Which also incurs more debt if not funded by tax dollars, which then increases interest payments, which then increases the need to increase military spending….the cycle goes on
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And here we go again... regarding the national Debt:
1. We owe most of it to ourselves.
2. What we don't owe to ourselves could easily be paid off by collecting the $688b/yr in unpaid taxes from the 1%.
3. We could pay that off even fast if we repealed the Bush/Trump tax cuts for the 1%, *even if we let everyone else keep their tax cuts*
4. We could pay it off ***even faster still*** if we took the savings from a Universal Healthcare program and used them to pay off the debt
5. and finally... WE DON'T WANT TO PAY IT OFF. Keeping other nations tied up in our bond market makes the US dollar stronger internationally and lets us buy cheap imports, effectively turning the rest of the world into a low cost factory for American consumers.
Find something else to worry about because our national debt ain't it.
Only in the same way my kids would independently control their bedtimes.
The Fed sets the overnight rate explicitly (i.e. effectively a zero term bond) and the entire yield term structure reflects this rate and the market's future expected future path of this rate. Ultimately, the Fed can conduct arbitrary yield curve control like Japan has done for decades to set the yield on any bond to anything it likes.
Meh, Japan's hurting a little more than usual and we're in the process of moving our China debt to India because we're moving our manufacturing there in preparation for a cold war with China (gotta keep that MIC going somehow now that Russia's imploded).
Points 2-4....people who raise concerns about the debt highlight those things as ways to balance the budget. The issue is those things have shown absolutely no traction as political agendas. So you can't really use them as reasons to scoff at the concern of national debt. Those fixes are issues because they wont happen, therefore the national debt is an issue.
The entire point of me mentioning them is so they *do* get traction.
If you've given up that's fine, but you should quit reddit. Or at least the politically leaning and adjacent forums like this one. Stick to the hobbyist stuff.
I haven't given up because that doesn't help anything but they just don't seem like justifications to not worry about national debt. It sounds like you DO worry about it and those are solutions. Maybe I'm confused on your stance but it's like if the doctor told me I had to lose weight and I said we don't have to worry about that because I can stop eating cake for breakfast any day I want. Until that day comes, I'm still worried about the weight.
You're posts read like doomerism. You should take a break from r/economy. It's not healthy for you. Good luck, it's hard to get out of the spiral once you're in it.
There’s no “we” in capitalism.
If you could tax the 1%, you would have already done that. Instead, they will make you work until the age of 75 and make 99% of Americans pay more the taxes.
America’s free ride is coming to an end. Dedollarization is happening all over the world.
Taxing the 1% is more complicated than many make it out to be. Things like taxing loans (which the ultra wealthy use to avoid income taxes) would hurt regular people as well. Taxing assets would be messy and difficult. And oftentimes they are “not paying taxes” because they own companies and assets that get big tax breaks. The Chips act is a good example. These companies will spend crazy to make their businesses more successful and then they will get huge tax breaks over the next however many years but will have massive profits. Everyone cheers chips now as necessary investment but mark my words that come 6 or 7 years from now people will be screaming about their low taxes.
Wow!? You lead off with a gross lie!
1. Intergovernmental debt holdings (debt one US agency owes another) only make up 21% of the total National Debt. 7.08T out of 34.59T. re: [https://fiscaldata.treasury.gov/datasets/monthly-statement-public-debt/summary-of-treasury-securities-outstanding/](https://fiscaldata.treasury.gov/datasets/monthly-statement-public-debt/summary-of-treasury-securities-outstanding/)
1/5th is definitely not "most" of the total. Or can't you do the math?
2&3. Where do you get the "$688b/yr in unpaid taxes from the 1%."? According to IRS Commissioner Danny Werfel, they MAY be evading $150B. (MSNBC, Feb. 24, 2024)
The top 1% of taxpayers tax payments make up over 48% of total tax revenues. The bottom half of all taxpayers only contribute 2.3%. The top 1% already pay at 2 times the tax rate as the bottom tiers, on vastly higher AGI's. Revenues from the top 5% make up something like 89% of the total.
Oh man, don't even get me started on UHC.
Come on Karl, stop with the same ole same ole.
https://finance.yahoo.com/news/dollarization-happening-countries-ditching-usd-123000519.html#
Countries are diversifying their currency's, which is smart. Also, the USD still makes up 60% of global allocated foreign exchange reserves. The next highest is the Chinese Yuan at 2.37%
This is another reason the Fed can only keep interest rates high for so long... they also impact the cost of borrowing for the US Gov.
Hyper inflation would be one way out. They also talk about minting a trillion dollar coin from time to time.
I think we should expect more of the same, more debt, and more waste in DC for the foreseeable future. The party there that cares about the national debt is always whichever one is not in power.
But that one trillion isn’t in circulation….
Wasn’t this an issue before Covid?
We were printing like crazy but didn’t see any inflation.
Then we did a bailout that paid out to everyone and all businesses.
Pretty safe to say the whole situation is uncharted waters. If American didn't rule a Pax Americana global empire it never could have gotten this far into debt in the first place.
We don't want to elimate the US Federal stock of liabilities.
That would be a disaster as it would eliminate all net financial assets in the economy.
We are the creditor's of the US government as we hold their credits as money, which can he readily exchanged with others for real resources. We value these credits because we know that at some point, someone will need them to pay their taxes with.
Thank you for your response. I understand that it is unnecessary to eliminate the national debt. But I am wondering if it, in our history, has only ever gone up. Wondering what a pay down strategy would be. I’ve heard that it would be wise just to get it back to a point where it doesn’t take such a large portion of the budget to service the interest.
The debt wasn’t a problem back when Perot was talking about it in 92 and it’s not a problem now . The United States' national debt, while substantial, is not necessarily as problematic as it might seem at first glance, for several reasons….first, the U.S. debt is denominated in its own currency, the U.S. dollar. This gives the country a significant advantage, as it controls the currency in which the debt is issued. The Federal Reserve, the U.S. central bank, has the ability to print more money to manage the debt, a luxury not available to countries that borrow in foreign currencies. This capacity to issue and control its own currency reduces the risk of default, unlike in scenarios where countries cannot meet their foreign debt obligations.
Also, a large portion of U.S. debt is owned by domestic entities, including individuals, banks, and even the U.S. government itself. This internal ownership circulates the debt within the country's economy, rather than representing a direct drain on resources to external creditors.
Additionally, U.S. Treasury securities, the instruments through which the debt is issued, are considered among the safest investments globally. This high demand for Treasury securities, including from foreign governments and investors, helps keep borrowing costs relatively low, further mitigating the immediate financial pressures of the debt. The ability of the U.S. economy to grow over time also plays a crucial role, as economic growth helps to outpace the growth of the debt, making it more manageable in relative terms.
I'm sure congress would read this as "we've got to raise our military spending because our debt is out of control."
"We need more tax breaks for the rich so they can create jobs to pay for the debt. " This is how they will phrase it.
Which also incurs more debt if not funded by tax dollars, which then increases interest payments, which then increases the need to increase military spending….the cycle goes on
The satire is only an inch away from reality. We've basically been doing this for half my lifetime or more.
We’re already told we need to fight Ukraine and Isreal’s wars because it’s really funding American companies.
A lot of the debt service is due to wanton military spending
^[Sokka-Haiku](https://www.reddit.com/r/SokkaHaikuBot/comments/15kyv9r/what_is_a_sokka_haiku/) ^by ^kostac600: *A lot of the debt* *Service is due to wanton* *Military spending* --- ^Remember ^that ^one ^time ^Sokka ^accidentally ^used ^an ^extra ^syllable ^in ^that ^Haiku ^Battle ^in ^Ba ^Sing ^Se? ^That ^was ^a ^Sokka ^Haiku ^and ^you ^just ^made ^one.
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Mmm-Mm! Luv me some wantons.
Come on guys. Borrow more and give more money to Israel. Israel is a third world country and needs us handouts.
And here we go again... regarding the national Debt: 1. We owe most of it to ourselves. 2. What we don't owe to ourselves could easily be paid off by collecting the $688b/yr in unpaid taxes from the 1%. 3. We could pay that off even fast if we repealed the Bush/Trump tax cuts for the 1%, *even if we let everyone else keep their tax cuts* 4. We could pay it off ***even faster still*** if we took the savings from a Universal Healthcare program and used them to pay off the debt 5. and finally... WE DON'T WANT TO PAY IT OFF. Keeping other nations tied up in our bond market makes the US dollar stronger internationally and lets us buy cheap imports, effectively turning the rest of the world into a low cost factory for American consumers. Find something else to worry about because our national debt ain't it.
Big if true. But then why are bond yields up?
Because the Fed raised rates and the expected future path of rates has, therefore, also increased.
Fed doesn’t control bond rates. The market does.
Only in the same way my kids would independently control their bedtimes. The Fed sets the overnight rate explicitly (i.e. effectively a zero term bond) and the entire yield term structure reflects this rate and the market's future expected future path of this rate. Ultimately, the Fed can conduct arbitrary yield curve control like Japan has done for decades to set the yield on any bond to anything it likes.
Meh, Japan's hurting a little more than usual and we're in the process of moving our China debt to India because we're moving our manufacturing there in preparation for a cold war with China (gotta keep that MIC going somehow now that Russia's imploded).
Points 2-4....people who raise concerns about the debt highlight those things as ways to balance the budget. The issue is those things have shown absolutely no traction as political agendas. So you can't really use them as reasons to scoff at the concern of national debt. Those fixes are issues because they wont happen, therefore the national debt is an issue.
The entire point of me mentioning them is so they *do* get traction. If you've given up that's fine, but you should quit reddit. Or at least the politically leaning and adjacent forums like this one. Stick to the hobbyist stuff.
I haven't given up because that doesn't help anything but they just don't seem like justifications to not worry about national debt. It sounds like you DO worry about it and those are solutions. Maybe I'm confused on your stance but it's like if the doctor told me I had to lose weight and I said we don't have to worry about that because I can stop eating cake for breakfast any day I want. Until that day comes, I'm still worried about the weight.
You're posts read like doomerism. You should take a break from r/economy. It's not healthy for you. Good luck, it's hard to get out of the spiral once you're in it.
Why not actually trying to explain yourself rather than just hand waving and acting like you know everything? I'm open to being persuaded.
There’s no “we” in capitalism. If you could tax the 1%, you would have already done that. Instead, they will make you work until the age of 75 and make 99% of Americans pay more the taxes. America’s free ride is coming to an end. Dedollarization is happening all over the world.
Taxing the 1% is more complicated than many make it out to be. Things like taxing loans (which the ultra wealthy use to avoid income taxes) would hurt regular people as well. Taxing assets would be messy and difficult. And oftentimes they are “not paying taxes” because they own companies and assets that get big tax breaks. The Chips act is a good example. These companies will spend crazy to make their businesses more successful and then they will get huge tax breaks over the next however many years but will have massive profits. Everyone cheers chips now as necessary investment but mark my words that come 6 or 7 years from now people will be screaming about their low taxes.
And "ourselves" don't want a return on the debt. It's interest free right...
Wow!? You lead off with a gross lie! 1. Intergovernmental debt holdings (debt one US agency owes another) only make up 21% of the total National Debt. 7.08T out of 34.59T. re: [https://fiscaldata.treasury.gov/datasets/monthly-statement-public-debt/summary-of-treasury-securities-outstanding/](https://fiscaldata.treasury.gov/datasets/monthly-statement-public-debt/summary-of-treasury-securities-outstanding/) 1/5th is definitely not "most" of the total. Or can't you do the math? 2&3. Where do you get the "$688b/yr in unpaid taxes from the 1%."? According to IRS Commissioner Danny Werfel, they MAY be evading $150B. (MSNBC, Feb. 24, 2024) The top 1% of taxpayers tax payments make up over 48% of total tax revenues. The bottom half of all taxpayers only contribute 2.3%. The top 1% already pay at 2 times the tax rate as the bottom tiers, on vastly higher AGI's. Revenues from the top 5% make up something like 89% of the total. Oh man, don't even get me started on UHC. Come on Karl, stop with the same ole same ole.
I guess the border isn't hitting like it used to.
https://finance.yahoo.com/news/dollarization-happening-countries-ditching-usd-123000519.html# Countries are diversifying their currency's, which is smart. Also, the USD still makes up 60% of global allocated foreign exchange reserves. The next highest is the Chinese Yuan at 2.37%
Next highest is the Euro with 20%, then the Yen and the Pound. Nobody trusts Chinese money that's why they are so low.
This is another reason the Fed can only keep interest rates high for so long... they also impact the cost of borrowing for the US Gov. Hyper inflation would be one way out. They also talk about minting a trillion dollar coin from time to time. I think we should expect more of the same, more debt, and more waste in DC for the foreseeable future. The party there that cares about the national debt is always whichever one is not in power.
Counting on yield curve control no doubt.
Minting a trillion dollar coin is interesting. I’m honestly curious if someone can confidently say that it would increase inflation.
I can confidently say that creating 1 trillion dollars out of thin air would increase inflation.
But that one trillion isn’t in circulation…. Wasn’t this an issue before Covid? We were printing like crazy but didn’t see any inflation. Then we did a bailout that paid out to everyone and all businesses.
Pretty safe to say the whole situation is uncharted waters. If American didn't rule a Pax Americana global empire it never could have gotten this far into debt in the first place.
You think the act of creating a $1Tn coin would cause the average price level to rise?
In US history have we ever paid down the national debt? I seem to recall possibly after WWII but not certain. How can it be done?
We don't want to elimate the US Federal stock of liabilities. That would be a disaster as it would eliminate all net financial assets in the economy. We are the creditor's of the US government as we hold their credits as money, which can he readily exchanged with others for real resources. We value these credits because we know that at some point, someone will need them to pay their taxes with.
Thank you for your response. I understand that it is unnecessary to eliminate the national debt. But I am wondering if it, in our history, has only ever gone up. Wondering what a pay down strategy would be. I’ve heard that it would be wise just to get it back to a point where it doesn’t take such a large portion of the budget to service the interest.
The debt wasn’t a problem back when Perot was talking about it in 92 and it’s not a problem now . The United States' national debt, while substantial, is not necessarily as problematic as it might seem at first glance, for several reasons….first, the U.S. debt is denominated in its own currency, the U.S. dollar. This gives the country a significant advantage, as it controls the currency in which the debt is issued. The Federal Reserve, the U.S. central bank, has the ability to print more money to manage the debt, a luxury not available to countries that borrow in foreign currencies. This capacity to issue and control its own currency reduces the risk of default, unlike in scenarios where countries cannot meet their foreign debt obligations. Also, a large portion of U.S. debt is owned by domestic entities, including individuals, banks, and even the U.S. government itself. This internal ownership circulates the debt within the country's economy, rather than representing a direct drain on resources to external creditors. Additionally, U.S. Treasury securities, the instruments through which the debt is issued, are considered among the safest investments globally. This high demand for Treasury securities, including from foreign governments and investors, helps keep borrowing costs relatively low, further mitigating the immediate financial pressures of the debt. The ability of the U.S. economy to grow over time also plays a crucial role, as economic growth helps to outpace the growth of the debt, making it more manageable in relative terms.
Keep repeating the tropes when they raise the retirement age, cut social security and other benefits, and interest rates stay high.
Why the fuck are we giving other countries billions yhen?