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Illustration: Aïda Amer/Axios

The truism that debt and deficits matter is fading away among policy elites.

Driving the news: The chorus is telling us don't worry, be happy: The Wall Street Journal: "Worry About Debt? Not So Fast, Some Economists Say" ... Foreign Affairs: "Who’s Afraid of Budget Deficits?" ... NY Times: "How America Learned to Stop Worrying and Love Deficits and Debt."

  • The NY Times' Neil Irwin captures the debtgeist: "Economic orthodoxy that ruled for decades held that fiscal responsibility was inherently good and the national debt a leviathan to fear. Now the intellectual and political currents are flowing — gushing, really — in the opposite direction."

That's after the national debt passed $22 trillion, the most ever — $2 trillion of that while Trump was in office.

  • And despite a strong economy, the deficit last year hit a six-year high.

This is a rare zone of agreement for left, right and center:

  • Rep. Alexandria Ocasio-Cortez has indicated openness to "modern monetary theory," the idea that deficits don't matter for countries that are running below their economic potential.
  • Trump didn't once mention the debt or budget deficits in this year's State of the Union address — nor did he mention it last year.
  • Warren Buffett, the third richest man in the world (after Bezos and Gates), said in his most recent letter to investors: "Those who regularly preach doom because of government budget deficits (as I regularly did myself for many years) might note that our country’s national debt has increased roughly 400-fold" over the past 77 years.

Why it doesn't matter, from Axios Markets editor Dion Rabouin: inflation, which over the past decade or so has been a non-factor, even after back-to-back years of above-trend growth and government spending binges.

  • Economists have argued about the reasons, pointing at everything from the internet to the lack of unions to globalization to the way companies have invested their profits. But the end result remains the same.

The two arguments:

Debt matters ... Axios Future editor Steve LeVine warns against a "glib new gospel."

  • Steve emails: "If debt really doesn't matter, you should be able to print any amount of money without impact. But none of the glib economists will go that far. That's why I call them glib. Because they are suggesting that we go out and spend more when all they really can say is, well, inflation and interest rates are low now."
  • And Fed chairman Jay Powell said in Senate testimony last week: "[I]t is widely agreed that federal government debt is on an unsustainable path. As a nation, addressing these pressing issues could contribute greatly to the longer-run health and vitality of the U.S. economy."

Debt doesn't matter ... Axios chief financial correspondent Felix Salmon: "There is no evidence from 240 years of American history that the level of the national debt has ever really mattered."

  • "The U.S. prints its own currency and can borrow as much as it likes, increasingly from domestic investors. Per Buffett, deficit hawks have preached doom for decades. They have never been proven correct."
Expand chart
Data: FactSet: Chart: Lazaro Gamio/Axios

1 fun thing: A man named Ian Hammond proposes improving American's balance sheet by selling Montana to Canada. The price? Just $1 trillion.

Go deeper

Michigan board certifies Biden's win

Poll workers count absentee ballots in Detroit, Michigan on Nov. 4. Photo: Salwan Georges/The Washington Post via Getty Images

The Michigan Board of State Canvassers certified the state's election results on Monday, making President-elect Joe Biden's win there official and granting him the state's 16 electoral votes.

Why it matters: Republican Party leaders had unsuccessfully appealed to delay the official certification, amid the Trump campaign's failed legal challenges in key swing states.

Biden to nominate Janet Yellen as Treasury secretary

Photo: Photo by Alex Wong/Getty Images

President-elect Joe Biden is preparing to nominate former Fed Chair Janet Yellen as his Treasury Secretary, four people familiar with the matter tell Axios.

Why it matters: Yellen, 74, will bring instant economic celebrity to Biden’s team and, if confirmed, she will not only be the first female Treasury Secretary but also the first person to have held all three economic power positions in the federal government: the chair of Council of Economic Advisers, the chair of Federal Reserve and the Treasury Secretary.

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AstraZeneca and the University of Oxford on Monday reported promising efficacy data for their COVID-19 vaccine, which has less stringent storage requirements than the Pfizer and Moderna vaccines and may be distributed earlier in developing countries.

Axios Re:Cap digs into the state of vaccine and therapeutics manufacturing with Bob Nelsen, a successful biotech investor who on Monday launched Resilience, a giant new pharma production platform that he believes will prepare America for its next major health challenges.