A recent viral video, featured in the leftist documentary “Finding the Money,” has shed light on why many American families are struggling with “Bidenflation.” In the video, Jared Bernstein, chairman of the White House Council of Economic Advisers, discusses modern monetary theory, suggesting that the government could eliminate debt by printing money. However, Bernstein’s comments lack coherence, leaving viewers skeptical of “Bidenomics.”
CLIP: We hear a lot about the national debt.
But do currency-issuing governments really ‘borrow' their own currencies?
The answer might surprise you.Watch FINDING THE MONEY documentary, In Theaters and On Demand TOMORROW May 3: https://t.co/H1e5fEuV7t pic.twitter.com/MA3AGIcCXi
— FINDING THE MONEY Film (@FindingMoneyDoc) May 2, 2024
Bernstein’s assertion that the government prints money is true, but it oversimplifies the process. While the Treasury Department produces currency through the Bureau of Engraving and Printing, the Federal Reserve Board actually issues the money after paying for production costs. This system has been in place since the 1913 Federal Reserve Act, allowing the Fed to conduct monetary policy independently of elected officials.
Historical interventions in monetary policy by elected officials, such as President Nixon’s actions in 1972, have often led to economic turmoil. The idea of modern monetary theory, which suggests that the government can print money to avoid debt, poses a risk of hyperinflation. The trillions of dollars injected into the economy during the pandemic stimulus packages have already caused price surges for goods.
Critics argue that embracing modern monetary theory could exacerbate inflation and undermine the Federal Reserve’s credibility. While some conservative voices have proposed limiting the Fed’s independence, the risks posed by modern monetary theory are far greater. Those on the Left pushing for these policies, including Bernstein, lack the necessary understanding of economic realities to justify their positions.
In defense of Bernstein, Maya MacGuineas of the Committee for a Responsible Federal Budget tried to explain his comments but acknowledged the nonsensical nature of modern monetary theory. Critics argue that Bernstein’s lack of economic qualifications and preparedness for interviews reflects a broader issue in the administration’s economic policies.
In conclusion, the government should focus on practical policies based on economic reality rather than indulging in leftist theories that could worsen inflation. Selecting qualified economists and implementing sound economic strategies is crucial to addressing the current economic challenges faced by American families.
