I think it is helpful that the narrative is changing away from household debt model (gotta pay our bills) to a fiat model (we can always pay high debt owed in o

I think it is helpful that the narrative is changing away from household debt model (gotta pay our bills) to a fiat model (we can always pay high debt owed in our currency, but we risk inflation). Please let me know where I bugger this. New money is either created through Federal fiscal spending or through loans (e.g., businesses). Because there is only so much monetary space in an economy beyond which inflation occurs, policies must choose between a mixture of fiscal spending (public works) and loans (private sector). 1. The prototypical fiscal conservative position is low taxes & low spending. 2. The prototypical fiscal liberal position is high taxes & high spending. Each of these policies can provide roughly the same monetary space for money creation through new loans, but can incur different problems (e.g. over/under regulation, over/under provision of services). 3. A low taxes & high spend policy could push on inflation, pushing out money creation via loans if maintaining inflation target (via raising interest rate). 4. A high tax & low spend policy could pull deflation, driving money creation via loans if maintaining inflation target (via lowering interest rate (but will there be customers?)). But none of this has to do with the "federal deficit is bankrupting us" arguments that have plagued our policy discussions. The shift in framing by MMT allows us to move away from debt towards how to most productively use new money creation. Some believe public works are productive. Some believe that businesses are most ready to use new money productively. hy does productivity matter? Apparently, from what I gather, when new money is used productively (creates value) it is less likely to be inflationary, perhaps because it creates new products and services instead of just driving demand. And the shift in focus allows us to focus on answering the important questions about how much money can be pumped into the economy (and to whom) before we see significant inflation, and relatedly, what are the real drivers of inflation. For example, money creation can create too many dollars chasing too few goods, but if there is an excess in supply/supply capacity, then you won't see inflation until there is an equilibrium. I suspect that our economy can run a lot hotter before we see a lot of inflation outside of housing, non-competitive markets, and healthcare. I'm just a guy that has read a few blogs on monetary policy. I'm probably wrong on a bunch of levels.