How will the US pay back its debt? - Page 4 - Politics Forum.org | PoFo

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Everything from personal credit card debt to government borrowing debt.

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#14922358
Crantag wrote:Good and well. I don't come here to argue I come here to try and learn. I think you just like to argue.

Americans aren't anything special. I just don't want others around the world to suffer for Americans to continue enjoying exhorbitant privilege.

But mostly I am just a realist. What I or anyone else may or may not want is actually quite irrelevant.

Actually I come here more to teach at least for MMT.
#14922460
Americans aren't anything special. I just don't want others around the world to suffer for Americans to continue enjoying exhorbitant privilege.


What is it that you want? What do you want the American people to do? Do you want them to not act in what they see as their self-interest? That is sort of what countries are all about.
#14922649
Drlee wrote:What is it that you want? What do you want the American people to do? Do you want them to not act in what they see as their self-interest? That is sort of what countries are all about.

Was it really in the US self-interest to invade Iraq?

The US is now a lunatic state, with a broken system of government. The system, through the coincidence of mass populism on appeal to reaction and outright and transparent corruption, resulted in the presidencies of George W. Bush, and now Trump.

The US is stuck in an a range of institutional pathways which include the rise of faux democracy and persistent militarism, as well as systemic collusion between the government and the most powerful moneyed interests, has corrupted everything.

Has deindustrialization worked in American's self-interest (as opposed to the moneyed class which pushed the process)?

I don't even buy the premise. Americans aren't even so much as empowered to act in their self-interest, if they could even so much as figure out what that self interest is--which they can't.

But there's something else here. Remember that rightwing meme: 'America; love it or leave it.' I for one packed my bags and left it, and I have seldom looked back. So you'll have to excuse my lack of sadness at the ongoing rot of the US.
#15015753
rik wrote:This is pretty much what is going to bankrupt America.
The debt has to be service, no matter what. That means Americans are eventually going to be working to serve the interests of other nations, such as China, Japan, and the UK.

There is one possibility of paying off the debt...

Start drilling for oil like Norway and Canada are doing, and cut government spending simultaneously.

It is not my intent to pick on rik, here. He wrote that 8 years ago.

I'm no expert on economics or economic history.
As far as I know, the US is the only nation ever to pay off a large national debt with tax dollars.
There may have been some that won a war and looted the loosers.

Based on just my 70+ years of learning (and 10 min. of googling), the history goes like this ---
1] During the Revolutionary War the US Gov. and the states ran up a large debt.
2] We won. Under the Articles of Confederation the US Gov. had no taxing power, so it could not even try to pay-off the debt.
3] After the Constitution went into effect Alexander Hamilton convinced Pres. Washington to take over the state debts and then tax enough to pay-off the whole debt.
4] At this time the US was the owner of all the land east of the Mississippi River and west of the 13 states. All it had to do was move the Native Americans off *their* land, and then the Gov. could sell it to pioneers.
5] The Gov. did this in the early 1800s. But, it sold the land to rich speculators who then resold it to the pioneers. This was very profitable. This ended with the Homestead Act that went into effect late in the Civil War or after it.
6] Hamilton had also convinced Washington to have a protective tariff. This tariff brought in a lot of money. This was added to the money from land sales and whiskey taxes.
7] Therefore, the US often ran a surplus that was used to pay-down the debt.
8] In the mid 1830s the debt was all paid off, during Andrew Jackson's presidency.
9] However, in 1837 the worst depression (bank panic) of the 19th cent. started and it lasted for 8 years or so. Some economic historians even say this depression was worse than the Great Depression. Remember I'm no expert.

MMTers will tell you that this is not a coincidence. That the panic was *caused* by the surplus.
MMTers say that a surplus, by accounting identity, must shove the non-Gov. sector of the economy into deficit. So, the people to keep the GDP flat must borrow from banks. At some point the people can't keep borrowing because their income is flat because the economy is flat. When this happens [i.e., that the people have to borrow less than they did last year] the GDP falls. When this happens comp. lay people off and farmers get less for their crops. When this happens the GDP falls more. [We can see this process in Europe since 2010.] This is repeated year after year as the GDP spirals down and down. Often it ends when the nation starts a war and the wartime deficit spending reawakens the economy and the GDP goes up. {Note here that, the Mexican War can be said to have ended the depression of 1837.}

So, my point is --- even the richest nation the world had ever known to that time [because of the value of the western lands] could not pay-off its large debt with tax dollars [i.e., including $$ taken in exchange for land] without causing a depression. How much harder will it be for the US now when it has no valuable land left to sell?

The US national debt can never and will never be paid-off with tax dollars. It can only be paid-off with newly created "money tree dollars". And this may not be a good idea either.
. . . OTOH, the US can never go bankrupt because it has access to the magic money tree.
. . . But it is important that that tree must not be harvested too much, if it is there will be hyperinflation and this is bad, but even this can be solved as Germany did after its hyperinflation. It did this even before the rise of Hitler.
#15016012
Based on just my 70+ years of learning (and 10 min. of googling), the history goes like this ---


Rare post on POFO.

Hey Diogenes, he's over here!
#15051896
Andropov wrote:It is mathematically impossible at this point, as this article suggests?: http://theeconomiccollapseblog.com/arch ... ional-debt

What happens if the country just keeps borrowing and borrowing and raising the debt ceiling higher and higher?

Not to worry.
https://www.thestreet.com/story/1353443 ... -debt.html
#15051907
Crantag wrote:Like talking to a brick wall.

The US doesn't 'act like an empire.'

The US is an empire.

I'm not looking for ways to make America better. America is a lost cause.

I'll tell you where we disagree, or as it seems to me.

You believe in the lie of 'American exceptionalism'. You also expect others to do so.

I don't.

And I never suggested the US slash the war budget. I never suggested this because I live in the real world and I know that is not going to happen.

The US is slowly crumbling. Too slowly, though, for my liking.


Another post I wish I could like 100 times but I can only do so once!

Yes, Crantag, you are a very thinking man. I try to come here too to learn something. Debating is fun if the opponent is also willing to think hard and bring forth a thoughtful rebuttal. If you have a bunch of people without any interest but in insults and being aggressive when they are found out to be liars? It is not worth anyone's time.

You I always learn from a lot.

The problem is I can't debate you much because I agree with you most of the time.

Ha, ha.
#15051928
Andropov wrote:It is mathematically impossible at this point, as this article suggests?: http://theeconomiccollapseblog.com/arch ... ional-debt

What happens if the country just keeps borrowing and borrowing and raising the debt ceiling higher and higher?



Great nations, empires, and civilizations often end. The main cause is loss of social cohesion fragmentation, division, balkanization, loss of values, etc. It happened in Greece and Rome

1. People on the left that want to spend even more money. They want everything free for everybody and that will be paid by the rich people.
2. People that depend on government programs will never agree to spend less.
3. Non-conservatives like Trump do not care, he used to be a democrat.
4. Social and moral decay which leads to citizens that want the USA to fail. They are the bitter people filled with envy.

The loss of cohesion is a big one. There is no national pride among 50% of the population. These folks think the American flag is as racist as the Confederate flag.

JFK said:
Image

Not true anymore. The left wants the country to do anything for them and that is very costly.


It does not look good.
#15052205
Julian658 wrote:
People on the left that want to spend even more money.



Reagan did a massive increase in military spending. But the kicker is that while spending increased dramatically, he reduced taxes. That turned us from being the world's largest creditor, to the world's largest debtor.

The 2 Bushes did war, and tax cuts. Which also made for a massive increase in the debt.

Clinton did neither. He actually did a tax increase, and the economy got better. Confidence, anyone?

This is a perennial. Republicans throw trillions away on stupid wars and tax cuts.

But if Dems want to spend a dime, it's time for wailing and moaning and gnashing of teeth.

In the unlikely event you do look, you will see Obama. But he didn't create that mess, he was just trying to dig us out of it. If you want to slide further out that branch, given the dominance of the financial sector in politics, changing party would have made no difference.

Guys from the finance sector would have run the show (as they were doing when Bush 2 was president) and their top priority is always covering their tukus.
#15052568
Steve_American wrote:8] In the mid 1830s the debt was all paid off, during Andrew Jackson's presidency.
9] However, in 1837 the worst depression (bank panic) of the 19th cent. started and it lasted for 8 years or so. Some economic historians even say this depression was worse than the Great Depression. Remember I'm no expert.

MMTers will tell you that this is not a coincidence. That the panic was *caused* by the surplus.
MMTers say that a surplus, by accounting identity, must shove the non-Gov. sector of the economy into deficit. So, the people to keep the GDP flat must borrow from banks. At some point the people can't keep borrowing because their income is flat because the economy is flat. When this happens [i.e., that the people have to borrow less than they did last year] the GDP falls. When this happens comp. lay people off and farmers get less for their crops. When this happens the GDP falls more. [We can see this process in Europe since 2010.] This is repeated year after year as the GDP spirals down and down. Often it ends when the nation starts a war and the wartime deficit spending reawakens the economy and the GDP goes up.

Right. Under the current debt-money system, when households and firms don't want to undertake more debt, government has to do it to stave off deflationary collapse. This is an inherent fault in the debt-money system that is caused by its inescapable positive feedback mechanism.
So, my point is --- even the richest nation the world had ever known to that time [because of the value of the western lands] could not pay-off its large debt with tax dollars [i.e., including $$ taken in exchange for land] without causing a depression. How much harder will it be for the US now when it has no valuable land left to sell?

It could be done easily by just rescinding private banksters' privilege of creating debt money de novo in order to charge interest on it, and gradually replacing the existing stock of debt money (equal to the total value of outstanding bank loans) with debt- and interest-free fiat money issued by an independent Mint whose sole mandate is price stability. Paying off the national debt with tax money is as inadvisable as making a souffle using chicken instead of eggs.
The US national debt can never and will never be paid-off with tax dollars. It can only be paid-off with newly created "money tree dollars". And this may not be a good idea either.

It's an incomparably better idea than trying to maintain the current debt-money system, thus enabling and subsidizing bankster parasitism.

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