Younger People, You Realize that When Governments Always Spend More Than They Take In, It Create a Debt that You Will Likely Have to Pay?

The old people will be dead and you will pay the bills.

When governments spend on non-essential things for the support of life, they are not investing in capital, but ideology. While you may gain rights and privileges related to lifestyle, you could loose the ability to undertake the things you need to live (ie jobs, housing, food, transport, retirement, etc).

Increased taxes will not work on the rich, because those with means will just move their money to lower tax places. Where the money goes, investment will increase. Money goes to where it can make the most money.

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Burnley123 · 41-45, M

So so many things wrong with this. You claim to be educating people but you need to educate yourself.

A government is not a household. Private debt and public debt have an important (and often inverse) relationship. Keynesian paradox of thrift.

okaybut · 56-60, M

@Burnley123 Annual interest on Canada’s government debt translates into $7,000 for a family of four. This is after tax.

okaybut · 56-60, M

@Burnley123 For USA. Net interest payments on the debt are estimated to total $393.5 billion this fiscal year, or 8.7% of all federal outlays.

Burnley123 · 41-45, M

@okaybut Similar is true if virtually every country. Any serious attempt to eradicate all government debt would mean Grapes of Wrath conditions and would fail anyway because it would destroy growth.

This is why even the most fiscally Conservative governments dont attempt to do it when in power.

Look at the example of Greece, where the government was cut by a record amount. The result was a 50% youth unemoyment and debt actually increased.

okaybut · 56-60, M

@Burnley123 I agree. It has to be gradual process during the good times. Canada did it before the debt crisis (a liberal government did it during the good times) and it helped us largely escape the 2008/9 collapse. Unlike the other G7 countries. And Harper kept it going. Trudeau came in and blew it up, so the next recession we will not be so lucky.

Burnley123 · 41-45, M

@okaybut Paying down debt in good times does make srnsr, though that was not your original point.

Deficit spending works a) in a recession and or b) if it stimulates enough growth to make it sustainable.

In addition, when governments cut, private debt increases to take up the slack demand. This is just as significant as any public debt issue.

Burnley123 · 41-45, M

@okaybut Also, Canada escaped the worst of the crash due to the relative lack if financialisation of your economy and the lack of dodgey mortgages

okaybut · 56-60, M

@Burnley123 In part on the better financial system. But our yearly debt skyrocketed with the collapse. But our government debt was in such good shape, we were fine unlike the USA and many other nations.

okaybut · 56-60, M

@Burnley123 And definitely take on yearly debt in bad times, but create surpluses in good times (like the last 4 to 5 years, which Canada or USA has not done).

Burnley123 · 41-45, M

@okaybut Deficit spending in good times you can legitimately question. I cant agree with your original post though

okaybut · 56-60, M

@Burnley123 You are right, let me adjust it. Added "always".