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> Then why can't I, a person looking to buy a home, or to start a business, skip the middle-man then and create a liability myself with the central bank? You a

by nly 6y ago

> Then why can't I, a person looking to buy a home, or to start a business, skip the middle-man then and create a liability myself with the central bank? You and your descendants do have a liability with the central bank. The Fed holds $5 trillion dollars of US Government debt, which is about $15,000 USD for every US citizen. Don't feel too bad though because in the UK it's about $17,600 USD per capita

grumple 6y ago
That isn’t very much money per person and could be recouped in a few years with slightly elevated tax rates, primarily on extremely wealthy corporations and people.
- nly 6y ago
  "The average federal income tax payment in 2018 was $15,322, according to the most recent data available from the IRS. " So it's doubling taxes for 1 year, or +5% for 20 years. Hardly "slightly elevated tax rates".
  - whatshisface 6y ago
    Only a fraction of total income is accounted for by all of the incomes equal to the average and below.
madsbuch 6y ago
Absolutely not. This is not an individual liability. It is the country's liability. Just like employees in a company is not liable for the dept the company could have accrued etc.
- bluecalm 6y ago
  Yeah but the country will need to collect from you and your descendants to keep paying that debt. If it wasn't for that debt the country could leave more money in your pocket. The debt is basically yours as the money to pay it comes from your pocket. Employees can leave without any liability. You can't at least not without paying a huge cost both financial and personal.
  - paulryanrogers 6y ago
    It's not exactly the same as a personal budget though. The Fed can print money to pay back debt. Of course this just becomes an indirect tax as it leads to inflation since the amount of resources in the country/world doesn't change when printing.
  - tryptophan 6y ago
    True. There is a reason that ~400-500B$ is spent on interest each year by our wonderful government. That comes out of our taxes. Enough to pay for 40% of social security or medicare. 70% of the military budget. The expense we have from debt is no joke.

by nly 6y ago

grumple 6y ago

That isn’t very much money per person and could be recouped in a few years with slightly elevated tax rates, primarily on extremely wealthy corporations and people.

nly 6y ago
"The average federal income tax payment in 2018 was $15,322, according to the most recent data available from the IRS. " So it's doubling taxes for 1 year, or +5% for 20 years. Hardly "slightly elevated tax rates".
- whatshisface 6y ago
  Only a fraction of total income is accounted for by all of the incomes equal to the average and below.

madsbuch 6y ago

Absolutely not. This is not an individual liability. It is the country's liability. Just like employees in a company is not liable for the dept the company could have accrued etc.

bluecalm 6y ago
Yeah but the country will need to collect from you and your descendants to keep paying that debt. If it wasn't for that debt the country could leave more money in your pocket. The debt is basically yours as the money to pay it comes from your pocket. Employees can leave without any liability. You can't at least not without paying a huge cost both financial and personal.
- paulryanrogers 6y ago
  It's not exactly the same as a personal budget though. The Fed can print money to pay back debt. Of course this just becomes an indirect tax as it leads to inflation since the amount of resources in the country/world doesn't change when printing.
- tryptophan 6y ago
  True. There is a reason that ~400-500B$ is spent on interest each year by our wonderful government. That comes out of our taxes. Enough to pay for 40% of social security or medicare. 70% of the military budget. The expense we have from debt is no joke.