MMP Blog #46 Responses
Comments and responses on the Modern Money Primer Part 46.
Milton Friedman was a conservative economist and a vocal critic of “big government” and of Keynesian economics. Yet, in 1948 he made a proposal that was almost identical to Lerner’s functional finance views.
This week we begin a new topic: functional finance. Today we will lay out Abba Lerner’s approach to policy.
There was never a strong argument for adopting the Euro, and the weaknesses have been exposed. Currency union without fiscal union was a mistake.
Even if the government ties its hands behind its back and its shoes together, it makes no difference – the balance sheets still balance.
We should not be fooled by such self-imposed constraints. We should be able to see through them to understand that since they are imposed by government on itself, they can be removed.