Originally posted by: Kevin Lewis
PJ answered your question very well, but I'd like to point out that government borrowing is a sound financial strategy if the cost of that borrowing is low--just as it is for businesses and individuals. What really matters is the COST of carrying that debt. In a situation where a) the federal government's credit rating is the best in the world; b) government debt instruments are carrying very low interest rates; and c) Inflation essentially reduces or even negates interest (because you're repaying with cheaper money), it makes no sense to NOT borrow. That's the case now.
I should also point out that we owe the majority of this debt to ourselves.
That's why the infrastructure and climate change mitigation bills made so much sense. We can finance all the rebuilding we need to do at 3% APR. Why wouldn't we want to seize that opportunity?
Of course, conservitards have been reflexively bleating about this for some time now, but it's like having a leaky roof and being offered a home equity loan to fix it at 3%. It would be stupid to NOT take out the loan and instead say, well, maybe the leak won't get any worse (the RepubliQ approach to climate change).
Kevin, we're been through this before. Today, US debt interest for a family 4 is $4000 annually. How would the lives of a typical family improve if they had an additional $4000 per year?
The debt and interest will almost certainly double within a decade. Kevin, grow a pair.
