What does US debt really mean?

Pages

There are some pretty scary numbers in the TARP thread. It got me thinking about what they actually mean, if anything.

I grew up with the assumption that if you spend more money than you have, you eventually can't spend money anymore. For a variety of reasons, that does not seem to be the case with our government. We've made some small gestures at reducing debt though these seem to be more symbolic than functional. Maybe "symbolic" is being generous.

We've seen some consequences for the debt. It's hard to argue that it didn't contribute to the recent recession and the devaluation of the dollar. Why hasn't it done more? How much worse does it need to get before we simply can't go any deeper?

In the TARP thread, people were juggling huge figures. Like, more debt than there is money in the entire world. We might owe $ALL.

Will we ever pay off this debt? Do we, as a nation, even want to? Does it really matter? Or is this just another complaint to be saved for some hypothetical future where the United States is no longer immune to the consequences of its actions?

I means that fiat currency is effectively meaningless.

LobsterMobster wrote:

Will we ever pay off this debt? Do we, as a nation, even want to? Does it really matter? Or is this just another complaint to be saved for some hypothetical future where the United States is no longer immune to the consequences of its actions?

To answer your questions: No. No. Yes. Maybe.

My fairly limited understanding is that at some point we'll stop being able to get more loans and/or our loan holders will start selling off our loans to try and recoup some of the money they invested. At which point, the value of the dollar will plummet Zimbabwe style.

I can't believe that we can continue to spend significantly more than we make without any consequences ever coming of it. The question really is when and what, and I just don't know enough to make any educated guesses. All I know is that it is the single scariest thing to me personally. I've never felt personally scared about terrorism or nuclear war or really anything "politically", but this stuff makes me worry.

kaostheory wrote:

All I know is that it is the single scariest thing to me personally. I've never felt personally scared about terrorism or nuclear war or really anything "politically", but this stuff makes me worry. :(

I'm in the opposite boat -- unless the United States becomes an impotent world player, like Zimbabwe, the deficit won't really be an issue. Provided we have strong enough military and economic clout in the world, it really doesn't matter. Countries continue to invest in us because our citizens spend their money in those countries and so does our government. Europe has basically outsourced most of its military strength to the United States.

America is, to cop a phrase, too big to fail. There's not a powerful country in the world that would, given the choice, prefer to see the drastic devaluation of the dollar and resulting economic catastrophe over bailing the US out.

Seth wrote:
kaostheory wrote:

All I know is that it is the single scariest thing to me personally. I've never felt personally scared about terrorism or nuclear war or really anything "politically", but this stuff makes me worry. :(

I'm in the opposite boat -- unless the United States becomes an impotent world player, like Zimbabwe, the deficit won't really be an issue. Provided we have strong enough military and economic clout in the world, it really doesn't matter. Countries continue to invest in us because our citizens spend their money in those countries and so does our government. Europe has basically outsourced most of its military strength to the United States.

America is, to cop a phrase, too big to fail. There's not a powerful country in the world that would, given the choice, prefer to see the drastic devaluation of the dollar and resulting economic catastrophe over bailing the US out.

Sure the game is fixed, but it is the only game in town.

It's interesting, because I had heard some years ago (it may no longer be true, but I wouldn't be surprised if it was) that if everyone who owed the US money paid up, we'd be out of debt, by a long shot. It's a concept that on the micro level is easy to understand (I must pay the CC company or they will ruin my credit and take my stuff) but on the International, Macro economic scale is so complex that no one truly understands it. Plenty of people claim they do... but it's been shown over and over that the predictions of these "in the knows" are rarely what becomes the outcome.

To big to fail is a part of it. The advantage to being a (the) massive financial industry (even though it seems to have bit us in the ass the last decade) is that the world's money moves through and relies on the US. There's a lot more at stake than just our dollar valuation. We control the strings of finance all over the world. We also have the largest and most powerful military. Idealists would like to pretend it doesn't matter, but it matters, in everything from dollar stabilization to diplomatic pull to sovereignty.

Shoal, how do you define, "owes us money?" Are you talking about repayments for foreign aid? That money is gone. We didn't give it as a loan, we gave it as a gift.

You're right in that our military is powerful enough that if anyone comes looking for their money we can effectively offer to pay it in bullets if we so desire. You're also right that it's naive to pretend otherwise. My concern is that the United States will not always be strong enough to take all comers. No nation has ever risen to the top and remained there forever. America has changed dramatically over the last decades and this debt is but one sign that our position is not sustainable.

It comes back to our discussion on international relations. Right now, we don't really need friends. Some day we will. Every time we piss someone off, that's one fewer friend we'll have and one more enemy just waiting for us to falter.

It's true that no nation wants the US to collapse due to the tremendous economic fallout. We should know by now that not all nations end in collapse.

Shoal07 wrote:

It's interesting, because I had heard some years ago (it may no longer be true, but I wouldn't be surprised if it was) that if everyone who owed the US money paid up, we'd be out of debt, by a long shot.

As an aside, I've always wondered about this. If we owe say, Germany, $100 B, and they owe us $100 B, why can't we just settle that debt? I realize that things aren't that simple, and that debt may be held in various semi-liquid forms with varying interest rates, but it still seems like it would be possible to get all of that off of everyone's books. Why don't we do this? It almost makes me think that the powers that be prefer to have our economies inextricably intertwined — which is a whole other discussion.

LobsterMobster wrote:

Shoal, how do you define, "owes us money?" Are you talking about repayments for foreign aid? That money is gone. We didn't give it as a loan, we gave it as a gift.

You're right in that our military is powerful enough that if anyone comes looking for their money we can effectively offer to pay it in bullets if we so desire. You're also right that it's naive to pretend otherwise. My concern is that the United States will not always be strong enough to take all comers. No nation has ever risen to the top and remained there forever. America has changed dramatically over the last decades and this debt is but one sign that our position is not sustainable.

It comes back to our discussion on international relations. Right now, we don't really need friends. Some day we will. Every time we piss someone off, that's one fewer friend we'll have and one more enemy just waiting for us to falter.

It's true that no nation wants the US to collapse due to the tremendous economic fallout. We should know by now that not all nations end in collapse.

Some foreign aid is a gift, some is not, and still there's actual Debt (we loan too!). Tracking it all down and compiling it is a monumental task of research, so I suggest picking a country or two and trying to see if you can find if they owe the US and how much (I'd start with Europe and/or Africa). Most everyone owes the US money somewhere - how much and for what is the question.

Also, we have some very close allies, and our very close allies are also some of the most powerful nations on earth (naturally).

Minarchist wrote:
Shoal07 wrote:

It's interesting, because I had heard some years ago (it may no longer be true, but I wouldn't be surprised if it was) that if everyone who owed the US money paid up, we'd be out of debt, by a long shot.

As an aside, I've always wondered about this. If we owe say, Germany, $100 B, and they owe us $100 B, why can't we just settle that debt? I realize that things aren't that simple, and that debt may be held in various semi-liquid forms with varying interest rates, but it still seems like it would be possible to get all of that off of everyone's books. Why don't we do this? It almost makes me think that the powers that be prefer to have our economies inextricably intertwined — which is a whole other discussion.

I had the same question, then I gave up asking when the answer was always "it's not that simple" or "it doesn't work like that". I just now accept what I bolded in your statement.

LobsterMonster - Come on man. I have been posting about this for months now. The whole paradigm is screwed up because Federal Debt is absolutely not like Household or Corporate Debt at all.

7 Deadly Frauds.

Seven Deadly Innocent Frauds of Economic Policy

1. The government must raise funds through taxation or
borrowing in order to spend. In other words, government
spending is limited by its ability to tax or borrow.

2. With government deficits, we are leaving our debt burden
to our children.

3. Government budget deficits take away savings.

4. Social Security is broken.

5. The trade deficit is an unsustainable imbalance that takes
away jobs and output.

6. We need savings to provide the funds for investment.

7. It’s a bad thing that higher deficits today mean higher
taxes tomorrow.

Deadly Innocent Fraud #1:
The federal government must raise funds through
taxation or borrowing in order to spend. In other
words, government spending is limited by its ability
to tax or borrow.
Fact:
Federal government spending is in no case
operationally constrained by revenues, meaning
that there is no “solvency risk.” In other words,
the federal government can always make any and all
payments in its own currency, no matter how large
the deficit is, or how few taxes it collects.
With government deficits, we are leaving our debt
burden to our children.
Fact:
Collectively, in real terms, there is no such
burden possible. Debt or no debt, our children get to
consume whatever they can produce.
Deadly Innocent Fraud #3:
Federal Government budget deficits take away
savings.
Fact:
Federal Government budget deficits ADD to
savings.
Deadly Innocent Fraud #4:
Social Security is broken.
Fact:
Federal Government Checks Don’t Bounce.
Deadly Innocent Fraud #5:
The trade deficit is an unsustainable imbalance
that takes away jobs and output.
Facts:
Imports are real benefits and exports are real
costs. Trade deficits directly improve our standard of
living. Jobs are lost because taxes are too high for a
given level of government spending, not because of
imports.
Deadly Innocent Fraud #6:
We need savings to provide the funds for
investment.
Fact:
Investment adds to savings.
Deadly Innocent Fraud #7:
It’s a bad thing that higher deficits today mean
higher taxes tomorrow.
Fact:
I agree - the innocent fraud is that it’s a bad thing,
when in fact it’s a good thing!!!

http://www.amazon.com/gp/product/069...

Those govt. checks will cash as long as the US Govt. is reliable. I am in the camp who believes that, while not a great idea, you can run deficits safely if needed. The problem is that this is dependent on the US being considered a safe investment. With the instability in the govt. of late that bet is becoming less sure. We should be worried about issues like rule of law and the integrity of our political process more than anything. The more this breaks down, the more people distrust the process, the more the fiat currency becomes untrusted.

I think the stark-raving insanity of Bernanke is driving it more than any rule-of-law issues lately. QE2 is...not popular.

In an International Trade class I took last semester, one of the points the prof raised was that the US is one of the most vigorous nations in the world when it comes to enforcing copyright law. This attracts business that might be vulnerable to intellectual piracy of their products. While you can certainly get things produced cheaper in China, you have nowhere near the safeguards that the US legal system affords.

DSGamer wrote:

Those govt. checks will cash as long as the US Govt. is reliable. I am in the camp who believes that, while not a great idea, you can run deficits safely if needed. The problem is that this is dependent on the US being considered a safe investment. With the instability in the govt. of late that bet is becoming less sure. We should be worried about issues like rule of law and the integrity of our political process more than anything. The more this breaks down, the more people distrust the process, the more the fiat currency becomes untrusted.

Is our political bickering really any different than any other country? They have fights in the parliament of India, and the Brits still have a line on the floor. Our political shenanigans are still tame compared to many of our international brethren.

Shoal07 wrote:
DSGamer wrote:

Those govt. checks will cash as long as the US Govt. is reliable. I am in the camp who believes that, while not a great idea, you can run deficits safely if needed. The problem is that this is dependent on the US being considered a safe investment. With the instability in the govt. of late that bet is becoming less sure. We should be worried about issues like rule of law and the integrity of our political process more than anything. The more this breaks down, the more people distrust the process, the more the fiat currency becomes untrusted.

Is our political bickering really any different than any other country? They have fights in the parliament of India, and the Brits still have a line on the floor. Our political shenanigans are still tame compared to many of our international brethren.

Bickering is one thing. I would welcome more vigorous debate. Talks of succession and civil war are not good for business. Especially if it heats up further.

Wait. People are seriously talking about seceding? Are they *complete* morons?

Hypatian wrote:

Wait. People are seriously talking about seceding? Are they *complete* morons?

Yes and yes.

I think it is safe to say that such people will have little impact on the stability of the republic.

I tend to subscribe to Hamilton's theory about debt. In many ways debt has helped the US. What much of our current problem stems from is private debt and inequity of out debt, namely in the hands of the Chinese and Middle East.

Hypatian wrote:

I think it is safe to say that such people will have little impact on the stability of the republic.

The 2010 mid-term election begs to differ.

Just FYI, I'll be answering this eventually, but haven't had the uninterrupted time available to do it properly. Hopefully I'll have something up later today.

Malor wrote:

Just FYI, I'll be answering this eventually, but haven't had the uninterrupted time available to do it properly. Hopefully I'll have something up later today.

Great! This thread is seriously lacking the use of bold, italics, and CAPS LOCK. It's almost impossible to understand what people mean.

Seth wrote:

Europe has basically outsourced most of its military strength to the United States.

Not really singling you out here, Seth, because this seems a common belief here on the forums (and wider) but that just isn't supported by the facts. The EU's entire military budget is 200 billion (US 600, China 100 and Russia 60). Even as single members, France and Britain spend more than Russia. The problem isn't Europe's security, is the fact that the US has way too much military assets than it knows what to do with.

I've said it before but it seems there is a need to overestimate the size of the Untied States enemies or threats and underestimate its allies. I have a cynical reason why this is the case. Anyho..

LobsterMobster wrote:

It's true that no nation wants the US to collapse due to the tremendous economic fallout. We should know by now that not all nations end in collapse.

This to me is the point. Remember Sterling used to be the reserve currency but Britain still exists and remains one of the more powerful countries in the world. I don't see the US disappearing but countries or other entities will attempt to exert their influence. Nothing nefarious about that fact either.

Jayhawker wrote:

Great! This thread is seriously lacking the use of bold, italics, and CAPS LOCK. It's almost impossible to understand what people mean.

Someone wrote a mod that will let you put users on ignore. Please let me encourage you to use it.

Crap, I put my comments in the wrong thread. Reposting here:

I knew this was going to take a while to write. I'm not even done yet, but I figured I'd post what I had so far.

Governments have to confiscate wealth from the economy to function. This is just simple baldfaced truth. They need resources to do anything; they need money for salaries, they need buildings to house them in, they need office supplies and (these days) computer equipment to do whatever the citizens think they should be doing. And they get those resources by taking them from the main economy. The actual process is to take dollars and convert them into wealth.

Wealth is energy, stuff, and knowledge, and the means of making more. I debated over getting into the history of money, but I think that can be avoided here, at least for now. Suffice it to say that modern money does not represent wealth. Having money does not directly make you wealthy. It's only when you trade that money into something useful that you actually become wealthy. Before that, you simply have claims on wealth, potentially enormous numbers of them, but they are just claims until you turn them into something. They are, in essence, a form of debt, a promise to pay something unspecified in the future, owed by the economy as a whole.

Money is a representation that you have provided value of some kind to the economy. In exchange for your efforts, whatever they are, you convinced people to pay you. They are 'turn' tokens. You can use your tokens to take your turn now, extracting some of the energy, stuff, and knowledge that the economy is constantly generating, or you can save those tokens for later use. Typically, most people put their saved tokens in banks or the stock market, where they become available for other uses. In exchange for giving your turns to other entities, they promise to give you more turns back in the future. If you delay your consumption now, you can enjoy more consumption later, because your turns can be used to make more facilities to generate energy, stuff, and knowledge. When you get your tokens back out of the system, you can trade them for more goods than you could if you had traded them in today.

Governments are not fundamentally different than any other actor in the economy. They are just people. They are just doing the things that people do. Their functions usually do not generate wealth directly, but rather provide indirect services to allow more wealth generation by everyone else. For instance, you need strong contract and property laws, and good law enforcement, to punish the dishonest and prevent theft, particularly violent theft. And you probably want things like roads and water and sewer and electric service. These are basic functions that are very hard to do on a private basis, and very tempting, when they ARE done privately, to exploit for unfair amounts of wealth from the main economy, through monopoly rents. It can be a very good idea to put these things in the hands of the government.

However, much government spending does not result in any wealth generation at all; it is wealth-destructive. Military spending is the canonical example. Take your average tank. These things are hugely expensive to build, requiring vast amounts of steel and (on modern units) depleted uranium for the armor, and gas to move around, and gunpowder and more DU for the weapons. And you have to pay people to learn how to use them, and then pay the crew to mostly sit around doing nothing, and pay mechanics to keep the tanks in good working order. And then, when it gets old, it has to be scrapped, which takes even more resources. And none of these things generate wealth at all. At best, they prevent other people from coming and stealing your stuff with THEIR tanks. It's immensely better to be building tractors instead, because tractors can be used to build more stuff. Instead of paying people to learn these complex weapons systems, which are only useful for one function, we could be teaching them to build roads and houses and factories. Defense is inherently wasteful; you want just enough to keep people from stealing the roads, houses, and factories you're building with your tractors.

There are lots and lots and lots of government programs that are wealth-destructive. Long-term welfare almost certainly is, for instance -- we send food and provide housing to poor people, and get very little in exchange. (Short-term programs can be highly effective -- people have this annoying habit of dying if they have no food, and providing a minimal standard of living can keep them together long enough to get back to productive work, where they'll repay that wealth many, many fold.) But when people stop being productive and will never be productive again, it is wasteful to feed them. From an economic perspective, this is simply true. It may be abhorrent, but the resources we devote to making food and housing for these people are resources we could have used to make factories or educate kids.

I'm NOT saying we should do away with Social Security or anything of the sort. I am making the simple observation that feeding and housing people who will not repay these resources destroys wealth. THIS IS TRUE, whether or not we happen to like it. We may, and probably should, choose to do so anyway, but we should never wear blinders about what's actually happening. We are using up energy and stuff (can't really use up knowledge), and will not get increased energy and goods production in the future. This is wealth destruction.

OK, so. A healthy government will extract turn tokens from the economy, and use those turns to accomplish its various ends, some of which generate wealth, and some of which destroy it. The more destructive activities are going on, the slower the economy will grow, because resources are being diverted to ends that do not result in more resources being made available. Each year, it takes in X dollars, and spends X dollars. It is balancing growth versus consumption. The smaller the destructive component of X, the faster the economy will grow. There is probably a point where X gets too small, also impairing growth -- if you don't have good roads in good repair, or reliable electric service, the economy will be damaged. So you want the destructive component of X as small as possible, and the overall level of X tuned for maximum possible efficiency, to get best overall growth.

Like almost all things in economics, X becomes less efficient as it increases. The first part of X produces a huge payoff, often a major multiple of whatever was invested. Additional resources devoted to X result in smaller and smaller multiples, and eventually it gets to the point that additional wealth put into X becomes negative; that is, you put more resources in than you will ever get out. A simple analogy would be roads; having a paved road in the first place is a BIG deal. Upgrading to a freeway can improve things substantially more, but usually less, dollar-for-dollar, than the original road. Adding each lane on the freeway costs just as much, but results in less economic improvement. Eventually, when you add the 100th lane to a 99-lane freeway, you're just wasting wealth. The tipping point will be different with different roads, but they all have them.

Law enforcement is another example; having enough to enforce contracts, property laws, and personal safety is a giant multiplier on wealth generation. Covering every streetcorner with police and monitoring citizens 24x7 is a waste of resources.

OK, phew. I think I'm going to post this part, and then contemplate how to talk about government debt.

OK, so, now we start to get more complex; what happens if the government borrows?

What with being sovereign authorities and all, governments tend to be a good bet to lend to, since they have the power to take money by force from their entire economies. This makes them highly creditworthy, particularly in advanced economies where the rule of law is at least nominally respected.

Governments, again, are not fundamentally different than any other economic actor. They're just people, acting as agents for the other people that make up their economy. They can do the same things that any other group of people can do, they just have a lot more money to do it with. They can save, giving the turn tokens in their possession to banks and other entities in order to get more turns later; they can invest, building wealth-producing facilities directly, or they can spend, using their income to support services that do not generate a return. Their perspective is a little different, since they're (supposedly) saving, investing, or spending for the entire economy at once, instead of just for individual actors, but the basic actions a government can take are the same that any other economic actor can take. They also have the ability to print money, but this does not overrule anything else; they can still use their newly-created turns to save, invest, or spend. The only difference is the source of the turns, and who ends up paying for them. I'll get to that later.

Just like with every other economic actor, a government typically has the option of borrowing turns from other people to divert economic resources to a project they want to do now. Like everyone else, they have to pay a fee to borrow tokens. In exchange for Y tokens today, they promise more than Y tokens later. Their implied creditworthiness means that the difference is typically smaller for a government than for nearly any other economic actor, because the risk is much lower than with individuals. Loans taken on by individuals cannot be enforced against anyone else, so should they die, or declare bankruptcy, the loan will not be repaid. (this is part of why people charge to lend their turns -- to help cover the risk of not getting their turns back at all.) Unlike any other kind of loan I can think of offhand, government debt is enforceable against the children of those who took out the loan. It's enforceable even against people who weren't born when the debts were taken on. The economy as a whole is irreparably on the hook to repay the debt, or suffer the consequences of default, which can be dire.

Governments, in other words, can borrow cheaper than anyone else, but they can do so because that debt is really dangerous. You can't just die and get out of it, and you can indebt generations at a time for spending incurred in the present. This is why it has to be treated very, very carefully.

Once the government has borrowed, like any other economic actor, it can choose to save, invest, or spend its tokens. It would be very weird to save borrowed money, though there may be times when it could be useful. Almost always, those turns would either be invested or simply spent.

Investment by government, like any other investment, carries risk. It can build new roads that not enough people use, and thus not generate enough additional taxes to liquidate the debt. Or it could build new power plants that aren't needed, or sewers for subdivisions that never materialize. Like any other investor, if the government is smart, it can use those borrowed tokens to create facilities that will generate enough tokens to pay off the loans, and even make a profit, helping to pay off loans for projects that did not result in the expected returns.

It can return whatever profits are left to taxpayers, or plow them into additional investment. This kind of borrowing can be a powerful net benefit to the economy, because it allows large-scale projects that couldn't otherwise happen. It's cooperation on an enormous scale, and it's responsible for a lot of truly amazing advancements and achievements; having played Fallout recently, Hoover Dam comes to mind. Hoover Dam is an incredibly valuable resource, and it continues to pay off vast multiples of the money invested to create it.

Alternately, the government can just spend its borrowed tokens. It can buy a bunch of shiny new tanks, or feed a bunch of poor people, or "invest" in foolish projects for the benefit of certain constituencies. The "Bridge to Nowhere" comes to mind, a huge bridge out in the middle of Alaska that few people will use, and which will almost certainly never generate enough tax revenue to make its construction worthwhile.

Because governments pay such low interest rates, relatively speaking, they can do a LOT of this consumptive spending before the interest they're paying starts to become much of an issue on their books. They can do it for years and years and years, in fact, long enough to convince everyone that the deficit spending doesn't really matter, that it's not hurting anything. But every year, that interest burden grows, and the government will come under more and more pressure to borrow to maintain the services it's already providing. Once it starts borrowing for consumption, it's really hard to stop. The naysayers are poohpoohed..."that's only $X million in interest per year, and we have trillions coming in, are you an idiot?" Because the borrowing is not self-liquidating, as it would be with an investment, it becomes a drag on the government's books, and thus on the economy as a whole. Every year, the government has to take more turn tokens out of the economy, and instead of using them productively, send them to the people who lent them their tokens years before, so that they can take their turns instead. This means that fewer turns are available for the economy and the government, and more turns are available to the lenders. The government ends up spending many more total turns than it would have, if it had simply paid for its consumption out of current-year spending, and economic growth is impaired.

Government borrowing snowballs. That's what you're seeing in countries all over Europe right now. They've been borrowing so long that that their creditors are seriously questioning their willingness to actually give them back their turns plus interest. So the risk premium is going way up.

Most government borrowing is paid for by bonds; I believe the bulk are in 5- and 10-year notes. If the government isn't repaying its debts, it has to roll its bonds over. That is, it has to issue new bonds into the market to repay the turns lent to it 5 or 10 years before. With a sudden new risk premium, all of a sudden that interest burden skyrockets. They were paying maybe 5% on the bonds in 2000, and now in 2010, to roll those bonds over, they'll be paying more like 10%. So their yearly interest drain in turns doubles, but they can't provide any new services in exchange for those new outlays -- rather, those new outlays must happen to pay for expenses a decade or more prior. Those who were poohpoohing a paltry few million in interest expenses, or a paltry few hundred billion, have usually conveniently left the government, which now has a gigantic problem.

With government debt, things are fine, things are fine, things are fine, things are fine, hmm, things aren't so good, OH MY GOD IT'S AN EMERGENCY. The tipping point into crisis can come very abruptly and painfully, and it's quite possible to end up with a debt that is simply unpayable. It LOOKED payable when it was taken on, but as soon as investors get worried about the government's books, all of a sudden it's not.

OK, I think I'm going to let that rest for awhile, I'm tired. I'll try to hit up the next steps, and cover goman's scenario ("We can just print money for everything!") tomorrow.

Axon wrote:
Seth wrote:

Europe has basically outsourced most of its military strength to the United States.

Not really singling you out here, Seth, because this seems a common belief here on the forums (and wider) but that just isn't supported by the facts. The EU's entire military budget is 200 billion (US 600, China 100 and Russia 60). Even as single members, France and Britain spend more than Russia. The problem isn't Europe's security, is the fact that the US has way too much military assets than it knows what to do with.

I've said it before but it seems there is a need to overestimate the size of the Untied States enemies or threats and underestimate its allies. I have a cynical reason why this is the case. Anyho..

The angry leprechaun speaks the truth.

Malor wrote:

Stuff

Usually when I read Gamer Jobs I go straight to the boogle dating stories, but I read this and found it very informative. Good job!

Let's stop and put things in perspective here, guys.

1) People have always threatened to secede. Texas maintains that it only remains part of the union at its pleasure. Remember that we are the United States. The fact that we've used military force to prevent secession does not mean we can't remember a time when we weren't quite so close. The biggest proponents of "state's rights" remember it much better than most of us. This means that threats of secession are nothing new and if they're worth getting worked up over, we'll have other warning signs. Hemming and hawing about the federal government is one thing. Arming citizens and sealing borders is another. We're not there yet.

2) There is a big difference between secession (or rebellion) and democracy. The mid-term elections do not tell us that we're headed toward civil war. They tell us that the people are unhappy and have addressed that with the system put in place for that purpose.

3) When you look at the stuff we're arguing about, it's all relatively minor. Healthcare, abortion, gay marriage, gun control, even privacy and security, these are the priorities of those who are not worried about feeding and clothing their children. I do not think there are many people who are willing to sacrifice that level of comfort for the sake of a dear - but intangible - principle. Few enough to arrest if need be, rather than meet on the battlefield.

I marvel at the fact that somehow, both Malor's and goman's points of view resonate with me. I read them and find myself nodding in agreement, despite the fact that they are essentially saying two opposite and irreconcileable things.

Seth wrote:

I marvel at the fact that somehow, both Malor's and goman's points of view resonate with me. I read them and find myself nodding in agreement, despite the fact that they are essentially saying two opposite and irreconcileable things.

Welcome to Econ.

Pages