Galbraith clarifies his view

Paul’s logical error here is that of assuming-the-consequent. He assumes the inflation which causes dumping of money. But if there is no dumping of money, the inflation will not generally occur.Summer rerun: Misunderstanding Modern Monetary Theory

This whole debate centers around aspects of Money Market Theory, the idea that DC has a lot of latitude to print dollars before they are rejected for a different money. How soon before we reject Obama Dollars? In our history we have rejected DC money on three or four occasions, starting with the Whiskey Rebellion, and through various attempts at a central banking and the Civil War. It happens.

When will we have to choose between money printing or money rejection? Channel theory has something to say. It says that the government channel needs a minimum spending interval to generate is largest spending chunk, the entitlements need a 15 year guarantee until the next update cycle. But we are at the point at which MMT theory cannot guarantee against money rejection over a 15 year cycle.