Posted on 07/30/2011 12:15:23 PM PDT by lbryce
In case you havent noticed, Washington is currently consumed in an acrimonious debate over whether to raise the debt ceiling. There is no agreement about whether to do so or how, but both parties appear to accept the logic that the United States is suffering from an unacceptably high level of government debt and that further debt will doom the U.S. to generations of decline. Judging by polling data, large swaths of the country agree. Nonetheless, that consensus is wrong.
The Republicans have generally been most vocal on this score. Eric Cantor, the House Majority Leader and a major player in the negotiations, has said,
The government is a fiscal train wreck. It is over $14 trillion in debt and borrows nearly 40 cents of every dollar that it spends. Before us lie two divergent paths: one defined by crushing debt, slow growth and diminished opportunity; and one defined by achievement, innovation and American leadership. We stand at a crossroads. If we are to leave our children a nation that offers everyone a fair shot at earning their success, we must take the later path House Republicans have taken an honest, responsible approach to confront the debt crisis facing our nation.
Yet even President Obama believes further debt is untenable and has pledged to cut spending by trillions of dollars in the coming years.
What neither side seems to recognize or at least acknowledge is that what matters about the debt isnt the dollar amount per se, but how much it costs us to service it. And by that measure, the debt isnt nearly as big a problem as its being made out to be.
(Excerpt) Read more at moneyland.time.com ...
Fine Zach . . . You can pay my share of the debt . . . when/if it comes due.
I’m sure it’s been posted, but I got a link yesterday about what 114 trillion looks like (the true unfunded liabilities which must be paid or turn into debt). The ability of liberals to completely ignore plain facts never ceases to amaze me.
What country is this guy writing about?
In my opinion the government has far more of our money than they should have.
If it were cut back to 10% of what they’re taking now they would still have money left over after paying for the things they’re constitutionally mandated to pay for.
Geez.
Sure. What’s $14,000,000,000,000.00 between friends?
What's this guy drinking? Servicing the debt may seem reasonable at today's historic and panic-stricken low rates, but what happens when rates go up thanks to a downgrade and/or economic growth forces the Fed to start increasing rates. Then servicing the debt will become more than uncomfortable.
Where do these people come from?
That is because the interest rates are at amazingly, historically low levels at the moment. It is virtually impossible to keep those rates that low for a long period of time. In fact, when the rates rise to historical levels, the amount required to service the debt explodes.
Zachary Karabell is an idiot.
You beat me by a bit!
>>>Where do these people come from?
Public education.
I have a credit card with a limit of $150,000 (OK, I made that up). It is not in my best interest to keep a balance of $150,000 on my card, even if I was only paying 4%. Sooner or later the interest rate will go up and some unexpected medical bill will cause me financial ruin.
The market may suggest how much I can borrow, but it is still my responsibility to manage my finances prudently. The same analogy applies to the Treasury Bond Market and the US Government.
Well, I don’t know about you, but I’m very relieved. ;’) Thanks lbryce.
He is trying to force others to drink kool-aid. This is a pure propaganda piece telling Americans that it is okay for the US to go further into debt and to subtlely smear the Tea Party.
I didn't say it, but I'll second the motion.
Uhh....Somebody tell Congress.
Apple has more cash in the bank than the US Govt.
What does that tell u?
Looks like what this guy does in his personal life is wrack up massive CC debt and then rest easy because he’s still is able to make the minimum payments due.
The problem will really come when interest rates skyrocket. And not for consumers, only for standing debt.
Apparently these guys think that it’s impossible for us to get in bad shape no matter how much we borrow. I used to be like that and then went bankrupt almost 10 years ago.
Technically we can’t go ‘bankrupt’, but we can have insanely lower standards of living due to this crap.
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