itfitzme
VIP Member
- Jan 29, 2012
- 5,186
- 393
Macro econ and the money supply are not "intuitive".
The Biggest Myths in Economics | PRAGMATIC CAPITALISM
See the following pieces for more:
The US Government is not ?$16 trillion in the hole? | PRAGMATIC CAPITALISM
IS SOCIAL SECURITY A PONZI SCHEME? | PRAGMATIC CAPITALISM
The Debt Bad Guys | PRAGMATIC CAPITALISM
The Biggest Myths in Economics | PRAGMATIC CAPITALISM
The national debt is often portrayed as something that must be paid back. *As if we are all born with a bill attached to our feet that we have to pay back to the government over the course of our lives. *Of course, thats not true at all. *In fact, the national debt has been expanding since the dawn of the USA and has grown as the needs of US citizens have expanded over time. *Theres really no such thing as paying back the national debt unless you think the government should be entirely eliminated (which I think most of us would agree is a pretty unrealistic view of the world).
This doesnt mean the national debt is all good. *The US government could very well spend money inefficiently or misallocate resources in a way that could lead to high inflation and result in lower living standards. *But the government doesnt necessarily reduce our childrens living standards by issuing debt. *In fact, the national debt is also a big chunk of the private sectors savings so these assets are, in a big way, a private sector benefit. *The governments spending policies could reduce future living standards, but we have to be careful about how broadly we paint with this brush. *All government spending isnt necessarily bad just like all private sector spending isnt necessarily good. *And at a macro level debt doesnt get paid back. *In a credit based monetary system debt is likely to expand and contract, but generally expand as the economy expands and balance sheets grow.
See the following pieces for more:
The US Government is not ?$16 trillion in the hole? | PRAGMATIC CAPITALISM
IS SOCIAL SECURITY A PONZI SCHEME? | PRAGMATIC CAPITALISM
The Debt Bad Guys | PRAGMATIC CAPITALISM