The downside of deficit spending is that if you do too much of it you’ll touch off a surge of inflation.
It is right there in your chart. Note the green line drops as deficits increase.
You were taught a red herring. Most economists get this wrong, it is a 200 year old blunder. The inflation comes after the default, and one can see the process by tracking inflation in the ten years after the Nixon Shock.
No comments:
Post a Comment