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Why do we have a national debt at all?


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2023 Mar 27, 9:37am   9,438 views  118 comments

by Patrick   ➕follow (55)   💰tip   ignore  

Seriously, what is the point?

I know that a lot of people say so that the Fed can collect interest from taxpayers, and that may be so, but why would the government even agree to that?

It seems that every country on earth has national debt, but how can this be? It always costs more to borrow and pay interest than to save and simply pay for something.

Is every country on earth stupid and/or irresponsible? Is it just that they have more demand for services than they can afford? If that's so, then it's still stupid because they have to pay it off eventually anyway. Or do they just keep rolling over the debt forever, growing ever larger? Eventually their debts will be infinite and the interest will be unpayable.


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80   gabbar   2023 Mar 31, 2:34pm  

GNL says

gabbar says


There is a war going on now on the American people, its a financial and cultural war.

No doubt about it.

Its about management of masses through news, continued debt, luxury problems, poor food, managed education, managed healthcare, censorship, conditioning, puffery, corporatism...they want money and power by instituting invisible ball and chain.
81   Reality   2023 Mar 31, 9:04pm  

The answer to the titular question is: "government" is a tool for banksters to collect tax money from the public . . . that's why interest payment is usually tax deductible (i.e. the banksters have already collected that money directly).

Georgist land tax has the evaluation problem: e.g. the usual "two neighboring lot should be taxed the same regardless developed or not" has two major problems in practice: 1. a beach front lot would have much higher or lower value than the lot next to it towards inland, depending on whether you prefer water-front view or prefer less salt corrosion (or even land erosion!). 2. similar problem with road-front vs. next lot one-lot removed from road. Should a lot that is next to a lot that has utility line worth more than a lot that has no neighboring lot with utility line? Does that mean utility line has negative value? Property tax as it's currently practiced is sort-of acquiesced to largely because the amount is much smaller than either the owner's income or the owner's ability to generate profit from the property; raising tax anywhere close to the full utilization value of the land would mean the the land has no value, then the whole edifice of private ownership collapses. Besides, land value is highly dependent on use/purpose, as exemplified by the drastically lower property tax if land is used for agriculture in most jurisdictions (per acre, farm land generates far less money than using the same acre for storage facility or home building; using home building lot price for taxation and collect full utilization value would immediately put all farm land at negative value).

1% Tobin tax would collapse market liquidity. This is not 1990, hardly anyone pays $10 for a $1000 trade. Even in 1990, people would pool money together so a $10 commission fee would pay for a $10,000 trade. People with sub-$10k accounts now trade at $0 commission. An entire day's market movement is typically only 0.5% to 1.5%; most intraday trends last only half an hour to an hour. People trading those trends are not high frequency traders, but normal intraday traders that supply much of the market liquidity.

There is a strong argument for import tariffs, as tariff-free international trade essentially forces domestic businesses and individuals subsidize the military that enables international trade. International traders should at least pay for their own protection/sustainability. One idea I haven't seen raised elsewhere is a tariff rate proportional to the source country's percentage of the world's total population (or plus area on top of it); e.g. China has 17% of the world's population, so gets hit with a 17% tariff; Russia has 12% of the world's total land area, so gets hit by a 12% tariff on account of land area; or combination of the two, so 24% for China and 15% for Russia respectively. That way, large countries are encouraged to break up into smaller ones, which is conducive to individual liberty and fair competition among numerous countries, and prevent the rise of the next big country threatening world peace.
82   Misc   2023 Mar 31, 11:42pm  

Patrick says

RWSGFY says


Not sure if serious. Living standards in NoKo are shit.


Yes, living standards in North Korea are shit.

I don't see any causal relation between not having a national debt and low living standards.


The difference is whether the Federal Government acts as a profit oriented entity. Throughout history if the government seeks to profit from its citizens, horrible things happen to the common citizens.
83   WookieMan   2023 Apr 1, 5:14am  

Reality says

Besides, land value is highly dependent on use/purpose, as exemplified by the drastically lower property tax if land is used for agriculture in most jurisdictions (per acre, farm land generates far less money than using the same acre for storage facility or home building; using home building lot price for taxation and collect full utilization value would immediately put all farm land at negative value).

This is the biggest flaw with Georgist taxes living in farm country in IL. Apple, the tech company I believe owns 360 acres on their campus. I know multiple farmers with literally that exact amount of land. They would just stop growing crops and become mechanics or some other skill derived from farming overnight and food prices would skyrocket. If you then adjust for AG land versus commercial we're back at the current method.

And I hate to sound like liberal here, but it wouldn't be fair. I like my farmer friends, but they are supported by the government AND many are very wealthy. BUT we need food. Government need to get out of subsidizing things. Let the market work itself out.

Fact is we need to stop spending. Term limits for Congress critters. Rules that force Federal officials on every level to halt all trading unless it's selling at a loss. Basically stock investments are frozen while in office. They could still make money on stocks, but they can't buy more Lockheed or Boeing if they're on the defense committee with classified contract negotiations.

Guys like Fauci and similar as well, not just the 3 branches. The leaders of the 3 letter agencies. That includes immediate family as well.

Do that and see how quickly spending drops. How much smaller the budget proposals get because they can't throw in pork barrel shit that they know will raise the stock price of some asinine publicly traded company no one looks at and they make $100k+ trading it once the public finds out ABC Company is going to get $10M from the government.
86   zzyzzx   2023 Oct 31, 11:44am  

Patrick says

Why not eliminate all income tax and sales tax and just have a land value tax instead?


Or do away with all taxes except import duties, and raise those high enough to fund spending? Didn't this already work for more than 100 years?
87   zzyzzx   2023 Oct 31, 11:46am  

Why do we have a national debt at all?

Same reason why every (or almost every?) government does....
They decide their spending first. Once that's done, then they look at ways to fund it. They don't do what any responsible person does which is to FIRST look at what money is coming in, and THEN decide how to spend it.
88   UkraineIsFucked   2023 Oct 31, 5:03pm  

RayAmerica says

through Constitutional Amendment, the Fed not only controls the money supply, but it charges the Government fees and interest on the debt that the government creates


There's no constutional amendment involving the Fed.
89   komputodo   2023 Oct 31, 9:16pm  

So that once or twice a year the media has another scare story about a govt. shut down with the typical bi-partisan agreement at the 11th hour. A lot of back slapping and glad handing and proof that the govt. is really working hard for the people.
Besides that, who is it owed to? It is never going to get payed back. Big buyers of treasuries don't seem to care. So does it even matter? If you say it does matter, when does it start mattering? 30 tril, 40tril, 100 tril....1 qudrillion?
90   GNL   2023 Oct 31, 10:00pm  

komputodo says


It is never going to get payed back. Big buyers of treasuries don't seem to care. So does it even matter? If you say it does matter, when does it start mattering? 30 tril, 40tril, 100 tril....1 qudrillion?

The $64,000 question. Seems like it will never matter. My belief is you'll see the results as a smaller middle class and a larger and larger poor class.
91   komputodo   2023 Oct 31, 10:53pm  

GNL says

The $64,000 question. Seems like it will never matter. My belief is you'll see the results as a smaller middle class and a larger and larger poor class.

Which will continue to get more extreme. As long as you can keep the debt slaves full of junk food and entertained, nothing is ever going to change
92   Misc   2023 Nov 1, 2:21am  

Does anyone want the Federal Government to be profit driven???

I would rather have a government going further into debt each year than expanding its coffers every year... and you think taxes are high now.
93   HeadSet   2023 Nov 1, 8:02am  

Misc says

I would rather have a government going further into debt each year than expanding its coffers every year.

False choice. The government can limit spending to collections.
94   komputodo   2023 Nov 1, 8:15am  

HeadSet says

Misc says


I would rather have a government going further into debt each year than expanding its coffers every year.

False choice. The government can limit spending to collections.

why would a politician want to limit spending when spending benefits him and being thrifty castigates him?
96   AD   2024 Feb 9, 10:35am  

its all about cash flow ... not enough income to match expenses and the federal government does not have assets or savings to cover its expenses ...

however it does have "assets" as far as land and resources...it could try to increase income by leasing forest land such as for deadwood collection used for engineered wood

when i saw the congressional democrat's publishing their 2024 budget which was a 5.2% increase from the 2023 budget, then that was enough to show that we are seriously fucked.... the same democrats tout annual inflation (i.e, PCE) around 2.5% ...

the democrats want to increase spending at twice the rate of guvmint-reported inflation

why not just grow spending at 1 or 2% below the annual inflation rate ?
97   AmericanKulak   2024 Feb 9, 10:36am  

AD says


its all about cash flow ... not enough income to match expenses and the federal government does not have assets or savings to cover its expenses ...

Print it.

Why tax at all? Most of the budget is borrowed.
98   AmericanKulak   2024 Feb 9, 10:40am  

Patrick says


One simple solution is to defer the land value tax until the owner dies. That is, let it accumulate as a debt to the government, but with no obligation for the owner to sell until the owner dies.

Or the ability for some (seniors for example, perhaps inheritors) to spread out or delay the Georgist Taxes with the balance due on sale if they rise dramatically in a short period.
99   AD   2024 Feb 9, 10:40am  

AmericanKulak says


D says

its all about cash flow ... not enough income to match expenses and the federal government does not have assets or savings to cover its expenses ...

Print it.

Why tax at all? Most of the budget is borrowed.


yep, so the "tax" on the working and middle class is guvmint-reported inflation

inflate out of a debt crisis seems like a perpetual feat
.
100   AmericanKulak   2024 Feb 9, 10:42am  

Tobin Tax would be great as well.

The arguments against it are retarded.

"I pay $7.95 to a broker for a trade, it would be a great injustice to pay 50 cents more in tax for a total of $8.45! I'll be bankrupt if I had to do that! Unfair!"

Seriously, there's a tax on buying pink lawn flamingoes from Ace Hardware but you can trade thousands of shares without paying sales tax?
101   HeadSet   2024 Feb 9, 11:13am  

AmericanKulak says

"I pay $7.95 to a broker for a trade, it would be a great injustice to pay 50 cents more in tax for a total of $8.45! I'll be bankrupt if I had to do that! Unfair!"

Seriously, there's a tax on buying pink lawn flamingoes from Ace Hardware but you can trade thousands of shares without paying sales tax?

That sounds like you want to have a tax on the broker fee and not a sales tax on the shares sold. To keep that pink flamingo analogy, one would pay a tax on the actual shares purchased. That is, buy $100 worth of stock, even without a broker fee like at Schwab, pay a $4 (at 4%) sales tax.
102   NuttBoxer   2024 Feb 9, 1:40pm  

UkraineIsFucked says

There's no constutional amendment involving the Fed.


16th's passage the same year the current central bank was chartered is pure coincidence...
103   WookieMan   2024 Feb 9, 2:09pm  

Everyone does realize that anyone alive and including unborn great grand kids will never pay the debt. It will never be repaid. That's the point. That's why we fight wars. Why in the flying fuck would you admit to wars and proxy wars that it was because you don't want to pay people back? It's nasty, but I'm glad to be a citizen of the most powerful one that can get away with it. Enjoy it. You got one life.
104   UkraineIsFucked   2024 Feb 9, 5:04pm  

NuttBoxer says

16th's passage the same year the current central bank was chartered is pure coincidence...


No. But Fed's charter has nothing to do with amending the Constitution. In fact, the Fed is the third national bank chartered by Congress.
105   Ceffer   2024 Feb 9, 6:18pm  

What doesn't anybody understand about 'Babylonian Debt Slavery' and 'fiat printing press money'? Our taxes are collected by the Vatican, and whatever they deem fit is deposited in the IMF or BIS and then lent back to us at an interest rate (low, but still interest) and the debt is meant to enslave, and keep the government operating at a deficit beholden to the various Euro banksters and mafias.
106   Someone_else   2024 Feb 9, 6:31pm  

If you or I had a printing press in the basement and it made money, would we be in debt?
107   HeadSet   2024 Feb 9, 6:47pm  

Someone_else says

If you or I had a printing press in the basement and it made money, would we be in debt?

Yes, if you are married.
108   AD   2024 Feb 9, 6:48pm  

Someone_else says

If you or I had a printing press in the basement and it made money, would we be in debt?


All that does is reward people with free money.

So there is essentially more demand but at best the same amount of supply.

If you are going to give out money, make sure there is enough innovation and productivity to provide adequate supply.
109   PeopleUnited   2024 Feb 9, 6:59pm  

WookieMan says

. That's why we fight wars. Why in the flying fuck would you admit to wars and proxy wars that it was because you don't want to pay people back?

Well said. The debt is paid in blood. We the people are collateral, and the elites will trade our lives and labor like bargaining chips on the global market.
110   NuttBoxer   2024 Feb 11, 8:52am  

UkraineIsFucked says

NuttBoxer says


16th's passage the same year the current central bank was chartered is pure coincidence...


No. But Fed's charter has nothing to do with amending the Constitution...


Your statements seem to be at odds.
112   GNL   2024 Feb 12, 6:25pm  

Patrick says





Cloward–Piven strategy?
113   NuttBoxer   2024 Feb 12, 7:40pm  

Does Cloward Pivan believe that you can inflate your way out of anything?
114   AD   2024 Feb 12, 10:22pm  

.

8% of 2022 federal budget was for net interest

https://www.federalbudgetinpictures.com/where-does-all-the-money-go/

I wonder what it is for 2024.

They should hold outlays (or the federal budget) as constant for at least 3 years to reduce the growth of deficits:
.

https://en.wikipedia.org/wiki/United_States_federal_budget#Overview

.
At least outlays from 2023 to 2024 only increase by about 1% thanks to the leadership of House of Representatives Speaker Johnson.

.
115   AmericanKulak   2024 Feb 12, 11:53pm  

GNL says

Cloward–Piven strategy?

Partially. I mean the hofare wasn't enough. Now they have to import 9M and give them more than hofare does, like pre-paid charge cards and hotel rooms. Even Shaniqua didn't get months at a Manhattan or SF hotel at $200/day.
116   AmericanKulak   2024 Feb 12, 11:55pm  

HeadSet says


That sounds like you want to have a tax on the broker fee and not a sales tax on the shares sold. To keep that pink flamingo analogy, one would pay a tax on the actual shares purchased. That is, buy $100 worth of stock, even without a broker fee like at Schwab, pay a $4 (at 4%) sales tax.

A transaction tax on Shares, like a sales tax, sure.

We definitely don't have a turnover or liquidity problem. Restoring a dividend-centric stock market might be better.

Paying taxes on money making money seems fairer than taxing productive income. I'd rather tax a surgeon's stock trades than tax his earned income.
117   zzyzzx   2024 Feb 13, 5:53am  

Stop funding all welfare programs and the budget will be balanced.
118   PeopleUnited   2024 Feb 13, 6:25am  

zzyzzx says


Stop funding all welfare programs and the budget will be balanced.

Stop funding warfare programs as well. It’s one thing to have a well equipped military. It’s quite another to play policeman for the world.

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