So Brad DeLong joining the choir with his important voice is good news. Drawing on more context than we could dream of his post titled "Needed: More Government, More Government Debt, Less Worry" will definitely help move the needle of public conversation in the right direction.
Importantly, from our perspective, in his introductory remark that:
"I believe that little adjustment to one’s view of the proper level of 21st-century public debt of *reserve currency-issuing sovereigns with exorbitant privilege* is called for because of systemic risk considerations."
In other words, due to the fragility of the private banking sector, governments need to start treating their budgets the way central banks treat their balance sheets. For example, investing in technology to increase productivity- that is the road to sustainable growth. It's like no one lived thru or benefited from the 90's! Instead, the 2000's left our political leaders stricken with economic amnesia regarding the impact information technology had in sustaining growth in employment and incomes. Instead crippling public discourse with false narratives fed them by a private banking sector willing to be the only driver of economic activity.
His conclusions are also consistent with the functional finance perspective on managing the economy. In his first 2 concluding points DeLong takes as a given the necessarily increased role sovereign currency governments will figure in managing money. We would preface with given the limitations of bank created money in managing sustainable growth without producing boom and bust investment cycles. Which he raps into his final point:
"3. With prudent regulation—i.e., the effective limitation of the banking sector’s ability to write unhedged puts on the currency—the power major sovereigns possess to tax the financial sector via financial repression provides sufficient insurance against an adverse preference shock to the desire for government debt.
The first two of these conclusions appear to me to be close to rock solid. The third is, I think, considerably less secure."
Ok so he's identified the possibility but remains skeptical-who can disagree. Given the economic ignorance of politicians we can't either but we're working on it.