Because debts must be paid off, it's just smoke and mirrors to talk about the US national "debt". - Politics Forum.org | PoFo

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Everything from personal credit card debt to government borrowing debt.

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#15102004
Nobody with a brain who actually thinks about it believes that the US national debt will be paid off someday.

Right off I must be clear with you. People who threaten voters with a future need to "pay off" the national debt MEAN to pay it off with dollars of tax revenue. We can't pay it off with dollars that we have borrowed. That is just rolling it over forever. This means to cut spending and raise taxes to have a surplus.

My new point is that because it can never be paid off and does not ever need to be paid off; that it is no longer proper to call it a "debt". We need a new word for it.

ACTUALLY, the so called US national debt is just all the dollars the US has spent and not collected back with taxes and fees. It is assets of some people in the US economy or some foreigners.
. . . The US is not on the gold standard and this is a huge difference. All paper and electronic dollars are just IOUs that can only be redeemed to extinguish your tax liabilities. They have zero real value. US bonds are also just IOUs, but they pay interest and will be redeemed at maturity for electronic dollars, which are also IOUs.
. . . The proposed process to pay off the US national debt is to tax the rich** to give them one kind of IOU in exchange for another kind of IOU. When you think about this is is just stupid. Tax rich people to pay rich people off. ?? Why do this?
. . . ** I said tax the rich because the poor don't have $24T to tax away from them. And the working poor don't either. The upper Middle Class have some wealth, but not enough. Only the super rich and rich have this level of money.

I say it is just "smoke and mirrors" because experts must be aware of this and are just hoping to fool you into being scared of something.

The austerity in the EU & EZ clearly shows that just a deficit that is too small will ruin the economy. The US national debt is over $24T now and growing fast in this covid crisis. To pay it off we would need to have a surplus for over 48 years if the surplus was just $500B/yr.
. . . It is economically impossible to do this. Austerity on this level would cause a Depression that would last for 48 years.
. . . It is politically impossible because the rich would not allow themselves to be taxed to do this and taxing everyone else like that for 5 years would cause a political revolution or a violent one.

There is a way though to pay the US national debt off, but is not what the economists are saying to do. The only way to pay off the US national debt is with dollars created by the Gov. as the issuer of a fiat currency. Basically by using the magic money tree to the tune of $24T.

Yes, I know there is a saying to the effect that, "There is no magic money tree."
But actually there is one. You don't realize it because the experts have used smoke and mirrors to hide it from you.

They have a few reasons for this. The only one that is not smoke and mirrors is ---
the real fear that the American people will make politicians use it so much there will be hyperinflation. My response is to point out that politicians use the magic money tree to "pay for" tax cuts and bail outs for the wealthy, and some crumbs in the current covid crisis for everyone else.
. . . All I'm asking for is for it to be used to benefit all American and not just the wealthy. I'll risk inflation for that. And the American people will be smart enough to *not* cause hyperinflation.

Ask me about interest rate on bonds.
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#15102678
Because the US and other nations are off the gold standard, the world should have been changed. But it wasn't.

This impacts the concept of a "national debt", which was always also financial assets of the bond holders.

My point is that it is silly to talk about paying off the US national debt (with revenues from taxes).
It can be rolled over forever and the US can easily control the interest rate it is willing to pay.
It can be paid with dollars that are created out of thin air by the US Gov. which has a fiat currency.
It can't be paid off by taxing the bottom half of the people, we don't have enough money to allow this no matter how long it is stretched out.
It can't be paid by taxing the super rich because they will not allow it politically.
It can't be paid by taxing the middle class because this would cause a depression until the taxes were dropped and deficit spending started.
To talk about it indicates a desire (on the part of an expert, not someone who is blindly following experts) to use smoke and mirrors to do something else. Something they want to sneak past the minds of the masses. The experts will say "TINA (there is no alternative) we have to do this", when in fact there are several alternatives.

Don't be fooled again. The experts have fooled the nation for 40 years, we need to draw a line in the sand and say "NO LONGER".

Somehow when the GOP wants to cut taxes on the rich that will add to the deficit they don't care that this is the opposite of working to pay off the national debt.
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