Are We Thinking About the Federal Deficit Correctly?

Photo by Alexander Schimmeck, Nick Gavrilov, Arno Senoner

As I try to get a greater understanding of how government works and how positive change can be achieved my reading has adjusted. Thus, the most important things I learned this week have to do with debt spending, global warming, and speech. Important topics we should all understand.

How Does The Federal Deficit Work?

I’ve become more interested in the philosophies behind historic and modern economics after reading The Price of Peace by Zachary D. Carter. This led me to The Deficit Myth by Stephanie Kelton, which is the basis for the transformation in my understanding of the U.S. Federal Deficit. 

The short explanation is the federal deficit is not a tally of debt that the government owes, and is not comparable to the standard household (personal) debt. That was my previous understanding.

Instead, it’s a balance sheet of the money the government has invested into the economy that it has not taken out through taxes. An example is the government investing $100 into the economy, and at years end having taxed out $80. This is a deficit of $20, where the $20 remains in the economy for people and businesses to use.

U.S. vs China and Global Warming

It seems the new counter-argument against actively combating climate change and global warming is simply pointing to the fact that China emits more CO2 than the United States. Factually, this is true. And it in no way absolves us of trying to reduce our carbon footprint.

If the moral argument about a clean environment doesn’t seem to be working, maybe this will. While true that China emits more total CO2, their per-person CO2 output each year (7.1 tonnes) is HALF our yearly per-person output (16 tonnes).

That’s So Orwellian

I was first introduced to George Orwell in middle school when assigned 1984 in my literature class. However, it’s remained relevant through history, especially recently as people invoked the term “Orwellian” to describe something they simply disagree with.

When in fact, Orwell wrote specifically against propaganda, which is something we’ve seen a lot of lately from the very people who claim something negative happening to them is “Orwellian.” A great all encapsulating quote that describes it’s current usage is:

“It tends to be a kind of catch-all for repression,” says David Ulin, associate professor of English at the University of Southern California.