| Government budgets work like household budgets | Governments are currency issuers, not users | Unlike households, sovereign governments can create their own currency and don't face the same budget constraints |
| Government debt burdens future generations | Debt is mostly owed to domestic holders | Most government debt is held domestically and represents private sector savings, not a burden |
| We need to balance the federal budget | Deficits can be beneficial and necessary | Government deficits inject money into the economy and can support full employment |
| Printing money always causes inflation | Inflation occurs when demand exceeds productive capacity | Money creation only causes inflation if it pushes the economy beyond its real resource limits |
| We need to "pay for" government spending with taxes first | Spending comes before taxation logically | Governments spend money into existence first, then taxes remove money from circulation |
| Social Security and Medicare are "going broke" | These programs can't run out of money | The government can always fund these programs; the only limit is real resources, not money |
| Rising national debt will bankrupt the country | Sovereign debt in own currency isn't bankruptcy risk | Countries that issue their own currency cannot be forced into bankruptcy by debt denominated in that currency |
| We need foreign creditors to fund our government | Domestic savings automatically fund government deficits | Government deficits create the very savings that appear to "fund" them |
| Austerity is necessary to restore fiscal health | Austerity often worsens economic conditions | Cutting government spending during downturns typically prolongs recessions and increases unemployment |
| Monetary and fiscal policy should be separated | Coordination between treasury and central bank is natural | MMT sees monetary and fiscal policy as inherently linked aspects of government financial operations |