'Debt default' and 'government spending' are misdirection
Biden, Schumer, Yellen, and Brainard, luminaries in the leftist galaxy, spread fear of default. They focus solely on Treasury obligation default. Were they honest, these federal bureaucrats should also discuss default on exorbitant government spending on welfare and entitlement programs. Don't let them misdirect the argument to debt default only.
These are two very different methods of default. It is irresponsible of these leftist luminaries not to look at both aspects of federal spending.
When the Federal Reserve started printing dollars (called quantitative easing or Q.E.) in 2008, they used that $8 trillion of new money to expand federal spending and thereby put every working citizen into debt. After all, we have to pay for federal spending through our taxes. Did they not know that this debt would eventually have to be repaid? Or did they just not care? After all, these politicians and bureaucrats put us into debt and, until now, don't pay the price for their malfeasance.
After the windfall, our government officials proceeded to spend all the money they borrowed (through issuance of Treasury Bonds) on government programs like entitlements and welfare — basically paying some people not to work, using our personal debt obligation (Treasury Bonds) to get re-elected.
Consider the moral implications in every aspect of this theft. Every tax-paying citizen is burdened with massive debt that he did not want. Then politicians and bureaucrats get to spend your money to pay other people not to work. In this scheme, politicians tax and take to get re-elected.
So, yes, the government has to default on one or another obligation — its agents must be held to account by us, the ones who pay. Bureaucrat jobs and entitlement programs must be forced to live within their means.
But we all know that that is not what Biden and the left mean, and that is where we citizens have to demand that our elected representatives take the heat and severely diminish the massive, useless entitlement spending.
Kevin McCarthy's stand is a noble start, but future politicians have a long way to go before wasteful government spending is reduced and the debt (Treasury Bonds) from these spending obligations is retired. We still have a long way to go just to drain the $8 trillion in Q.E. that the Federal Reserve created, and Congress spent, since 2008.
The socialists, communists, fascists, woke would focus everyone's attention on the good this spending does for one recipient. They ignore the negative effect on everyone else. We should draw a bright line to the moral dereliction of giving a person anything for not working. We should question the efficacy of government spending versus private spending — control versus free choice.
The next revelation is that the term "government spending" is misdirection. Government doesn't have anything to spend. Government doesn't create profit; it takes profit from those who created it.
The government is, instead, spending every citizen's money by force, and when the tax revenue runs out, it drives every citizen into debt. Being placed into debt without approval is pure control, absolute evil, and the antithesis of the concept that became our America.
In any sane world, that would be called theft. But get ready: the left will foment massive riots to protect its "legal" theft. While these ramifications are unpleasant, they must be faced by us so that our grandchildren don't have to solve our problems.
Jay Davidson founded and operates a commercial bank. He is a student of the Austrian School of Economics and a rabid capitalist. He believes there is a direct connection from individual right and responsibility to our Constitution, capitalism, and the intent of our Creator.
Image via Picryl.