DEBT CRISIS, or The Case for Bankruptcy of the USA, Inc
We are at the end of a cycle that will lead to the destruction of debt. Right now, our national debt is about 122% of GDP ($38.432T/$31.616T), and that is a dubious claim since back in 1947 Harry S Truman added Government Spending to the GDP. So, if you deduct the Government Spending from the GDP ($7.034T) you have a real GDP of $24.582T or 156% of debt to GDP.
Before I say anything, give me a plan to clear/pay down the debt.
Remember we must first clear the $1.767T extra we add each year to the debt, then make a meaningful reduction to start paying the debt down. Also, realize there is no motivation to do this as everyone involved in the decision-making process is making money off this debt, including the holders who are earning almost $1T in interest.
In the past 2000 or so years we have had 5 instances where an economy collapsed and everything, including debt, was reset. Watch the video below to understand these ideas are not unprecedented.
So, they claim there are only a few ways out of debt, inflation, debt jubilee or war. There are problems with all!
Inflate the currency to pay off the debt has two problems. First, it kills those who are saving money where their savings becomes worthless. Second, is one that is not really discussed, is this is a patch, it does not fix the underlying problem of not waiting for results. We as a people want the new car and will pay interest to get it now instead of saving for it and repairing the old one. We stopped following the “Thou shall not covet” commandment. How many people (me included) expect to win the lottery to fix our money problems? Fun fact, it ain’t gonna happen!! Trust me after 30 years of expecting the winning ticket, I stopped playing!!
Debt jubilee to eliminate the debt has problems as well. First and foremost, it does not cure the spending problem. I got my credit card debt over $175k and was in trouble, I had no way to recover and was almost to bankruptcy. My father helped bail me out, a friend helped negotiate the debt down and pops loaned me the money to close it out. The caveat was I had to pay it off in 1 year. It hurt and 15 years later makes me think every time I consider going into debt. The country needs to go through that, and jubilee will not fix that problem.
War is not a solution. If you look at all the examples of WAR, after WWI Germany lost and that caused the Weimar Republic mess. After WWII, Germany and Japan actually recovered and eventually challenged the USA (whose factories all survived and thus became an economic superpower). They also folded Japan earlier and Germany now is along with the USA. Their assumption was the debtors and creditors all die and removed the debt. They also used the “Plague” which corrected the monetary crisis in the Middle Ages. As with all the above they do not correct the root problem.
This is why my theory is Bankruptcy will fix the nation. Again, short term, BUT it provides a path to fiscal responsibility for some time. Follow me here, the USA, unlike other countries in their example is a “corporation” established in 1871. Therefore, this allows us to bankrupt using the current corporate bankruptcy laws. We dissolve the USA, Inc and restructure the nation back to the 1871 constitution, this would force an Article V Convention of States (which still needs a few more states to request the COS to start the process).
We can fix the amendments passed after 1871, like eliminate the 16th (IRS and income tax) and modify the 20th to include term limits for all of DC including house, senate, courts, and even the bureaucracy. Also, we would need to include amendments to limit spending, remove “personhood” on corporations, make campaigns so that anyone can easily run, and funding will be pooled to avoid corruption, and limit or end lobbying/donations to politicians. Congress would have to be fixed, then review ALL the laws and maybe have a KISS amendment (Keep It Simple Stupid) saying each law needs to be SIMPLE and understandable by a high school student (without a law degree).
In conclusion, this, IMHO, is the only way to fix the debt crisis we are in today and would be the least painful. Also, is this the "Great Reset" the conspiracy folk talk about all the time?
