We will tank the economy if we continue to grow debt expenentioally. I’d say he best bet is to find a happy medium. We are a ways off from that happy medium currently.
National Debt
- Thread starter tlwwake
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We will tank the economy if we continue to grow debt expenentioally. I’d say he best bet is to find a happy medium. We are a ways off from that happy medium currently.
It spirals out of control when demand exceeds supply. The constraint is real resources not monetary resources.
Yeah, for stable price levels, ideally it should grow by the amount the private sector desires to save.
Step 1 determine the size of government you want.
Step 2 finance it via a mix of taxes and borrowing
Step 3 if inflation is too high increase taxes if unemployment is too high decrease taxes
Step 4 you don't have to fiddle with taxes as much if you use buffer stocks such as a jobs guarantee and strategic reserves and government purchasing power to stabilize inflation and unemployment
“Coats is the latest national security official to warn of security risks posed by the national debt, which is now roughly $20 trillion [February]. A slew of former intelligence and military leaders have insisted that a fiscal crisis involving rising borrowing costs spurred by the ballooning national debt could leave the U.S. vulnerable to attack.
Former Joint Chiefs of Staff Chairman Mike Mullen in 2010 called the national debt "the most significant threat to our national security." And former Pentagon chiefs Leon Panetta, Chuck Hageland Ash Carter wrote to Congress in November opposing the GOP tax plan, citing concerns about its debt impact.
Former Joint Chiefs of Staff Chairman Mike Mullen in 2010 called the national debt "the most significant threat to our national security." And former Pentagon chiefs Leon Panetta, Chuck Hageland Ash Carter wrote to Congress in November opposing the GOP tax plan, citing concerns about its debt impact.
Pretty sure the only code I cracked was what posters not to go to for economic and financial advice.
Appeal to authority fallacy.
Again those guys are worried about the debt because they think it will prevent them from.getting appropriations. They are right to be concerned, but not because the debt, because fiscal Hawks in Congress who don't understand functional finance will see a high debt and won't appropriate money. The real security threat are the fiscal Hawks.
You can’t evaluate debt without evaluating who owns the debt. Those ratios have changed dramatically over the last 3 decades.
The more of your debt that’s controlled by foreign interests, the more exposed you could potentially be.
Economics will teach you there are limits and adjustments to everything. So, to think we can continue onward with no limits or adjustments (natural or manipulated) isn’t the smartest play here.
If anyone can figure out this solve without tanking the economy, I will buy you a beer.
The more of your debt that’s controlled by foreign interests, the more exposed you could potentially be.
Economics will teach you there are limits and adjustments to everything. So, to think we can continue onward with no limits or adjustments (natural or manipulated) isn’t the smartest play here.
If anyone can figure out this solve without tanking the economy, I will buy you a beer.
The thing that stood out the most to me was that economists are never the people sounding the national debt alarms. It's the pols and career bureaucrats that need big government checks to fund their stuff.
Forgive me for being blunt but you are talking in circles here. Monetary resources are proxies for real resources. How many ever units of currency denominate the underlying "real resources" debt is a pledge of the assets and/or the income derived from those assets.
While you temporarily get away with diminishing the cost of the debt by creating more currency, you immediately pay the price when you have to refinance that debt - in other words unless you are paying it all of at a discount by currency manipulation you really aren't doing yourself any favors, at least from a fairly naive point of view.
Debt is a pledge of monetary resources, not real resources. Monetary resources are a poor proxy for real resources.
I don't want my point here to be distracted from by hypotheticals about $150 trillion helicopter drops. The points here are
1. The government can always meet its monetary obligations.
2. The only danger posed by "excessive debt" is to price level.
3. Inflation and unemployment rates are better indicators for fiscal concerns than monetary figures are.
