When is the last time a Republican President or a Republican Congress actually lowered the debt?

[ttwtt78640]

As long as the minimum payment can still be met every month (or however often we pay it), there is no problem. The issue is when the minimum payment exceeds the amount that the Treasury takes in. Which I'm not sure has ever happened.

Nope, because the interest cost (for past spending) is an ever increasing portion of (current) annual spending.

 

[PoliSciPulse]

Nope, because the interest cost (for past spending) is an ever increasing portion of (current) annual spending.

Well, yeah - that's the same thing on a credit card. And banks just want the minimum payment (extra payment is not required, but desired). And since we pay our debt to the central banks of the world, they will be using the same yardstick. And when you can't pay the minimum balance, you default.

That said, you and I seem to see things differently -- you are concerned that the debt still has a concrete number. And yes, you can look at the number provided by the Treasury and say, "That's the amount we owe." I'm arguing the opposite, which is that nations will be happy regardless of what number you have as long as you can pay them. Put differently, from a bookkeeping perspective, yes, we do need that number in case one day we actually do manage to turn the balance sheet around. But as a matter of pragmatism, as long as you pay your creditors, that number doesn't matter. They will gladly take the United States' money because it builds their dollar reserves.

 

[ttwtt78640]

Well, yeah - that's the same thing on a credit card. And banks just want the minimum payment (extra payment is not required, but desired). And since we pay our debt to the central banks of the world, they will be using the same yardstick. And when you can't pay the minimum balance, you default.

That said, you and I seem to see things differently -- you are concerned that the debt still has a concrete number. And yes, you can look at the number provided by the Treasury and say, "That's the amount we owe." I'm arguing the opposite, which is that nations will be happy regardless of what number you have as long as you can pay them. Put differently, from a bookkeeping perspective, yes, we do need that number in case one day we actually do manage to turn the balance sheet around. But as a matter of pragmatism, as long as you pay your creditors, that number doesn't matter. They will gladly take the United States' money because it builds their dollar reserves.

OK, but the more you bought on credit, the less you have each month to buy anything else.

 

[PoliSciPulse]

OK, but the more you bought on credit, the less you have each month to buy anything else.

Unless you have a credit card with no limit, which is essentially the argument I'm making here. All you have to do is make the minimum payments. If the United States were actually treated like someone using a credit card with a limit, they'd have gone over the limit a long time ago and its credit score would be roached (we're talking D rating, not AA rating). The only nations who ever have to worry about limits and such are the ones that take loans from the International Monetary Fund (IMF) or World Bank, and even then, as long as reforms to their spending are made, they can still get loans.

 

[ttwtt78640]

Unless you have a credit card with no limit, which is essentially the argument I'm making here. All you have to do is make the minimum payments. If the United States were actually treated like someone using a credit card with a limit, they'd have gone over the limit a long time ago and its credit score would be roached (we're talking D rating, not AA rating). The only nations who ever have to worry about limits and such are the ones that take loans from the International Monetary Fund (IMF) or World Bank, and even then, as long as reforms to their spending are made, they can still get loans.

There is a limit as to how much tax revenue the government gets each year, but interest on past spending is becoming an increasing percentage of mandatory spending, leaving less for sending all else (without more borrowing).

 

[Yes_Minister]

There is a limit as to how much tax revenue the government gets each year, but interest on past spending is becoming an increasing percentage of mandatory spending, leaving less for sending all else (without more borrowing).

Doesn't Japan have the biggest debt-to-GDP ratio in the world? Are they spending a ton of money on interest of debt repayment?

Also didn't the GOP just put the trillion dollars the US spent on the Iraq War on the old credit card? Are people who complain about the national debt, but insist the US spend 800 billion dollars on the military every year really serious? Also, do the upper-class tax cuts the GOP often introduces actually pay for themselves or do they increase the debt by lowering the amount of money the government takes in?

Wouldn't austerity be the fastest way to reduce the debt, where you cut spending and raise taxes at the same time? That is what Germany imposed on Greece some years ago. The problem is, everyone would hate that, but at least that would be an actual real solution if you think the debt is the worst problem in the world.

 

[ralfy]

Overall debt went up because of continuous voodoo economics.

 

[ttwtt78640]

Doesn't Japan have the biggest debt-to-GDP ratio in the world? Are they spending a ton of money on interest of debt repayment?

Also didn't the GOP just put the trillion dollars the US spent on the Iraq War on the old credit card? Are people who complain about the national debt, but insist the US spend 800 billion dollars on the military every year really serious? Also, do the upper-class tax cuts the GOP often introduces actually pay for themselves or do they increase the debt by lowering the amount of money the government takes in?

Wouldn't austerity be the fastest way to reduce the debt, where you cut spending and raise taxes at the same time? That is what Germany imposed on Greece some years ago. The problem is, everyone would hate that, but at least that would be an actual real solution if you think the debt is the worst problem in the world.

It won’t be long before paying interest on the national debt exceeds defense spending.

As it is, the federal government over the next decade is projected to spend a total of $12.4 trillion on interest — the highest amount of interest in any historical 10-year period, according to the Peter G. Peterson Foundation, a think tank that's focused on reducing the federal debt. That's the equivalent of about $37,100 per person, it said.

U.S. interest payments on its debt are set to exceed defense spending. Should we be worried?

Higher interest rates and heavy government spending is leading to ballooning interest payments on the nation's debt.

www.cbsnews.com

 

[Hip septuagenarian]

Does it matter???

Republicans like to act like it matters.

 

[Yes_Minister]

It won’t be long before paying interest on the national debt exceeds defense spending.

U.S. interest payments on its debt are set to exceed defense spending. Should we be worried?

Higher interest rates and heavy government spending is leading to ballooning interest payments on the nation's debt.

www.cbsnews.com

Okay, but does Japan currently spend a lot of its budget paying interest on its debt? I am not being glib here, I am actually curious. Their debt load is far bigger than their GDP, which is not quite the case in the US.

I also think if anyone thinks the ancient people who vote for the GOP would want to cut Social Security or Medicare is fooling themselves. They want to punish some random person on social assistance, but they won't want to cut programs they benefit from, why would they?

Also why does the US have a higher debt load than a social democracy like Sweden:

How Did Sweden's National Debt Get So Low? Hint: Retirement Funds - Commodity.com

ContentsThe National Debt Of SwedenHow Is National Government Debt Calculated & Reported?Facts About Sweden’s National DebtHow Did Sweden’s National Debt Get So Low?What Is Sweden’s Credit Rating?Who Manages Sweden’s National Debt?Types Of Swedish Government SecuritiesForeign Investors In The...

commodity.com

 

[ttwtt78640]

Okay, but does Japan currently spend a lot of its budget paying interest on its debt? I am not being glib here, I am actually curious. Their debt load is far bigger than their GDP, which is not quite the case in the US.

It seems that Japan pays less (as % of its GDP) on debt service than the US does.

https://www.imf.org/external/datamapper/ie@FPP/ITA

I also think if anyone thinks the ancient people who vote for the GOP would want to cut Social Security or Medicare is fooling themselves. They want to punish some random person on social assistance, but they won't want to cut programs they benefit from, why would they?

Also why does the US have a higher debt load than a social democracy like Sweden:

How Did Sweden's National Debt Get So Low? Hint: Retirement Funds - Commodity.com

ContentsThe National Debt Of SwedenHow Is National Government Debt Calculated & Reported?Facts About Sweden’s National DebtHow Did Sweden’s National Debt Get So Low?What Is Sweden’s Credit Rating?Who Manages Sweden’s National Debt?Types Of Swedish Government SecuritiesForeign Investors In The...

commodity.com

 

[Yes_Minister]

It seems that Japan pays less (as % of its GDP) on debt service than the US does.

https://www.imf.org/external/datamapper/ie@FPP/ITA

But that's interesting, if Japan is in an worst position towards its debt in terms of debt ratio to GDP ratio than the US, why would it have to put less it's GDP towards debt repayment? Shouldn't Japan be in an worst position for its debt than the US?

 

[ttwtt78640]

But that's interesting, if Japan is in an worst position towards its debt in terms of debt ratio to GDP ratio than the US, why would it have to put less it's GDP towards debt repayment? Shouldn't Japan be in an worst position for its debt than the US?

That’s a good question, since Japan appears to have higher government spending (as % of GDP) than the US does. The only thing that I can think of is that Japan must have a lower interest rate than the US.