the people, their homes, health care, savings, education, and the infrastructure that makes the rest possible. Any moderately adept accountant can balance a budget, but the “value” of the dollar depends upon a lot more than it’s contribution to the balance sheet when it is invested in multipliers in the economy.

I find it odd that you fail to mention “business activity”, which of course moves capital to the people so people don’t starve, they can afford homes and health care, save money, go to school, and, well, actually NEED an infrastructure. :-)

The US has such a large potential in reserve that we could likely double the deficits for decades (which we should) without inflation resulting from the added currency.

That would be nice. However, I prefer to avoid sweeping risky assumptions. If they turn out to be wrong, our story might not end well. At any rate, it appears that your theory is going to be tested, because it is unlikely that we will ever elect a majority of fiscally responsible politicians.

Increased productivity over the last four decades has pretty much gone straight to someone’s bank account without benefiting anyone who isn’t part of the elite wealthy class.

Closer to five decades, actually. I wrote a document on this elsewhere on Medium. At any rate, mean real wage in the US peaked in 1974, but the trend to aggregate wealth at the upper end of the income curve has maintained the same upward slope since the late 1960’s at least (IIRC, the graph I drew only went back to the late 60’s because I had trouble finding a dataset that went further back than that. It’s possible the trend started previous to that.

If you want to find the cause of inflation since the 60’s you would be wise to overlay its graph with one reflecting the price of oil which we insist upon being the primary energy source that we protect against all competition.

Odd statement, that. We just had an election where one of the primary issues was a removal of barriers artificially set which restricted coal production. There has been a movement in place for decades, primarily by the same people who advocate for oil, advocating the use of nuclear power to the extent that the French utilize it. Natural gas and fracking technologies are advocated by the same people. So, not seeing too much “protection” of oil companies in all that, unless of course you’re confusing the conservative dislike of subsidies with “protections.”

At any rate, you’re implying that economic inflation is causal to the price of oil. Overlaying two graphs doesn’t answer that question. If you believe there is a causal relationship, I’d have to ask you to make that case.

Not following that inflation with a balancing increase in the currency supply only creates a misery index, not countering pressure on prices.

Hmmmmm. In the 1970’s, we saw a sharp increase in the price of oil, driven by OPEC. This occurred at the same time that Mr. Nixon decided to monetize the debt that occurred because Mr. Johnson thought he could fight a war without raising taxes. What occurred was that, by the late 1970’s, there was a sharp increase in the currency supply ACCOMPANIED BY a sharp increase in the misery index.

So, it would appear that actual events in recent history do not bear out your assertion.

Denying reality shouldn’t be a requisite to being conservative.

Now, now, don’t be a prick. The only concrete examples we have in this exchange about “denying reality” are your assumption about oil/inflation causality and what really happened in the late 1970’s. At any rate:

  1. In your last paragraph, you are correct that we’ve done those things for some time. I would date the behavior back another decade, but let’s not quibble.
  2. What you miss is in your item (1) — there are alternatives other than deficit spending. Specifically, trade imbalances can also be the result of currency manipulation, which is a political hot potato that (even now!) no presidency wants to tackle.

Hope that helps.

Data Driven Econophile. Muslim, USA born. Been “woke” 2x: 1st, when I realized the world isn’t fair; 2nd, when I realized the “woke” people are full of shit.

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