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"We" Don't Owe $16 Trillion; and You Don't Owe $50,000

letsgetitdone's picture

Just saw John Sununu, one of Republicans favorite Bushie junk yard attack dogs all up in arms about the debt subject to the limit (the so-called national debt) reaching $16 Trillion dollars, and going on to tell people that every man, woman, and child in the United States now owes $50,000 to pay that debt off. Now, I'm here to tell you that all that is bull shit.

The debt subject to the limit is a debt incurred by the Congress and the Treasury Department because when the Government spends more than it taxes, the Treasury Department issues debt instruments in the name of the US Government even though it doesn't have to do that in order to deficit spend. These instruments make the Government a debtor. But they don't make any individual man, woman, or child in the United States a debtor. So, the idea that YOU owe $50,000 or even a single dollar is BS. You've signed no such note. You've not charged a single dollar on your credit card for this purpose. And you've not made a single promise that any portion of the national debt will be paid by YOU.

Well, you might ask: “Doesn't the US have to pay the $16 T debt sooner or later by taxing, and won't we then be responsible for our portion in the form of a tax obligation?”

The answer is that the US must pay all its debts when they fall due. It's in the Constitution. If the Federal Government refused to do that it would be violating the Constitution, and would be illegal. But saying that the US must pay all its debts, doesn't say that it must do so only by using taxation to raise enough revenue to run budget surpluses and pay those debts. It's that lie that Sununu and the other austerians want you to believe!

How we pay US debts is up to us and is a political question. If we do it the way Sununu suggests we'll condemn the country to permanent recession in the context of a perpetually depressed economy in which the wealthy get wealthier and everyone else gets poorer. That's what a plutocratic tool like John Sununu wants. But there are other ways to do it.

The best way, because it ends unnecessary welfare for the rich and foreign nations is to stop issuing debt instruments, continue with enough deficit spending to create full employment and an economy operating at its full potential, and make up the gap between spending and revenue by using the legal power of the Government to issue 1 oz. Proof Platinum coins with arbitrary face values, and using the coin seigniorage profits gained by depositing the coins at the Federal Reserve. Here's the process, along with the political speech explaining it to everybody.

Read it, and understand that There Is An Alternative (TIAA) to making every, or any, man, woman, or child pay $50,000 to pay off that national debt through taxing more than we spend, and that John Sununu, as usual, either doesn't know what he's talking about or is lying through his teeth about there not being one. Take your choice!

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Comments

Submitted by Hugh on

Excellent point. Distraction is the priniciple weapon in the class war being waged against us, and misdirection is an important example of it, as in getting people to worry about owing what they do not owe, or even blaming them for trying to lay off these debts which they do not owe on to their grandchildren and future generations. The point is to trap them in a fiction so that they can not even conceive of an alternative outside of the fiction, such as using the power of a fiat currency to pay off debt without incurring new debt and closing down the subsidy to the rich that Treasuries are.

letsgetitdone's picture
Submitted by letsgetitdone on

misdirecting us with irrelevant stories and fairy tales, and the reinforce with the big money. Until Americans supplement their own cynicism with the discriminating critical ability to take apart the fairy tales, the elections will always be about fairy tale wars.

mtngun's picture
Submitted by mtngun on

The national debt guilt trip reminds me of the story my parents used to tell me about how I had to eat my broccoli because children were starving in India.