Re: Letter to ABC

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Good letter!!!!

>   On Wed, Nov 5, 2008 at 3:59 PM, Bill wrote:
>   Dear ABC breakfast,
>   Headlines like – 40 billion hole in the bucket – repeated by the breakfast
>   hosts today – merely perpetuate the myth that the Federal government
>   has a financial constraint. This myth has been used by the neo-liberal
>   agenda that is now in tatters as a result of the failure of markets to
>   self-regulate.
>   The reality is that the Federal G. as the monopoly issuer of the currency
>   has no financial constraint and does not require revenue to spend. In
>   fact, spending provides the funds to the private sector that we use to
>   fulfill our tax obligations.
>   Further, the pursuit of budget surpluses has squeezed the liquidity of
>   the private sector and been an important part of the reason why that
>   sector is now so indebted. The natural state is for the federal
>   government to run deficits in order for the private sector to save. The
>   private sector cannot save if the government is running surpluses.
>   Further, running surpluses (or deficits) in any one year makes no
>   difference to the capacity of the Federal G. to run a surplus (deficit) in
>   the next. The surpluses that have been adored by the neo-liberals and
>   by the sin of ignorance of your announcers have not built up any
>   capacity to allow spending to proceed now. There is no hole in the
>   bucket. There is no bucket!
>   I have written a lot about this over the year. My recent book (see
>   details below) articulates this in detail. You can also read details of how
>   a modern monetary economy like Australia works from the many papers
>   available from my research centre.
>   It would be good if you stopped perpetuating this myth and instead
>   allow reasonable commentary on what is actually going on with
>   government opportunities etc. It is time your listeners (and viewers)
>   learned how the economy actually operates and how they have been
>   dudded by fiscal surpluses over the last 11 years.
>   Best wishes,
>   Bill