How do we continue to pay for these things — with deficit after deficit after deficit?
About 25 years ago, I took an economics course for a distance MBA. I understood microeconomics, macroeconomics, and Keynesian economics reasonably well. The last section was monetarist economics. That was a bit of a mystery where governments create money out- of thin air. And they have been doing it for centuries. The trick is to do it in such a way that it does not create social and political instability.
I have partaken several informal lessons on this topic over the years. While I do understand it a little better, it is still a topic that escapes my logical thinking.
From my best inderstanding, since 2008, most western countries have created or modified federal institutions that issue loans to government who then supposedly pay interest and principle back to these institutions. But if the institutions default, then because the debtor and creditor are actually the same institution, there never was a loan in the first place, right?
Confused? I am too. But we can afford to pay for all this.