Younger Americans Should Repudiate US Debt

Discussion in 'Political Opinions & Beliefs' started by Ethereal, Jul 16, 2019.

  1. FreshAir

    FreshAir Well-Known Member Past Donor

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    never pass, put that one right next to reparations
     
    Last edited: Jul 18, 2019
  2. FreshAir

    FreshAir Well-Known Member Past Donor

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    raise taxes on the rich

    and cut spending by 2% across the board, I am good with that

    if not also raising the taxes on the rich, then it's a non-started
     
    Last edited: Jul 18, 2019
  3. Mac-7

    Mac-7 Banned

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    Raise taxes on everyone, rich and poor alike
     
  4. truth and justice

    truth and justice Well-Known Member

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    There have always been university courses in like sociology, history of art or ancient history etc so your post is of no point. One difference, in the UK (same as US?), the older generation did not have to pay to go to university. Now everyone pays via student government backed loans (those studying sociology etc never actually earn enough to ever pay it back!)

    caveat : I'm not disagreeing on the principles of your post regarding pointless courses and too many are going on to further education
     
  5. FreshAir

    FreshAir Well-Known Member Past Donor

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    not hardly, the rich can afford to pay more, the poor can't

    undo all the tax cuts for the rich sense Bush and close the tax loopholes

    if you want to raise the taxes on the poor, raise the min wage to a living wage
     
    Last edited: Jul 18, 2019
  6. Mac-7

    Mac-7 Banned

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    I want a single flat tax on everyone, rich and poor alike, with zero tax exemptions

    Then the welfare bums can raise taxes only as much as THEY can stand it

    But spending cuts to balance the budget
     
  7. truth and justice

    truth and justice Well-Known Member

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    A single flat tax on everyone would cause the economy to collapse unless there is a tax exemption ie a threshold tax liability level. Every person, rich or poor, spends approximately the same on basic every day necessities. A flat tax on everyone would result in the "welfare bums" having less disposable income means that they will have less to spend on those essential items meaning that less money would be floating around economies that rely on supplying those every day essentials resulting in job losses
     
  8. FreshAir

    FreshAir Well-Known Member Past Donor

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    me too

    a flat tax where everyone pays the same % for every dollar they earn over the poverty line is the only fair system

    all income needs to be treated as income, no caps, no tax loopholes, everyone pays the same % across the board for every dollar earned over the poverty line.. rich or poor alike
     
    Last edited: Jul 18, 2019
  9. Mac-7

    Mac-7 Banned

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    How high should the threshold be?
     
  10. Mac-7

    Mac-7 Banned

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    We are talking about a radical change that the washington establishment will not willingly support

    And probably not many voters either unless they see something in it for them
     
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  11. Ethereal

    Ethereal Well-Known Member

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    We'll see about that.
     
  12. Ethereal

    Ethereal Well-Known Member

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    Do you have a point?
     
  13. Ethereal

    Ethereal Well-Known Member

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    Why?

    Cutting tens of billions of dollars of wasteful spending every year isn't serious? Interesting theory.

    Incorrect.
     
  14. Mac-7

    Mac-7 Banned

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    Simple common sense

    You need consensus not a bare majority to make such a big change

    That means everyone has to know that everyone else is sharing the pain
     
  15. Mac-7

    Mac-7 Banned

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    Its not serious when you target sections of the budget but spare others knowing that will insure that the effort will fail
     
  16. Lil Mike

    Lil Mike Well-Known Member

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    1. Currently the US dollar is the world reserve currency. Repudiation would end that abruptly with no backup currency or transition.

    2. Dollar demand would collapse world wide.

    3. Much of the world have assets in US Treasuries which would suddenly vanish.

    4. US interest rates would skyrocket (think 30-300%) because the risk of new treasury debt is extreme given the US government just repudiated their old debt.

    5. Inflation would skyrocket since dollar would become worthless.

    6. US companies, here and abroad, would go bankrupt since their asset values denominated in dollars are worthless.

    7. Every American's 401k and IRA that are denominated in dollars would become worthless.

    8. Social Security would immediately go broke.
     
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  17. DentalFloss

    DentalFloss Well-Known Member

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    Well, if you consider the majority of my property taxes go to schools that I have no children in, I think it's reasonable to assume I've paid off my own education many times over by now. Can I stop now since I've no doubt paid my fair share?
     
  18. Quantum Nerd

    Quantum Nerd Well-Known Member

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    Thanks for injecting some reality into the debate. Most people don't realize that our whole economic system is built on debt. Every dollar is lent into existence, courtesy to the fractional reserve banking system. Without debt, a constant money supply would create a deflationary spiral and economic hardship.
     
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  19. Distraff

    Distraff Well-Known Member

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    Put very simply if we cancel our debt and decide we can cancel it, then nobody will ever loan us any money ever again, and it will never be possible to run a deficit ever again, since nobody will loan us any money to make a deficit possible. Greece couldn't pay back their debt and now nobody loans them any money so they have to balance their budgets. So if the economy goes into recession and revenue falls, then the government will be forced to slash spending instead of adding a stimulus package and running a big deficit. This will make recessions really bad and would have made our last recession a depression much worse than the great depression.

    Also, that 22 trillion are treasury bond investments by working class Americans, wealthy Americans, and foreign investors. If the government cancels the debt, then 22 trillion in people's personal wealth and investment will vanish and endanger the retirement of many people. Also, when 22 trillion in global wealth vanishes, this will immediately plunge us into a recession, since those poorer investors will cut back spending and their stocks, and many of these investments are owned by banks which our economy depends on for solvency. This recession will turn into a depression as explained above.

    Since there are many foreign investors in treasury bonds, this will be a global recession and foreign countries will be very angry when trillions in their citizen's and banks investments evaporate and the global depression. So we will lose our global allies and many of our deals. Countries will move away from the dollar and make China their trading partner and place to invest. These countries will also retaliate and cancel their debts held by US citizens hurting the US economy and making this depression even worse.

    A better plan is simply to be fiscally responsible and not rack up any deficits, which would happen anyway if we cancelled the debt. The debt relative to GDP will become smaller and smaller and insignificant.
     
    Last edited: Jul 18, 2019
  20. 61falcon

    61falcon Well-Known Member

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    I cannot recall a single U.S.politician ever making a serious proposal to actually reduce the debt by paying some of it off??Our government whether GOP or Democrat never tries to bargain shop for anything,just look at the refusal to bargain shop drugs and medical services within Medicare and Madicaid.Our defense department overspends hugely on EVERYTHING they buy.
     
  21. Lil Mike

    Lil Mike Well-Known Member

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    Both Medicare and Medicaid have fixed rates (depending on location ect...) for services, both lower than private insurance rates. I'm not sure what you're talking about when you say we don't bargain shop medical services. I doubt we can get them at any lower price than is currently being paid.
     
  22. Ethereal

    Ethereal Well-Known Member

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    There is already a consensus among younger people that "national security" spending needs to be reduced. The only ones who will feel the pain from those cuts are warmongers and profiteering arms manufacturers.
     
  23. Ethereal

    Ethereal Well-Known Member

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    Sounds fine to me. The US government takes in more than enough tax revenue each year to pay for its essential functions. It doesn't need to borrow any money.

    Most of that debt is owned by the Chinese government and huge banks. And for every bond holder that gets stiffed, there will be an American with a smaller tax bill. And why should the government's financial arrangement favor bondholders over taxpayers?

    So you're volunteering to work the rest of your life paying off trillions of dollars of debt that was accumulated by greedy and irresponsible boomers because you're worried about some theoretical depression? It's just as likely that the US economy will experience a boom. Or is being debt-free somehow a bad thing for the country? Corporations and individuals default on loans and declare bankruptcy all the time. Many of them are better off as a result. Why wouldn't the same logic apply to the US government, which is just a really big corporation?
     
    Last edited: Jul 18, 2019
  24. Ethereal

    Ethereal Well-Known Member

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    Your entire scenario is predicated on the assumption that repudiating the debt would somehow collapse demand for the dollar. But the value of the dollar is based on its status as a taxable instrument and legal tender. That wouldn't change in the scenario I describe, so I fail to see how you arrived at that conclusion.
     
  25. Ethereal

    Ethereal Well-Known Member

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    That simply isn't true. The US government's financial system and much of the corrupt banking system is built on debt, but the economy itself is built on production. That is economics 101. Production makes debt possible, not the other way around.

    It's a corrupt and antiquated system, so why would we want to preserve it?

    A "deflationary spiral" just means the purchasing power of the dollar would increase. Wow, how horrible!
     

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