AOC Declares Victory

If you think I’m referring to the popular barista/legislator/socialist rockstar you can stop reading right now. My AOC instead refers to All Outta Consequences. We have written before about the popularity of modern monetary theory which suggests that governmental deficit spending is seemingly inconsequential. The amazing thing is that this type of mindset is percolating down to the state and local level, where  even states such as Illinois elect officials content to ignore the obvious and elevate can kicking to new heights. In fact, of all the mayoral candidates for The City of Chicago, only one is advocating a property tax hike to shore up funding for the multi-billion dollar pension gap( a portion of which needs to be funded by 2020). The others have instead chosen to follow a long line of Illinois politicians who  have looked to creative financing (i.e. borrowing more to fund the borrowing you already can’t afford) and other stop- gaps such as casino gambling.  When asked about how to finance the ludicrous New Green Deal initiative AOC (the barista) stated that ” The Federal Reserve can extend credit to fund these new initiatives….” If however you think that this type of free lunch thinking is limited to the uninformed socialist realm, I heard a well known economist remark recently that the imposition of negative rates of interest here in the U.S. in the aftermath of the financial crisis in 2008 would have really “done the trick”. From one AOC to another.