Our “National Debt” Fiasco
By Rick Bottger
The “fiasco” is not the bogeyman itself, but the righteously exclaimed horrified belief in it. And bogeyman it is, indeed.
In brief–it’s easy–the reason all horrific predictions about the imminent catastrophe of the big scary number HAVE NEVER and WILL NEVER come true is simple. Our national assets are ten times that of our debt.
Take an average Old Towner* with a mortgage of $250,000 and an income of $100,000. His debt is 2.5 times his income, while the U.S. debt is only half that, 1.25 as big as our GDP. So is he in imminent danger of catastrophe?
Drum roll, please….Well, you didn’t ask what the mortgage was ON, like 99% of the people I’ve asked in the 31 years since I got published a national book on the subject which led to a national talk radio show on it, Well, again like an average Old Towner, his property is worth about $1,000,000, four times the debt. And the real drum roll is that the asset value of the U.S, calculated just as for every country each year by the IMF, is ten times our debt. That is, if you think your “share” of the debt is $100,000, your share of our national wealth (as the IMF calls it) is a cool $one million.
But we can’t sell the U.S.! you cry, in a desperate attempt to stay scared. Well, in fact we can. We sold Pebble Beach and Rockefeller Center to the Japanese in the 1980s**, and bought most of the country to start with.***
Dang, I got so tired of trying to explain this to a national audience full time for three years I just chucked it all–the radio show, the second book, the Fort Worth heiress–and ran away to Key West at age 48. Every few years I feel compelled to get myself worked up again when, as now, our political leaders of all stripes (libertarians are the worst) and the sheep media, which includes all–legacy, upstarts, podcast, blogs–ignore the facts of 300 years of Chicken Little predictions and any concept of national assets, not only mine, but another ten like mine even before a placid version, Modern Monetary Theory, hit sort of big a few years ago.
The only good news I heard reported was on NewsNation, “the politicians always declaim the debt, but the voters don’t care.” Thank Goodness for the rare Wisdom of Crowds. The electorate dimly remembers that what we need to fear is not the debt, but FIGHTING the “debt,” by raising taxes and slashing benefits, meaning SS and Medicare, which of course always causes recessions. Only this famous Third Rail keeps our thriving economy on track. Rest easy, unless you prefer nightmares.
*The single way I am proud to be average.
** The Japanese took all the $trillion earned making us cars, TVs, and VCRs for ten years and squandered it all on such properties and marvelous renovations, then selling them back at a huge loss.
*** The first Deficit Hawk was Thomas Jefferson, who recanted and bought the Louisiana Purchase for $17 million, all borrowed from Dutch bankers. That debt is still carried on our ledger, but not the uncounted trillions the 15 states are worth.
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Re: selling our property. It is not sold i the sense LA could be brought back to France. But Germany got out of its hyperinflation in the 1920’s by creating “Rentenmarks,” new money backed up by German state property. It worked.