My Radical Solution to the National Debt
The U.S. Senate will vote today to raise the federal government's debt limit to nearly $9 trillion. Can't wrap your head around that number? Don't worry. The people who are borrowing the money can't either. "It's hard to understand what a trillion is. I don't know what it is," confessed Senate Budget Committee Chairman Judd Gregg, a New Hampshire Republican, earlier this week. On second thought, worry. If the chairman of the Senate Budget Committee doesn't grasp how big our national debt is, we should all worry.
A mathematics professor at American University puts things in perspective: To spend $1 trillion in the average American life span of 77 years, you'd have to be on a lifetime spending spree of about $35,580,857 and change every day from birth. And that's just one trillion.
Now, here's my radical solution to the national debt. The federal government should default on it. Policymakers should say, "we can't ever pay this off. Sorry. Our bad. We're not going to pay". This is the only moral solution to the problem. The only other alternative is to make people who played no role whatsoever in amassing the debt pay it off. This is simply unfair. It's grand theft. Ok. Trillion theft.
Will I feel bad for all the people with government bonds who don't get paid? No. They colluded with the federal government to rip-off their children and grandchildren. Fuck them. (Disclaimer: I probably own mutual funds that invest small amounts in government bonds. So, fuck me too.)
Could defaulting on the national debt hurt the overall economy? Yes. It would likely crash the stock market. But, it would most certainly shake people's faith in government. And that would be a good thing. Once people realized that the federal government could default on bonds in the future, they would be less likely to loan money to the federal government. That would prevent the government from racking up a huge credit card bill ever again (or at least for several decades). Knowing this, investors would become quite bullish. The American economy would rebound and flourish. Without the federal government driving up interest rates through massive borrowing, companies could afford to expand like never before. And the federal government would free-up the $350 billion it spends every year just paying the interest on the national debt. Congress could give this money back to the American people through major tax cuts, further stimulating the economy. (Bone to socialists: Congress could also spend that money on health care, welfare, etc.).
A mathematics professor at American University puts things in perspective: To spend $1 trillion in the average American life span of 77 years, you'd have to be on a lifetime spending spree of about $35,580,857 and change every day from birth. And that's just one trillion.
Now, here's my radical solution to the national debt. The federal government should default on it. Policymakers should say, "we can't ever pay this off. Sorry. Our bad. We're not going to pay". This is the only moral solution to the problem. The only other alternative is to make people who played no role whatsoever in amassing the debt pay it off. This is simply unfair. It's grand theft. Ok. Trillion theft.
Will I feel bad for all the people with government bonds who don't get paid? No. They colluded with the federal government to rip-off their children and grandchildren. Fuck them. (Disclaimer: I probably own mutual funds that invest small amounts in government bonds. So, fuck me too.)
Could defaulting on the national debt hurt the overall economy? Yes. It would likely crash the stock market. But, it would most certainly shake people's faith in government. And that would be a good thing. Once people realized that the federal government could default on bonds in the future, they would be less likely to loan money to the federal government. That would prevent the government from racking up a huge credit card bill ever again (or at least for several decades). Knowing this, investors would become quite bullish. The American economy would rebound and flourish. Without the federal government driving up interest rates through massive borrowing, companies could afford to expand like never before. And the federal government would free-up the $350 billion it spends every year just paying the interest on the national debt. Congress could give this money back to the American people through major tax cuts, further stimulating the economy. (Bone to socialists: Congress could also spend that money on health care, welfare, etc.).
posted by Cicero @ 3/16/2006
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