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US Published National Debt: $28T. The Truth: $146T. Each Taxpayer's Share: $951k

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Re: US Published National Debt: $28T. The Truth: $146T. Each Taxpayer's Share: $951k

#101

Post by nickthemagicman »

janandonly wrote: post #3

This is more a discussion of semantics than about the amount itself. The way I read the statistics is that the current debt is $28T of money that is already spent while the quoted debt of $146T is the amount of money needed to be spent to fill full current promises and expenses . It's interesting that since the USA got off the gold standard in 1971[1], and thereby all countries that had a currency backed by dollars,…

> the only reason we don't feel this too much just yet, is because often times cheaper alternatives where available.

There is a trick, what I like to call value extraction, that companies do in place of financial extraction(or raising prices).

This is commonly known as shrinkflation in regards to commodities, such as cereal, as the company provides less product for the same price and as such the product has to be bought more. People just buy their product as usual and don't realize the quantity has gone down and just have to purchase more and more.

In the sense of a more tangible product, like a tool or shoe, the company lowers the 'value'...it is cheaper pricewise by say a factor of 3 but the actual quality of the product is lowered by a factor of 10 or more, in materials, in manufacturing, etc..so the value is reduced massively, and it's cheaper financially in the short run on the price tag, but not cheaper in the long run, because the product fails much more often than the quality product and has to be purchased over and over again.

As humans we just see the price tag in the short term for all of it. Prices are easy to compare and are objective, value is much harder to quantify.

This is also part of Ubers business model of milking drivers as well, not out of money, but out of asset depreciation. The drivers just see the money they're making today, and aren't thinking about long term asset depreciation. So the less educated driver thinks they're making 20 bucks an hour, but in reality that driver is making like 4 bucks an hour after operating expenses, however, Uber advertises the 20 dollar an hour number in employment ads.

I haven't formed a complete framework for it but this idea of 'value extraction' is one way companies make money without raising prices.

Re: US Published National Debt: $28T. The Truth: $146T. Each Taxpayer's Share: $951k

#102

Post by nickff »

JumpCrisscross wrote: post #63
jfengel wrote: post #30

It's a misleading way of calculating the number, since it refers to all of the future debt obligations, including Social Security out many decades -- but also ignoring the fact that we'll be collecting taxes all that time. It's a bit like concluding that you're a million dollars in debt because you are going to need to buy food for the rest of your life. I suppose it's true -- it is something you need to plan for. Bu…

Would also note that if you're incorporating unfunded future liabilities, it also makes sense to cancel out intergovernmental debt, e.g. Treasuries held by the Federal Reserve or by agencies.

You can't quite 'cancel out intergovernmental debt', as their sale (to extract their value) would cause devaluation. I am not sure how you would model the loss in value.

Re: US Published National Debt: $28T. The Truth: $146T. Each Taxpayer's Share: $951k

#103

Post by Iwan-Zotow »

mywittyname wrote: post #80
janandonly wrote: post #3

This is more a discussion of semantics than about the amount itself. The way I read the statistics is that the current debt is $28T of money that is already spent while the quoted debt of $146T is the amount of money needed to be spent to fill full current promises and expenses . It's interesting that since the USA got off the gold standard in 1971[1], and thereby all countries that had a currency backed by dollars,…

> but could simply be printed when needed. This created huge money supply inflation This could and did happen before 1971. The US government has always been able to issue debt. And paper money, in the form of bonds, has been a staple of the country's financial systems since long before it was a country. Mostly owing to the fact that England largely prohibited the export of specie to the colonies. Forcing states to fi…

> I'd love to find another one

how about bamboo tabletops?

https://www.ikea.com/us/en/p/anfallare-tabletop-bamboo-00465...

Re: US Published National Debt: $28T. The Truth: $146T. Each Taxpayer's Share: $951k

#104

Post by TbobbyZ »

meepmorp wrote: post #90
seneca wrote: post #61

Earlier quoted context omitted.

Yeah, just strangle the golden goose and we'll eat like kings tonight. Tonight.

Oh no, whatever shall we do without if we no longer have rich people but still have all their assets?

Zimbabwe. That’s what we will do. You can’t simple hand assets over to normal people and expect the assets to maintain their value.

The Zimbabwe government took the farms from their owners and gave them to normal people. Mismanagement of them lead to food shortages.

Re: US Published National Debt: $28T. The Truth: $146T. Each Taxpayer's Share: $951k

#105

Post by Donotbeliveme »

mattnewton wrote: post #27
munk-a wrote: post #6

The US National Debt being viewed like a bad loan is a load of BS - that's a sum invested and leveraged against the projected continued growth of the country and, honestly, nobody on earth has the ability to forcefully collect from the US government.

As far as I understand it, it has nothing to do with creditor’s ability to collect but the interest future creditors will be willing to part with their money for. With an institution even a fraction the size of the US federal government, I don’t think people can reasonably collect, and instead the incentive to take care of current creditors is to give future creditors confidence that their investment is safe. Histori…

Interest Rates! You nailed it. Nobody is going to collect on the US, but if we default we basically lower our national credit score. It then becomes harder to get/give loans internationally. Debt is also super complicated. The most recent estimate is only ~40% of all public debt owed is foreign. That means the rest of our debs it owned by Americans themselves or intergovernmental. This article is mostly highlighting that we will need to borrow in order to fund some of these programs. I doubt that will be difficult for us considering our current credit rating. https://sgp.fas.org/crs/misc/RS22331.pdf

Re: US Published National Debt: $28T. The Truth: $146T. Each Taxpayer's Share: $951k

#106

Post by listless »

jfengel wrote: post #30

It's a misleading way of calculating the number, since it refers to all of the future debt obligations, including Social Security out many decades -- but also ignoring the fact that we'll be collecting taxes all that time. It's a bit like concluding that you're a million dollars in debt because you are going to need to buy food for the rest of your life. I suppose it's true -- it is something you need to plan for. Bu…

If I’ve learned anything during the pandemic, it’s “that’s not how money works”. If it runs out, they’ll just borrow more. The real question is at what point are we so leveraged that we default on bonds because we can’t meet our obligations? 10 years? 100 years? I don’t think anyone can answer this. But this is how it will likely end.

Re: US Published National Debt: $28T. The Truth: $146T. Each Taxpayer's Share: $951k

#108

Post by agentdrtran »

wallawe wrote: post #64
bserge wrote: post #11

Nobody cares anymore. People are working, resources are being extracted, created and traded, economies are rolling. Money is there to facilitate that, but on its own it's pretty much worthless. Just wish inequality wasn't so fucking huge.

Inequality seems like a meaningless metric. It's not a good measure of a society's well being. For example, let's assume a country of 10 where 9 people have $1 million and 1 person has $100 trillion. The inequality is massive but everyone has a great standard of living.

that thought experiment is nice but in the real world we have widespread poverty and 1% with more money than any human could ever spend

Re: US Published National Debt: $28T. The Truth: $146T. Each Taxpayer's Share: $951k

#109

Post by BitwiseFool »

tibbon wrote: post #81
DFHippie wrote: post #72

Earlier quoted context omitted.

> The meaningful number is 2033, the year Social Security is projected to run out of money. This is the year the trust fund runs out of money, at which point Social Security won't be able to meet its full obligations, only what it can cover with current payroll taxes. Social Security can't run out of money unless the taxes that support it are eliminated. "Social Security won't be available for you Gen X'ers" is misle…

Removing the income cap is really a clear way to mitigate this problem greatly. From what I understand it doesn't fix it entirely. I wonder if we could put SS on capital gains, even at 1%. That would help this include investment gains.

Please, no. Social Security was never meant to be funded this way. It was originally supposed to be paid for by a tax on labor, originally a minuscule at ~3% but now it is around 12.5%. It was supposed to be something that would pay out roughly what you paid in. But now it looks like people want to decouple that aspect of Social Security and turn it into a general wealth redistribution program.
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