Here’s why you shouldn’t freak out about the national debt: http://www.vox.com/us-public-debt/
There’s a short, but, incredibly vapid and naive video at the link. It’s fraught of errors, (the most obvious is confusing public debt with national debt), and erroneous thoughts on debt and inflation, all without noting the obvious bind we’re in.
The premise is that we shouldn’t worry about our debt because we can never run out of cash because we can print our own money.
The video also notes that the Fed has tools to fight inflation. But, what Matt is describing is an overheated economy. He notes that our “inflation” is near all time lows, but, fails to understand the errors in calculating inflation, and notes that interest rates are low. But, with low inflation and low interest rates, our economy is still in the crapper. Which is the corner we’ve painted ourselves in with our QE stimulus which has failed to stimulate anything.
Further, our debt can cause us to no longer have the ability to finance our debt. We finance our debt by selling bonds and the like to other nations and people. There’s no rule saying they have to buy our crap bonds. Further, the more debt, the more we have to pay in interest to service the debt, which causes us to have less funds available for the many things people like Matt want the government to provide.
Printing cash, in and of itself doesn’t mean we can’t run out of money because our cash is only good for the value people perceive it to be. It’s financed wholly by faith and credit of the US. When the world loses faith in, and refuse to credit the US, then we can print all the worthless cash we want, and it won’t finance even the printing presses or even electricity for the imaginary transactions referenced by Yglesias.
It’s the stupidity embraced by people like Yglesias which will cause the eventual downfall of the US if we don’t change our ways very soon.
As noted by Twitchy, the obvious question to ask is ….
@mattyglesias According to your posit, why don’t we just print 12.5 Trillion dollars to pay off the debt?
But, why stop there? If we can never run out of money because we can print, why don’t we just print enough money for everyone in the country? How come we don’t do that Matt? Just think!!! You would never have to work again, and the world would never have to be subject to your abject stupidity ever again!!! Win/win!!!