15. Deficits and Fiat Money - National Debt Is Not “Immoral.” The Moral Question is Inequality.
No economic news report is complete without a lingering look at the terrifying national debt clock rocketing toward infinity [12]. What is wrong with the picture? There are about 300 million people in the US so better to divide the debt clock number by 300 million to show average savings per person. The clock will also slow down by a factor of 300 million.
But they love to mess with your mind and program your thinking with vivid imagery.
Listen to people talk about the American national debt. They cannot get away from their fixation that government debt is “borrowed” and has to be repaid to avoid “bankruptcy.” The presidential candidates and both parties and Ron Paul devotees all proliferate versions of these misstatements.[1][2][3] Internet blogs are filled with debt cliches[4].
Deficit loathing has gone over the top -- into issues of morality. One especially bizarre statement by a public figure was Carly Fiorina’s parable of disciplining children by taking away their credit cards [6]. Mitt Romney recently upped the ante, to opine on deficit morality itself.
“We have a president who spends more than he takes in. It’s wrong, it’s immoral and it must stop.” [13]
Maybe as an expert on morality of deficits Mr Romney is right ... he is a huge beneficiary of all that national debt piling up as his outsized share of total private savings.
Nothing in this tally stick story could predict where the savings would pile for groups like the top 1% or the top 10% or the bottom 50%. Impossible to predict how bad the inequality of the piles would become. Those piles become different size over time [14] due to individual talent for moneymaking and individual ability to manipulate the money system to advantage and luck.
It ought (moral judgment, this) to be an ongoing high-integrity discussion at the national level how extreme we want the inequality to get and if we want to reduce the inequality and who gets to choose if it is reduced and by how much and by what means.
But they love to mess with your mind and program your thinking with vivid imagery.
Listen to people talk about the American national debt. They cannot get away from their fixation that government debt is “borrowed” and has to be repaid to avoid “bankruptcy.” The presidential candidates and both parties and Ron Paul devotees all proliferate versions of these misstatements.[1][2][3] Internet blogs are filled with debt cliches[4].
Deficit loathing has gone over the top -- into issues of morality. One especially bizarre statement by a public figure was Carly Fiorina’s parable of disciplining children by taking away their credit cards [6]. Mitt Romney recently upped the ante, to opine on deficit morality itself.
“We have a president who spends more than he takes in. It’s wrong, it’s immoral and it must stop.” [13]
Maybe as an expert on morality of deficits Mr Romney is right ... he is a huge beneficiary of all that national debt piling up as his outsized share of total private savings.
Nothing in this tally stick story could predict where the savings would pile for groups like the top 1% or the top 10% or the bottom 50%. Impossible to predict how bad the inequality of the piles would become. Those piles become different size over time [14] due to individual talent for moneymaking and individual ability to manipulate the money system to advantage and luck.
It ought (moral judgment, this) to be an ongoing high-integrity discussion at the national level how extreme we want the inequality to get and if we want to reduce the inequality and who gets to choose if it is reduced and by how much and by what means.