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]I understand completely how it works, Debt is Debt, and is required to be paid back. [/b]
Debt requires interest to be paid, this is a cost, in addition to all other costs. Therefore if you have debt, and the interest on that debt, along with the rest of your bills is greater than your income, you are required to increase your debt, to pay for your bills, and the interest on your current debt, instead of being able to pay it down, because the money you are earning, or your incoming funds are greater your expenses with interest.
Economics 101.
The bottom line, is your debt load keeps increasing, without a cost benefit.
It is an integral part though. The payment of interest is an additional cost, that increases as debt increases. That reduces funds that could be used for things that are beneficial.
It's just like a credit card, if you keep running up debt, sooner or later, the benefit of having a credit is outweighed by the detriment of increased debt caused by both interest payments and trying to pay down the original debt.
Unless you can pay off your debt load at either
a. an interest rate lower than the interest you receive on the funds you own,
b. immediately before the accrual of additional load of interest,
than the result is, less money available for the tax payers/government benefit, or the demand for increased borrowing.
If the above is true, and we should really not be worried, then why did Obama say this:
"The fact that we are here today to debate raising America’s debt limit is a sign of leadership failure. It is a Sign that the US Government cannot pay its own bills. It is a sign that we now depend on ongoing financial assistance from foreign countries to finance our Government’s reckless fiscal policies. ...Increasing America’s debt weakens us domestically and internationally. Leadership means that 'the buck stops here'. Instead, Washington is shifting the burden of bad choices today onto the backs of our children and Grandchildren. America has a debt problem and a failure of leadership. Americans deserve better."
SENATOR BARACK HUSSEIN OBAMA, MARCH 2006
and then this:
“The problem is, is that the way Bush has done it over the last eight years is to take out a credit card from the Bank of China in the name of our children, driving up our national debt from $5 trillion dollars for the first 42 presidents -- number 43 added $4 trillion dollars by his lonesome, so that we now have over $9 trillion dollars of debt that we are going to have to pay back -- $30,000 for every man, woman and child,” Obama said on July 3, 2008, at a campaign event in Fargo, N.D.
If $50K per person is not such a big deal, why was $30K so horrible
Did he say that because of lack of experience or political posturing, both of which are understandable. But what has changed his mind? Because the huge debt increase occurred on his watch?
Gee, I'm sorry the second-richest man in America said something you don't like. He must be lying, or out to destroy America or something, to have the temerity to disagree with you.
Bill Gates says the same thing, and he's not even old-- he's just richer than Buffett.
You don't understand how the United States debt, essentially works.
Most people right of center do not. The debt of the federal government does not work the same way as household debt. The quote, paraphrasing it: when you owe the bank thousands of dollars, the bank has you by the neck, when you owe the bank billions of dollars, you have them by the neck. The U.S. can tell the bankers tomorrow to go take a hike, they are not paying 100% of the debt and can do that without consequences. Mexico has done it, Brazil has done it, Russia has done it, Iceland did it, Argentina has done it, all the countries are still around. They haven't exploded yet nor are their people living in a Mad Max world. Federal government debt is NOT sacrosanct and it is not the be all end all of human existence.
Quote:
Originally Posted by Goodnight
You should listen when billionaires and millionares tell you they are not taxed heavily enough, especially someone as bright as Warren Buffett. You don't ask to be taxed at a higher rate for personal gain, the only conclusions you can come to is that they are either crazy or telling the truth.
Warren is not telling out of the goodness of his heart that the rich should be taxed more. He is repeating the same tired Democratic Party empty talking point. Tax the rich is not a program. How are you going to do it without them evading the higher tax rate, especially when they don't earn income?
That's right. Buffett understands that it is his personal interest to reduce income inequality.
The one thing he is right on, and I told the above poster that, federal government debt is not sacrosanct. Many countries, especially Russia, Iceland, and in Latin America, have told the bankers either to take a hike, or called for a haircut on their debt. What are the banks gonna say? No? They loaned out billions, they are going to want some of it back instead of nothing. So, they will take what they can get. Countries are far more powerful than any banking institution ever will be. As long as the US can pay its Treasury bondholders twice a year, the total amount of debt does not matter at all
if buffett thought that increased taxes are such a great idea, why did he donate $31 billion of his fortune to fund the Gates Foundation-A PRIVATE ORGANIZATION. Does he think that a private organization will help fight infectious diseases and reform education better than the government?
why wasn't that check made out to uncle sam, mr. hypocrite?
you too, gates.
now i am done commenting on the brilliant wisdom of warren buffett.
i seriously don't know how anyone can think that massive debt and huge interest payments are good in a fiat (TRUST) based currency.
if buffett thought that increased taxes are such a great idea, why did he donate $31 billion of his fortune to fund the Gates Foundation-A PRIVATE ORGANIZATION. Does he think that a private organization will help fight infectious diseases and reform education better than the government?
why wasn't that check made out to uncle sam, mr. hypocrite?
you too, gates.
now i am done commenting on the brilliant wisdom of warren buffett.
i seriously don't know how anyone can think that massive debt and huge interest payments are good in a fiat (TRUST) based currency.
Most people right of center do not. The debt of the federal government does not work the same way as household debt. The quote, paraphrasing it: when you owe the bank thousands of dollars, the bank has you by the neck, when you owe the bank billions of dollars, you have them by the neck. The U.S. can tell the bankers tomorrow to go take a hike, they are not paying 100% of the debt and can do that without consequences. Mexico has done it, Brazil has done it, Russia has done it, Iceland did it, Argentina has done it, all the countries are still around. They haven't exploded yet nor are their people living in a Mad Max world. Federal government debt is NOT sacrosanct and it is not the be all end all of human existence.
partially true, there is debt owed to other countries. We should not be telling other countries "to go take a hike"..
Quote:
Warren is not telling out of the goodness of his heart that the rich should be taxed more. He is repeating the same tired Democratic Party empty talking point. Tax the rich is not a program. How are you going to do it without them evading the higher tax rate, especially when they don't earn income?
If you want to tax the rich, tax the capitol gains, as well as the purchase of stocks and bonds.
Quote:
The one thing he is right on, and I told the above poster that, federal government debt is not sacrosanct. Many countries, especially Russia, Iceland, and in Latin America, have told the bankers either to take a hike, or called for a haircut on their debt. What are the banks gonna say? No? They loaned out billions, they are going to want some of it back instead of nothing. So, they will take what they can get. Countries are far more powerful than any banking institution ever will be. As long as the US can pay its Treasury bondholders twice a year, the total amount of debt does not matter at all
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