Is Federal Borrowing Necessary?

• Monetarily sovereign governments don't need to accumulate funds via taxation before they can spend

  • Spending precedes taxation

  • No taxation unless you've got the units of account taxes are levied in

• Similarly, monetarily sovereign governments don't need to accumulate funds via borrowing (debt sales) before they can spend

  • Spending precedes borrowing

  • Government bonds are purchased with currency previously spent into economy