- Apr 30, 2012
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Rather than drifting off on the topic in the Boehner curses Reid thread, here we go:
This article is from October, but it is still relevant.
No, The United States Will Not Go Into A Debt Crisis, Not Now, Not Ever
This article is from October, but it is still relevant.
No, The United States Will Not Go Into A Debt Crisis, Not Now, Not Ever
http://www.forbes.co...t-now-not-ever/[background=transparent]If there’s one article of faith in Washington (and elsewhere), it’s the idea that the United States might get into a debt crisis if it doesn’t get its fiscal house in order.[/background]
[background=transparent]This is not true.[/background]
[background=transparent]The reason why it’s not true is because we live in a fiat currency system, where the United States government can create an infinite number of dollars at no cost to meet its obligations. A Treasury bill is a promise that the government will give you US dollars–something that the United States government can produce infinitely and at no cost....[/background]
[background=transparent]....You don’t have to take my word for it. How about Alan Greenspan? He said (PDF): ”[A] government cannot become insolvent with respect to obligations in its own currency. A fiat money system, like the ones we have today, can produce such claims without limit.”.....[/background]
[background=transparent]....[background=transparent]A lot of people still think that the US is under some risk of one day becoming like Greece, and it’s distorting our public debate.[/background][/background]
[background=transparent]It’s especially distorting it on the Right, where hysteria about deficits, and debt, and becoming like Greece has reached a fever pitch. Paul Ryan, especially, has framed his entire message on entitlement-cutting on the flawed premise that the US needs to cut its entitlement or it will suffer a debt crisis. This message, in turn, has infected broad swathes of the conservative movement (including very smart people in it), a movement that I consider myself a member of and want to see in strong intellectual health.[/background]