Mosler: Gov. 0 rate policy euthanizes rentiers. AND creates fiscal space for more public spending and/or lower taxes!

Mosler: Corporations that move jobs to Mexico create fiscal space for your infrastructure proposals!

Comment: This is the US/Canada trade data for 2017, according to the US government. It shows the US with a modest $2.76b surplus. We have a very large dairy surplus with Canada as well, suggesting, by the president's own criteria, we are unfair to them. But I don't think that's the case.

Mosler: Not to forget, imports are real benefits and exports real costs, it's better to pay less than more, and a trade deficit gives that nation more fiscal space. ;)

Comment: China offers 6-year import boost in trade talks with US.

Mosler: This would "use up" our fiscal space.

Comment: The ultra-rich have rigged our economy & rigged our tax rules. We need structural change. That’s why, I’m proposing something brand-new: An annual wealth tax on the tippy-top 0.1%. We’d get $3 trillion in new revenue to invest in rebuilding the middle-class. Let’s make it happen.

Mosler: It doesn't reduce aggregate demand so it doesn't add any fiscal space... :(

Mosler: So it doesn't at all address the real issue- excess consumption by 'the rich' (or anyone else), and, in fact is a useful distraction for 'the rich' that works to delay resolution of this real issue. :( We can gain $trillions per year of fiscal space by eliminating most of the parasitic financial sector by deleting the supportive institutional structure that created it. Not mention how Medicare for all likewise cuts $1 trillion in real costs.

Mosler: President Trump and his team seem to have no idea that the trade deficit creates fiscal space for the likes of his tax cuts. Nor do the media, business professionals, main stream economists, etc. seem to get it???

Comment: Trump takes dig at Japan for 'substantial' trade advantage and calls for more investment in US.

Mosler: Seems the President still doesn't know, this is producing the fiscal space for his tax cuts.

Comment: Good piece on currency values and the trade deficit: Treasury overlooks the true culprit behind US dollar strength thehill.com

Mosler: Net imports that reduce US aggregate demand create the fiscal space for the likes of the tax cuts and a Green New Deal. This global trade war is dimming the future for all of us, and with no pushback from the politicians, economists, and business press who all have it backwards.

Comment: The first candidate to recognize Medicare for All is a deflationary event that not only doesn't beg a tax increase, but, to the contrary, is what 'pays for' the rest of the progressive laundry list, leapfrogs to the head of the class.

Mosler: Job Guarantee in the first instance provides for superior price stability vs unemployment, thereby adding to fiscal space crucial to 'paying for' the GND, free higher education, etc. etc.

Comment: Agreed the so called "bleeding hearts" suddenly care more about "prices" rather then people having a productive job to shelter, feed, cloth, and educate their family with dignity. Hard to pay less for something if you don’t have a job!

Mosler: Trade deficit= a productivity increase= fiscal space to lower taxes or increase public services to sustain full employment levels of aggregate demand. Imports are real benefits, exports are real costs- the problem is the policy response that turns a good thing into a bad thing.

Comment: I know, but I still feel that is more fare to other nations, like China, to have a balance trade with the US. let them use their full resources rather than send it to us in exchange of $ that they will not use.

Mosler: Unspent income in general gives us the 'fiscal space' to implement the likes of the Green New Deal, public services in general etc. without tax increases (or to reduce taxes). It's about confusing a productivity story with an unspent income story...

Comment: "Our economy is really doing well" - President of the United States!

Mosler: Not to forget that productivity increases create fiscal space for the GND.

Comment: Venezuela to add Bitcoin and Ethereum in central bank's reserves – AMBCrypto.

Mosler: Expenses like this add to their inflation problem. Buying said assets with local currency uses up 'fiscal space'.

Comment: The corona virus test should be made widely available and free. The corona virus vaccine, when ready, should be made widely available and free. Treatment for corona virus should be free, too. We're in a crisis. No one should have to pay for their corona virus health care costs.

Mosler: I agree there should be no charge, but it's not free in real terms, and it does use up fiscal space...

Comment: States collect taxes and are sovereign in the same way as the federal govt. States could issue "vouchers" to pay health workers, for example, which voucher recipients could use to pay state taxes. This is consistent with MMT.

Mosler: Yes, states can and do use tax credits/(vouchers) to deficit spend, and so doing transfers 'fiscal space' from the Federal to the state Governments.

Comment: President, EU Commission: Fully agree that we can only defeat this virus by working together. We need funding for treatments and vaccines. This is why I decided to host an online pledging conference on 4 May. I hope that countries and organisations all over the world will contribute.

Mosler: You do know the ECB can immediately write the entire check? And with current available fiscal space there's no real cost?

Comment: And why do I have to keep on reminding you that Bill Gates wasn't rich when he built Microsoft? He got filthy rich afterwards, by extracting money. And he's still sitting on it. Big piles of saved money don't get recycled back into the economy.

Mosler: Sitting on it, leaves that much fiscal space for increased public services or tax cuts. (That choice is political.)

Comment: Wednesday’s blog post (15/07) is now posted (18:37 EAST) - MMTed Q&A - Episode 7 - featuring Dr Pavlina Tcherneva discussing the Job Guarantee with me.

Mosler: My comments: 1. Unemployment defines minimum 'fiscal space'. 2. Job Guarantee does not reduce the ability to import. 3. Currency depreciation does not reduce the ability to import or reduce real wealth, however it does alter internal distribution.

Comment: Here's the issue. Free trade and an increasing reliance on imports is a demand drain for a domestic economy. This destroys jobs and growth.

Mosler: Yes, and said demand drains are good things that create fiscal space for lower taxes or increased public services to sustain full employment and increased personal income.

Mosler: First, said CB gold buying is "off balance sheet"- it doesn't count as gov (deficit) spending. The only 'cost' is a bit of inflation/lost fiscal space that's way under the radar.

Comment: Makes no sense for public sector to minimize internal costs, like private firms. They are assigned a public purpose, and evaluated on if and how they achieve it. They can be cost-effective, but the goals are set independently by political decision.

Mosler: Not to forget that minimizing real costs allows 'fiscal space' to 'go further' allowing for that many more public services (or lower taxes).

Comment: Will Obama Position be yours too? Check out this quote: "“Families across the country are tightening…" - "Creditocracy:…"

Mosler: Relaxing bankruptcy laws works to slow private sector lending and accumulated nominal wealth, as well as to create fiscal space.

Comment: I have been critical of German fiscal policy in the past - unneeded fiscal consolidation from 2010 to 2012 and persistent (large) surpluses held back European growth. But credit should be given when credit is due: Germany has used its accumulated fiscal space wisely this year.

Mosler: Fiscal space is the excess capacity in the economy, not the available funds.

Comment: The ZLB refers to the very front-end policy rate. There is always room for policy to influence longer-term yields, which is what QE is for. And there's plenty of room for ECB asset purchases to reduce real yields for Italy and Spain, which are still too high...

Mosler: The ECB could guarantee new issues of member nation debt rather than buy it, for example. Not to mention that lower long term rates are further deflationary, which is a good thing- creates fiscal space for larger fiscal deficits/more public services/lower taxes, etc.

Comment: “In the short term, it would be very positive for the housing market," says Lawrence Yun, the National Association of Realtors chief economist. He says his group's surveys show that student debt has people delaying homeownership by five to seven years.

Mosler: Understood, though I'd first spend our fiscal space on (green) infrastructure, free education, free m4all (creates fiscal space short term), etc

Comment: Taxes extinguish liabilities. Writing off debt to a government is a tax break. They are given all the time (in very big doses) to rich people and large corporations. It doesn't affect the value of the currency. Why should writing off student debt have any affect?

Mosler: They both reduce 'fiscal space'