Saturday, March 18, 2006

A trillion here, a trillion there…

Cicero at To The People has a radical solution to our $9,000,000,000,000 problem:
Now, here's my radical solution to the national debt. The federal government should default on it. Policymakers should say, "we can't ever pay this off. Sorry. Our bad. We're not going to pay". This is the only moral solution to the problem. The only other alternative is to make people who played no role whatsoever in amassing the debt pay it off. This is simply unfair. It's grand theft. Ok. Trillion theft.


Could defaulting on the national debt hurt the overall economy? Yes. It would likely crash the stock market. But, it would most certainly shake people's faith in government. And that would be a good thing. Once people realized that the federal government could default on bonds in the future, they would be less likely to loan money to the federal government. That would prevent the government from racking up a huge credit card bill ever again (or at least for several decades). Knowing this, investors would become quite bullish. The American economy would rebound and flourish. Without the federal government driving up interest rates through massive borrowing, companies could afford to expand like never before. And the federal government would free-up the $350 billion it spends every year just paying the interest on the national debt. Congress could give this money back to the American people through major tax cuts, further stimulating the economy. (Bone to socialists: Congress could also spend that money on health care, welfare, etc.).
I like it…except for the bit at the end.

via: Nick Gillespie