Thoughts on the Deficit Myth?

[OddBeMe]

Being a WW2 buff i remember how America just canceled the Nazi debt and made it go away. Not without downsides of course. And not saying we can do that to ourselves. Lol

[lightbulb27]

There's deficit - which is too much spending on yearly basis. That can go away by way of changing spending habits. Granted, very hard to reduce spending without trashing economy.

The debt - I'm not really sure what happened to WWII Germany debt. Whod they owe? Probably just said..."you ain't gonn aget it" cause they lost. In USA case, we can't do that without trashing dollar and global power.

[OddBeMe]

75% of our debt we owe to ourselves. Like Germany, I'd assume. But america basically canceled the riechmark and traded used bills to deutchemarks.

Again... not a great solution. But our economy is not like everyday families. The govt constantly cuts corners for itself. Like the secret service just flies the president across the country and tells the FAA to reroute.

[lightbulb27]

we still have to pay that bill, which is now aroumd a trillion. something like 200% of gdp is our debt. mathematically... a turning point according to some.
yes we can keep doing the same, but more of whta we produce goes to the debt service. that $ goes into economy as you said... but creates inflation... which the fed has to balance and deal with as do people at grocery.
I think all this been done before, there's patterns at play. and those that had similar issues... eventually lost reserve status, and wars, and faded... although they still survived.

so it's not the end of the world... unless nukes go off.

[exitseven]

I think this is what Trump plans to do with China; China has a big liability since they were the ones that caused the Covid epidemic. The damages are over a trillion dollars. Whatever debt the US owed China , it will be a good down payment on what they owe US.

[OddBeMe]

I agree. But trump definitely doesn't recognize ignoring the debt.

[exitseven]

@OddBeMe He would not be above China tsking a haircut.

[exitseven]

Thanks for the MHO

[Anonymous]

Debt goes away when a country falls. Yet others forgive debts like the US did some what to the allies when we entered the war!

Yeah if we kept charging england they would still be paying us today.

[OddBeMe]

True. It's the absurdist example to show what I mean. The govt does this sht everyday but it's just small and we handle it. They maneuver through 3 letter agencies pushing things where they need to go.

Our problem is seeing govt debt like household debt. It isn't!

[Anonymous]

Soviet ww2 debt was written off in the 70s.

[OddBeMe]

And probably led to a faster downfall. That and cernobyl.

[Opinion Owner]

I think with Soviet debt was how were they going to get it off them, it was written off i think for nuclear treaties. Economics was the big thing, they were maintaining a huge military and spending on building more weapons instead of developing their infrastructure, updating their industry and investing in technology. Of course the government was using propaganda and statistics to tell them how good they had it but of course when people are queuing for a loaf of bread they know that's horseshit.

[OddBeMe]

Very true. Can still see the awful infrastructure today. East and West Berlin is like N and S Kroea