Minting debt has little to do with conventional credit intermediation. It is all about investors and fee-charging intermediaries, not about debtors. They and their assets only provide the input to sustain the production line. And whenever it breaks down, which it does when the quality of inputs deteriorates or external factors (like a pandemic) disturb its operation, central banks stand ready to absorb the risk and recycle the financial junk.
We can reverse causality. whenever Congress needs help paying interest charges, the primary dealers can arrange distressed debtors willing to pay the Fed tax back to Treasury. Hence, the whole system revolves around paying for our vote. The increasing risk taken on by the Fed gets passed on to government.
But I think there is a limit since this causes a long term economic decline. The risk costs are paid out each recession, and that lowers the total market size, we get Antificants, folks kicked out of the system. Eventually the Antificants have the Right to Coin on their side and cause government default.
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