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Every dollar of tax revenue we have to raise to pay the interest on the debt is a dollar that can't be left in our pockets, or diverted to more useful governmen

Every dollar of tax revenue we have to raise to pay the interest on the debt is a dollar that can't be left in our pockets, or diverted to more useful government programs. Last year it was $522B, this year it's already been $562B and we still have one more fiscal quarter to go.

Phiwise_ 5y ago
Exactly. The answer to Noah's question is barely two sentences long, and it runs something like "Because people saw how Austerity hurt Greek citizens, and people saw how low confidence hurt Greek businesses and governments". Lazy debt and currency management ultimately serves neither the desires of the pro-business nor the desires of the pro-social program political wings.
- tuatoru 5y ago
  Greece does not have its own currency. Its situation was different. At the time (2009), many economists expected Greece to bail out of the Euro, which is not an "optimal currency area", taking short term pain for long term gain. It didn't, instead opting for short term pain and long term pain.
  - nradov 5y ago
    Having your own currency doesn't really solve the problem. Sure in theory the US could inflate the currency enough to drastically reduce the value of outstanding debt. But we would still have to borrow going forward, and that level of inflation would drive T-bond yields through the roof. That will mean short and long term pain no matter what.
    - toomuchtodo 5y ago
      Lessons from the yields on Japan’s sovereign debt, their debt to GDP, and their historical and forward looking inflation indicate a different forecast. https://www.bloomberg.com/markets/rates-bonds/government-bonds/japan https://www.bloomberg.com/markets/rates-bonds/government-bon... https://en.wikipedia.org/wiki/National_debt_of_Japan https://en.wikipedia.org/wiki/National_debt_of_Japan https://data.worldbank.org/indicator/FP.CPI.TOTL.ZG?locations=JP https://data.worldbank.org/indicator/FP.CPI.TOTL.ZG?location...
boublepop 5y ago
If there are more useful government programs. Just issue more bonds and pay for them. The idea that the government should refrain from finding useful programs until it’s paid off all its debt is absurd.
- missedthecue 5y ago
  I never said they should pay off all their debts before spending another dime. But managing deficits is important for the reasons laid out. Cashflow management is important in any organisation.
- Proven 5y ago
  Far more absurd is the idea that there are useful government programs.

Phiwise_ 5y ago

Exactly. The answer to Noah's question is barely two sentences long, and it runs something like "Because people saw how Austerity hurt Greek citizens, and people saw how low confidence hurt Greek businesses and governments". Lazy debt and currency management ultimately serves neither the desires of the pro-business nor the desires of the pro-social program political wings.

tuatoru 5y ago
Greece does not have its own currency. Its situation was different. At the time (2009), many economists expected Greece to bail out of the Euro, which is not an "optimal currency area", taking short term pain for long term gain. It didn't, instead opting for short term pain and long term pain.
- nradov 5y ago
  Having your own currency doesn't really solve the problem. Sure in theory the US could inflate the currency enough to drastically reduce the value of outstanding debt. But we would still have to borrow going forward, and that level of inflation would drive T-bond yields through the roof. That will mean short and long term pain no matter what.
  - toomuchtodo 5y ago
    Lessons from the yields on Japan’s sovereign debt, their debt to GDP, and their historical and forward looking inflation indicate a different forecast. https://www.bloomberg.com/markets/rates-bonds/government-bonds/japan https://www.bloomberg.com/markets/rates-bonds/government-bon... https://en.wikipedia.org/wiki/National_debt_of_Japan https://en.wikipedia.org/wiki/National_debt_of_Japan https://data.worldbank.org/indicator/FP.CPI.TOTL.ZG?locations=JP https://data.worldbank.org/indicator/FP.CPI.TOTL.ZG?location...

boublepop 5y ago

If there are more useful government programs. Just issue more bonds and pay for them. The idea that the government should refrain from finding useful programs until it’s paid off all its debt is absurd.

missedthecue 5y ago
I never said they should pay off all their debts before spending another dime. But managing deficits is important for the reasons laid out. Cashflow management is important in any organisation.
Proven 5y ago
Far more absurd is the idea that there are useful government programs.