26 votes

There is no national debt.

The US has spent over budget for 30 years. The government has spent without interest rate penalty. It is almost as if there were no books to be balanced. Therefore call a spade a spade: there are no books to be balanced. The national 'debt' is the living history of currency devaluation. Every year there is a budget deficit and the government prints the difference. If there is no national debt, then there is no QE either, as that was fronted as a purchase of treasury bonds.

UPDATE: As was mentioned by others, the notion is that if a government decides to run deficits forever then it doesnt have to pay back its debt and the debt just measures how much new money the government borrowed into existence (currency devaluation).
However Spiritof76 pointed out there is a difference between printing money into existence and borrowing money into existence but not paying back the principal. When you borrow money, the creditor gets interest payments. These interest payments unfortunately require the debtor to keep rolling over the debt.
So it would have been smarter for the government to just print money to cover deficits, like its doing now. thank god.



Trending on the Web

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.

A true debt...

A true debt has to have some value. What value does fiat currency have?
What value does counterfeit currency have?

The Dept. of Treasury should instruct the mint to print out enough Trillion dollar bills to pay of the bankers in full plus interest and be done with it.

Then we can eliminate the central banks and return to a gold standard.

Live in Liberty
Tom Rankin

But what about compounding.

If you look at the compound rate of growth in bonded debts, which are at ~$17 trillion now, the rate calculated depends on when you start the calculation. If you start with 1900 debt, it is has grown at a compound rate of 8.295%; if you start with 1964, when silver was removed from circulation, it has grown at 8.56%, not much of a change; and if you start with 2007, when the current depression began, it has grown at 12.265%. So not only is the debt compounding, the rate at which it is compounding is growing.

All compound rates of change eventually collapse because they are exponential functions, and approach infinity with the passage of time. Given the above three alternative rates of growth, in 2025 the debt will be either $45.3, $46.7, or $72.3 trillion. Extending those to 2035 and the debt will be either $100.4, $106.2, or $229.9 trillion. Another way to look at it is the time it takes for the debt to double for the three alternative rates is either 8.4, 8.2, or 5.7 years.

Another thing to consider is that the economy only grows at best 4% a year. So government debts are growing faster than the wealth being produced, and since most of that wealth being produced is necessary for us just to survive, the divide between the growing debt and the growing income to pay the debt simply is widening.

If you take the view that banks will just keep issuing more and more bank debt (checking accounts) to the federal government to allow the federal debt to increase as it must, then you can see that eventually the banking system must collapse since they will be the holders of this worthless government paper. It will be through the inability of banks to expand credit to the federal government that the end of this scheme will arrive. Governments repeatedly throughout history have expanded, lived off paper, and collapsed economies. What makes you think there is anything special about the federal government that would exempt it from reneging on its promises?

"Bend over and grab your ankles" should be etched in stone at the entrance to every government building and every government office.

Taxes

on the general citizenry, and the threat of violence / incarceration if they are not paid, are nothing more than a way to preserve the illusion to the buyers of government debt that the principal will be repaid.

Who else but a greater fool would buy a bond from an entity that produces NOTHING and by right has NO COLLATERAL or physical property upon which the debt holder can make a claim, should the debt issuer default on the obligation?

Of course, Murray Rothbard says it far better than I ever could:

"The public debt transaction, then, is very different from private debt. Instead of a low-time-preference creditor exchanging money for an IOU from a high-time-preference debtor, the government now receives money from creditors, both parties realizing that the money will be paid back not out of the pockets or the hides of the politicians and bureaucrats, but out of the looted wallets and purses of the hapless taxpayers, the subjects of the state. The government gets the money by tax-coercion; and the public creditors, far from being innocents, know full well that their proceeds will come out of that selfsame coercion. In short, public creditors are willing to hand over money to the government now in order to receive a share of tax loot in the future. This is the opposite of a free market, or a genuinely voluntary transaction. Both parties are immorally contracting to participate in the violation of the property rights of citizens in the future. Both parties, therefore, are making agreements about other people's property, and both deserve the back of our hand. The public credit transaction is not a genuine contract that need be considered sacrosanct, any more than robbers parceling out their shares of loot in advance should be treated as some sort of sanctified contract."

It's a shell game, with all these governments buying each other's debt - and shall soon be exposed.

Throw off the yoke!

I think the timescale has shamed us.

Very few in the minimal government camp thought the government was capable of such brilliant monetary planning as the Keynesians claimed. Egg is on our faces. It discredits libertarian economists that they spent the last six years predicting immanent doom. I think we all need to be a little humbled at how well they've done. I have switched from market bear to calamitous moderate-- we have a risk sensitive system that barring major calamities has enough power in the US monetary tool chest to steer straight for at least two decades (straight= nominal 1% growth or the new normal), by disguising money printing with unbounded borrowing at low interest rates set by the Fed. PROOF: it is already intellectual consensus that Fed unwinding is going to be slow and take decades. What then is a few more decades in a decades long unwinding? Whats a few trillion of additional critical monetary support given so many trillion on the Fed balance sheet?

I've thought this for some time....

If any shortfall is paid for by printing money, which devalues the currency, resulting in higher prices, which we are all paying, that means we are continually paying off the debt through the inflation tax.

So the debt is being paid as we go.

So, yes, the so-called national debt is just a measure of the amount that has been taken from us through higher prices.

A brilliant scam which few Americans understand or care about, as long as they are thrown a few crumbs.

But QE DOES create money and it puts that money in the hands

of investors the government favors, to the exclusion of you and I.

If there is no real debt to buy there certainly is a very large amount of government money to distribute.

And they aren't distributing it to ME.

Its kind of another version of trickle down. Give the money to the investor class, and maybe (just maybe) they will be gracious enough to let us work for some of it in whatever capacity we can to please them.

You are correct the reason there is no trickle down.

The self enriching hogs that are installed as puppet dictators for the criminal Rothschild family are rewarded for accepting the false national debt and extorted theft called tax collections. They are rewarded for being good government puppet pigs with false debt slave script.

Its not about the money, and its not about the false debt.

Its about identifying opposition who will not submit and eliminating said opposition.

And now its about genocide to distract and protect the Rothschild criminals and their puppet hogs.

sovereign

There is a FALSE DEBT, National DEbt

But you have to understand its purpose is to create a nation of slaves.

So how you ask? Im glad you ask. Example I punch you in the nose Sucker Punch. We ask those who saw the action to describe. They say I sucker punched you and I am wrong.

Same situation but this time I use that famous Jewish Zionist tactic and scream out that I am the victim you refuse to pay me (debt) as I sucker punch you, saying you owe me debt (FALSE DEBT).

Now we ask the onlookers and now you will see a change. With the illusion of the debt many will support aggression justified with claims of debt even if its a false debt and a false claim.

Rothschild Banks create false national debt to be used along side with the collections system (EXTORTED THEFT CALLED TAX) This is used to identify and eliminate opposition. Its not about money collections remember they have the magic Rothschild central bank keyboard and create unlimited amounts.

Its about forcing (controlling) people. Make people to submit immoral theft. Converting free humans into, false debt slaves, cowardly submitters. Then eliminating those who will not be immoral cowardly submitters.

The false national debt used to create the illusion of individual debt then the false debt tax collections are to identify and eliminate opposition.

Eliminate the Rothschild Zio Governments ability to create/inflate
sovereign money and its all over for them. What a huge parasite upon humanity.

sovereign

No debt just theft, fraud and extrotion

.

The most powerful Law of Nature is Time. It is finite and we all will run out of it. Use this Law to your advantage, for it offers you infinite possibilities...

You miss the point

Look FALSE DEBT is not the same as No debt.

That is the whole point. If the tax collections occurred without the false compounding national debt not to many would go along with it.

But with claims of debt all be it false debt (NOT NO DEBT) they can get away with the extortion and theft.

I owe no debt but they make claims of National debt. Can you distinguish the difference between what you said (wrong) and what I said (first) CORRECTLY?

sovereign

If it is fraud, theft and extortion

then it is not debt. It is felony criminal acts.

Commission of fraud cannot be converted into lawful acts.

The fraud is born of their own Breach of Duty to the Constitutional Contract the individuals claiming to be under capacity of the Constitutional capacity are actively violating, explicitly Article 1 Section 10 Tender laws. They use a "Thing" that is a mathematically guaranteed to fail private bank's debt note as tender in violation of law and then claim their own breaches are lawful. Making a claim that some Thing other than gold and silver coin is tender is FRAUD and Breach of Duty.

Forcing people into contract to pay for something that was never lawful to begin and born of their criminal acts fraud is EXTORTION.

Stealing people's property from Fraud and Extortion is THEFT.

So there is NO DEBT only CRIMES.

The most powerful Law of Nature is Time. It is finite and we all will run out of it. Use this Law to your advantage, for it offers you infinite possibilities...

You freaking dong get it NOT DEBT BUT

False DEBT. do u understand that false debt is not debt? False DEBT get it? DARN so thick,.

sovereign

different sides of the same coin.

Thats a deeper argument. My point was just if a government decides to run deficits forever then it doesnt have to pay back its debt and the debt just measures how much new money the government borrowed into existence (currency devaluation).

Thats a good way to say it.

The model is broken when a bankrupt debtor can jail his creditor when he ceases to take IOUs.

Well, the US government is

Well, the US government is not a private household. They issue the currency. They can print to pay off all "debt".

Plan for eliminating the national debt in 10-20 years:

Overview: http://rolexian.wordpress.com/2010/09/12/my-plan-for-reducin...

Specific cuts; defense spending: http://rolexian.wordpress.com/2011/01/03/more-detailed-look-a

If a puppet pig politition tryed to pay off the false debt

With some new unconstitutional currency. He would get Lincoln-ed... See the green back dollar. Or Kennedy ed see the Executive Order No. 11110.

That's the whole reason that these government elections are faked. To install proper puppet pigs who will take the payoff and understand the threat if they don't follow orders one one hand and on the other pacify the public into aligning themselves into two teams, re-pugs or demon-rats and cheer for the faked winners of the crooked elections like a good public.

They use the immoral extorted theft collections to identify and eliminate individual opposition.

Either you submit to extortionists and thieves who collect from you then tell you they are using your money to war/genocide and destroy.

Or you submit and become a cowardly submitter to extortionists and thieves and war/genocide promoters.

Or you move out of the box by no longer using the false debt slave scripts or stores.

No matter the case if you resist you are identified for elimination.

sovereign

What kind of nonsense

What kind of nonsense conspiratorial rambling is this?

Plan for eliminating the national debt in 10-20 years:

Overview: http://rolexian.wordpress.com/2010/09/12/my-plan-for-reducin...

Specific cuts; defense spending: http://rolexian.wordpress.com/2011/01/03/more-detailed-look-a

You speak like a fool

Nice buzz words that are worthless and meaningless. You just don't understand so its easier to mumble your programed buzz words that to admit your own stupidity. Don't worry I will never allow you to see another post of mine on this site after you respond to this.

sovereign

Typical of what your type do.

Typical of what your type do. Make these wild accusations with little proof, and anyone who disagrees with you, you subject to ridiculous personal attacks and claim is under the influence of the "man", using programmed buzz words.

I don't think you actually understand how money works. You seem to have this really weird concept of it, lot of it based in these conspiratorial ideas.

Plan for eliminating the national debt in 10-20 years:

Overview: http://rolexian.wordpress.com/2010/09/12/my-plan-for-reducin...

Specific cuts; defense spending: http://rolexian.wordpress.com/2011/01/03/more-detailed-look-a

Listen and learn

The US government does not create nor issue currency.

The private owned (ROTHSCHILD) Federal Reserve Bank creates you money out of thin air with a digital keyboard.

Then they loan these digital monies to the so called US GOV LOAN is the key term.

DEBT is then owed for this so called sovereign currency.

FALSE COMPOUNDING NATIONAL DEBT created out of thin air used as justification to make you into a cowardly immoral submitter to liars thieves extortionist and mass murdering genocide focused Zionist controllers.

So first get educated about who creates the money, then respond.

sovereign

Well, the banks create money

Well, the banks create money by creating credit out of thin air. Not the Federal Reserve.

What causes inflation is the expansion of credit. The expansion of the reserves, by the federal government/Federal Reserve, can contribute to that, yes. But ultimately it is the banks who control the gun of credit creation.

Plan for eliminating the national debt in 10-20 years:

Overview: http://rolexian.wordpress.com/2010/09/12/my-plan-for-reducin...

Specific cuts; defense spending: http://rolexian.wordpress.com/2011/01/03/more-detailed-look-a

Go back to school

Not fool school. Digitized out of thin air loaned at a compounding rate to the installed puppet gov.

Sure the fractional reserve system the subordinate banks draw upon the Rothschild federal reserve but still the FED CORP CRIME BANK creates the digital money as a false national debt that is compounding.

NOT THE SUBORDINATE BANKS! You try to look smart by arguing stupidity.

The friking point is that the false national debt is used as leverage to make TAX claims and steal my life time and my property.

I shake my head at how stupid people can be.

sovereign

Vice President Cheney said

Vice President Cheney said deficits don't matter....he was right

egapele's picture

It is starting to make me wonder

about the role of modern Christianity.

I am a devout Catholic and have been convinced I would be lowly if I didn't pay my "debts."

I am starting to see I am paying thieves.

Michael Nystrom's picture

Ah, clever.

Reminds me of what my dad used to say: "They're never going to pay it off."

And it squares with what you say. Because if they're never going to pay it off, it is not a debt. Debts are paid off.

The national 'debt' is the living history of currency devaluation.

Yup. I can't disagree with you there.

The only way to make sense out of change is to plunge into it, move with it, and join the dance. - Alan Watts

Repudiating The National Debt (Rothbard)

http://mises.org/daily/1423
audio: http://mises.org/media/7671/Repudiating-the-National-Debt

___________________________________________________________________________
"Bipartisan: both parties acting in concert to put both of their hands in your pocket."-Rothbard

1986 Grace Commission Report

Explained that 100% of income tax receipts are delivered to the Federal Reserve to retire old debt.

Fedgov spending outside of military and some specific items and items supported by user fees is 100% debt financed.

New debt is issued against the "full faith and credit of the United States" which the supreme court has determined can be constituted by income tax remits.

Look, I'm not saying it's right or good. But we have to deal with facts, for better or worse. That's the only way to recognize where you are when you are planning to get to where you want to be.

If you start from a false assumption, then, necessarily, any logic you apply will yield an unexpected or illogical result.

Thats a strong rebuttal but I think I can save a major point...

When a sovereign government chooses to maintain or expand its national debt indefinitely, it is not using debt in the customary manner-- to transiently plug budget gaps, instead it is using it to expand the money supply, in other words the government is using the debt to devalue the currency.

It is in that sense that the record of our national debt is also a record of currency devaluation; the government does not plan to stop increasing debt (CBO, out to 2020 does not project any balanced budgets). So I guess I would make the claim that it is not using it as a debt instrument (since it will never repay it) but that it is being used as a monetary instrument. Once more it is gradually shifting that monetary instrument into the hands of the Federal Reserve, which now owns a quarter ($3 trillion) of our national debt ($12 trillion). When the process is 50% complete, it should be fair to say we are financing our debt by money printing?

Of course it is likely to be inflationary.

And it has been as history has proven.

The way "they" keep it in balance, or at least how they think they try to - is the Keynsian macroeconomic equilibrium forumula.

AE=C+I+G+(X-M)
http://www.amosweb.com/cgi-bin/awb_nav.pl?s=wpd&c=dsp&k=Keyn...

Naturally, it does not work in the long term. However, that's the mechanism "they" try to use.

OK.... deleted...

oops.