Warren Mosler and the Value of Money

In this discussion on an Yglesias thread I was reminded by another commenter of the fascinating work of one of the big three modern economists who have most shaped the way I think about economics. Kuttner is one, Taleb is another, and this guy, Warren Mosler, is the third.

The linked post is called "The Natural Interest Rate is Zero," but what it's really about, like most of Mosley's work, is how the relationship between a government and its currency is fundamentally different from every other entity's relationship with that currency.

The point he makes many times that is really quite interesting when you turn it over in your mind is that if you pay the government with cash, whether you're paying taxes or buying securities, the government shreds the money.

He does a good job going into some of the implications of that fact, but it's also fun to just sit and thing about it.