AndreusMaximus
Master
So, I do sort of have my own thoughts on the answer to this question, but I've kind of just realized that when pressed, I can't really give a solid answer and "show my work" as @JettaKnight put it.
So the question is, given that the USA has already borrowed ridiculous amounts that we'll never pay back in a single lifetime, and everybody keeps lending to us with no apparent expectation of getting their money back, why not just keep borrowing forever? Does it actually hurt us at all?
The below came up in another thread, and not wanting to thread jack that particular one any more than it already has been, I thought I'd start a new thread in hopes of getting more insight from others.
I seems to me that it's always been a conservative value to balance the budget and reduce national debt. But have we actually been wrong in that all along? Can we really just keep borrowing endlessly with no repercussions? So far the answer seems to have been yes, I have to admit.
Who did we actually borrow the money from under Reagan? I don't know if that specific $2-3T we borrowed under Reagan hurt us so much per se as the precedent of racking up ungodly amounts of debt that we'd never be able to pay off in a single generation. That's led us to the current situation, where we owe primarily to one of our biggest rivals; China. If China, tomorrow, said "okay, no more borrowing, and pay back what you owe us," would the USA just say "lol, no" and business would continue as usual with no consequences? I have to imagine not. If our creditors aren't gaining some kind of power over us by loaning us money, than why are they lending to us? Does the USA really just project that much economic power that other countries are willing to make free donations to us in the form of "debt" that everyone knows they'll never get back, all for the sake of hoping to benefit by playing nice with us? Or is it just a delicate game of balance, where we don't think China would actually stop lending because they don't want to lose us as the primary customer for all their manufactured stuff?
I genuinely don't know. Maybe we should start another thread about this; I'd love to hear more answers.
So the question is, given that the USA has already borrowed ridiculous amounts that we'll never pay back in a single lifetime, and everybody keeps lending to us with no apparent expectation of getting their money back, why not just keep borrowing forever? Does it actually hurt us at all?
The below came up in another thread, and not wanting to thread jack that particular one any more than it already has been, I thought I'd start a new thread in hopes of getting more insight from others.
You know, I honestly don't know the answers to any of that.Genuine question here, "how did that $2-3T hurt us?" Please show your work.
We haven't had to pay it back, we still borrow money with seemingly reckless abandonment, so did it hurt? And what did we gain economically by crushing the USSR? I think one could argue that a big upfront expenditure potentially saved a portion of that in the long run.
I seems to me that it's always been a conservative value to balance the budget and reduce national debt. But have we actually been wrong in that all along? Can we really just keep borrowing endlessly with no repercussions? So far the answer seems to have been yes, I have to admit.
Who did we actually borrow the money from under Reagan? I don't know if that specific $2-3T we borrowed under Reagan hurt us so much per se as the precedent of racking up ungodly amounts of debt that we'd never be able to pay off in a single generation. That's led us to the current situation, where we owe primarily to one of our biggest rivals; China. If China, tomorrow, said "okay, no more borrowing, and pay back what you owe us," would the USA just say "lol, no" and business would continue as usual with no consequences? I have to imagine not. If our creditors aren't gaining some kind of power over us by loaning us money, than why are they lending to us? Does the USA really just project that much economic power that other countries are willing to make free donations to us in the form of "debt" that everyone knows they'll never get back, all for the sake of hoping to benefit by playing nice with us? Or is it just a delicate game of balance, where we don't think China would actually stop lending because they don't want to lose us as the primary customer for all their manufactured stuff?
I genuinely don't know. Maybe we should start another thread about this; I'd love to hear more answers.