"Chuck it in the fire". What are the economic consequences if America dishonors the national debt, like France is planning?

Photo above - a 100 quintillion banknote (a 1 with 20 zeroes after it), issued by the government of Hungary in 1946, after socialists and communists seized power.

Your personal share of the $40 trillion US national debt is $100,000. Make that $350,000 if you’re the sole breadwinner for an average family. When and how do you plan to repay? Maybe this is why we can't afford to buy houses?

Socialist pundits in America have been claiming there's an easy solution – just double the taxes on corporations. Unfortunately, companies probably would just jack up prices to cover this tax hike, leaving us holding the bag. Or relocate overseas, to places like Europe, where corporate taxes are already much lower.

Will 2028 progressive candidates in America try to pull the same stunt France is considering? Just cancel the national debt. Stop repaying it. Will this mean there's a bunch of extra money for things like welfare, free healthcare, government-built housing, free bus/subway/train fare, subsidized supermarkets, and free college for everyone?

France is the canary in the coal mine. If they get away with their cute little debt cancellation scheme, this will be a realtime experiment to see if nations get punished for refusing to repay their debts. Punished with ungodly high interest rates, or a complete lack of borrowing ability, or hyperinflation, or all 3 at once. The outcome should probably inform America on how to choose our own 2028 candidates.

It’s unclear if US politicians – either democratic socialists of America, republicans, democrats, or libertarians – have any understanding of the economics. The consequences refusing to repay US treasury bonds. Bondholders include US banks, US citizens like you and me, nations like Saudi Arabia and China. Stop cheering - it’s okay to hate Saudi Arabia and China, but not to simply repudiate all our global monetary obligations overnight.

Cancelling the national debt doesn’t unleash a bunch of money for new spending. We’re already spending trillions more each year than we collect in taxes. The most likely outcome of debt repudiation is that there will be interest rates so high that NOBODY can get a mortgage. And draconian US budget cuts because nobody will buy US treasury bills again in our lifetime.

Federal budget cuts likely mean massive unemployment, hunger, and homelessness, in case we haven’t thought that far ahead. France clearly hasn’t.

The French presidential candidate drawing so much attention is Jean-Luc Melenchon, former communist party member and 3-time socialist presidential candidate. Don’t laugh – he unexpectedly came in in 2022..

Imagine the attention certain American politicians are giving France right now. NYC mayor Mamdani. BA in “African Studies”, socialist, and former rapper. Democratic Socialist Alexandria Ocasio-Cortez (AOC). Socialist without adjectives Bernie Sanders. Politicians who might say anything to get elected. Look at how this worked for Trump.

We know how NYC recently voted. This was in part a reaction to an economy that doesn't work for millions. How will nervous voters across the nation pull the lever during the next presidential election?

If you want to buy a house, get a credit card, or already have a 401K account, the outcome might matter to you.

I’m just sayin’ . . .



'Chuck it in the fire.' A leading candidate in France’s presidential race has a simple solution to its massive national debt: just cancel it