Author Topic: A question, then hopefully a discussion.  (Read 4297 times)

grampster

  • friend
  • Senior Member
  • ***
  • Posts: 9,514
A question, then hopefully a discussion.
« on: June 14, 2012, 09:24:09 PM »
So, the national debt is 14 and some odd trillion dollars.  Here's the question.

What if the Treasury printed 15 trillion new dollars and paid off every single debt to every single person, foreign government and/or entity in full?

Now a couple of my comments to get the ball rolling:

After all, dollars are fiat dollars with nothing backing them except the full faith and credit of the United States which is governed by the people of the United States as set up by the Constitution.  So if the people are the government then the people of the U.S. are the backbone of the fiat U.S. dollar.  We are the value backing the dollar.  The people of the United States have shown themselves to be one of the most inventive, hard working, efficient etc etc populace in modern history.  So if the fiat dollar is based on the efficacy of Americans then nothing else could be a better backer of currency, even a lot of it.  The rest of the world has faith in the American people.

So now there are 15 trillion new dollars loose in the world.  What then?  Well some would say galloping inflation because demand and available dollars abound.  But aren't demand and available dollars a good thing in a free and capitalist society?  But what if at the same time those dollars paid off the national debt, Congress enacted wage and price controls?  Now that hasn't worked in the past some will say.  That's true.  But wage and price controls were knee jerk reactions AFTER a problem was in full bloom.  What if those controls were put in place to prevent unchecked inflation that has not occurred..say wages and prices can't increase by more than 5% per year for a set period of say 15 years after the debt is paid.   And what if America set about to create an elevated high speed electric rail system that follows the interstate highway rights of way as much as possible, at the same time as the above, throughout the entire country, along with feeder lines.  (The only criticism not allowed here is the lame tired one that Americans don't like trains and they will not use them.  Bushwah!! This is an entirely new concept and old thinking is not relevent regarding trains.)

Taxes would drop because there is no national debt interest and principal to be served.  That adds more dollars into the fray.  But it allows people with those dollars to invest in the private enterprise that ultimately builds, runs and maintains the rail system as well as all of the other types of industry, business and service that might begin to appear because of the available dollars and the pent up demand.  As for employment, every able bodied unemployed person, especially veterans, would have an opportunity to work on the rail system.  Able bodied people on welfare would be required to work after a period of time of weening and training.

OK.  Flame suit on.  Fire away.
« Last Edit: June 14, 2012, 09:28:43 PM by grampster »
"Never wrestle with a pig.  You get dirty, and besides, the pig likes it."  G.B. Shaw

Perd Hapley

  • Superstar of the Internet
  • friend
  • Senior Member
  • ***
  • Posts: 62,153
  • My prepositions are on/in
Re: A question, then hopefully a discussion.
« Reply #1 on: June 14, 2012, 09:34:50 PM »
cool story bro
Can the liberties of a nation be thought secure when we have removed their only firm basis, a conviction in the minds of the people that these liberties are the gift of God?
--Thomas Jefferson

Balog

  • Unrepentant race traitor
  • friends
  • Senior Member
  • ***
  • Posts: 17,774
  • What if we tried more?
Re: A question, then hopefully a discussion.
« Reply #2 on: June 14, 2012, 09:34:52 PM »
You are being sarcastic here, right?
Quote from: French G.
I was always pleasant, friendly and within arm's reach of a gun.

Quote from: Standing Wolf
If government is the answer, it must have been a really, really, really stupid question.

Tallpine

  • friends
  • Senior Member
  • ***
  • Posts: 23,172
  • Grumpy Old Grandpa
Re: A question, then hopefully a discussion.
« Reply #3 on: June 14, 2012, 09:52:58 PM »
My days of taking you seriously are certainly coming to a middle ...
Freedom is a heavy load, a great and strange burden for the spirit to undertake. It is not easy. It is not a gift given, but a choice made, and the choice may be a hard one. The road goes upward toward the light; but the laden traveller may never reach the end of it.  - Ursula Le Guin

MicroBalrog

  • friend
  • Senior Member
  • ***
  • Posts: 14,505
Re: A question, then hopefully a discussion.
« Reply #4 on: June 14, 2012, 10:09:55 PM »
I .... seriously think that a default is a better idea than this.
Destroy The Enemy in Hand-to-Hand Combat.

"...tradition and custom becomes intertwined and are a strong coercion which directs the society upon fixed lines, and strangles liberty. " ~ William Graham Sumner

grampster

  • friend
  • Senior Member
  • ***
  • Posts: 9,514
Re: A question, then hopefully a discussion.
« Reply #5 on: June 14, 2012, 10:13:57 PM »
Heh. [popcorn]  C'mon, why is this a bad idea?  In addition look at all the cash that would be available to bail out Greece, France, California, New York and Spain.
« Last Edit: June 14, 2012, 10:18:23 PM by grampster »
"Never wrestle with a pig.  You get dirty, and besides, the pig likes it."  G.B. Shaw

Regolith

  • friend
  • Senior Member
  • ***
  • Posts: 6,178
Re: A question, then hopefully a discussion.
« Reply #6 on: June 14, 2012, 10:34:13 PM »
Heh. [popcorn]  C'mon, why is this a bad idea?  In addition look at all the cash that would be available to bail out Greece, France, California, New York and Spain.

Combine the U.S. Great Depression with the Weimar Republic and that's just about what you'd have. The government could try just as hard as it could and it wouldn't stop hyperinflation, the demand for US dollars would actually FALL because they'd be worthless, and the price controls would bankrupt companies or severely restrict what they could make, and a makework program is just that: make work. It doesn't actually produce anything of value; the vast majority of passenger rail systems have completely and utterly failed to pay for themselves. You might as well hire people to dig holes and then fill them back in. So, massive layoffs, a steep falloff of any kind of production, the US would likely lose its credit rating anyway (other countries generally don't like being paid with worthless paper), people would have to go back to bartering because paper notes would be worth more as toilet paper, etc. etc.

Basically, you've taken every economic program that has not only failed to stimulate the economy but had the exact opposite effect (besides outright communism, anyway), and rolled it all into one package.  It'd be like a doctor prescribing a shotgun blast to the forehead as a cure for a broken leg.
The price of freedom is eternal vigilance. - Thomas Jefferson

Necessity is the plea for every infringement of human freedom. It is the argument of tyrants; it is the creed of slaves. - William Pitt the Younger

Perfectly symmetrical violence never solved anything. - Professor Hubert J. Farnsworth

makattak

  • Dark Lord of the Cis
  • friend
  • Senior Member
  • ***
  • Posts: 13,022
Re: A question, then hopefully a discussion.
« Reply #7 on: June 14, 2012, 11:25:05 PM »
Aside from the other problems of black markets and other ways of cheating wage and price controls, how many products do you purchase for which every material comes from the United States?

Our imports would simply stop. Every person in this country would be SIGNIFICANTLY poorer. Transportation would effectively shut down (oil is, of course, significantly coming from overseas). Unless the government also forced every company to sell their materials only to Americans, most of the resources in the US would get exported. US workers would have their real wages cut, probably more than by half. Given how fast people would be trying to dump cash, I wouldn't be surprised if they dropped TO 10%.

Barter would be the main form of trade. (And barter is TERRIBLY inefficient.)

Also, the dollar would cease to be the reserve currency of the world which would further weaken our economy. Our military would likely starve (like all the rest of us poor saps) and that would mean the rising of one or more new dominant powers.

And this is but a cursory overview.

So, disaster, to put it mildly.
I wish the Ring had never come to me. I wish none of this had happened.

So do all who live to see such times. But that is not for them to decide. All we have to decide is what to do with the time that is given to us. There are other forces at work in this world, Frodo, besides the will of evil. Bilbo was meant to find the Ring. In which case, you also were meant to have it. And that is an encouraging thought

Perd Hapley

  • Superstar of the Internet
  • friend
  • Senior Member
  • ***
  • Posts: 62,153
  • My prepositions are on/in
Re: A question, then hopefully a discussion.
« Reply #8 on: June 15, 2012, 12:11:22 AM »
So, grampster for Treasury Secretary, anyone?


No?  ???
Can the liberties of a nation be thought secure when we have removed their only firm basis, a conviction in the minds of the people that these liberties are the gift of God?
--Thomas Jefferson

zxcvbob

  • friend
  • Senior Member
  • ***
  • Posts: 12,498
Re: A question, then hopefully a discussion.
« Reply #9 on: June 15, 2012, 12:18:16 AM »
Y'all know that's what the Federal Reserve is doing already, right?  Just not doing it all in one step.  They are printing dollars out of thin air and buying US Treasury bonds with them.  It's called "monetizing the debt"  That's why the real inflation rate (as deduced from food, energy, and commodity prices) is so high while the official inflation rate (pulled out of the Treasury Secretary's backside) is so low.
"It's good, though..."

ArfinGreebly

  • Level Three Geek
  • friend
  • Senior Member
  • ***
  • Posts: 1,236
Re: A question, then hopefully a discussion.
« Reply #10 on: June 15, 2012, 12:48:29 AM »
I don't think this approach works.

It doesn't work for the same reason that counterfeiting doesn't work.

It doesn't work for the same reason that printing unsecured Federal Reserve Notes counterfeiting doesn't work.

(There is an actual physics to economics.  I've got a writeup somewhere that I did in another [related] discussion.  I will not attempt to reproduce it here.)

An economy requires balanced exchange.  Mountains of money far exceeding production is not balanced exchange.

Value -- real value -- is a function of production.  In the absence of production, "value" is a fraud.

I'm sure I could construct a long-winded argument for this, but I think the effort would be pointless.  It wouldn't be needed for some, and wouldn't be convincing for the rest.

Money isn't value, it's value tokens.  Production, the actual "energy" of the system, is value.

When production value grossly exceeds the representative token "value" there is waste.

When the token "value" representation grossly exceeds the real production, there is fraud.  "Inflation" if you prefer.  No amount of rule making will prevent the inevitable scarcities created by illicit markets or financial "workarounds."

And "fooling" the system with a "shock treatment" of scads of currency doesn't fool the physics of the system:  eventually the system will seek balance, and physics will have its due.

"Look at it this way. If America frightens you, feel free to live somewhere else. There are plenty of other countries that don't suffer from excessive liberty. America is where the Liberty is. Liberty is not certified safe."

Balog

  • Unrepentant race traitor
  • friends
  • Senior Member
  • ***
  • Posts: 17,774
  • What if we tried more?
Re: A question, then hopefully a discussion.
« Reply #11 on: June 15, 2012, 01:23:27 AM »
No, but seriously you're Modest Proposal'ing us here, right?
Quote from: French G.
I was always pleasant, friendly and within arm's reach of a gun.

Quote from: Standing Wolf
If government is the answer, it must have been a really, really, really stupid question.

vaskidmark

  • National Anthem Snob
  • friends
  • Senior Member
  • ***
  • Posts: 12,799
  • WTF?
Re: A question, then hopefully a discussion.
« Reply #12 on: June 15, 2012, 06:53:41 AM »
Grampster -

It sounds like you forgot to take one or more of your meds.  Either that or the results of drinking out of that aluminum canteen cup all those years have finally arrived.

I'm a dummy but immediately recognized the Weimar Republic similarities.  And I've seen the results of that fiasco episode personally!  (My grandfather was returning from Germany after a business trip and still had a (as in one (1)) $10 Silver Certificate in his wallet.  He could not board the boat until he converted US hard currency to local paper.  He needed two large wicker hampers to hold the bits of paper he received in "exchange" for that sole $10 bill.  When he returned home he used that paper to wallpaper the bedroom of the two young children who turned out to be my father and my uncle.  Having to grow up in a bedroom papered in worthless Weimar funny money may explain why and how my father and his brother turned out as adults. [tinfoil]  I recall a few nights I stayed at my grandparents' apartment while Mom & Dad were out.  I slept (very fitfully) in that bedroom which still had the Weimar wallpaper - scary dreams were most of what I remember about sleeping over at my grandparents'.

Thanks, but I do not want to go through that again.

stay safe.
If cowardly and dishonorable men sometimes shoot unarmed men with army pistols or guns, the evil must be prevented by the penitentiary and gallows, and not by a general deprivation of a constitutional privilege.

Hey you kids!! Get off my lawn!!!

They keep making this eternal vigilance thing harder and harder.  Protecting the 2nd amendment is like playing PACMAN - there's no pause button so you can go to the bathroom.

RoadKingLarry

  • friends
  • Senior Member
  • ***
  • Posts: 21,841
Re: A question, then hopefully a discussion.
« Reply #13 on: June 15, 2012, 08:19:27 AM »
From what I've been hearing on the news this morning we might get to see just how such a scheme will work in the Euro-zone just pretty soon.
If ye love wealth better than liberty, the tranquility of servitude better than the animating contest of freedom, go home from us in peace. We ask not your counsels or your arms. Crouch down and lick the hands which feed you. May your chains set lightly upon you, and may posterity forget that you were our countrymen.

Samuel Adams

grampster

  • friend
  • Senior Member
  • ***
  • Posts: 9,514
Re: A question, then hopefully a discussion.
« Reply #14 on: June 15, 2012, 08:38:37 AM »
You see what boredom does when its late at night, one has had a afternoon nap, is not sleepy? :angel: =D
"Never wrestle with a pig.  You get dirty, and besides, the pig likes it."  G.B. Shaw

makattak

  • Dark Lord of the Cis
  • friend
  • Senior Member
  • ***
  • Posts: 13,022
Re: A question, then hopefully a discussion.
« Reply #15 on: June 15, 2012, 08:44:02 AM »
Ah, yes. More disaster came to mind.

I didn't even mention the total collapse of all finance as everyone either runs to the bank or simply spends EVERY SINGLE DIME IN THEIR BANK ACCOUNTS on hard assets as soon as this scheme is discovered.

Ever see "It's a Wonderful Life"? Now try that scene, but no one actually in the bank (ok it was technically a "building and loan", but it was a bank.)

Every bank in the United States would collapse. Hey, but fortunately, the government could just print more money to cover all the deposits lost! And, with everything else that is screwed up, it probably couldn't make it any worse! (Of course, it also would do absolutely nothing to make it better, either.)

So, no investment happening, no trade (in dollars) happening, significant black markets, corruption, bribery, starvation, and I will bet rioting and theft and violence.

Hmmm... what does that situation sound like?
I wish the Ring had never come to me. I wish none of this had happened.

So do all who live to see such times. But that is not for them to decide. All we have to decide is what to do with the time that is given to us. There are other forces at work in this world, Frodo, besides the will of evil. Bilbo was meant to find the Ring. In which case, you also were meant to have it. And that is an encouraging thought

seeker_two

  • friend
  • Senior Member
  • ***
  • Posts: 12,922
  • In short, most intelligence is false.
Re: A question, then hopefully a discussion.
« Reply #16 on: June 15, 2012, 11:31:03 AM »
grampster's plan could work.....as long as we invaded Poland & France afterwards....
Impressed yet befogged, they grasped at his vivid leading phrases, seeing only their surface meaning, and missing the deeper current of his thought.

makattak

  • Dark Lord of the Cis
  • friend
  • Senior Member
  • ***
  • Posts: 13,022
Re: A question, then hopefully a discussion.
« Reply #17 on: June 15, 2012, 01:07:28 PM »
grampster's plan could work.....as long as we invaded Poland & France afterwards....


Clearly we need to learn from the mistakes of the past.






 

Start with Russia, then work your way to Europe.
I wish the Ring had never come to me. I wish none of this had happened.

So do all who live to see such times. But that is not for them to decide. All we have to decide is what to do with the time that is given to us. There are other forces at work in this world, Frodo, besides the will of evil. Bilbo was meant to find the Ring. In which case, you also were meant to have it. And that is an encouraging thought

Jamie B

  • friend
  • Senior Member
  • ***
  • Posts: 2,866
  • I am Abynormal
Re: A question, then hopefully a discussion.
« Reply #18 on: June 15, 2012, 06:20:39 PM »
grampster's plan could work.....as long as we invaded Poland & France afterwards....


Let's invade a country that actually has something useable......
Greatness lies not in being strong, but in the right use of strength - Henry Ward Beecher

The Almighty tells me He can get me out of this mess, but He’s pretty sure you’re f**ked! - Stephen

French G.

  • friend
  • Senior Member
  • ***
  • Posts: 10,274
  • ohhh sparkles!
Re: A question, then hopefully a discussion.
« Reply #19 on: June 15, 2012, 06:54:35 PM »
Has not been exposed to Polish women or food I see.
AKA Navy Joe   

I'm so contrarian that I didn't respond to the thread.