In other words, with fiat money, there is not intrinsic incapacity to finance growing fiscal deficits. The kinds of debt-to-GDP ratios that are thrown around in the United States and Europe—40 percent, 60 percent, 100 percent—are just that, numbers. They’re arbitrary numbers.
The issue is not what levels of debt are sustainable but how does the state intervene to support (or not) social expenditures and to determine the nature and level course of private business activity.
Read the whole thing at Toto, we’re not on the gold standard anymore
h/t Stephen Ewald