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- Jun 13, 2009
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A national surplus would be better for the country.
Can you imagine collecting real interest? Reducing burdens for everyone?
My savings could use a good interest rate increase.
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A national surplus would be better for the country.
1. Debt enriches the private sector.
When the government issues debt, it spends the same amount of money as the amount it borrows. Money flows from the private sector through the government, and back into the private sector again. No money is lost or made in this process. The only net result is the creation of new treasury bonds, which enrich the private sector.
2. The debt need not be paid back.
So long as people want to hold government bonds, and the government can afford to pay the interest, there is no need for the government to pay back money it's borrowed in the past.
3. Paying interest does not make the country poorer.
When the interest is paid to Americans, there is no net result. When it's paid to foreigners, they can save the dollars or spend them on American goods and services. Either way it's good for us.
4. Debt is the basis of our financial system.
Dollars are backed by US debt. If the debt were paid off, it would result in the collapse of our economy.
5. We can't default on our debt, unless it's voluntary.
Our debt is denominated in dollars. We can create as many as we want. Therefore we can't run out of dollars to pay our debt.
6. We are not "borrowing from our grandchildren."
Should our grandchildren choose to pay down our debt (and there's no reason why they should), the payments will go to our grandchildren, not to us. (We'll be dead by then.)
7. When the government issues debt, it enriches the private sector, which encourages people to spend and invest. When people spend and invest, they create jobs and improve the economy.
Yeah Right-- We see how well that's working with Obama's flood the basement economic policies--specifically his 1 trillion spent on an economic stimulus bill.
The Federal Government is currently borrowing .43 cents on every dollar it spends. Today there are 18,000 baby-boomers entering social security and medicare resulting in another 64 TRILLION in unfunded liabilities--resulting in $534,000.00 per household debt in America.
In 10 years--even after this debt ceiling bill passed we will be 21 TRILLION in debt.
View attachment 14475
1 billion dollars--$100.00 bills stacked on palets.
View attachment 14476
1 trillion dollars--$100.00 bills stacked on palets. NOTE--how small the man is in this chart.
Just multiply the trillion dollar chart by 21 to get a real good look at our debt in 10 years--
You can't keep creating something from nothing.
Before long, something will come calling on nothing.
And if nothing never asks anything of something, then something eventually becomes nothing.
Except for the fact one of the biggest problems with running such a high debt is the US dollar gets devalued. When that happens the rest of the economy takes a major hit. People buy less since their money doesn't go as far anymore, that means less demand and less jobs, and the economy spirals from there. Even in a business running a debt isn't good, because if the economy takes even a little hit then you're screwed. But run your business on cash and you can make a killing during that type of economy, buying up all of the failing businesses dirt cheap.
Spin it any way you want, debt is never good in any situation.
It is official, the left is delusional. This mentality is demonstrates such ineptitude that it defies any rational explanation.
Can one liberal explain to me, if deficit spending and debt is so beneficial, why is it not working? Under this president deficit spending and debt has increased more than any other president, so why is economic growth stunted?
This is such a stupid, and there really isn't any other word to describe this thinking, that it is laughable if it weren't for the fact that we have a president that subscribes to this stupidity.
If national debt is beneficial what went wrong in Greece
This is so easily demonstrated to be absurd, though absurdity usually is.
7. When the government issues debt, it enriches the private sector, which encourages people to spend and invest. When people spend and invest, they create jobs and improve the economy.
7. When the government issues debt, it enriches the private sector, which encourages people to spend and invest. When people spend and invest, they create jobs and improve the economy.
You left out all the important reasons & made your argument completely one sided.
8. Increasing debt = Inflation. This is bad for most especially fixed income & savers. It is earnings & savings theft. A cruel tax. If the USG is going to print money then they should pay it to the people who they stole the value from. The savers. All that newly created currency should not go to government cronies first. They are getting to spend it first before inflation sets in. That is criminal in so many ways.
9. China is artificially devaluing their currency creating a de-facto export subsidy & import tariff. They have found a way around the WTO policy on protectionism.
Name calling is not a substantive response. If you think I've said something delusional, you should say what it is.
If name-calling is just your knee-jerk reaction to reading something you don't understand, you should try to understand it so you can make an intelligent response.
Any number of liberals - or just plain economists - could explain it to you, if you read what they had to say.
Here's Paul Krugman, yesterday:
Given a crisis that should have been relatively easy to solve and, more than that, a crisis that anyone who knew macroeconomics 101 should have been well-prepared to deal with what we actually got was an obsession with problems we didnt have. Weve obsessed over the deficit in the face of near-record low interest rates, obsessed over inflation in the face of stagnant wages, and counted on the confidence fairy to make job-destroying policies somehow job-creating.
The Greek and US situations are vastly different. For one, people are perfectly willing to lend the US money. Treasury rates are at historic lows. For another, our debts are denominated in our own currency.
My knee-jerk reaction to reading something that has no basis in reality is to say that it is delusional. What you have stated in the OP is absurd, and stating so is a substantive response.
If national debt is beneficial to economic growth, why isn't it working? The democrats had a decisive majority in Congress and held the presidency for two years, during which time they increased the national debt more than any other administration in history. Where are the benefits?
If national debt is beneficial, why is it cited every single time as the reason for possible for loss of America's AAA credit rating?
Paul Krugman is in the minority of economists who believe that borrowing 40 cents on every dollar spent is something that can be sustained indefinitely. When it comes to global warming I'm sure you would shout consensus, well a clear consensus of economists believe the current situation is going to lead to inevitable default, credit rating downgrade, ect.
Maybe they are debt deniers?
The mortgage crisis had nothing to do with Democrats or low-income housing. It had everything to do with fraud and wishful thinking on the part of private companies like Lehman, Goldman, AIG, and Ameriquest.
The money the US lent GM was not from TARP, it was not a gift, and it was not $500 billion. It was not meant to prevent GM's bankruptcy. It's what allowed GM to be able to reorganize.
Government jobs are not increasing, they're decreasing. And they're decreasing because state governments are slashing their budgets, not because they're hiring more And unemployment is going down, not up, though it's going down slower than it should.
100% of what you said was wrong.
- Our grandchildren didn't loan the money, so why would it go to them? The money was loaned from China, it will go to China. You are absolutely STEALING from your grandchildren.1. Debt enriches the private sector.
When the government issues debt, it spends the same amount of money as the amount it borrows. Money flows from the private sector through the government, and back into the private sector again. No money is lost or made in this process. The only net result is the creation of new treasury bonds, which enrich the private sector. - That's funny, that is "Trickle Down" Economics, which your party swears on their very life doesn't work. It's the reason you people have attacked Reagan for 30 years. Suddenly you're claiming it does work? Well I'll be damned....
2. The debt need not be paid back.
So long as people want to hold government bonds, and the government can afford to pay the interest, there is no need for the government to pay back money it's borrowed in the past. - And so long as German's were turning their head, nobody cared that Jews were being exterminated by the millions. The point is - the debt is deadly, debt like this collapsed the U.S.S.R. and just collapsed Greece, people are not going to "hold" the bonds, and the bill is now due.
3. Paying interest does not make the country poorer.
When the interest is paid to Americans, there is no net result. When it's paid to foreigners, they can save the dollars or spend them on American goods and services. Either way it's good for us. - Right, and eating 73lbs of fast food 3x's a day does not make you any fatter. There is no need to respond to a statement this asinine. If you believe China is going to spend $1 on American "goods and services", I have thousands of brindges in China I'd like to sell you.
4. Debt is the basis of our financial system.
Dollars are backed by US debt. If the debt were paid off, it would result in the collapse of our economy. - Right, and women love being raped. They just don't know it yet. We just need to rape them so they will realize how much they enjoy it. Again, a comment this asinine doesn't even need a response. Our economy is collapsing because of the debt. Our economy would flourish if the debt were paid off and the nations budget balanced each fiscal year.
5. We can't default on our debt, unless it's voluntary.
Our debt is denominated in dollars. We can create as many as we want. Therefore we can't run out of dollars to pay our debt. - That's what Mexico thought. Now the Peso is worth about as much as a grain of sand. What you Marxist/Socialist/Communist don't understand is that something is only valuable if it is rare. If we just print off trillions of dollars tomorrow, those dollars cease to be rare and thus are not worth the paper and the ink used to print them.
6. We are not "borrowing from our grandchildren."
Should our grandchildren choose to pay down our debt (and there's no reason why they should), the payments will go to our grandchildren, not to us. (We'll be dead by then.)
I don't know I would say debt is good but there's a lot of truth in what you say. Running a business or the government of a cash basis means you bypass a lot a lot of good things, like the putting a man on moon and the interstate highway system. However, when you consistently grow debt faster than GDP growth, you will have problem. Interest will become such a large expense that it threatens your ability to continue borrowing and your credit standing with your lenders.
There is a point where debt becomes a problem. But we're not there. Japan has twice the debt that we do, as a ratio to GDP, and interest rates even lower than ours. Our interest rates are at historic lows, and the amount of interest we're paying is manageable.
Reducing unemployment, on the other hand, would improve the governments situation, because it would bring in more income in the long run.