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I mean “responsible spending” is just a right wing talking point that is only deployed on things they don’t like. Governments, like companies and individuals, c

by moomin 3y ago

I mean “responsible spending” is just a right wing talking point that is only deployed on things they don’t like. Governments, like companies and individuals, can and should take on debt in appropriate circumstances. The shocking thing with austerity, as the IMF has underlined, is that it shrinks the economy so much your tax revenues fall by more than you “save”.

brailsafe 3y ago
Left wing parties have various labels for people/things they don't like too, it doesn't mean either side is wholly incorrect though, especially when whatever it is becomes a real problem, like borrowing flagrantly based on the assumption there'd be no wars, extremely low interest rates, and stable employment. Whoever in that case said something like "forgive me if I'm not concerned about finances" might look a bit silly later, while the right wingers banging on about the budget might look silly if they cut funding to scientific research in times of prosperity, but didn't cut oil subsidies, and then wind up with climate problems.
hgomersall 3y ago
Governments have to take on debt for there to be a net money supply. There's no two ways about it. The right wing certainly wouldn't want all their savings to disappear to pay off the "national debt". Moreover, government spending pays for itself - from each transaction a proportion comes back in tax. It can be considered as a geometric series that tends to zero.
germandiago 3y ago
For me it is not really that. The logic that starts from the small applies to the big. In other shapes and with different scale limitations, but at the end if you spend more than what you have increasingly accumulating debt things get bad. It can take 5 or 50 years. At that time services stop working. I also refuse the idea that everyone can permanently get more than what they produce. If you give someone some push it should be for them to be able to become autonomous, not for living from other people permanently.
- moomin 3y ago
  It’s not a matter of scale, it’s a matter of lifetime. You can’t roll over a loan indefinitely because you will at some point die and lenders will factor that in to their calculations. But even in the small, plenty of people take out mortgages and spend WAY more than they were earning and do very well out of it. The breaking point is if you expand your debt repayments beyond your ability to service them. And, because growing economies and inflation are both real things, an ever growing debt is not only possible but desirable. As long as you can invest in things that grow the economy like libraries and benefits for those in need, you’ll be fine. Btw, read a UBI study sometime. You’ll find the actual research into just plain giving people’s money does not match the naive econ101 theory.

by moomin 3y ago

brailsafe 3y ago

Left wing parties have various labels for people/things they don't like too, it doesn't mean either side is wholly incorrect though, especially when whatever it is becomes a real problem, like borrowing flagrantly based on the assumption there'd be no wars, extremely low interest rates, and stable employment. Whoever in that case said something like "forgive me if I'm not concerned about finances" might look a bit silly later, while the right wingers banging on about the budget might look silly if they cut funding to scientific research in times of prosperity, but didn't cut oil subsidies, and then wind up with climate problems.

hgomersall 3y ago

Governments have to take on debt for there to be a net money supply. There's no two ways about it. The right wing certainly wouldn't want all their savings to disappear to pay off the "national debt". Moreover, government spending pays for itself - from each transaction a proportion comes back in tax. It can be considered as a geometric series that tends to zero.

germandiago 3y ago

For me it is not really that. The logic that starts from the small applies to the big. In other shapes and with different scale limitations, but at the end if you spend more than what you have increasingly accumulating debt things get bad. It can take 5 or 50 years. At that time services stop working. I also refuse the idea that everyone can permanently get more than what they produce. If you give someone some push it should be for them to be able to become autonomous, not for living from other people permanently.

moomin 3y ago
It’s not a matter of scale, it’s a matter of lifetime. You can’t roll over a loan indefinitely because you will at some point die and lenders will factor that in to their calculations. But even in the small, plenty of people take out mortgages and spend WAY more than they were earning and do very well out of it. The breaking point is if you expand your debt repayments beyond your ability to service them. And, because growing economies and inflation are both real things, an ever growing debt is not only possible but desirable. As long as you can invest in things that grow the economy like libraries and benefits for those in need, you’ll be fine. Btw, read a UBI study sometime. You’ll find the actual research into just plain giving people’s money does not match the naive econ101 theory.