Raleigh, NC—A friend of mine told me that he thought the reason politicians, in general, can’t get anything done is because once they’re elected the real movers and shakers in Congress sit them down and tell them the political facts of life.
To some extent, I agree with that. I’m not a conspiracy theorist in thinking that there are groups of people who control the world. But, I do think once politicians are elected, they are sat down and told how much all of their good ideas are worth in DC.
In fact, I know that to be the case. A week after this November election, new members of Congress will be traveling to DC for a long, grueling and in depth orientation session.
So, there is some validity that Americans are told things that aren’t necessarily true. And, voters are told those things by people who either know or should know that the information they’re pumping out is misleading.
Here’s one of the biggest misconceptions I think you need to know before you vote in November. The federal debt.
Most people believe that the federal government uses our taxpayer hard earned money to pay for things. We’re somewhat taught that idea in accounting classes, by some economic people and even in the media. Hell, we have politicians that tell us that all the time. They pander that concept to win votes.
But, in a nutshell, that really isn’t true because the federal government makes it’s own money literally out of thin air.
There’s a difference between money we have in the bank (as private citizens) and money the government has available as a sovereign nation.
A sovereign nation creates it’s own money (as much as it wants and needs) at any given time. It makes laws that only it can create and print money. Then the government turns around and spends the money it creates.
The only reason government money is worth anything at all is because once we get money that the government spends, a certain amount of that money comes back to them in the form of tax payments. If we weren’t required to pay tax, the dollar bill would have a much different appeal.
Before you get the “deer in headlights” look, all I’m trying to get across is that government debt is not a bad thing and that the federal deficit isn’t as big of a deal as some politicians will have you believe.
When you wrap your head around that concept — do some research into MMT (Modern Monetary Theory). And, when you see how it works in real life—your idea of how the government should spend money will change.
That new knowledge will undoubtedly influence your thinking process in who the best political candidates are.
But, also keep in mind the spending “thing” only works for the federal government—state governments can’t make their own money, just like you can’t make your own dollar bills.
I’m not just throwing the MMT concept out there. I’ve actually talked to economists at various think tanks (most had their own agenda), politicians and eggheads in the pubic sector. MMT is something you should know and something you’d be wise to wrap your head around.