I have had my share of friends and borrowers who have said “I would rather owe it to you than cheat you out of it.” That is pretty much how the US is going to have to deal with the nations or people who have invested in the US through treasuries in the coming years. It becomes more obvious that the debt load is unserviceable much in the way it would be if you gave unlimited credit to a shop-a-holic with no income.
But that will hardly stop the miscreants in congress from mortgaging our nation to the hilt, falsely believing that giving alcoholics a Budweiser is a prudent thing to do through expanded welfare and unemployment benefits which will encourage just that.. unemployment.
Further, they are expanding the nationalization of all aspect of health care (read the summary linked here) to the tune of $200 billion. This is not a ONE time investment, but rather a mere beginning to an authoritarian “servicing” of the health industry.
Note to physicians and other health providers.. Keep the K-Y handy. and learn to bend at the knees. Your “fees” will have to be renegotiated soon as the government will discover it cannot afford your normal rates.
All of this, with the idea that “someday” this debt can be paid or made up. hmm.. Of course these folks who apparently have all taken the popular speed reading courses still FAIL when it comes to GDP Debt ratios. Those pesky little details about HOW some things are paid back. And it will be paid back, either by inflation or through confiscatory taxes. (And I thought they were already)
A quick lesson on the value of the dollar..
The dollar, as backed by the government has a certain value, as perceived by those who buy into it through long term treasuries by business, countries or individuals. Because it is backed, (by the 13th amendment btw ) the government relies on taxes to assume the debt and pay the debt as well as the interest promised. At some point when taxes are unable to keep up with the principle and interest, the overall value is diminished, and the underlying purchasing power for real goods through trade and commerce declines.
This is as real a tax as if it came right out of your paycheck.
You get less and have to spend more. The government ialso then finds it cannot buy real goods and services in the same manner, and when its cost increases even more it will again prime the pump through crisis and new confiscatory policy to relieve those who have, from what they had. The cycle will continue until the subjugation of the population as in other communist nations or an ultimate revolution.
We are at a crossroads. For the sake of the nation, we cannot follow the folly of those who think 2+4 =24 in the way our legislators have in the past and apparently even now.
The summary of this pork laden vein hardening monolith can be seen here: http://finance.senate.gov/press/Bpress/2009press/prb021209.pdf I recommend reading from the bottom to truly understand the direction we travel. H/T to Michelle Malkin for the Link to these documents