When You Print Your Own Currency, Money Should Never Be a Limiting Resource

This is a point I’ve been making for quite a while, and this misunderstanding is why your non-competitive grant renewal was cut. I’ll outsource this to Matthew Yglesias (boldface mine):

There are many reasons you might lose a war. But no country on earth has ever lost a war because it’s “out of money.” If you have the soldiers, and the soldiers have guns and ammunition, and you have the ability to grow food to feed the soldiers and the workers making the guns and the ammunition then as long as you prefer continued fighting to surrender you can keep waging the war.

That’s all pretty obvious if you think about it for ten minutes, and of course nobody surrendered in World War I because they ran out of money. They borrowed money, they printed money, they bartered, they did what they had to do. You fight with your real resources and money is one of several tools for mobilizing real resources. Everyone knows that. What people forget is that this is true in peacetime as well. No matter what you do with your monetary system, you can’t conjure up real resources that you don’t have. But by the same token, if you in fact have real resources available “lack of money” is never a good reason to fail to mobilize them.

We are governed by people who essentially believe in the gold standard (even if they mock those that do). And if you’re a scientist, you’re probably getting fucked by this idiotic belief. Just wanted to make that clear. This shit matters, even if it bores you.

Disclaimer: Before you start screaming “inflation”, where would it come from? Wages are declining. Median household income is down ten percent in real dollars over the last decade. Unemployment is high, employment is low. U.S. manufacturing capacity is idle. Inflation is not the present concern (and, besides, the Fed has always been able to crush inflation if needs be).

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