Where is the Money Coming From?

Congress is poised to pass a huge spending bill ( sometimes called a stimulus bill ) and has a 12 trillion dollar national debt. If they think they can stimulate the economy by running up more debt why not just pass another $12 trillion and pay off the debt. This of course brings up the question ," Where is the money going to come from to pay off the debt?" Well if there isn´t money to pay off the debt how can there be money to stimulate the economy? Here we enter into the mumbo jumbo of political blather. Simply said we are going to borrow the money. Who are we going to borrow it from? When Congress passes an appropriation bill they necessarily turn to the taxpayer as the taxpayer is the only source of revenue the government has. Loans are not revenue. Loans have to be paid back. The taxpayer doesn´t get paid back. If the government reduces the taxes it confiscates, the taxpayer gets to keep more of what he earns. This is not a cost to government anymore than it is a cost to a burglar if he doesn´t take your money. But this is the language the government uses to make the tax payer think the government is paying for "tax cuts". Why the taxpayer is willing to swallow this convoluted mush must be left to the inner workings of the taxpayer´s mind.

The common explanation for where the money will come from rests on foreign countries like China. So China has a huge reserve of solid currency that it is willing to spend on buying a bunch of bad debt that we have to offer? Why is the trade deficit so high when we have a sucker like that on the hook?

If there is so much money available for Congress to spend why not just appropriate a few quadrillion and make the economy really grow and prosper? Even in the darkest recesses of the political quack´s minds there is a realization ( although mostly blanked out ) that endless money can never be a reality. Someone has to create wealth by coming up with an idea that people will buy and other people produce. From the profits will come surpluses that can go to purchases and capital that will erase debt. Nothing in the spending for potholes and CCC like mausoleums will reduce debt.

Is debt something we can ignore? Every individual knows he cannot ignore what he owes without the someone he owes taking action to collect. Why should a nation be exempt from this? Suppose we do borrow from China ( I don´t think we need to expect a gift from them). Currently they are also feeling the pinch of the global financial crisis. Might they want to have some of the money we owe them back? Did we get such good terms that we can extend the loan forever? Where is the delving into the financial arrangements we have with foreign lenders? When are the loans due? How much credit do we have with China? What is the value of the money we will be paying them back with?

Since these "transparencies" are not visible perhaps there is something going on that no one wants to face up to. Perhaps there is a time of reckoning just as the deadbeat who ignores the obvious until action is taken against him and he must either flee or ?

So the approach right now as indicated by our government is to wait for the shoe to drop and then we´ll deal with it. This is pragmatism and demonstrates the evil associated with this philosophy. The deadbeat is a pragmatist and he has no idea what he will do when the shoe drops but he will put off any planning until the crisis arises. This means in terms of the current financial crisis until the inevitable high inflation sets in a government knows that it only has one way to fight inflation and that is to raise interest rates and reduce the printing of money. In true political evasion the specter of hope arises meaning maybe this time we can get away with it and it won´t leave us with a deterioration of our currency. History shows that is wrong, has been tried and failed and will in all certainty happen again. This of course means people with vastly lower standards of living, chaos, disruption and ultimately revolution. This is what the politicians are willing to risk by spending money they do not have to spend.

So the question remains, "where is the money coming from?" That is the central question and the answer is it is not coming from anyone. No one or no country has the amount of money to loan that our government is seeking. That leaves printing of money that has no more value than the value of the paper it is printed on. With only the printing press to pay off our debt we must resort to legalized counterfeiting and as soon as the recipients of these bogus bills find out their true worth the shoe will drop and it will drop hard and heavy. As has happened in the past in 1924 in Germany and in Zimbabwe and in Iceland the name United States will not be enough to salvage the currency we have debased. Without a viable currency we will take on the appearance of all other nations that tried this stupid spending stunt and failed ( as is the only option). All the high hope voters who ignored facts and history to jump on the wagon to fantasy are like the bad boys in the story book "Pinocchio ". They head to Treasure Island and turn into jackasses. It is telling that the symbol for the Democratic Party demonstrates who led them down this primrose path and the identity they acquired.