Quote:
Originally Posted by BleedBurgundy
Here's a stupid question, but I'm going to ask it anyway. What happens if the US just says, we're not going to pay anybody and anyone who has a problem with that can talk to the Department of Defense? Is our GNP insufficient to pay for our various programs, if you take all lending out of the picture?
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This is basically what the deficit is. We are spending more than what we take in, hence we borrow to make up the difference. And some reasonable level of deficit spending is not an awful thing, certainly we expect that our country will not suddenly lose it's ability to produce wealth, which is why other countries are willing to lend to us in the first place. The debatable question is what is a reasonable level of deficit spending. And should the country ever be forced to balance its books, even if its only every couple years.
If we did as you suggest, and certainly we could, it would change our role in the world. Do you think anyone would trust the US dollar, buy US goods, or believe that our military was defensive in nature(not that they all do now, but I am speaking of countries like the EU/Japan, those who treat us as good faith partners).
So even though we could, we shouldn't.