Crash-Test Dummies as Republican Candidates for President

The New York Times has the column Crash-Test Dummies as Republican Candidates for President by Paul Krugman.

And you can see why. “Obama is endangering America by borrowing from China” is a perfect political line, playing into deficit fetishism, xenophobia and the perennial claim that Democrats don’t stand up for America! America! America! It’s also complete nonsense, but that doesn’t seem to matter.

The phrase “deficit fetishism” comes dangerously close to Krugman’s telling the American public the truth about “deficits” in a country that creates its own money with the push of a few keystrokes. Also this is country where all government debt is denominated in the currency we freely create. And also “debt” instruments which other countries are glad to keep to the tune of trillions of dollars. What part of this picture fits any Republicans fantasies about how money works? None, that I can see.

Next thing you know Paul Krugman will actually state that he knows what Modern Money Theory is all about, and in large part it explains how money works. That’s going to be a tough one for him, though, after how dismissive of MMT he has been in the past.

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