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"$1,000 paid monthly ... by increasing the federal debt would grow the economy." Borrowing money from my credit card does not increase my annual salary.
by joshuaheard 9y ago
"$1,000 paid monthly ... by increasing the federal debt would grow the economy."
Borrowing money from my credit card does not increase my annual salary.
- digitaltrees 9y agoGovernment finances are different than personal finances. You can’t print money. You can’t tax all economic activity. You can invest a small portion of the next few generations earning potential to build productive assets now.
- jkn 9y agoNo but it does grow the economy. Things you buy with the borrowed money count towards the GDP. If you have people buying and selling nothing that's going to be a small economy. If you have the same people, with the same wealth, buying and selling stuff to each other, that grows the economy. If you have the same people buying and selling stuff faster, they may still retain the same wealth but the economy will grow even further. The size of the economy is about the number of transactions, and printing money or borrowing money can definitely grow the economy (IF that money gets used to accelerate economic transactions).
- sigzero 9y ago"No but it does grow the economy." At the expense of creating huge amounts of personal debt.
- jtuente 9y ago> If you have the same people buying and selling stuff faster, they may still retain the same wealth but the economy will grow even further. At the expense of future growth. All of the money borrowed must eventually be paid back, which reduces growth by reducing that same money supply (increasing taxes to pay for it reduces the money supply similarly). It only makes sense to borrow when the future rate of return is greater than the interest rate of the debt, i.e. it'll take more than 8 years to see any return on investment from UBI.