Deficit Spending is the Problem

reply to post by Brotherman


I agree. The point I DISAGREE with is that debt is a backbone of capitalism, which was his argument. He was saying if you like capitalism you are FORCED to have a debt based economy. Patently false. What he is doing is confounding the problem, saying if you want to get rid of debt you must leave capitalism. That kind of talk prevents solutions. I am not for preventing solutions. Especially not when my children are looking at having $500,000 in debt or more if this continues.

reply to post by OccamsRazor04


I was pilling up on you indication that not all citizens can be direly included on a per capita division of the debt, but only the collectible ones. I was just adding that economic policy is also insane in removing those that should and can pay more (as they benefit also more from the system) at every chance (lobby revenue opportunity).

In any case I agree and disagree with you. Capitalism is about the raw (read without any other consideration) pursue of capital gain. Since interest generates capital they are part of capitalism even if it is not directly at its core (monetary value is, the worth of something expressed in a easy to trade currency a core necessity for capital accumulation). Of course that interests is only possible if there is safety on them being collectible (in most cases), recent events shown that profit can be made from noncollectable loans or secondary gains can be leveraged by the risk of default if one has the capital and ability to control the markets, something that is also becoming clear to all now.

In any case debt has become the central peace of our global economy that is capitalistic in nature...

Panic2k11
reply to post by OccamsRazor04

 

I was pilling up on you indication that not all citizens can be direly included on a per capita division of the debt, but only the collectible ones. I was just adding that economic policy is also insane in removing those that should and can pay more (as they benefit also more from the system) at every chance (lobby revenue opportunity).

Ok! Yes I agree with that. Even when you break it down to collectible ones, some will bear a larger share of the burden.

In any case I agree and disagree with you. Capitalism is about the raw (read without any other consideration) pursue of capital gain. Since interest generates capital they are part of capitalism even if it is not directly at its core (monetary value is, the worth of something expressed in a easy to trade currency a core necessity for capital accumulation). Of course that interests is only possible if there is safety on them being collectible (in most cases), recent events shown that profit can be made from noncollectable loans or secondary gains can be leveraged by the risk of default if one has the capital and ability to control the markets, something that is also becoming clear to all now.

This would suggest being the lender of the debt, not the lendee, would be the better of the 2 options. Now in a modern society of any type, there will be debt. All governments will borrow when they need it, it has nothing to do with capitalism really. "Non capitalist" China loans money to make money.

Having a government be in debt is NOT necessary in a capitalist government, nor is it limited to capitalist societies. It's a sign of a BAD government, of any type.

As far as businesses go, in modern society you will certainly have debt, because the intention is to expand and cover their loss. It takes money to make money. Some will thrive, some will fail.

The governments job is not to take money and turn it into more money. They should never gamble that they can repay the overspending, and capitalism does not demand that they do. Their job is to collect money and in turn provide services. The services provided should never significantly outspend money collected.

reply to post by OccamsRazor04

This would suggest being the lender of the debt, not the lendee, would be the better of the 2 options. Now in a modern society of any type, there will be debt. All governments will borrow when they need it, it has nothing to do with capitalism really. "Non capitalist" China loans money to make money.

Being the lender is logical the optimal position on a debt system, if you incur in debt you lose independence (aka freedom). Yes due to the nature of capital any modern society will exist with debt at some form (note that Islamic nations have a very distinct form of lending as their faith prevents them from collecting interests, even if it works mostly there is some benefits for the lendee and I would say to society).

Now you say that even governments will borrow as that should be seen as natural and optimal, I don't see it in that way since governments tend to only represent the more powerful interest on their society not all the citizens as most of them claim (whatever system is said to be implemented) and that arises for the pursuit of capital gains and so capitalistic objectives. That is why China is anything but a Communist nation (as the USSR was also not a Communist nation), yes there were core points of the ideology of government that pretended to be communist but more as a justification for their local economical and social structure and pursue of geopolitical interests than the initial claim of better distribution of wealth and power, somethings worked but more didn't expecially because they needed to compete in what was a capitalistic global economy. That is why the US created the UN, the IMF and the WTO (to defend first defend their interests and then defend their core political divergence, in that things like democracy and freedom are simply propaganda tools).

Having a government be in debt is NOT necessary in a capitalist government, nor is it limited to capitalist societies. It's a sign of a BAD government, of any type.

I agree and disagree, the ideology of the government is not directly linked with debt unless it prevents them for incur in it (and I don't know any even with Theological governments).

Now debt clearly defines a society as adopting capitalistic ideals, debt is strictly linked with consumerism (you incur debt for needs and wants) most non capitalistic societies are obliged to provide the needs (take for instance Cuba, or the USSR in its first stage basic needs even under duress are provided) but since this societies exist in a larger economic ecosystem that is capitalistic in nature there is no way to survive in the long run outside of the capitalistic system and so debt (consider why many people wished to escape the Soviet block or Cuba, more than political repression it was because their wants were not satisfied). This is why Europe is being slowly invaded from Africa, the grass is always greened on the other side of the fence (this is an oversimplification of the issues but necessary to understand at least the social pressures that economic competition generates in states and why it is important to be successful in the competition at a social scale).

Having that in mind that is were I disagree, debt in itself in not a sign of BAD governance. What is a sign of bad governance is bad utilization of capital acquired by inuring in debt (when it risks the independence of the state, when it erodes the standard of living or degrades it from what was predicted affecting future generations, when it is not utilized to generate and improve the states economy or competitiveness), that is Bad governance even risking being criminal and treacherous activities depending on how it was planned and why it failed to meet economical reproductive objectives.

Really Capitalism ?

Where the hell did they get that ?

Capitalism introduces new wealth instead of just recycling wealth.

And that recycling wealth is the leading contributor of debt, and deficits.

Capitalism is a sole attribute of the private market. the free market.

As most people know a free market doesn't exist in this country. Especially when one looks at fiat currency.

That has no real value.

True we are in debt, from a medium of payment the government created.