A Polite Discussion Addressing the Pro Tariff Arguments

[Ponca Dan]

The idea that tariffs are passed on to consumers is Sean Hannity silly. Not tax or tariffs are ever passed on to consumers. If you believe that you are in fantasy land.

For someone to believe that you have to believe that corporations are not interested in extracting maximum profits. They are. They charge the very maximum they think the public will accept. Right now.

Right now.

An increase in their business expense has no calculation on that amount.

I believe you said you are a teacher. Please, please, I beg of you, don’t tell me you teach economics.

 

[brtinla]

I am an expert, the very best on economics. The very best. It is my favorite subject. Ask me anything you want. Please.

 

[HighStickHarry]

I am an expert, the very best on economics. The very best. It is my favorite subject. Ask me anything you want. Please.

What, if any, will the consequences of a 20trillion dollar debt be? What about the forty trillion dollar debt that we will have when trump leaves office? The 80 trillion dollar debt when Nikki Haley leaves office?

 

[brtinla]

What, if any, will the consequences of a 20trillion dollar debt be?

Great question. The answer is none. The United States is still paying for debt from the Civil war, and it always will in perpetuity. The United States will always grow it's debt. We always roll it over, It will one day reach 100 trillion. We are not alone in this in the advanced world, and it does not matter.

First of all, the vast majority of US debt is held by the Federal Reserve. SO we owe most of the debt to ourselves. The FED pays the interest on the debt right back to the Treasury.

2nd: Since we have our own currency, the debt cannot ever be defaulted on, since the FED could always monetize debt payment with investor confidence

3rd: Since we are the world's only reserve currency, debt levels don't rattle the currency markets. They do in places like Greece, (who don't have their own currency) or other developing world currencies whose bonds are ALWAYS tied to the dollar

4th: Current USA national level GDP to debt ratio is high, but not higher than it was in 1945. We have done pretty well since then.

Don't worry about the debt.Worry about the those who worry about the debt screwing up policy.

 

[brtinla]

As an aside, having a balanced budget is ok, but only in the short term. We would not want to maintain a balanced budget for very long. We definitely would not want to pay down our national debt for long. We would cherry pick the older more expensive maturities, but after that a good Treasury Sec would ask for lower taxes and increased spending to get a deficit again.

Massive sectors of our economy depend on government debt. Insurance is the biggest example. They couldn't properly structure their actuarial driven model without Treasury debt.

 

[HighStickHarry]

Great question. The answer is none. The United States is still paying for debt from the Civil war, and it always will in perpetuity. The United States will always grow it's debt. We always roll it over, It will one day reach 100 trillion. We are not alone in this in the advanced world, and it does not matter.

First of all, the vast majority of US debt is held by the Federal Reserve. SO we owe most of the debt to ourselves. The FED pays the interest on the debt right back to the Treasury.

2nd: Since we have our own currency, the debt cannot ever be defaulted on, since the FED could always monetize debt payment with investor confidence

3rd: Since we are the world's only reserve currency, debt levels don't rattle the currency markets. They do in places like Greece, (who don't have their own currency) or other developing world currencies whose bonds are ALWAYS tied to the dollar

4th: Current USA national level GDP to debt ratio is high, but not higher than it was in 1945. We have done pretty well since then.

Don't worry about the debt.Worry about the those who worry about the debt screwing up policy.

If this is true, it is nothing short of evil that anyone in this country wants for anything. There should be government funded every service you can think of on every street corner.

 

[brtinla]

Ummm no. Unlimited debt has consequences. The point is to grow the economy faster than as a percentage of gdp than the debt level. Thus while the number rises, the true level is constant, manageable or ideally declining.

 

[HighStickHarry]

You lost me.

 

[brtinla]

You lost me.

The true measure of national debt is not it's amount but percentage to annual GDP. If you make 1 million a year, 60,000 in credit card debt is nothing.

If you make 100k a year, 60k is a potential problem.

 

[CoastGuardCowboy]

President Trump is going to pay off the debt!

 

[HighStickHarry]

The true measure of national debt is not it's amount but percentage to annual GDP. If you make 1 million a year, 60,000 in credit card debt is nothing.

If you make 100k a year, 60k is a potential problem.

So if true, was adding 1.5 trillion to the debt over ten years for trump tax cuts and another 1 trillion in potential infrastructure spending within the parameters to worry about or not worry about?

 

[Pancreek1]

Debt to GDP when Obama took over = 67%
Debt to GDP when Obama left office = 106%
Debt to GDP today after 1 year of Trump = 105%

The infrastructure spending will pay dividends in added taxes and might even be deficit neutral. Even the Dems wanted to take credit for a trillion of infrastructure.

Let's make a bet on where the deficit is when Trump leaves office. I'll bet it is lower than he inherited. $100 bucks. Any takers?

 

[Medic007]

Debt to GDP when Obama took over = 67%
Debt to GDP when Obama left office = 106%
Debt to GDP today after 1 year of Trump = 105%

The infrastructure spending will pay dividends in added taxes and might even be deficit neutral. Even the Dems wanted to take credit for a trillion of infrastructure.

Let's make a bet on where the deficit is when Trump leaves office. I'll bet it is lower than he inherited. $100 bucks. Any takers?

You talkin crazy!