Saturday, 2 August 2014
Last updated 11 hours ago
Oct 22 2010 | 9:58am ET
Hedge fund manager and independent Senate candidate Warren Mosler is throwing down the gauntlet. If any U.S. congressman or senator can prove that the federal government can run out of money, as President Barack Obama says it has, he will put his own fortune to work towards paying down the federal deficit.
Mosler, who is seeking the Connecticut seat being vacated by Sen. Christopher Dodd, one of the architects of the recently-passed financial regulation reform law, say's he'll put $100 million towards the deficit.
“I am running for U.S. Senate to see my policies implemented to create the 20 million jobs we need," the III Offshore Advisors founder said. "And to do this it must be understood that there is simply no such thing as the U.S. Federal government running out of money, nor is the Federal government operationally dependent on borrowing from China or anyone else. U.S. states, individuals, and companies can indeed become insolvent, but U.S. government checks will never bounce."
"If lawmakers today understood this fact, they would not be looking to cut Social Security and we would not still be mired in this disastrous recession," he added.
Mosler likened the situation to a football. When a team scores, the points simply show up on the scoreboard, without anyone wondering where the stadium got the six points or demanding "that stadiums keep a reserve of points in a 'lockbox'" or worrying "about using up all the points and thereby denying our children the chance to play."
"The Government doesn’t get anything ‘real’ when it taxes and doesn't give up anything ‘real’ when it spends," Mosler explained. "There is no gold coin that goes into a bucket at the Fed when you are taxed and the government doesn't hammer a gold coin into its computer when it spends. It just changes numbers in our bank accounts."