I just did a quick calculation. I'm sick of hearing how our national debt is manageable (which is obviously false) and that we really need more of it right now (false). A normal rate for the government to pay to borrow money is 6.5%. This is back of the napkin stuff, but kind of compelling. By the end of the year the national debt will be over $14 trillion. Multiply that by the interest rate and you get $910 billion in interest payments per year, or 59% of the entire revenue of the federal government just for interest. How is that manageable again?
That is assuming that people will pretty much still want the debt. If they really are concerned about getting paid back with dollars that are still worth something, it gets out of control fast. Let's just pretend the interest rate was 10%. The interest alone would eat up 90.3% of the entire revenue of the United States government, leaving 9.7% for, say, everything else -- defense, social security, medicare, roads, education, pork, waste and nonsense, etc.
By the way, in case I haven't mentioned it, Keynesian stimulus in a balance sheet recession is idiotic because the money is bound to fall into a deleveraging sinkhole and disappear, yet the problem is still there, only slightly smaller, and consumer confidence doesn’t budge. In other words, people and companies take money they get and stick it in the bank or pay off debt, so it more or less disappears from the economy instead of stimulating the economy!
(My thinking is if they had any intention of learning from history, it would be physically impossible to be on the left.)
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