If there are no limits on US gov't debt...

Post Reply New Topic

If the US government can run up as much debt as it wants, then why have taxes?

To oppress the masses.

That's very true. If the US government weren't out to oppress the masses, then it would borrow unlimited amounts of money from China, and then give it all to us so that we could live like billionaires.

Because if they keep running up debt, they have to either 1) default on the debt, or 2) pay it back by inflating the currency, which reduces the value of the currency. Currencies are based on trust - people expect them to hold their value. If things get way out of whack, investors pull out their money and real capital becomes scarce.

Because eventually there is a limit to how much debt a government can take out, and we're getting close to reaching that limit.

While I know it's fun to make US public debt jokes, as a percentage of GDP we really aren't as bad as some other developed countries.
http://en.wikipedia.org/wiki/List_of_co ... ublic_debt

We are not the worst, but you can't be the world's reserve currency and be anywhere near the top of that list (or bottom of the barrel).

Did anyone really expect a sane, rational result from a system that is clearly insane? Oh, I forgot, most people DO believe the hype. What else is there to believe?

I notice that in the UK, the same bankers who a couple of years ago were getting millions of pounds in bonuses and knighthoods for their 'services to banking' are now resigning because of the mess they made. It's not as if there weren't and haven't been those who have been critical of the short-sighted greed encouraged by the unregulated system. Plenty of unheeded warnings, as there always is, that it would end in tears.

Maybe we ignore the obvious flaws of the systems we live by because we think *we* may be able to profit from them. It's the 'others', those inferior to us, who will lose out.

Or maybe it's too unpleasant to face the true horror of the situation. Our leaders stumble from one predictable scandal to another. Perhaps it's power has been lost as it's an often repeated cliche, but the one thing scarier than our own (also unthinkable) mortality is that the lunatics have truly taken over the asylum.

You neglect to mention Option 3: borrow money to pay the debt on the borrowed money. There is no need for the spiral to come to an end. Why shouldn't we just all enjoy ourselves, and not worry?

Oh, and by the way, the definition of a Flaming Liberal is anyone who perceives any flaw in option 3, to which all good conservatives ascribe.

The issue with option 3 is that it is well known as a "Ponzi scheme" and it can fall apart.

The description of a person who finds a flaw with option 3 is an intelligent person. Good conservatives actually tend to hold to a ridiculous supply side economic dogma that always holds that we are on the right of the Laffer curve.

I'm surprised Japan comes second only to Zimbabwe.

http://en.wikipedia.org/wiki/Japanese_a ... ice_bubble

Thatcher is partly to blame for what happened in US, UK and worldwide. She was responsible for a deregulation that effectively enabled a fusion of retail banking with banking proper. This happened in the UK first (interestingly it was mainly US banks that were taking advantage of this), until the US copied this model and went further. The main problem is that these two different disciplines hardly understand each other and have different values, in fact there are very few that understand the complexity of the bigger picture and those that did it wasn't in their interest to do anything about it.

There are alway limit on anything. You think if you borrow from china they are not going to want anything in return. Think again.

You're an idiot. Good conservatives consider public debt to be even worse than tax-and-spend. Only a moron would think otherwise.

Here, let me disrupt your ignorance a bit.

The problem in the USA all arose because of an explosion in mortgages lent to people who simply could never be reasonably expected to pay them. Why was this done--because government passed laws like the Community Reinvestment Act, which imposed additional regulations on banking that required them to extend bad mortgages. In order not to be left holding these bad mortgages that the government had forced upon them, they sold said mortgages to speculators. Speculators found willing morons to buy these up in bundles. The mortgages are now defaulting by the millions, which any non-idiot would have expected.

Deregulation is not at fault here--exessive regulation is at fault.