This is not inconsistent with MMT economics. MMT economists are experts in fiat money economies . They recognize deficits can not only be too large but also too small. Somehow the myth got started that MMT economists maintain that deficits don't matter at all. Although some MMT economists may have said on occasion that deficits don't matter in regard to specific circumstances, they have been misunderstood. Four years ago I got interested in MMT economics and began to study it. It developed into a specialty discipline after 1971 and by now there are those who have spent a working lifetime in pursuit of a better understanding of fiat money economies and how they do, and don't, differ from economies constrained by commodity based money. Here's part of what I have learned as it relates to inflation. Inflation is largely function of sovereign surpluses and deficits, private sector credit and sovereign bond issuance, all relative to productivity. Deficits can expand the supply of readily spendable money, credit does expand it, and sovereign budget surpluses can contract it. Bonds temper the supply of readily spendable money. When the supply of money expands at a rate greater than the supply of available goods and services, i.e., productivity, inflation can be expected. However to the extent that money supplied in excess over what is justified by productivity can be absorbed into bonds, inflation can be sidetracked. Bonds are an interest bearing temporary store of money and a tool of the central Bank. The can also be seen as latent inflation (vide infra). However they are not needed, as MMT economists point out, when the government wants to spend in excess over revenues. The government does not have to issue bonds to do this, though it gives every appearance of "borrowing money"when it issues bonds. Inflation is dependent on the supply of readily spendable money relative to productivity. Money that sits idle in reserve accounts at the Fed and money tied up in bonds will not cause inflation. Therefore the long term concern regarding deficits should be, at least in part, over the limits of economies to absorb excess money into sovereign bonds and service them. The existence of limits on new sovereign bond issuance and the servicing of bonds tells us that in the long run, in addition to all of us now alive being dead, deficits do matter. Fiat currency is in effect backed by productivity. One could say that countries with fiat currency are on a productivity standard. Zimbabwe is an interesting example. Farm productivity plummeted after Mugabe nationalized the farms and gave the land to his freedom fighters. The result was hyperinflation caused by grossly insufficient productivity to back the currency.
Max out your credit cards and take on a load of debt that you'll pass along to your grandchildren. Now, put a 911 in your driveway and tell your friends that you're wealthy. You seeing the picture?
There is also the matter of one country "exporting or importing" another country's inflation/deflation.
Thanks, interesting perspective. It strikes me that in some ways much of what you wrote isn't necessarily new or unique to MMT as much as it is a new and unique way of looking at existing ideas. For example, the concept that issuing bonds neutralizes increased money supply isn't new, that's pretty well established. The way of looking at it as latent inflation is perhaps a unique way of thinking about it, and there's often something to be gained from unique perspectives in and of themselves.
I'm not so sure that AOC only exists due to Trump. She might be the natural result of a steadily increasing positive attitude towards socialism among millennials. Agree with you on fossil fuels. Although I own some XOP, KMI, MPC, and others, I would not mind seeing the end of fossil fuels provided there is an economical and equally practical alternative. I think that will happen anyway. Not so confident that cars will be driving around with toxic 1200 pound battery packs that sometimes spontaneously combust 60 years in the future, but that's another discussion.
Demographics definitely playing a large roll in the political paradigm shift. Early gen z's voting in 2020.
Alternative energy is now .... the 2nd largest generator of electricity worldwide. As for 60 years from now who knows really but my guess is it is just as likely, maybe even more so, carbon based fuels will be used only in "antique" automobiles.
Is hydropower considered alternative energy? If so, then I'm not surprised. Fossil fuels will still be needed for land, sea, and space. You won't see large aircraft or ships powered exclusively by batteries and solar anytime soon. The energy density just is not there.
We already make millions of gallons of ethanol and biodiesel and there's some promising work with alage and yeast to make it less environmentally damaging. Hydrocarbons don't have to come from fossil fuel located in hostile countries. Not to mention if we moved everything but jets off fossil fuel we'd be in a decent spot, but lots of far more low hanging fruit to worry about first.
Not entirely convinced on the carbon neutrality of ethanol & biodiesel yet as we clear forests for more corn fields & spend energy to distill the product. I do like algae, but am interested in its dry-flake form as animal feed as opposed to extracting diesel from it.