Posted on 10/23/2009 7:26:01 AM PDT by SeekAndFind
At least since the end of World War II, sovereign debt risk has been a very real problem, but one confined mostly to the developing world. Sure, there was the risk that the government might decide to inflate away the value of your loan, that risk abated in most places. (Though obviously not all--I'm looking at you, Italy!) Places where it didn't abate were increasingly forced to borrow in other currencies, leaving default as their main option--inflating away domestic denominated debt tended to make your dollar denominated debt problems worse.
Oh, conservatives made noise about sovereign debt risk and inflation, and then they let the liberals take over for a while under the Bush administration, but this remained very much a fringe issue. US government debt is still used as the "risk free" rate, and few governments of industrialized countries have much problem borrowing.
But the financial crisis is making developed-world sovereign debt risk a more worrisome problem. As this article in the New York Times points out, Japan's massive debt is finally starting to become a really worrying problem, especially as they need to borrow more money to stimulate their sodden economy.
Tokyo's new government, which won a landslide victory on an ambitious (and expensive) social agenda, is set to issue a record amount of debt, borrowing more in government bonds than it will receive in tax receipts for the first time since the years after World War II.
"Public sector finances are spinning out of control -- fast," said Carl Weinberg, chief economist at High Frequency Economics in a recent note to clients. "We believe a fiscal crisis is imminent."
One of the lessons of Japan's experience is that a government saddled with debt can quickly run out of room to maneuver.
(Excerpt) Read more at business.theatlantic.com ...
I see. Jim Jeffords was our fault. The RINOs allied with the Democrats to control the agenda and let conservatives take the blame. That way, they could fix it with more socialism because "Bush failed."
What a crock. Bush was a statist from the get-go and conservatives have NEVER held a majority in Congress.
If you want to cut to the chase in an argument with a liberal over Obama’s proposals and programs, just tell them we don’t have the money. Period. We’re broke, in debt up to our eyeballs, and this is not the time for expensive government experimentation.
Nah! We can print more. We have plenty of paper and ink. /s
There are at least four failures in your argument, with all due respect.
1: Bush is the one who got us here, and we are the ones who have the education and articulation to get us out!
2: Anybody who has taken Economics 101 knows the government has to spend in times like this!
3: It’s not an experiment, we have carefully worked out our plans behind closed doors where you troglodyte Republicans can’t interfere with them!
4: Typical logical argument. My college humanistic sociology professor had five better theories, one for each day of the week!
^^^^^^^^^^
They can’t be talked to. Logic does not exist. They are either defeated, or the country is gone.
Very simple solution, take over Las Vegas and Atlantic City and create a government controlled lottery, tax free of course.
This is the new liberal/democratic world that America voted for.
They are either defeated, or the country is gone.
They’re like Michael Myers on Halloween or Zombies!
They never ‘die’!
"I deem [this one of] the essential principles of our government and consequently [one] which ought to shape its administration:... The honest payment of our debts and sacred preservation of the public faith." --Thomas Jefferson: 1st Inaugural, 1801. ME 3:322
"I sincerely believe... that the principle of spending money to be paid by posterity under the name of funding is but swindling futurity on a large scale." --Thomas Jefferson to John Taylor, 1816. ME 15:23
"[With the decline of society] begins, indeed, the bellum omnium in omnia [war of all against all], which some philosophers observing to be so general in this world, have mistaken it for the natural, instead of the abusive state of man. And the fore horse of this frightful team is public debt. Taxation follows that, and in its train wretchedness and oppression." --Thomas Jefferson to Samuel Kercheval, 1816. ME 15:40
In 2009 all level of governments in the US will spend 45% of GDP. This level has only been exceeded during the World War II years. As a comparison, most European countries and Canada governments spend 50% of GDP in a normal year. The money is there although it would take over $1 trillion in new taxes to become Europe.
In 2009 all level of governments in the US will spend 45% of GDP. This level has only been exceeded during the World War II years. As a comparison, most European countries and Canada governments spend 50% of GDP in a normal year. The money is there although it would take over $1 trillion in new taxes to become Europe.
“Why isn’t slowing down spending and taxing less to allow businesses and individuals to keep more of their money an option ?”
Because it’s a repudiation of the total governmental control these types seek. Logic and common sense are intended to fall to the goal of absolute government.
Why can’t President Mugabe er, er Obama just write a check?
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