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●The more federal budgets are cut and taxes increased, the weaker an economy becomes.
●Austerity is the government’s method for widening the gap between rich and poor, which ultimately leads to civil disorder.
●Until the 99% understand the need for federal deficits, the upper 1% will rule.
●To survive long term, a monetarily non-sovereign government must have a positive balance of payments.
●Those, who do not understand the differences between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.
●The penalty for ignorance is slavery.
●Everything in economics devolves to motive.
Which do you fear more?
The out-and-out, “I-can’t-believe-they-actually-said-that” fruitcake-nutty, Michele Bachmannesque right-wing liars?
Or the sneaky, “I’m-one-of-you-simple-99%-folks,” “Don’t-listen-to-that-rat-Snowden,-trust-me-you-can-keep-your-health-care,” Barack Obamaesque liars?
To trust a nut or to trust a sneak. That is the question.
Here’s something that might help, an article in the Fiscal Times:
Top Dem Hints at Forbidden Entitlement Cuts
By Rob Garver
Rep. Steny Hoyer (D-MD), the second-ranking Democrat in the House showed that there are significant fissures in the Democratic Party.
Though nominally Minority Leader Nancy Pelosi’s second-in-command, he is starkly different from Pelosi and many others on the party’s left wing when it comes to economic and fiscal issues. Hoyer spoke at an event sponsored by the self-described “centrist” group Third Way on Monday, delivering a firm defense of the “grand bargain” theory of fiscal policy.
You remember the “grand bargain,” don’t you? It was Obama’s austerity plan to cut Medicare, Medicaid and Social Security if only the Republicans would be nice and increase a few taxes on the wealthy (taxes for which the wealthy easily would find loopholes).
In summary, it was a gigantic stab in the backs of the people who elected Obama. Remember, he’s a Chicago politician whose slogan is, “Change you can believe in, sucker.”
Hoyer expressed his disappointment that the Simpson-Bowles commission’s recommendations were never adopted, and reiterated his support for a “big and balanced” deal to correct the nation’s fiscal course.
You remember Simpson and Bowles, the bought-and-paid-for flunkeys hired by Obama to come up with a really big austerity deal, that would guarantee a huge widening of the gap between the rich and the rest.
The plan would have eliminated what they cleverly called “tax expenditures.” Of course, these things are not an expenditure at all. They are tax deductions.
But Messrs. Simpson and Bowles looked at it this way: All your money belongs to the government. So if you take a deduction, say for charity or for mortgage interest, you are spending the government’s money. Got it?
On the Democratic side of the aisle, the terms “big deal” and “balanced” are code words for agreements that include cuts to entitlement programs such as Social Security and Medicaid.
And really, who could object to a “big deal” that is “balanced?” No one wants an unbalanced little deal, do they?
As the country continues to borrow money to find spending, Hoyer said, debt service becomes an increasingly debilitating drag on our ability to invest in the future.
“In my opinion, a big deal is the best way for Congress to achieve a fiscally sustainable outlook that can inject certainty into our economy and help us invest in competitiveness, job growth, and opportunity.”
Of course, as readers already know, the country does NOT borrow money to find (fund?) spending, and debt service is not a drag on our ability to invest in the future. Quite the opposite. Mr. Hoyer merely is quoting the BIG LIE.
The vast majority of federal debt service (principal) consists of nothing more than transferring existing dollars from private savings-type accounts to private checking accounts, and does not involve federal government finances at all.
A small part of debt service — interest payments — is not a drag on anything. The government creates those dollars at will, and they add directly to Gross Domestic Product.
And then we come to the magic words of the BIG LIE: “fiscally sustainable” “inject certainty into our economy,” “invest in competitiveness, job growth, and opportunity.”
“Fiscally sustainable” implies the BIG LIE that our government can run short of its own sovereign currency. It cannot.
“Inject certainty into our economy” implies the BIG LIE that certainty of a recession is a worthwhile goal. Austerity, i.e. reducing the money supply, is certain to lead to recession.
“Invest in competitiveness” implies the BIG LIE that taking dollars out of our economy, by some strange metaphysics, actually becomes an investment that will make business more competitive, hire more people and provide opportunity for . . . for poverty, we suppose.
“If we can, in a bipartisan way, reach a comprehensive agreement, it would be the single most effective action we could take to stimulate our economy, give confidence to markets, and ensure that we have the resources to invest in our people.”
“Bipartisan” is another magic word meaning, “If we give the Republicans what they want (lower taxes on the rich and less spending for programs that aid the not-rich), they will give us what we Democrats want (less spending for programs that aid the not-rich and higher taxes that look like taxes on the rich, but easily are avoided.)
And yes, if you think that reducing the money supply and cutting benefits stimulates the economy, you also must subscribe to the “apply-leaches-to-cure-anemia” school of medicine.
But it will “give confidence to the markets,” since the markets are owned by the rich.
And now, the article closes with its funniest lines:
Earlier this month, Laura Friedenbach, press secretary for Progressive Change Campaign Committee told The Fiscal Times, “Just one year ago, Democrats were stuck in defense, constantly defending Social Security benefits from cuts. We’re now at a turning point — progressives are united and going on offense.”
Go on offense by retreating; full speed to the rear.
So, as you can see, the Republicans nuts are not the only people determined to suck up to the 1% and widen the gap between the rich and the rest.
The Democrat sneaks are in that race too, led by none other than Barack “trust me” Obama.
Rodger Malcolm Mitchell
Nine Steps to Prosperity:
1. Eliminate FICA (Click here)
2. Federally funded Medicare — parts A, B & D plus long term nursing care — for everyone (Click here)
3. Provide an Economic Bonus to every man, woman and child in America, and/or every state a per capita Economic Bonus. (Click here) Or institute a reverse income tax.
4. Free education (including post-grad) for everyone. Click here
5. Salary for attending school (Click here)
6. Eliminate corporate taxes (Click here)
7. Increase the standard income tax deduction annually
8. Increase federal spending on the myriad initiatives that benefit America’s 99% (Click here)
9. Federal ownership of all banks (Click here)
10 Steps to Economic Misery: (Click here:)
1. Maintain or increase the FICA tax..
2. Spread the myth Social Security, Medicare and the U.S. government are insolvent.
3. Cut federal employment in the military, post office, other federal agencies.
4. Broaden the income tax base so more lower income people will pay.
5. Cut financial assistance to the states.
6. Spread the myth federal taxes pay for federal spending.
7. Allow banks to trade for their own accounts; save them when their investments go sour.
8. Never prosecute any banker for criminal activity.
9. Nominate arch conservatives to the Supreme Court.
10. Reduce the federal deficit and debt
No nation can tax itself into prosperity, nor grow without money growth. Monetary Sovereignty: Cutting federal deficits to grow the economy is like applying leeches to cure anemia.
Two key equations in economics:
1. Federal Deficits – Net Imports = Net Private Savings
2. Gross Domestic Product = Federal Spending + Private Investment and Consumption – Net Imports
THE RECESSION CLOCK
As the federal deficit growth lines drop, we approach recession, which will be cured only when the lines rise. Federal deficit growth is absolutely, positively necessary for economic growth. Period.
28 thoughts on “–Did you really think Republicans were the only BIG LIARs?”
RMM says: “The vast majority of federal debt service (principal) consists of nothing more than transferring existing dollars from private savings-type accounts to private checking accounts, and does not involve federal government finances at all.”
Yes. Neither taxpayers NOR THE US GOVERNMENT pay any interest on the “national debt.”
The FED ITSELF creates the money out of thin air to pay the interest on T-securities.
How do I know that?
Federal “spending” consists of discretionary spending, mandatory spending, and interest on T-securities. (I put “spending” in scare-quotes because the US government does not “spend.” Instead, the US government sends instructions to credit or debit accounts. The users of money “spend,” but the sovereign creators do not.)
For FY 2014 the government expects to “spend” on all three categories an aggregate $3.8 trillion.
Of that $3.8 trillion, only $12.9 billion will be created for the US Treasury Department.
However interest on T-securities will be 18 times larger, and will total $228 billion. Where will that $228 billion come from?
It is listed as part of total federal “spending,” but there is no department charged with creating that $228 billion.
Ergo, the FED ITSELF will create the $228 billion. The Fed creates (out of thin air) the interest money on every T-security that matures.
Below is a Wikipedia breakdown of discretionary federal spending for FY 2014. There is no entry for paying interest on T-securities.
As for mandatory spending, this is Social Security, Medicaid, Medicare, and Food Stamps.
Again, there is no creation of money for the “national debt.”
The FED ITSELF creates the interest money.
On a different note, part of the Big Lie is to claim that the Social Security “trust fund” will “run out of money.”
However the “trust funds” have no money to begin with, just like the US government itself. There are over 200 US government “trust funds,” the largest of which is Social Security. These are NOT pools of money. (Money is not physical, remember?)
No, the “trust funds” are simply accounts used by the federal government to create money, which is then spent by the users of money.
(Will Rogers Quote)
There are three kinds of people: The ones that learn by reading.
The few who learn by observation.
The rest of them have to urinate on the electric fence and find out for them.
We don’t need to argue with people about whether or not banks create money any more; the Bank of England has helpfully settled that debate with their recent paper, “Money Creation in the Modern Economy”. Sorry, quant, you still haven’t done any of the research for your own enlightenment, have you? So you might read the paper suggested, written by another “monetary sovereigns” central bank and discover the truth of the matter. The Constitution does indeed grant our Treasury the right to create all of the money, however, legislation in place dismisses that right in favor of private banking interests; who currently create almost the entirety of dollars. When will you recognize the difference between actual description and prescription? One other question, are coins physical? Or are they some sort of digital mirage?
As has often been stated on this site, dollars are created in two ways and destroyed in two ways:
1. Federal spending
1. Federal taxing
2. Repayment of loans
Somewhere near 80% of the dollars in circulation were created by lending. An important difference is that they are temporary dollars, in that they disappear when the loans are repaid. Federal spending never needs to be repaid.
As for coins, like dollar bills, they are not in themselves, money. They are titles to money. Like dollar bills, they have little-to-no intrinsic value, but instead base their value on the full faith and credit of the U.S. federal government.
Even the formerly-used gold coins, which had scarcity value, had little-to-no intrinsic value, and were valued according to federal standards — just like paper. For instance, a $10 gold piece was worth exactly $10, just as it would have been had it been made of tin.
No sovereign currency is physical. That’s what makes it sovereign currency.
@RMM: I find it confusing to say that lending also creates dollars. Where do the banks get the dollars to lend out in the first place? Don’t banks need to be in possession of these dollars first, before lending them out? Then what would stop banks from creating their own wealth, merely by creating more loans? Is lending dollars that already exist really creating new, additional dollars, thereby increasing the number of dollars in the total money supply?
According to current law, banks can lend 10 times the balance of their capital. This is erroneously called “fractional reserve” lending, but actually is fractional capital lending.
@RMM: Doesn’t fractional reserve lending by private banks make it harder for the government to control for inflation when others have a hand in affecting the total money supply? Should fractional reserve lending be kept, abolished or changed in your opinion in view of MMT and MS principles?
@RMM: (off-topic I know for this post): Would you consider doing a book review on your blog for Ha-Joon Chang’s “23 Things they don’t tell you about capitalism.”? It’s an interesting book.
Hey Rodger, I feel like poking some so-called “progressives” in the eye. Mind if I cross post this over at daily kos?
Not at all. Feel free.
Holy crap Rodger, you’ve sure stirred up a hornet’s nest over at Kos. As Quatloax likes to say, the people love austerity and the punishment of the 1%. Just look at how dishonest and hateful so called “progressives” are when you point out that their savior Obama is a liar and that the Dems are only slightly less horrible than Cons in their desire to enrich the already wealthy and screw regular people.
As I have often noted, liberals defend the Big Lie even more strongly than do conservatives.
Right-wingers will grant any concession, make any surrender, and allow any change, as long as the Big Lie remains intact and unchallenged.
Liberals, by contrast, will not budge on ANY topic, since they claim to have “right” on their side.
For example, liberals insist on using taxes to punish the rich, even though this would do nothing to help the lower classes. On the contrary, their demand hurts the lower classes by helping to sustain the Big Lie that the US government needs tax revenue. To tax the rich is NOT to “redistribute wealth.”
@ AUBURN PARKS: In one of your comments you write that, “The deficit is not dangerous, and not a problem.”
Actually the USA will have no economy at all if there were no deficit spending.
You also write, “The amount of T-bonds outstanding is pretty much irrelevant.”
Yes. The Fed itself creates money out of thin air to pay the interest on T-securities.
Actually the deficit is a problem in my opinion: it’s much too SMALL. A deficit that is too small or if we have a balanced budget or surplus is indeed actually dangerous from my understanding. The U.S. economy has a shortage of dollars that is inhibiting it from really prospering. We need INCREASED federal government spending. There are not enough dollars circulating to support a robust economy and concomitant job growth to keep more people employed.
Yeah, they rip tthe Cons relentlessly over there for being intellectually dishonest, ignorant, and hypocritical. I too hate, HATE, these qualities. And that leads me to always question my assumptions and everyone else’s too. And when the facts and logic don’t support a currently held belief of mine, then I do what all intellectually honest people must, I change my mind.
The folks over at Kos do not change their mind when their beliefs dont match reality. They cling to their fantasies just as much as the Cons do. Not progressive at all in my mind. If anything they are acting conservatively with their obsession of maintaining the status quo of a poor Govt. and if only those mean conservatives would let us raise taxes, then we would be able to support the middle and working classes. What a disgrace.
As to your two economic claims:
“”Actually the USA will have no economy at all if there were no deficit spending.””
That is not true at all. There was an economy during the Gold standard, there was an economy before there was ever such a thing called the US Dollar. There has been periods with high growth and budget surpluses.
Basically, you are overstating the case here. The private sector is capable of growing its own money supply. Just not sustainably and not for the long run. But an economy is simply people exchanging goods and services, that always exists regardless of the monetary system.
“Yes. The Fed itself creates money out of thin air to pay the interest on T-securities.”
This is not true either. Interest payments come out of the TGA just like all other Govt spending. The TSY never pays to redeem bonds because they simply issue new ones to replace the maturing ones. Thats why the “debt” is irrelevant. We control our own interest rate, and the “debt” never gets “paid back” with tax dollars. Your Wiki link the other day was about the Govt budget. Budget’s are irrelevant, only appropriations matter. Govt money can be said to be created at the moment that spending is appropriated by Congress and signed by the Pres. If you look at tTSY statements, then you can clearly see that interest payments come out of the TGA, just like all other Govt spending.
Yikes! You are mixing yourself up.
 “There was an economy during the gold standard, there was an economy before there was ever such a thing called the US Dollar.”
Yes, and there were economies before the USA existed. What’s your point?
 “There have been periods with high growth and budget surpluses.”
Those are simply bubbles, which are never sustainable. For example, during Bill Clinton’s second presidency, Clinton pushed for a budget surplus as a favor to Wall Street. (Less government money means more begging from bankers and Wall Street). This caused a depression, but the depression was delayed by the dot-com bubble, then by the housing bubble and Bush’s wars. Now Obama is again pushing for a budget surplus. Since we do not have a bubble in the real economy, we are stuck in a depression. If the federal government actually achieves a surplus, then the dollar-based economy will become extinct.
 “Basically, you are overstating the case here. The private sector is capable of growing its own money supply. Just not sustainably and not for the long run. But an economy is simply people exchanging goods and services, that always exists regardless of the monetary system.”
If the US federal budget deficit were to shrink to zero, or past that into a surplus, then we might survive for a while with pure bank loans, but the debt load would eventually cancel the economy. Then we could have barter or something, but the dollar-based economy would be no more.
 “Interest payments come out of the TGA just like all other Govt spending.”
All monetary accounts (no exceptions) are kept at banks. The federal government’s main bank is the Federal Reserve, which is the keeper of the “general account,” itself a nebulous term that simply means the total of federal government accounts kept at the Fed and various other banks.
 “The TSY never pays to redeem bonds because they simply issue new ones to replace the maturing ones.”
Yikes! So when my T-security matures, and I want to be paid the interest on it, the Fed will refuse to pay me, and will instead give me another T-security? Wow!
Please re-read Rodger’s (repeated) explanations that buying a T-security is simply a matter of debiting your personal checking account, and crediting your savings account at the Fed.
Meanwhile, paying the interest on your T-security is the reverse. Your savings account at the Fed is debited, and your personal checking account is credited.
The US Treasury issues bonds for sale, but the interest on them is paid by the Fed. The Treasury will receive only $12.9 billion for FY 2014, whereas the interest paid on T-securities will be 17 times that. The Fed pays that interest, just as any other bank pays interest. For FY 2014 the Federal Reserve expects to pay $228 billion in interest on T-securities. You are confused because that $228 billion created by the Fed is listed as part of overall “government spending” (even though the government does not spend one penny).
 “That’s why the ‘debt’ is irrelevant. We control our own interest rate, and the ‘debt’ never gets ‘paid back’ with tax dollars.”
The “national debt” is irrelevant because there is no constraint on the US government’s ability to create money. Therefore federal finances for a Monetarily Sovereign government are not like finances for any other kind of entity. The term “federal spending” is a misnomer that helps sustain the Big Lie that US government finances are the same as private personal finances.
 “Budgets are irrelevant, only appropriations matter.”
Huh? The federal budget determines how much will be appropriated. You consider this to be irrelevant? That’s illogical.
 “Govt money can be said to be created at the moment that spending is appropriated by Congress and signed by the Pres.”
No. Wrong again. The US government has no money at all. None. Zero. “Government money” is created the moment that a bank updates (i.e. credits) an account after receiving instructions to do so from the US government.
 “If you look at TSY statements, then you can clearly see that interest payments come out of the TGA, just like all other Govt spending.”
The “general account” simply means “government spending” in all its forms (even though the government does not actually spend one penny). When the Fed creates the interest money on T-securities, this is part of the “general account.”
Thank you for reading and commenting.
“Yes, and there were economies before the USA existed. What’s your point?”
That your statement that there would be no economy if there were no deficits is wrong. It may be a worse economy, but there has always been economies and there will always be, deficit or no deficit.
“Those are simply bubbles, which are never sustainable. For example, during Bill Clinton’s second presidency, Clinton pushed for a budget surplus as a favor to Wall Street. (Less government money means more begging from bankers and Wall Street). This caused a depression, but the depression was delayed by the dot-com bubble, then by the housing bubble and Bush’s wars. Now Obama is again pushing for a budget surplus. Since we do not have a bubble in the real economy, we are stuck in a depression. If the federal government actually achieves a surplus, then the dollar-based economy will become extinct.”
I said this very same thing. private sector led economic expansions are by definition temporary and cyclical BUT THEY ARE POSSIBLE. Again the “extinct” remark. Totally unnecessary and inaccurate rhetorical flourish.
“If the US federal budget deficit were to shrink to zero, or past that into a surplus, then we might survive for a while with pure bank loans, but the debt load would eventually cancel the economy. Then we could have barter or something, but the dollar-based economy would be no more.”
Statements like this are just pure trash. Even if the Govt ran a perpetual balanced budget, the number of private bank created dollar tokens would never go to zero. People will still live and work, take out loans and repay loans etc.
Idiot! If there were nothing but bank loans, then everybody would be borrowing to pay their debts. The government would consist of banks alone, and there would be no US dollar, as Rodger has noted.
Please re-evaluate your own worthless trash (a word you seem to favor).
“Yikes! So when my T-security matures, and I want to be paid the interest on it, the Fed will refuse to pay me, and will instead give me another T-security? Wow!”
Nope, you get regular interest payments on you T-bond. If you have a 10yr T-bond you will receive interest payments regularly throughout the duration of your bond. All those interest payment come from the TSY. When the bond matures, your securities account is debited and your private bank account is credited. But this money does not come from the TSY as someone else has already purchased the equivalent of your T-bond. Thats why there are no TSY statements that include a ‘redeeming bonds payment” All maturing bonds are matched with new bond issues as long as we continue to run defcits.
This is just the accounting, this is not an opinion. If you get the accounting wrong, you get the operations wrong.
“Huh? The federal budget determines how much will be appropriated. You consider this to be irrelevant? That’s illogical.”
Sorry, all the war spending for Iraq annd Afghan was done using supplemental appropriations. None of the spending was in “the budget”. Besides for these simple examples, the budgets that Congress passes never match the final appropriations spending as seen on TSY statements
“No. Wrong again. The US government has no money at all. None. Zero. “Government money” is created the moment that a bank updates (i.e. credits) an account after receiving instructions to do so from the US government.”
Right you are on the operations of this, but the AUTHORITY to credit those accounts aka create money comes from COngressional appropriations. And that future spending doesnt become “law” until the President signs the bill. If Congress doesn’t appropriate it, it doesn’t get spent = created.
“The “general account” simply means “government spending” in all its forms (even though the government does not actually spend one penny). When the Fed creates the interest money on T-securities, this is part of the “general account.””
Again, the interest spending for bonds comes from the TSY not the Fed. Now, interest on reserves that the Fed pays now during QE, that money does not come from the TSY. That is the Fed doing fiscal policy and simply creating and spending its own money (I realize that the phrase “own money” is kind of awkward and is not really a good way to describe this”. But this is decidely different than the $300 billion in interest spending we did last year.
Wow, you must really have some kind of inferiority complex going on. Here I am, a daily MS reader. In agreement with 95% of the things you write and yet when I disagree and painstakingly describe why so, you flip out and call me an idiot. Who do you think you are?
As to my trash comment, it may have overly negative connotations and for that I apologize. But the original point and complaint still stand, your words were sloppy and false. If you care about intellectual honesty you should have no problem admitting you were wrong.
Steve Keen has done extensive work showing that private debt and economic activity is fully capable of maintaining itself sans a Govt deficit.
Its OK to be wrong man, everybody does it. The thing that most people dont do is turn to childish and immature insults against people on their own side.
GDP = Federal Spending + Non-federal Spending + Net Imports.
For dollars to exist at all requires federal deficits to create the “seed,” the first dollars.
For GDP to grow without federal deficits, requires that bank lending (i.e. private borrowing) grow each year. The problem is that private borrowing must be repaid, so the increase in annual borrowing needs to be significant. Banks create what I term “temporary” dollars.
Theoretically, once dollars have been created by federal deficit spending, private borrowing and spending could take over, and federal deficits no longer would be necessary. That’s theory.
In actuality, however, almost all recessions and every depression, have been preceded, not just by the absence of deficits, by the reduction in deficit growth.
The economy needs the continual input of “permanent” dollars — dollars that don’t need to be repaid — in order to grow. Those are federal deficit dollars.
What I find amusing listening to all of these economic ignoramuses (and some deliberate) is this mistaken belief that creating money “out of thin air” is something wrong. They call these particular dollars “funny money,” as if there is a difference between one dollar from another dollar – which is obviously absurd and illogical. All dollars come from the same place, the federal government. Dollars are like a point system as described by Warren Mosler. Dollars don’t have to be “backed” by anything physical and tangible like gold to work, like many people wrongly think.
Yes, Fiat money can be a wonderful gift. However, more importantly it is where and to what those dollars created, and the proper terminology is “almost out of thin air”, are spent or directed towards. Also, your statement “all dollars come from the same place, the federal government” is completely wrong and not current reality. Educate yourself at places not limited to blog posts. This should not be taken as criticism of most of RMM’s assertions. It is however a fact that the federal government does NOT create all of our dollars by spending them into existence.
All money is “fiat money” in that is created by the fiat of a government.
The substance that serves as the title document for money, whether paper, nickel, or most often, mere accounting notation, doesn’t change that fact.
You are correct that the federal government does not create all our dollars. However, without federal creation of dollars, there would be no dollars. Perhaps that is where the confusion lies.
@ Beaker: Correct. All money is created out of thin air, just as points on a sports scoreboard are created out of thin air.
We could use gold coins as currency, but currency is not money. It represents money. Likewise the title to a car is not the car. It represents the car. Titles are created out of thin air. Even the piece of paper the title is printed on is not the title. The actual “title” is the human agreement to honor the piece of paper. The core essence of money is human agreement. What “backs” the US dollar is the human agreement to honor the dollar. That is, the dollar is “backed” by the “full faith and credit of the United States.” In this context, credit means belief. The dollar is credible because we believe and agree that it is.
There is a mass delusion that “real” money is physical, or must be backed by some physical substance, disconnected with any human agreement.
This delusion is one reason why the Big Lie continues, and with it, the ever-growing poverty around us.
I know all that. But it doesn’t change the fact that the statement:
“If the US federal budget deficit were to shrink to zero, or past that into a surplus, then we might survive for a while with pure bank loans, but the debt load would eventually cancel the economy. Then we could have barter or something, but the dollar-based economy would be no more.”
Is wrong. The economy can never be “cancelled”. And the dollar based economy would still exist sans deficits. Would the economy be much worse? Yes. But thats not the point he made and his erroneous point is the one I’ve been referring to.
Probably not worth discussion, but it depends on the surplus. Given a large enough surplus, and all dollars would disappear.