Does anyone else see a correlation behind Debt / GDP

My IQ is quite high, thanks. I object to Keynesian economic policy because artificially creating value in the transactional medium simply robs those who use that currency of their wealth, and constantly demands ever-increasing levels and varieties of taxation in order to continue to propagate it.

 

Keynesian economics has nothing to do with what I'm talking about right now. I'm simply talking about how our current economy works. As in it's operational realities. Fiat money has to be "created" somehow. We didn't just stumble upon $10 trillion digging it out of the ground.

So a country has two options to control it's own currency. They can take complete seigniorage over the currency issuance or they can take our approach and introduce it through debt. Think of the public portion of the national debt as our supply of gold. Like I said, the complexities of Govt accounting and how the country works financially is nothing like your households finances. And we are nothing like Greece.

 

Until those we owe trillions of dollars decide they want to cash out. You are NEVER in control of your money when you are in debt and the more debt the less control you have over your own finances. The people/nations/banks you owe money to OWN you... and make decisions FOR you.

 

Where Did They Get The Made Up Money In The First Place??????

 

Clarify... who is "they" and what is "made up money?"


If you are talking about the Chinese holding our debt from the loans they gave us... well that money came from the profit from "stuff" they sold to us from the shelves of Walmart. Citizens used money they earned, driving trucks, caring for the sick and elderly, farming, building cars, boats, planes, houses... etc. Yes, money with SWEAT behind it... real money... not made up. The US government used promissory notes (and went into debt) to get that money back and spent it on whatever they wanted... like...

Well here is a list of 50 examples of WASTEFUL government spending that probably totals more than the debt we owe to China.

http://www.heritage.org/research/reports/2009/10/50-examples-of-government-waste

But wasteful spending accounts for only a fraction of the costs of corruption, kickbacks etc... here.. Homer Stokes stated it clearly.... substitute USA for Mississippi

"The great state of Mississippi con not afford four more years of Pappy O'Daniel. Four more years of cronyism! Nepotism! Rascalism! Of service to the interests!"

You could make a pretty good argument that a nation with a 4 trillion dollar annual budget is going to make "mistakes" ...heck, I make mistakes, impulse purchases etc. on my meager budget of a few thousand dollars a month... BUT what pisses off MOST taxpayers is the ATTITUDE and lack of responsibility to correct and prevent "mistakes" and eliminate fraud and abuse of power.

Here, let's start with our top dog... our Commander in Chief.... do you know that almost every trip he takes (vacation to Hawaii, trip to South Africa, etc) costs taxpayers about 5 MILLION dollars? That sets the example for all other elected officials under him. Why can't leaders set an example of tightening of the belt like the people who are supporting them are FORCED to do. No, they just print money, sell funny money promissory notes and pass on an unsustainable burden onto out children and future generations...

my oh my... how different our leadership has changed and become PERVERTED from the sacrificial spirit of the great men and women who founded this nation...

...and we wonder where the greatness of America has gone.

 

This is not explaining how the money was created, it is simply explaining how we have taken our made up money and given it to China in return for incredibly cheap sweatshop labor made goods.

Wasteful spending is still spending. That money doesn't just disappear because it didn't initially provide any benefit.

You are turning this argument in to a partisan battle and talking more theory on efficient spending. I'm not talking about where money should be spent. My theory is that there is a correlation between debt and GDP. The higher the debt, the higher the GDP. So what I'm saying is that the United States Debt is not really how much it has "borrowed". Or in other words, the question is who are they borrowing from and what money are they using?

 

You can't just cash out your treasuries whenever you want. China will get paid when their treasuries come due just like every one else. What is China going to do with a trillion dollars in debt?? The only thing China can do to hurt us in the long run is to stop accepting USD, which they won't. Otherwise they are very limited in what they can do with our made up money.