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Total debt is a tax on everyone. The debt multiplier has swung negative. If you want to cut the tax burden then cut total debt. The consumers are maxed out on debt. Everyone is maxed out on debt.
Total debt is a tax on everyone. The debt multiplier has swung negative. If you want to cut the tax burden then cut total debt. The consumers are maxed out on debt. Everyone is maxed out on debt.
The debt has to go.
I agree that debt is a serious problem, both on the individual level and at vary levels of government.
I do not agree that "everyone is maxed out on debt." Many of the largest corporations and the wealthiest % are sitting on piles of cash, as they have no immediate incentive to spend it. But, this is largely ignored in debates on debt levels, and that ignorance only fuels fears of an economy crippled by debt.
If only consumers or the government was highly indebted, the solutions would be straightforward enough. Because both are simultaneously drowning in red ink, a solution for one is a death knell to the other.
And, unfortunately, redistribution of wealth has become taboo. But, so long as so much wealth is concentrated in the hands of so few citizens, then the rest of the country will be choked for income, which, in turn, starves the levels of government of tax revenue.
The problem isn't just debt, it is debt and how that debt is distributed in the economy and for what purposes that debt was incurred.
I agree that debt is a serious problem, both on the individual level and at vary levels of government.
I do not agree that "everyone is maxed out on debt." Many of the largest corporations and the wealthiest % are sitting on piles of cash, as they have no immediate incentive to spend it. But, this is largely ignored in debates on debt levels, and that ignorance only fuels fears of an economy crippled by debt.
The very top don't spend cash they loan it out to those that do expecting to get it back with interest.
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Originally Posted by darkeconomist
If only consumers or the government was highly indebted, the solutions would be straightforward enough. Because both are simultaneously drowning in red ink, a solution for one is a death knell to the other.
Well if you increase wages by the use of the minimum wage law then both are bailed out. And those that have lint the money in the first place.
Quote:
Originally Posted by darkeconomist
And, unfortunately, redistribution of wealth has become taboo. But, so long as so much wealth is concentrated in the hands of so few citizens, then the rest of the country will be choked for income, which, in turn, starves the levels of government of tax revenue.
Oh wealth redistribution isn't taboo it is alive and well... going from the middle to the top.
Quote:
Originally Posted by darkeconomist
The problem isn't just debt, it is debt and how that debt is distributed in the economy and for what purposes that debt was incurred.
I agree with you completely. Well almost the total level of debt needs to come down. Not in dollar value but in % GDP.
The very top don't spend cash they loan it out to those that do expecting to get it back with interest.
While that used to be the case, now they use financial vehicles to seek returns without having produced something or having financed someone else producing something.
As for the interest part, the rate is so low as to be of concern in and of itself, though that is another discussion entirely.
Quote:
Originally Posted by Frank Shoemaker
Well if you increase wages by the use of the minimum wage law then both are bailed out. And those that have lint the money in the first place.
Increasing minimum wages won't help the middle class to earn more money; they already earn above the minimum wage rate. But, it will harm those at the bottom by reducing the number of available jobs. Like the interest rate, minimum wages are another discussion entirely.
Quote:
Originally Posted by Frank Shoemaker
Oh wealth redistribution isn't taboo it is alive and well... going from the middle to the top.
Fair enough. I concede that point. But, downward redistribution of wealth, to those who would readily spend it from those who have nothing else to buy, is taboo.
Quote:
Originally Posted by Frank Shoemaker
I agree with you completely. Well almost, the total level of debt needs to come down. Not in dollar value but in % GDP.
Very true on both points. But, the debt should be spread across economic actors more evenly, instead of lumped on specific groups, as it is now. And, so long as it was incurred by any given economic actor as a matter of investment, then that debt is okay, within limits.
And roads, and sewers, and bridges and airports and fire protection and police and all kinds of crap that we are supposed to believe comes from nowhere.
While that used to be the case, now they use financial vehicles to seek returns without having produced something or having financed someone else producing something.
As for the interest part, the rate is so low as to be of concern in and of itself, though that is another discussion entirely.
Increasing minimum wages won't help the middle class to earn more money; they already earn above the minimum wage rate. But, it will harm those at the bottom by reducing the number of available jobs. Like the interest rate, minimum wages are another discussion entirely.
Not true. If you can work a minimum wage job with no skill they need to entice you with more. Same with government employment which sets a wage floor. Those in the private sector who think reducing public empoyee benefits will help them are in for a big surprise.
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Fair enough. I concede that point. But, downward redistribution of wealth, to those who would readily spend it from those who have nothing else to buy, is taboo.
Just give them a square block in Manhattan to rent out and its very fashionable.
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Very true on both points. But, the debt should be spread across economic actors more evenly, instead of lumped on specific groups, as it is now. And, so long as it was incurred by any given economic actor as a matter of investment, then that debt is okay, within limits.
I think we should spread the debt onto stray animals. Let them owe it too since they freely use the land. Why just charge the naked monkeys?
Debt created from ground rents is a fraud.
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