The debt ceiling and math

It’s not just math, describing it as so demonstrates that you have little understanding of either economics or history.

I know, you’re a junior representative or senior senator and want to make it simple for your constituents. But stop, you’rebreminding the rest of us how ineffective congress is.

Why does the deficit and debt ceiling matter today? Because we are approaching 100% debt / gdp. Sure, that affects the Greek economy, but they don’t control their currency. Next, consider Japan, with a 200% debt/GDP – but nobody is worried about that because they pay their debts mostly to themselves, because of their high savings rate – combined with they control their own currency.

On the history front, Jefferson was against any debt, but finally was sold on the idea of having a navy and eventually discovered that debt and therefore credit legitimized the United States government.

Would a balanced budget approach reduce interest payments, sure, but keep in mind that the u.s. pays lower interest than inflation. Technically, the United States is making more money if it sells debt and invests in anything, especially growth projects ( like municipal bond projects) but even gold.

Then there is the question about the federal reserve, it increased its assets by 16 trillion in 2008 alone, theoretically, if all of those loan obligations are met, then if we nationalize the federal reserve, the u.s. has no debt.

So simple math, no way. The ‘problem’ has half a dozen less than transparent debates that most congressmen can not comprehend.