Something that really REALLY pissed me off about the Democrats/Biden

[GriswaldTerrastone]

Fact is, this nation is thirty TRILLION dollars in debt.

How are we going to get out of that?

[RandyB]

Fact is, this nation is thirty TRILLION dollars in debt.

How are we going to get out of that?

Controlled demolition or uncontrolled collapse.

[jeff37923]

In fact, Trump jump-started our economy so well

Obama jump-started the Economy again after the 2008-2009 crash. Trump inherited it and spoke about it like if it was his own merit alone (as usual). His cultists then drank the Holy Words.

Edit: https://markets.businessinsider.com/news/stocks/9-charts-comparing-trump-economy-to-obama-bush-administrations-2019-9

The recovery from the 2008 recession was the slowest since at least World War 2. It's a terrible performance, not an accomplishment to celebrate.

And Trump, for all his stupid protectionism, nonetheless managed to get that stubborn workforce participation rate up (something Obama struggled with), and increased jobs at the low end of the economic ladder, helping blue color workers and minorities. Though that also had its downside, because a lot of those low income jobs were in the gig economy. Neither did much about about the overall fragility of the economy, though Trump did less damage. Both loved deficit spending, big budgets, and unsustainable monetary inflation.

Also people tend to forget that when your national economy hits rock bottom, any upward movement is seen as an improvement - hence why Biden is currently being hailed as a hero.

[FelixGamingX1]

Fact is, this nation is thirty TRILLION dollars in debt.

How are we going to get out of that?

Simple, we don't. And to be frank, if it wasn't for the mass inflation we are about to experience, national debt has zero to passive effect on our everyday lives.

[Pat]

Fact is, this nation is thirty TRILLION dollars in debt.

How are we going to get out of that?

Freeze spending as a percentage of the GDP, and grow out of it. $29 trillion is staggering when the federal budget is $4 trillion and GDP is $19 trillion, but it's a lot more manageable if the federal budget is $38 trillion and the GDP is $190 trillion. Which would take about 60 years at 4% growth.

But that would require restraint, the foresight to plant a tree that none of the current decision makers will live to sit in the shade of, and economic policies than encourage growth. Which would require changing political incentives, so politicians are concerned about the nation's long term inheritance, not just the next election cycle.

The other option is default, which has some real advantages. Ruining the US's credit rating means politicians wouldn't be able to borrow almost infinite money at rates approaching zero.

Incidentally, the US debt isn't that bad, compared to other wealthy countries. Don't get me wrong, I'm not saying it's good. Just that a lot of other countries are worse.

What's more worrying is the unfunded liabilities. Unfunded liabilities are the promises of future payments that politicians have made, i.e. sending social security checks to future retirees. In the private sector, companies have to list promises like that as debts, but the government has exempted themselves from that requirement. The total, the last time the CBO reported it under the alternate scenario (in 2014 maybe?), was $240 billion. Yes, that was more than an order of magnitude higher than the debt itself, at the time. And not only is this a much bigger number, but, per capita, the US's unfunded liabilities are the highest in the world. That's the dragon that will swallow future generations, not the debt.

Though of course the hidden nature of unfunded liabilities requires another fix: Hold the government to basic accounting standards. Which would probably require the establishment of a fourth branch of government, because look at what happened under the aegis of a supposedly independent federal agency, like the CBO.

[Pat]

Fact is, this nation is thirty TRILLION dollars in debt.

How are we going to get out of that?

Simple, we don't. And to be frank, if it wasn't for the mass inflation we are about to experience, national debt has zero to passive effect on our everyday lives.

Not true. Just because you can't see the consequences n your everyday life, doesn't mean it's not there.

The cost to service the national debt is between $400-600 billion a year. The interest rate has been between 2-3%. This was around 8% of the federal budget a couple years ago, and is higher now.

Compare that to Medicaid, which costs about $600 billion a year. Or Medicare, about $800 billion a year.  Or the entire national budget, which is less than $4,000 billion in normal (pre-pandemic) years.

Now consider what happens if interest rates rise. The fed funds rate is effectively negative right now, and has been under 2% for years. That's deliberate. The Fed has been printing money like crazy since 2008 to prevent it from rising even slightly. But despite all their efforts, inflation is on the horizon. With CARES and the other stimulus bills, they printed too much, and spent too much.

The prime rate is a few points higher than the federal funds rate. In the past, it's risen to more than 20% (early 80s), and was over 10% for much of the 70s and 90s. Those are closer to natural levels, without all the monetary manipulation of the Fed.

What happens if the interest the US pays on the federal debt rises to normal historical levels? What about the average historical prime rate, which is about 7%? Or over 10%? Over 20%? If we say the cost to service the national debt right now at 2.5% is half a trillion, then the cost would jump to almost $1.5 trillion, or over $2 trillion, or over $4 trillion. That's the entire federal budget, and then some.

At that point, how do they pay off the increased service changes? They can restructure or renegotiate the debt, but that only goes so far, and the further it's pushed the more the US's credit will suffer. After all, if you can only pay pennies on the dollar to your debtors, that's not much better than completely defaulting.

The other option is printing money, but that's a trap. Printing money is inflationary. So you print off money to pay off the service charges, then inflation happens, and that means the interest rate goes up. So you've paid it off one year, only to increase the amount you have to pay next year.

This is actually a lot worse than it appears, because inflation isn't just a steady, cumulative corrosion. No, inflation is a wild beast, barely held in check. Nobody knows when it'll break its leash, but when it does, you end up with hyperinflation. We can talk about the mechanics of hyperinflation, but we might as well cut to the end result: Every single person's wealth and savings is completely erased, the entire economy is destroyed, and since the medium of exchange is broken, it's not even possible to start rebuilding until the beast is killed (which is not a trivial task). Printing money is thus a form of Russian roulette, except the barrel is pointing at everyone, not just the people pulling the trigger.

Even if that trap is avoided (and the Fed is running out tricks), all the money printing in the last year and half, or the last 13 years, or the last 50 years (inflection points when it increased), still hurts you and I. Monetary inflation causes price inflation, but it doesn't happen evenly across the economy. First, it hits the banks, and secondly, the capital sector, i.e. investments. And even if you've maxxed out your 401K and Roth contributions, investments make up a much smaller portion of your total wealth than a rich person.

And that's important, because the first people to get the new money can spend it before prices rise in other sectors. In other words, they can buy up assets for cheap. The inflationary wave doesn't hit the consumer sector, which includes your wages, until the very end. So by the time you and I get the new money, the prices of assets have risen. We end up paying a dear price for the assets the wealthy and the financial sector got for cheap. This is the main reason why wealth has been funneling from the middle class and poor, to the wealthy, since monetary inflation really kicked off in the 1970s.

But we can't stop inflating the monetary supply, because it's how they suppress the interest rate. And they can't allow the interest rate to rise, because it would break the government's bank, and potentially the entire US.

[Ratman_tf]

Fact is, this nation is thirty TRILLION dollars in debt.

How are we going to get out of that?

That's for Future Generations to decide!

[oggsmash]

Fact is, this nation is thirty TRILLION dollars in debt.

How are we going to get out of that?

   Default, collapse, and break up into several nation states from the former united states.  Probably not in that order.   I suspect the debt for Rome became less important to them as the place just fell apart.

[GriswaldTerrastone]

There have been many scenarios about a social collapse in America, but there is one thing I can guarantee you all: it will be a blood bath.

There is so much hatred out there now that if the government collapses many, many people will die within a few weeks. Feminist judges who shake men down for child support when the kid isn't even his, ANTIFA, people involved from the start with this, the workplace jerk who likes pushing people's buttons...they will all be slaughtered.

Others will simply be left to die. If someone who has made a point of bashing straight white men needs my help, why would I lift a finger to help if that someone has nothing of use to offer me? The fact that Hollywood and the sports franchises are dying is just a taste of this.

The weird thing is that those who can least survive the collapse of western society (or what's left of it) are the ones most pushing for it.

[Zelen]

The weird thing is that those who can least survive the collapse of western society (or what's left of it) are the ones most pushing for it.

Wrong. They have private jets and homes all over the world. They don't have to deal with the consequences.

[KingCheops]

The weird thing is that those who can least survive the collapse of western society (or what's left of it) are the ones most pushing for it.

Wrong. They have private jets and homes all over the world. They don't have to deal with the consequences.

And apocalypse survival bunkers in easy reach in several spots.  They're ready for something.

[Trond]

The weird thing is that those who can least survive the collapse of western society (or what's left of it) are the ones most pushing for it.

Wrong. They have private jets and homes all over the world. They don't have to deal with the consequences.

Hysterical students and punks have private jets? The movie stars are mostly just bending whichever way the wind is blowing.

[GriswaldTerrastone]

The weird thing is that those who can least survive the collapse of western society (or what's left of it) are the ones most pushing for it.

Wrong. They have private jets and homes all over the world. They don't have to deal with the consequences.

If all of western society collapses they had better have small armies to protect those places, unless they are private islands.

[FelixGamingX1]

Tuned to CNN for the first time in a year, and was surprised to see not even them can ignore the facts our retreat from the middle east was a manmade disaster. Only a big taxpayer funded stimulus to have a chance at reelection now.

[Snowman0147]

Tuned to CNN for the first time in a year, and was surprised to see not even them can ignore the facts our retreat from the middle east was a manmade disaster. Only a big taxpayer funded stimulus to have a chance at reelection now.

And watch inflation fuck that up.  Beef is getting too expensive as it is due to the other economic poor choices Biden had made.