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0 pointszie3y ago0 comments

That was my point.

At some point, we can't keep borrowing to satisfy our debt(s). The question then becomes, what happens? This current inflation is actually a not bad thing for US debt, as we are inflating away some of it. It totally sucks for those of us that want to buy food and shelter though.

Either we endure some hardship(s) and have a miserable decade or three or we crash and burn.

I'm betting we endure the hardships. The other option(s) are much worse.

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shkkmo3y ago

> At some point, we can't keep borrowing to satisfy our debt(s)

Why not? It's just a question of the rate of growth of the debt, the interest rates the USG pays on its debt, the rate of inflation and the rate of growth of the GDP/tax base.

There is absolutely a level of deficit spending that can be supported indefinitely. The question is whether we are above or below that level, not whether that level exists.

zieOP3y ago

There is indeed a possibility that a govt could, theoretically, borrow indefinitely. There is a LOT of assumptions in that calculation though, and it's pretty obvious the USA and almost every government never bothers to even try to live in that range.

So while what you say is theoretically possible, it's practically impossible, as there is almost no incentives for any people currently in government to try and sustain that, and incentives absolutely matter.

If you know of a practical example of this theoretical indefinite borrowing, I'd be very, very surprised.

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