Why should the government pay interest on the national debt? People hold it because it's better than holding other assets. China holds it to finance their trade surplus. It's our money. We can print whatever we need to sustain full employment if we spend it wisely on the infrastructure, education, and research we need to sustain the economy and don't create more demand than we can support with the population and resources we have at our disposal. Doing the latter would cause inflation, so that's really the only limit there is on printing money. The debt ceiling is just a self imposed constraint that is used to deflate the economy and cause political instability. The easiest way to reduce the debt is to stop paying interest on it, and just print whatever money is necessary to sustain the economy, without overheating it. Think about it. Read about it. It's not a new idea.
Wednesday, October 02, 2013
Why should we pay interest on the national debt?
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