Publications

One-Pager No. 68 | November 2021

Are Concerns over Growing Federal Government Debt Misplaced?

With the US Treasury cutting checks totaling approximately $5 trillion to deal with the COVID-19 crisis, Senior Scholar L. Randall Wray argues that when it comes to the federal government, concerns about affordability and solvency can both be laid to rest. According to Wray, the question is never whether the federal government can spend more, but whether it should. And while there are still strongly held beliefs about the negative impacts of deficits and debt on inflation, interest rates, growth, and exchange rates, with two centuries of experience the evidence for these concerns is mixed at best.

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Public Policy Brief No. 157
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The Fed Cannot Engineer a Soft Landing but Risks Stagflation by Trying
Author(s): Yeva Nersisyan, L. Randall Wray
April 2022

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