IMF Warns About Soaring Global Government Debt (semafor.com) 85
The IMF has issued a stark warning over soaring global government debt, saying it is on track to exceed 100% of GDP by 2029. Semafor: Such a ratio would be the highest since 1948, when large economies were rebuilding post-war. Today, "there is little political appetite for belt-tightening," The Economist wrote: Rich nations are reluctant to raise taxes on their beleaguered electorates -- but they're facing pressure to spend more on defense, and on social services for aging populations.
Higher long-term bond yields, meanwhile, suggest investor wariness over governments' balance sheets. In the short term, the debt concerns manifest in political disruption: France's budget fight recently toppled another government, while the US federal shutdown highlights the tension between new spending demands and deficit reduction.
Higher long-term bond yields, meanwhile, suggest investor wariness over governments' balance sheets. In the short term, the debt concerns manifest in political disruption: France's budget fight recently toppled another government, while the US federal shutdown highlights the tension between new spending demands and deficit reduction.
I'm not going to speak about the rest of the world (Score:2, Interesting)
So 80% of American debt is owned by americans. We literally owe it to ourselves. This is the equivalent of you loaning yourself money. Only it's a little different than that because you're not a nation state.
When America loans itself money that is effectively creating money supply. That is perfectly fine as long as that money suppl
Re: I'm not going to speak about the rest of the w (Score:4, Insightful)
So it's neither (Score:1)
You can do that as long as there is economic activity backing that money and if you take that money and you actually invest it then you get that economic activity.
So for example back in 1980 when the Democrats gave Ronald Reagan his military spending in exchange for 1 trillion dollars of infrastructure spending that was a solid investment.
That i
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You should ask yoursel
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"When the government hands out money in the form of debt it creates that money out of thin air. " No it isn't, that money comes from the bond market, not thin air. And bond rates really matter. We can expect the bond rates the U.S. must pay to borrow to raise due to no fiscal discipline in Washington (always cutting taxes on the wealthy because they "create jobs".....create jobs for themselves).
Washington does other stupid things, like propping up the private medical insurance market causing Americans to pa
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You don't get what he is saying. The other side of the debt is held by somebody. The interest payment is somebody else's passive income. Whose is it? Other Americans.
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There is plenty of money, it's just being hoarded. If more of it was flowing through the economy and thus being taxed, this wouldn't be an issue.
The funny thing is (Score:1)
But we don't want to do that because it would wreck the value of the us dollar. We want countries to hold a bunch of our debt because that artificially boosts the value of our currency which artificially lowers the cost of buying goods from other countries.
It would be one thing if we
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there's no benefit to workers from having consumer goods manufactured in your country anymore. Stuff like coffee pots and TVs and whatnot are almost entirely built by machines except where slave labor exists.
That is just late 20th century thinking. That worked in mono-polar world where we were the only nation really capable of sustain force projection (security), the reserve currency, and at least some technological superiority.
Advanced Medical equipment - If China wanted to take that market they could inside a decade. Same thing with chips at this point, they have all the precursors. There is nothing left we can produce that is a 'you can't get there from here' for them any longer, it is just a pick an ite
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You are so close to figuring something out (Score:1)
What if instead of that we focused on the health and well-being of American citizens?
I don't mean American first bullshit nationalism nonsense. We don't have to close our borders or anything like that to make things better.
The only thing I'm talking about is ending the race to the bottom we have been trapped in since Nixon opened up the globe and the factory automation got going in the '80s.
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When America loans itself money that is effectively creating money supply.
This is patently false. The only way to buy US public debt is with US dollars, that already exist. Buying public debt increases the money velocity some, but that is it. Private debt is what increases the money supply, because all the way up the chain, the Fed created it out of nothing. The Fed is control of money creation.
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The problem is the interest. In 2024, the US paid about $890 billion in interest payments. That's a whole lot of money that could have been spent on, well, *not* interest. That burden of paying interest makes it harder to put money where it's actually needed, without either cutting programs or raising taxes.
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The problem is the interest. In 2024, the US paid about $890 billion in interest payments. That's a whole lot of money that could have been spent on, well, *not* interest. That burden of paying interest makes it harder to put money where it's actually needed, without either cutting programs or raising taxes.
Quite right. I'm Canadian but the same idea applies. I can remember a couple decades ago when our federal debt was a few hundred billion. A lot of money at that time yes, but with some serious effort there was at least a theoretical possibility of paying a significant amount of it off. As our debt approaches 2 trillion today I really hope nobody is kidding themselves thinking any meaningful fraction is ever going to be paid down. It is not like the interest on a mortgage or a loan that goes down over t
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Yes, while our kids will inherit the debt owed by the government, they will also inherit the bonds sold by the government to citizens to cover that debt.
But there is still a potential crowding out problem. Every $1 spent to buy a government bond is a $1 that is unavailable for investing in private enterprise. The real question is not if the debt is unsustainable, it is whether the ROI of the marginal $1 spent by the government paid for by debt is greater than the ROI of whatever private enterprise would hav
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We already do (tax the rich).
In the US, the top 1% pay 40% of all income taxes collected.
The top 50% of earners paid 97% of all income taxes collected.
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We already do (tax the rich).
In the US, the top 1% pay 40% of all income taxes collected.
The top 50% of earners paid 97% of all income taxes collected.
That is mostly statistical bs. To start with the income tax is only one tax people pay. Second, those numbers invariably use the amount of a single years taxable income as the measure of earnings. And it includes everybody who files a tax return.. Including the kid who worked for two weeks at McDonald's. So the bottom 50% includes a lot of people who have close to zero income.
So most people in the top 50% aren't even vaguely rich. The bottom 50% includes a lot of people who are rich but had a bad year (w
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Here's an actual breakdown: https://taxfoundation.org/data... [taxfoundation.org]
- Top 1% of earners paid 40% of all income taxes (income over $731,000)
- Top 5% of earners paid 61% of all income taxes (income over $335,000)
- Top 10% of earners paid 72% of all income taxes (income over $167,000)
- Top 50% of earners paid 97% of all income taxes (income over $75,000)
The linked report gives many more details.
As for your protest that some rich people have bad years...well yes, income tax is paid on ANNUAL income. So if somebody has
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But if they really are rich, the "bad years" won't continue forever, and if they do, they won't be rich anymore.
We aren't talking about how much their net worth increased so that is obviously false. And we aren't talking about all taxes, just the graduated income tax. And we aren't comparing people, we are comparing tax returns. And we are lumping the percentages together. The top 1% of people now own 30
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To call it propaganda, you'd need to identify what their propaganda goal is. Otherwise, it's just a random guy (you) spouting about how he disagrees with the data. I doubt you have done any serious research that would contradict their data.
Be that as it may, it sounds like your biggest beef is defining wealth as "annual income" vs. "total assets." Well, in that category as well, wealthy people pay the vast majority of taxes, because only wealthy people have significant assets to be taxed. These include:
- Re
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To call it propaganda, you'd need to identify what their propaganda goal is.
No, all you need to do is look at the details and the history of the organization.
Wealthy people pay the vast majority of taxes, because only wealthy people have significant assets to be taxed.
See. Its easy to see propaganda. That is a ridiculous argument.
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So, you say to look at the history of the organization, but you can't point to anything specific. What specific part of its history do you refer to, and how does that apply to this conversation?
And you say the argument is ridiculous, but you can't point to a single thing about it that's...ridiculous. That makes me think you don't actually have an argument, just an opinion. And that makes your statements no more convincing than propaganda.
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you don't actually have an argument
You are right, I am not interested in an argument. And I see no point in a discussion with propagandists. They simply change the topic, as you have done here.
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Weasel words.
I made my point and backed it with sources. I invite you to do the same.
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You haven't supported a single fact of any kind. What is a "fair share"? How do you know the numbers were massaged? Who has published numbers you think are reliable? Got a link?
Nope, all you have are personal opinions because, you know, it *couldn't possibly* be true. Prove it. Or at the very least, provide some evidence. But nope, you don't have any, because it doesn't exist.
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What is a "fair share"?
I don't know. You are the one that is claiming the rich are paying more than their fair share.
The evidence you apparently used to come to that opinion is based on defining the rich as the people who pay the most income tax one year and finding that group paid the most income tax that year.
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No, I never said the rich are paying more than their fair share. What I said was that
We already do (tax the rich).
Don't put words in my mouth, I never made a comment about the fairness or unfairness of the current tax system. I only pointed out that the statement of Anonymous Coward, and supported by you, was factually incorrect.
In reply, YOU said
Given the way wealth is distributed, the top 1% paying 40% of the taxes means they are paying less than their share.
So I ask again, what is "their share"? How do we decide what is fair?
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We already do (tax the rich). In the US, the top 1% pay 40% of all income taxes collected. The top 50% of earners paid 97% of all income taxes collected.
I think the tax foundation logic is pretty clear there. You are defining those who pay the most income taxes as "the rich". Its not surprising you find "the rich" pay the most income taxes. Remember your claim that Donald Trump isn't rich when he isn't paying a lot of income taxes?
Given the way wealth is distributed, the top 1% paying 40% of the taxes means they are paying less than their share.
It is commenting on your numbers and I clearly got tricked into associating that top 1% with wealth, not income taxes. But I think the wealthy should be paying at least as big a percentage for public services as the percentage of
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Thank you, now you're starting to explain your position clearly.
You are defining those who pay the most income taxes as "the rich". Its not surprising you find "the rich" pay the most income taxes.
We also defined "the rich" as those who have a lot of assets, and we established that only the rich (by that definition) pay taxes on assets. So pick whatever definition of wealth you like: the most income, or the most assets--by either definition, the rich pay the vast majority of taxes.
Remember your claim that Donald Trump isn't rich when he isn't paying a lot of income taxes?
No, I don't remember that, because I never said that.
I think the wealthy should be paying at least as big a percentage for public services as the percentage of national wealth they have accumulated with the support and help of those public services.
That qualifies as an actual position. But what is national wealth? How does it apply to a rich person? How
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only the rich (by that definition) pay taxes on assets.
The income tax doesn't tax assets. And the rich aren't the only people with assets. They just have more of them and the income tax doesn't tax them. You are actually making the point that those rich in assets don't pay taxes based on those assets and that benefits the rich. About the only assets that get taxed are real estate and every homeowner pays those taxes.
On the other hand, wages over about $100,000 are taxed at a fixed minimum of 13%. Wages over that amount aren't subject to those taxes at all. So
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I believe that it's important to discuss issues with people who disagree with you, because I believe we can learn from people with other viewpoints. However, you have repeatedly made false statements, such as:
wages over about $100,000 are taxed at a fixed minimum of 13%. Wages over that amount aren't subject to those taxes at all.
Income tax for this income bracket start at 24% and increase to 37% for any income over $609,000. https://www.irs.gov/filing/fed... [irs.gov]
When you make statements that are *that* wrong, I no longer find it useful to continue the discussion.
You have also repeatedly misquoted me and twisted what I said. I've al
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Income tax for this income
Once again you are limiting the discussion to the taxes the rich pay and ignoring the taxes they don't pay. There is a 13% tax on wages under $100,000. Its not applied to other sources of income. And its not applied to wages over $100,000. Which means people who work for a living pay it on all the money they need to live on and the rich who live off their assets don't pay it at all.
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FICA is not an income tax, nor is it a regular tax used to fund the government. It is instead a tax used for one specific purpose: to fund one's *own* retirement. The more you pay in FICA withholdings, the more you get back per month in your retirement. Once you reach $176,000 in income (not $100,000), your FICA withholding stops. Also, the amount of the amount of Social Security payments you will receive in retirement, stops increasing. So essentially the tax stops when you reach the maximum benefit the go
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FICA is not an income tax
Nonetheless it is a tax.
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We agree on that point.
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it is instead a tax used for one specific purpose: to fund one's *own* retirement.
Just to be clear, that is not true. It funds benefits to current retirees. The benefits you get when you retire are not tied to the taxes you paid,they are tied to how much you earned. And no those are not the same thing.
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Yes, it does fund current retirees. But the benefits you get when you retire are indeed tied to the FICA taxes you paid. While it's true that they are nominally tied to your income, the taxes you pay are a percentage of your income. And further, because FICA is capped at $176,000 per year, you also don't get credit for income over that amount, with regard to the amount of SS benefits you get in retirement.
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because FICA is capped at $176,000 per year, you also don't get credit for income over that amount, with regard to the amount of SS benefits you get in retirement.
There is no guarantee that if congress expands the wages taxed it will also expand the benefits for people with those higher wages. They are, in fact, separate decisions. Just as there is no guarantee that congress won't decide to reduce social security benefits in the future or eliminate the taxes entirely and pay no benefits.
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That's all true. But they are *not* going to ever make those benefits unlimited, if anything they will make changes to reduce the amount of benefits received by people who exceed those limits. So if you're trying to hold this up as a way that the government "doesn't tax the rich enough" then sorry, I don't follow.
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sorry, I don't follow.
What don't you follow? People have all their wage income under $100,000 taxed and people who have no wages don't pay the tax at all no matter how rich or high their income and if they have wages over $100,000 they don't pay taxes on those either. In any case, you and the tax foundation are trying to make the case that the rich pay more than their fair share bu excluded most of the taxes they don't pay and others do from the comparison. That includes this.
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There you go again, lying to make your point. It's not capped at $100,000, and I pointed to an official IRS link to prove it. If you can't even bother with facts, there's no reason I should listen to your logic, such as it is. We already went over how the Social Security payments are capped. It doesn't seem unfair to me.
Re:billionaires (Score:5, Insightful)
You're right. And before people chime and say
we need to realize a few things: the billionaire oligarch ultra-wealthy folks (the top 0.1% or so ~ those with hundreds of millions of dollars or equivalent, or more) choose to allocate huge amounts of wealth to frivolities (yachts, etc.), which in turn sucks away resources from real concerns (food, housing, health care, the environment, elder care, education). We live in a world with finite resources and the allocation of those resources matters. There is a zero-sum element at play. In addition, the uber-wealthy control the major global media and also the major political parties, which means that the uber-wealthy control the national discourse & the allocation of national wealth. We need to push back against the ultra-wealthy or else we will be left with a mere pittance. They will call this pittance "basic income," and it will be bare-minimum subsistence living, scraping-by survival income.
Don't be surprised if attempts to tax the wealth of the ultra-ultra-wealthy will be met with a deluge of articles in the news media about how it can't work, won't be done, etc. Tax wealth, not work!
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We need to push back against the ultra-wealthy or else we will be left with a mere pittance.
You mean we will be left in mass graves? They are absolutely not planning to give us any basic income.
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I think we will only get mass graves if they can program the robots to dig. Otherwise, we won't even get that.
Re: billionaires (Score:2)
They can, mining equipment can do that. And it's big enough too
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those with hundreds of millions of dollars or equivalent, or more) choose to allocate huge amounts of wealth to frivolities (yachts, etc.), which in turn sucks away resources from real concerns (food, housing, health care, the environment, elder care, education). We live in a world with finite resources and the allocation of those resources matters.
The top 0.1% of earners pay 42% of all income tax collected. [taxfoundation.org]
The top 10% of earners pay 73% of all income tax collected.
The top 50% of earners pay 97% of all income tax collected.
In other words, the 'ultra-wealthy' are actually paying way more than their fair share, if you want to have a honest discussion about 'fairness'. Even their 'excessive consumption', generates economic activity which would otherwise not exist.
We need to push back against the ultra-wealthy or else we will be left with a mere pittance.
What you need to do is get a job or a trade, and I don't mean your average bullshit barist
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Did you read the link you posted, or is this just your reflex talking-points-based reply for any discussion on taxation rates?
The page I linked uses hard data from the IRS for income tax collection and revenue percentages; the link you posted is a 5-point post talking about how the 'unfairness of taxation rates'. The two are not the same thing.
And again, your link specifically mentions "unrealized capital gains", which are, by definition, untaxable. I don't have my crayons, but let me try to make it simp
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Share of Total Gross Income - shows the richest keeping more of their money, facts.
https://taxfoundation.org/data... [taxfoundation.org]
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Well... yah?
If you have $100 and I have $5, do I have any right to say what you can or can't do with your $100 dollars, just because I only have $5?
I don't think I do, but if you think so, then give me $50.
It's only fair.
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Ok now do the same analysis for property tax instead of income tax.
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The top 0.1% of earners pay 42% of all income tax collected. [taxfoundation.org] The top 10% of earners pay 73% of all income tax collected. The top 50% of earners pay 97% of all income tax collected.
This is propaganda from the tax foundation, funded by the ultra wealthy with a chunk of matching tax dollars from the rest of us. You will notice the term "earners" does some kid who has a trust fund from his parents "earning" the interest they live off of make him an earner? No. That term is carefully chosen, likely based on focus groups, to tell a message.
Those numbers are actually just numbers from tax returns. So if your kid files a tax return on his summer job he's included in that bottom 50% of "ear
What's got me scared about the billionaires (Score:1)
Don't think any of us ever imagined capitalism falling to neo feudalism instead of something like socialism or something. Even most fascist regimes tended towards capitalism like China does. So the idea of the trade of goods and services for money with the goal of people obtaining and using capital fundamentally breaking down not from the bottom but from the to
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Those with hundreds of millions of dollars or equivalent, or more) choose to allocate huge amounts of wealth to frivolities (yachts, etc.), which in turn sucks away resources from real concerns
Its actually worse than that. Tax deductions combined with graduated income tax brackets means when Bill Gates gives a million dollars to his favorite cause, he saves a third of it in taxes. Everyone else pays higher taxes to make up the difference. In effect, the taxpayers give a 50% match to his contribution. So when you wonder who is paying for all those non-profit think tanks that defend the wealthy's interests, the answer is we are. And we are borrowing some of the money to pay for it.
eat the rich (Score:2)
At some point people will stop being distracted by wedge issue bullshit and notice how shitty exploitative rich people have made things, right?
Because where does it end? Everyone's working in company towns again? Better not piss off the boss.
Correction (Score:3)
pressure to spend more on ... social services for aging populations.
"... pressure to spend more on social services for the imported third world."
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"... pressure to spend more on social services for the imported third world."
Oh did the latest Fox News talking points drop? I guess the very predictable problems caused by the baby boom and an economic process that relies on borrowing from future generations which turned out to be smaller and have lower wealth can now be blamed on immigrants too.
I can understand why you feel threatened. It sounds like your immigrants are some kind of super humans, there's literally nothing they can't do, somehow stealing your jobs while supported by welfare and having access to public socialised me
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I find it ironic, and delicious, that farmers are going bankrupt at record rates right now https://www.hoosieragtoday.com... [hoosieragtoday.com] due to
- Inability to find labor (because they were either deported or self-deported)
- Inability to sell crops overseas (because of the tariff war)
It's ironic because farmers almost unanimously voted for a President they knew would...deport their workers and start tariff wars.
Yet even more generic space filler (Score:2)
Were I that slack I'd have been fired from every job I ever held.
Smoke and mirrors? (Score:3)
Fake news (Score:2)
"the US federal shutdown highlights the tension between new spending demands and deficit reduction"
No, this is not true and hasn't been true for many decades. Republicans, Democrats, conservatives, liberals, all of them want to spend more. Yes, they want to cut back on on some things due to ideology, but they mostly want to expand rather than decrease spending. There's a huge amount of rhetoric, but the actions never match the rhetoric. The only spending reductions ever pushed across are for programs fa
Stupid neo liberalism (Score:2)
This whole narrative is because the neoliberals NEED to get everyone to believe that the 'country is like a household' again. You know, where they pretend the GDP is the same as income and the debt is like having a mortgage, and if you don't pay the mortgage of the big scary bank manager will come and see you. It was the most effective economic narrative we have had since likely forever, because every mom and pop goes 'oh dear, debt is bad!!!'. It meant governments could beat their populations while telling
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We saw a way forward - just use fiscal stimulus.
Well, thank goodness that just grows on trees.
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It's a lot simpler than GDP vs. debt. It's about spending more than tax revenues bring in.
There are times when it's appropriate for a government to borrow. For example, when undertaking a massive project that they want to spread payments out over time. Or when times are tough and taxes are down. But borrowing to support the general operating budget, simply is not sustainable. The more the debt grows, the more the interest payments (now almost $1 trillion a year) sap from the budget. It's a death spiral.
Shutdown (Score:2)
The shutdown isn't about fiscal responsibility, give us a break.
What? (Score:2)
Paul Krugman, darling of the NYT, insisted Debt is GOOD
https://www.nytimes.com/2015/0... [nytimes.com]
https://x.com/paulkrugman/stat... [x.com] ....
"DEBT IS MONEY WE OWE TO OURSELVES
DEBT IS MONEY WE OWE TO OURSELVES
DEBT IS MONEY WE OWE TO OURSELVES
DEBT IS MONEY
It only make us poorer in aggregate if it crowds out investment â" which is isn't doing"
(apparently disregarding the obvious, recognized, inevitable consequences of soaring debt)
Let's remember: in the US, about 20-25% of every year's budget is borrowed against the fut
Belt Tightening (Score:2)
The belt tightening will come when all the exit liquidity is used up after the AI boom is over.