|Graph One Gross Federal Debt 1939 - 2012|
but wait, there's more.
Of the two types of federal debt, only debt held by the public is reported as a liabilityso to the $11 trillion in public debt noted above, add this $5 trillion, plus some other things left out, and we get to a total of about $18 trillion, we owe ourselves...
Whenever a government account needs to spend more than it takes in from the public, the Treasury must provide cash to redeem debt held by the government account. The government must obtain this cash by increasing taxes, cutting spending, borrowing more from the public, retiring less debt (if the budget is in surplus), or some combination thereof.Now, hmmmm, what is the trend in debt, and how much we have, no nonsense?
|Graph Three bank Credit of All Commercial Banks 1971 - 2016|
Ok, you say that is the profligate down the street, not you. Fat chance it is not you, when he cannot pay, you do when banks get bailed out because he cannot pay what he borrowed from the banks. Again, the banks are not out anything, just what your neighbor borrowed now you owe the banks. And because he could borrow ex nihilo credit, he called forth goods and services you never would: hot tubs, snow mobiles, Club Med Vacations, Corn Dogs with every fill-up... not only that, he called forth the means of production to provide what you never would call forth with money. Too bad for you.
Note all the graphs start up when Nixon went off Gold Standard Lite in 1971. And then what happened when we allowed banks to lend credit, as Uncle Sam just added wars, bailouts, scams to our tab.
There is no raational limit to what can be financed with ex nihilo credit. What cannot go on will eventually stop. And therefore, when it stops it will be for an irrational reason, meaning nobody knows when. The only thing we can be sure is all policies will benefit the Hegemon, and and and when it crashes disastrously, the Hegemon will benefit. "Rule over us, fight our battles for us!"
The fight will be beyond "what do we get?" the fight will be how little of this will be allocated to each class. The more debt allocated to you, the less you get in life.
We owe it to ourselves.
Pay up. Or, start your own business and be high, sparse fruit. Lifestyle over accumulation.
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