BOO!!! - And Fucking BRAVO !!! - A Shit Of A WaPo Editorial, And One HELL Of A Response...

[jeff47]

83. Golly, I'm so surprised you failed to show any math in your response.

Certainly it would bring in more revenue. But NOT ENOUGH.

Well then it would be very easy for you to show that with some math. Yet you didn't quite do so. Almost as if using actual numbers would not support your argument.

If we are "constantly paying it off" (the debt), then why does it keep going UP?

Looks like we'll have to go back to "Government Debt 1". We can get to "Government Debt 101" in a while.

Government debt is financed by bonds. Those bonds have a maturity date when the government pays back the money, with interest. That maturity date is not "forever". It's fixed.

As a result, we are constantly paying off the bonds we already issued.

As for why it keeps going up, that's because the debit and the deficit are two different things. The deficit is the difference between the money the government takes in from all sources and the money the government spends. Our debt is the cumulative effect of those deficits.

So how does this come together? By reducing the deficit, we are adding less to the debt. Which shrinks the next deficit. And so on. Since we're constantly paying off the debt, we do not need to suddenly pay trillions of dollars.

In addition, there's two things that 'deflate' our debt. Inflation reduces the real value of our debt. Under "normal" conditions, our real debt goes down all on it's own by 2% per year, because the borrowed money is worth 2% less. But a much larger deflator is GDP growth - the larger our GDP, the less our debt really is. Since you're stuck in a personal economics model, think of it like you getting a raise. Suddenly that car that was too expensive is affordable.

This effect is why actual economists measure government debt as a debt-to-GDP ratio instead of absolute numbers. $1T would be a huge problem for a country with a $1B GDP. It's nothing for a country with a $20T GDP.

Our debt-to-GDP ratio is less than other times in our past. For example, after WWII our debt-to-GDP ratio was much higher. In addition, we have examples like Japan who have a much worse debt-to-GDP ratio than we do. They'll run into problems before we do - we don't have to worry about debt suddenly becoming a huge problem.

We simply pay interest most of the time.

False. When the bonds mature, both interest and principle must be paid. And as mentioned above, we are constantly paying off bonds.

We're sitting at 17 trillion. How much is high enough?

The fact that the number is large is utterly irrelevant. The only thing that matters is the interest rate we have to charge to get people to buy our debt.

So how's that interest rate going? Well, people are willing to buy US debt at a negative real interest rate. As in, you give the government $100, and they will pay you back $98. And people are signing up to do this.

So we can run that $17T up a lot higher before we even begin to have a problem.

The top 1% earn somewhere between 1-2 trillion annually (if i multiply correctly). If you take ALL of that, it would still take years to pay off the debt.

Government debt is not like your credit card. You can not pay it off in just a few years, because you can not pay it until the bonds mature.

If I'm so wrong, show me the proof that my facts are wrong.

Well, you've yet to show any facts. Instead you think government debt is exactly like you charging stuff on your Visa. It isn't, but the Republicans thank you for buying into their framing.