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This. The first US income tax was passed to pay for the Civil War. Since that time, most of our income tax revenues have gone to prepare for, fight, and pay off the debt from, various wars.
Yep. Americans love to be the big world police, so we have to somehow pay for it. Our infrastructure is falling apart and our education system is a mess with the student loan crisis, but we can invade other countries and protect Israel with the income tax money. It is what it is, but we can't change it.
Your mindset is as you would like it to be, not as it is.
Federal deficit spending is spending without taxing. NO extra taxes were collected to fight two wars, do TARP or bail out GM.
If we had no taxes, we'd have a whole lot more money to spend. (duh!) We have taxes, so we have less money to spend. And millions of Americans pay on April 15th. So Federal Taxes received are about double most other months.
You can tell yourself and anyone who will listen (and many will) all you want about national debt vs GDP.
But there of course is no hard and fast rule or line, despite Rogoff and Reinhart's very flawed nonsense.
One simply has to look at Japan.
Bernanke was/is an avid historian of the Great Depression, and I have to give Georgie Boy the good nod for appointing him!
Yes, but without revenue no one would lend us any money. We would have no way of rolling over the debt of maturing Treasury instruments, forcing the country into default.
Then the stock market would crash and unemployment would shoot up to sky-high levels. Ultimately, we'd have less to spend. More to spend only if you're thinking short-term.
Yes, but without revenue no one would lend us any money. We would have no way of rolling over the debt of maturing Treasury instruments, forcing the country into default.
Then the stock market would crash and unemployment would shoot up to sky-high levels. Ultimately, we'd have less to spend. More to spend only if you're thinking short-term.
No one lends us money. We create debt that others buy. The Federal Gov't as monopoly issuer of the USD can always pay off any debt based in its own fiat currency. We have next to no foreign denominated debt.
And that's the difference with the USA 'owing' vs you and I, businesses, states, cities and the EU countries. We and they aren't the currency issuers. We and they are the currency users.
Huge difference that very few understand and/or appreciate.
No one lends us money. We create debt that others buy. The Federal Gov't as monopoly issuer of the USD can always pay off any debt based in its own fiat currency. We have next to no foreign denominated debt.
Absolutely.
And as long as everyone who is purchasing our debt (so that we can buy weapons to bomb the bejeezus out of brown people) thinks we're going to repay it in a responsible manner, we're aces.
But if we elect a nimrod ideologue who mints trillion-dollar coins and mails them to our creditors, with an attached note of "suck it, losers" the whole system grinds to a halt. Personally, I think this country will default on it's debt in the near future. I simply do not see how what we are currently doing is sustainable.
But if we elect a nimrod ideologue who mints trillion-dollar coins and mails them to our creditors, with an attached note of "suck it, losers" the whole system grinds to a halt. Personally, I think this country will default on it's debt in the near future. I simply do not see how what we are currently doing is sustainable.
The large bulk of our National Debt is not callable.
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