Debt limit - budget options - play the game

Beginning and end points make all the difference.

 

I would hope it would be obvious from this thread and other posting that I am one that is for some level of fiscal sanity. And I do agree with your other post at this point there isn’t much motivation for most people to care. For instance this thread will probably get about 1/10 the responses on any of the trans threads.

Where I disagree with you is I don’t necessarily think the outcomes are as catastrophic as you make them out to be we don’t do enough, which I doubt we will. There will be consequences, but they will be more muted and distributed.

Fir instance if we go from 100% to 150% govt debt to gdp in 10 years, I’m not sure the world ends. Currently Japan has over 250% debt to gdp. Many European countries are already approaching that and have more relative debt to gdp than most industrialized countries. China is racking up debt fast and their public and private sector is intertwined.

Consider that about 25% of our public debt is owned by the federal reserve. The government owes the fed, a quasi government central bank. Is that bad? Does that make any difference?

There will be side effects, which could include some inflation, or secular stagnation, further wealth inequality due to asset inflation, etc etc. Standard of living could diminish, but that could be offset somewhat by technology

I certainly hope we decide to act such proactively, but I doubt we will, and when we don’t I doubt we will all be living in our cars.