Speaker A
And we are rolling. Okay. So, um, Casey Ritter, here I am. Roll call. Yep. I'm Jaden Martinez.
Discussion on the US national debt problem, political challenges, and balancing long-term debt reduction with economic impacts.
Key Takeaways
- US national debt is a complex political and economic issue, not just a financial one.
- Sustainable debt reduction requires difficult political decisions on spending and taxation.
- Balancing short-term economic impacts with long-term fiscal health is challenging.
- Local government-run enterprises can offer models for revenue generation and community benefit.
- Current debt management strategies are unsustainable without structural reforms.
What the video covers
- The video features a group discussion analyzing an article about the US national debt problem.
- The debt issue is framed as political rather than purely financial, with challenges in reaching bipartisan agreement.
- Focus on public debt versus total debt clarifies what is owed outside the government.
- The US borrows in its own currency, reducing default risk but rising interest rates increase refinancing costs.
- Mandatory federal spending limits flexibility, requiring both spending cuts and tax increases to address deficits.
- Participants debate balancing long-term debt reduction with short-term economic effects of tax hikes or spending cuts.
- Examples from municipal golf courses illustrate how local government-run services can generate revenue and serve communities.
- Concerns about fairness in taxation and political will to tax the wealthy are discussed.
- The sustainability of current debt management—paying old debt with new debt—is questioned.
- The discussion highlights the complexity of the debt problem and skepticism about near-term political solutions.
Chapters
- 00:00Introduction and Roll Call
- 02:09Overview of US National Debt Problem
- 06:00Municipal Revenue and Local Government Examples
- 08:27Balancing Debt Reduction with Economic Effects
- 10:57Long-term Debt Management and Deficit Issues
- 13:33Public Engagement and Spending Accountability
- 16:10Concerns about Rapid Spending Cuts
- 18:15Tax Fairness and Political Will
- 21:40Debt History and Economic Implications
- 26:10Final Thoughts and Political Challenges
Full Transcript — Download SRT & Markdown
Speaker A
I am Ben Jansen. And then I am Brian Oni. That's okay. Um, so, uh, I guess we're just going through the articles we each read. Um, Brian, I don't think you had time, so you just have to, you just have to be
Speaker A
here on the Zoom at the very least. I'll chime in whatever you guys are talking about.
Speaker A
Uh, does anybody have a raring to go first or I'm going to say that's a no. So, uh, I guess I'll start.
Speaker A
Um, mine was the, uh, debunking the US national debt problem. And let me just pull up my paper because I don't want to do this from memory.
Speaker A
Okay. Uh, basically, uh, the article says that, um, the problem is political in nature and that, um, that, uh, if we don't start making some hard decisions, we'll, um, fall in more debt. But let me see.
Speaker A
Let's see. Um, multiple points to consider include the importance of focusing on debt held by the public rather than total because it represents money owed to individuals and institutions outside the federal government as opposed to gross, which includes the money that the government
Speaker A
owes to itself. So that makes no sense to keep it. Um, the United States also issues debts in its own currency, unlike other countries that borrow in foreign currencies, which makes it less likely to default. Um, but it doesn't mean that
Speaker A
rising debt is risk-free. Um, the higher interest rates make refinancing current debt and funding new deficits more expensive. Um, since about two-thirds of federal spending is mandatory and difficult to change without new legislation, solving the problem would require spending cuts and
Speaker A
uh, increases in taxes or possibly both. Um, the challenge has less to do with whether the United States can pay its debt and more to do with whether political leaders and citizens are willing to agree on a long-term
Speaker A
financial plan. Um, it's, uh, but the big problem is yeah, the political system just doesn't want to commit to putting in, um, US primary deficit on a sustainable path.
Speaker A
Um, was the long and short of it and we are going to continue to add to the deficit every year. Um, and it's not going to end well basically.
Speaker A
Um, so I didn't really know much about the national debt problem when, um, I started reading this. Um, I just sort of considered it to be related to whether the government had enough money to pay what it owed. Um, and clearly that
Speaker A
is not the case. It is a much more complex issue, um, that, uh, could be solved if we could all get together and, you know, agree on a plan. But I'm going to be a bit of a cynic here
Speaker A
and say that's probably not happening anytime soon. Yeah. Um, so, um, my discussion question I guess I asked was what could the US do to balance the need for long-term debt reduction with short-term economic effects of raising taxes or governmental
Speaker A
spending cuts? Are there certain programs that should be prioritized? Who should pay higher taxes?
Speaker A
Who knows? Yeah. So, uh, that was my question. Uh, I know who should be paying higher taxes.
Speaker A
We spoke about it last time, but, um, how we go about doing that is clearly the problem. And, um, we currently have somebody in office that's going to make it very difficult for us to, um, tax the people that need to be taxed
Speaker A
without them getting away with, um, hiding their money so they don't have to pay more taxes. So that was my, um, takeaway from that question because unfortunately I don't think there is a simple answer.
Speaker A
Um, so questions if anybody got an answer to my question? I'll say the first thing I mean for me right now, um, I do accounting for like golf, uh, municipal golf courses and stuff like that and I'll say one of the
Speaker A
biggest things at least I've noticed is it's really hard for like a city of Seattle they do collect taxes in revenue and in taxes but then there's also like, like if you go to a park right and you
Speaker A
see the park ranger picking up trash and stuff like that and I mean the park doesn't generate any revenue but it's, it's got to, it's, it's got to be upkept somebody could cut grass and stuff like that and it's like
Speaker A
well stuff like that you can cut off but then it's cutting off on what people like to and stuff like that and I feel like at the end of the day it becomes on I would say like make the city be run as
Speaker A
a business but to a certain degree kind cuz like you can only tax so much and tell people like enough is enough and stuff like that and then obviously currently right now say the tax system is not set up in the right way to
Speaker A
whereas like some people don't pay what their fair share and stuff like that. So, I mean, at least for me working at the city municipal golf courses, I'll say I've seen where it's like they kind of run themselves and stuff like that.
Speaker A
And I'll say at least for the city of Seattle last year, I think we netted like over what $10 million or something like that along those lines and it kind of upkeeps itself and it's like it's cheaper than any golf course you can go
Speaker A
to is kind of the first thing and it employs people. There's like social programs people come to and stuff like that. That's like I feel like you kind of find that balance between it kind of so it's just like like that thing kind
Speaker A
of being owned by a bunch of people like that people everybody has a say in it but not concentrated enough to it's like only one person makes a decision to where it's like benefits everybody and I feel like that's at least for me that's
Speaker A
why I think that kind of national will kind of come down and I think there was what was it was it Chicago or I think it was Chicago that sold their parking meters to some private company and that
Speaker A
private company made like $10 billion. I'm like why would you guys sell that to a private company instead of like staying in house and kind of collecting that money and then reinvesting in the community and stuff like that and doing
Speaker A
different things. So I mean I feel like it's it's more like the city doing the work and kind of owning I guess you can say their company aka city state whatever it is and also kind of making sure that people have a voice
Speaker A
in whatever is owned out there and stuff like that and then that will kind of make sure like hey I go to the park maybe there's like a fund you can put into whatever it is maybe there's a hot
Speaker A
dog stand but then the hot dog stand is not owned by a company it's owned by the city and then it's much cheaper to buy a hot dog from that hot dog stand versus down the street wherever you go and kind
Speaker A
of that benefits the people and it creates revenue for the government whatever it is and at the end of it kind of builds into it and it doesn't really take away from the people kind of at least for me that's what I've noticed so
Speaker A
far in a very small scale obviously it can get bigger and stuff like that and go the treasury bonds and all that different things but obviously that's that that gets more complex but yeah that's what I realized for me I'll But
Speaker A
what about you guys? Really quick before J answers, can you repeat your question again?
Speaker A
Yeah. Uh, let me pull it up again. Um, I said, "What could the US do to balance the need for long-term debt reduction with short-term economic effects of raising taxes or government spending cuts?" Like, how are we going to balance that?
Speaker A
What are there certain programs that should be prioritized? I can't talk today. Who should, uh, pay higher taxes?
Speaker A
You know, that kind of stuff. Yeah, that's really open. So, it's, it's really hard to Yeah. Yeah. The point down on one specific thing.
Speaker A
I know that with like long-term debt, our solution right now is without bringing in just terms, it's buying our, it's paying for our own debt with new debt.
Speaker A
Yeah, that's, that's our form of keeping pace with what we're spending and our I don't know what our surplus or our, uh, our deficit is.
Speaker A
We are in one. I just, I know we're in a fiscal deficit, but it's, we've been in a deficit forever. I can't, I can't remember how long and how much, but it's been a, it's been a lot.
Speaker A
But like looking at a smaller scale, um
Speaker A
Yeah. So, yeah, it's been about 26 years. Yeah. So, so government spending has gone through the roof. How much is it?
Speaker A
Do you know? Yeah. Um, my article is about that. It's 40.1 trillion. Trillion. Yes. In the trillions.
Speaker A
Joy. Yeah. And this came out in in this article I wrote read. I didn't write write it. Came out in um 2025 and I think it was only in we were at like 26.3.
Speaker A
So we basically doubled. Wait. So that's the total debt. But what is it per year? Like what's our deficit spending per year? So, I'll say like per the hour we probably accumulate let's see uh $329 million I per hour and then per day $7 billion.
Speaker A
Yeah, a lot of money. Yeah, basically that. Yeah. Um and we can't just keep refinancing.
Speaker A
Yeah. I'm this also tied into like my article as well, but anyway, for answering your question, like that's our long-term solution in like the broadest context possible, which is not sustainable and we know it.
Speaker A
So, we need to either a figure out a new way to to not figure out a new way, we know we have to cut spending, but the problem is where and that's what the argument is about. And then people
Speaker A
look at small things outside of like military spending is one thing that's macro. That's pretty big. That's pretty long term. They look at m and then they look at micro.
Speaker A
Um and yeah, like you said, like you can get so specific of cutting revenue here, cutting spending somewhere for like parks or something um and putting it somewhere else. Like I'd say you have to model it like property taxes. You have
Speaker A
to take something from an asset that people pay for and then put it towards something that everyone uses like parks or education.
Speaker A
So like the tax from property taxes goes towards education and everyone knows it. Like you have to put certain things behind you have to put private stuff into public. That way there's a there's a transfer of funds that
Speaker A
that brings the economy and people are like, "Oh, my taxes aren't going to nowhere." Yeah. Yeah.
Speaker A
Yeah. Well, this kind of goes into my question as well, but I think the government just needs to agree on something like like it's going to be that's already a really hard thing. People don't agree.
Speaker A
People have disagreements. People have different ideals. But I think once we come to an agreement, we could like think of a better way or a what's the word? Like a consensus way to cut our our spending.
Speaker A
And I think that's a start. We need to find a place where we're all comfortable at and we need to find a way to cut costs and make up some of the the debt.
Speaker A
Yeah. And go ahead. Uh I'll say and then I kind of building on that and I think like this pending aspect of it I'll say um let's say a computer gets sold for I've seen this on this military like a computer
Speaker A
from Dell I can buy from the store for like $150 versus the government is going to buy it for $200 and that person that works with military or whatever it is they don't care it's not their money. So, I feel like kind of
Speaker A
also making sure that people feel like they have skin in the game whenever they're spending that money will go a long way to where it's like you're just not wasting money. You're wasting your payroll. Like I said, we got to have
Speaker A
like some kind of community to where it's like when like like a grocery store is like everybody that works there. the reason you're getting paid is I know obviously it comes into that but the the thing is like the company only one
Speaker A
person takes the money versus if it's owned by like a city state the federal government everybody kind of profits off it and stuff like that so I feel like one of the biggest thing is like making people feel like they have skin in the
Speaker A
game and that money actually goes to something that they want they can see like a benefit from and it's just not going wherever it goes to to where it's like nobody sees and and also kind of being transparent on how We spend the
Speaker A
money to his vlog goes a long way cuz half the time you never know who spent what what went what and then like some money just disappears out of thin air and sometimes they create money out of thin air as well on the other
Speaker A
side. But um kind of making people feel like whatever money the government spends like we have some skin in the game and it's like if I don't do XYZ or if I don't look how we're buying these computers or these chairs and stuff like
Speaker A
that, you know. um making sure like everybody feels like they have some skin in the game and that will kind of reduce the cost of government spending and stuff like that. I mean that's what I'll start with.
Speaker A
Yeah, I think most of us can agree that something needs to change. It's just getting everybody on the same page um about the pro the issue. Um, I think we spoke about it last week that that we thought there should be more
Speaker A
transparency on where the taxes are going and more open voting as to the people where the taxes should be spent um, and where it should be cut. Um, and I think that's I think that's a really good point. I think there needs to be
Speaker A
more power given to the people to um instead of just us all being sort of like kindergarteners with one teacher telling us what to do.
Speaker A
Um so that I I think if that is um I think that's a good idea and uh uh I hope someday that maybe it can be implemented. Probably not anytime soon, but you know, we can hope.
Speaker A
Yeah. Gut the House, gut the Senate, got the there would be a lot of gutting needed.
Speaker A
Yeah. A lot of deboning. Yeah. But it's like you don't want to gut too much and too fast because then everything kind of breaks down and it's like where's where's my Medicare? Where's this? Where's that? And then it kind of
Speaker A
creates a deeper issues where it's like well nothing's getting funded but this kind of not so much gut but replace with newer people people have people who have are 30 40.
Speaker A
Yeah I was about to say people who are on their death younger. Yeah I agree with that but but it's like you go in a very strategic way of cutting it and you just can't go around just cutting stuff just cuz Yeah. Exactly.
Speaker A
And let you know I mean obviously the government can sell some of their asses and stuff like that that will create revenue.
Speaker A
So you want you want to know a good point on that is I learned this was a while ago and I just remember we should stop meeting in DC as like Congress can just do everything they do on a Zoom
Speaker A
call because taxpayer dollars fund all their flights into DC. So all their private jets and all their transportation gets is all tax dollars.
Speaker A
So like stuff like that that you know is a waste. You got to you got to figure it out.
Speaker A
We need to um start maximizing our use of technology better. Yeah. That's where tax should probably be going.
Speaker A
Um, and like if we cut 99% I'm not saying we should, but we if we cut 99% of the spending to the military, literally we'd still be make we'd still be spending more than any country on military funding, which I think is
Speaker A
interesting. Um, I'm not saying do it. I'm just saying that is an interesting point.
Speaker A
I will say no, I'll say one of the biggest issues the private companies that work with the military is like they're the ones that inflate that budget so much. Like I said, you can buy a computer for $400 and then the
Speaker A
military will buy it for $200. Like doesn't cost that much to buy. But then the because but then the that company knows they can sell us the government for XYZ. Like I said, cuz they don't know. They know the people in there
Speaker A
don't have like skin in the game. They're not worried about it. It's like who cares? We're still going to get more money anyway. So, might as well, you know, buy that computer for $300. Who cares? you know, and kind of making sure
Speaker A
like people that work in government feel like, hey, this is actually matters and this is going to affect you personally.
Speaker A
That will definitely go a long way to kind of cutting that debt and stuff like that.
Speaker A
I think that's a a good ending for my question. Good spot. Yeah. Um, for mine, I'm I just realized like looking at this now, we had to do it on the articles and I did mine on the on the book.
Speaker A
So, I did my uh reaction paper on the book because I didn't see the the a article. Um, but you know, it is what it is. Um, for mine, it probably ties in anyway.
Speaker A
Yeah, it probably ties in anyway. So mine was mainly on the implementation of the income tax in so the authors use examples of um Britain, the United States and France. So the implementation of the British income tax was in 1799 during their war with France
Speaker A
and the United States implemented their first income tax in the Civil War. And France, funny enough, adopted it in 1914. and they waited that long to do it. Um, was it also during a war?
Speaker A
World War I. Interesting. All so Yeah. The funny thing is what I when I was hearing about like the authors comparing and contrasting these these implementations of the imple of the income tax, they were all meant as um
Speaker A
temporary revenue streams to fund something that that mattered during that time. and the local populace that was getting taxed through the income tax implementation were fine with it because they knew that it was going to something that they
Speaker A
believed in for the most part depending on the person. Um but answer. Yeah. So l like finding out um after these these temporary implementations, they were then taken away and then brought up years later and then those taxes were also somewhat
Speaker A
temporary and then they were originally um or eventually turned into permanent fund revenue streams for the government, which is really important today. And kind of seeing how that history was built um not only with our country in the United States, but also with
Speaker A
countries like Britain and France is really interesting. Something I found in the book was um in the United States all the way from like Civil War when they reintroduced it in the 1920s um only 13% of the workforce during that time in the
Speaker A
United States filed their tax returns. But the income taxes earned made up around twothirds of the federal receipts. So thinking of the perspective of that the their their spending was quite low obviously compared to now but with the
Speaker A
with the revenue that they generated through that they were able to pay for things that they needed. Um, and then yeah, towards the end of the book, the authors had a bit of a dialogue between like what they put themselves in the
Speaker A
founders of the income tax um, the pro-income tax people in the United States today. and they were they said that they were they would be scared about how big the government has grown and how much it takes today. So I
Speaker A
thought that perspective was interesting and kind of comparing it from the late 1800s or late 1700s to now is how big we've gotten and how much money they need. And obviously we've grown far past that and we'll continue to grow until
Speaker A
something changes. Um I don't think they're completely against the income tax themselves, but um the dangers of of that government expansion is definitely something to keep in mind. So one other thing before I do my discussion question, the there was
Speaker A
someone in France when they were implementing this in World War I, a couple of months before uh Ferdinand was murdered that do led the domino effect for World War I.
Speaker A
he was murdered for the implementation plan of the income tax. Um, so I thought that was interesting. Um, and so to close my discussion question is what should determine how much a person is responsible for contributing to taxes? And then I'll just go over my
Speaker A
conclusion paragraph. Um, people can earn income in different ways such as labor, investments, and other means. Uh at the same time, the simplistic view of increasing tax rates as income rises raising raises a burning question. Is it excessive? Um I think this makes it
Speaker A
difficult to create an income tax system that everyone views as fair because people will always have different ideas about who should pay more and why. So I'll open up to discussion.
Speaker A
It's a tough question. um who decides who makes that well we know the government makes that decision right now but um I'll ask a follow question on that do you think the more you earn the more kind of government
Speaker A
um I guess government resources you use it so like you need to pay more taxes or and that's why you have to pay more taxes or how what do you guys think kind of add on to it like the more you get
Speaker A
paid the more resources you use from the government you need to pay more taxes or is it the more you earn, the less racism in the government you use, so you have to pay less.
Speaker A
But then it's like, why was somebody using more, you know, and that's I feel like that's kind of where the dilemma comes in where it's like these people that make a lot of money, they like, well, I don't use that much,
Speaker A
you know, and and government, whatever it is, and why should I pay more? I guess my my answer would be you're taking advantage of the populace, these people who are are part of these billion-dollar companies.
Speaker A
hundreds of thousands of possibly millions of people. They're benefiting from our money. So, um they I would say they have a duty to put that money back into the economy.
Speaker A
Yeah. Um, it's just hard because when you you tax income, you're able to people are able to get around it by, you know, moving their money so it doesn't look like it's income and that becomes the problem.
Speaker A
Um, so it it's it's finding ways to um stop people from getting around certain rules, which we saw with the window case um last week. Um it it's it's sort of like that. You just you you have to
Speaker A
find um something has to be implemented. You see the leaks of or the problems with that implementation and then you tweak it and you tweak it. problem is that Congress is so darn slow that the tweak would probably take like a decade
Speaker A
and by then it's too too late. Yeah, funny story with that with billionaires is obviously like capitalism breeds innovation and that innovation pushes society forward and um without that without that idea of if I work hard I can reach
Speaker A
whatever form of wealth you want is scary to think about because if you cut that off then people will only do up to a certain point and then innovation slows down or if even stops and we've seen that in in communist countries
Speaker A
But for income that is earned that we have a progressive taxes system which is like the tax bracket idea and then that's obviously to a certain point and then people avoid that in numerous ways right including real estate and other ways to
Speaker A
show that they aren't claiming income. Um, but another thing for like investments and unearned income, a super obvious example for that is should someone like Elon Musk, who's a super popular billionaire owner now, be able to leverage his unearned income, which pays
Speaker A
zero income tax or zero tax at all to fund life without paying his fair share. Because if you make that much and you purposefully pay yourself with your own company a low salary, it is blatant dodge of the system that's
Speaker A
in place. OB, like you said, it could take a decade for Congress to be like, okay, just you can't do this anymore.
Speaker A
But we're seeing now that things are coming to a head fast and we need to make these decisions quicker.
Speaker A
And but you don't want to interrupt that capitalism breeds innovation mindset. So it's tough changing those tax laws because everyone everyone who's wealthy uses them.
Speaker A
Yeah. I think a theme we're going to run into all semester is not everyone is going to be satisfied no matter what we do.
Speaker A
So it you always have to find the medium. You always have to find so it's a compromise for both people and no matter what we do to try to cut that people are always going to try to find a
Speaker A
way to avoid those those new measures. So like that's what rises the question what are we going to do? What could we do to, you know, get out of this 40 trillion deficit?
Speaker A
It's a mess. But that also goes back to if you implemented that tax system like property taxes, if your money actually went to keeping your roads, would you actually pay the tax instead of avoiding it?
Speaker A
That would be nice. So roads or or cities or housing or education or parks, anything like that, community centers like Yeah.
Speaker A
I guess my thing would be innovation um is important but uh we also need to take care of ourselves our country.
Speaker A
So um the health of the country needs to be taken into concern um because let's say um if you're a person and your immune system isn't great. Um doesn't matter how hard you uh want to work or you're you're not going to get as far as
Speaker A
somebody who's not as sick. If that made sense. I don't know if that made sense. made sense in my brain, but you Okay.
Speaker A
All righty. Well, if no one has anything else, go for it. Last try. Well, so my my article was basically the the the US Treasury government website which was just it was telling what the national debt was and it was explaining how it
Speaker A
happens, how what's funded and so I just gave a general overview. So it was saying how you know the national debt is it funds you know the go the the armed forces Medicare social security, things like that. And
Speaker A
obviously when the government spending exceeds our our GDP, I guess that's when our our debt rises. So it was really low and it just skyrocketed like 2001 it skyrocketed and then again in when was that regression? 2009.
Speaker A
Yeah. Yep. Those corporations then Yep. Right. Again in 2020 with COVID big drop. So it also explained how like public emergencies have you know sped up the growth of the debt and like I have a question about it later
Speaker A
but something I I learned that I didn't really know that there is a debt ceiling that the the house or congress chooses and it can't be exceeded unless there's like an extraordinary um extraordinary measures need to be taken with a with an emergency like a
Speaker A
regression or COVID or something like that. So, I thought it was kind of cool that there was a ceiling, but like where's that line at and what determines when we're able to exceed that?
Speaker A
So, let me pull up my question. Just didn't we just move that goalpost? We did. Yeah. after the big beautiful bill, we kind of went up up the debt ceiling, especially when the government shut down like months and stuff like
Speaker A
that and they finally agreed on something. So, it's like it's I feel like at this vote and say here's more money and it's like what's where's that money coming from? That's that's the thing. It's like just creating money in thin air and they
Speaker A
just keep it's like you having an unlimited card and saying, "Okay, today I'm only going to spend $100." And then you go out and you're like, "Oo, I like those new shoes." And then you ask yourself and you say, "I can buy those
Speaker A
shoes cuz I have unlimited money." So you go and buy those shoes. Like, "Oh, okay." And the next day comes along and you're like, "I didn't pay my rent." And you're like, "I still got my card still.
Speaker A
I mean, only I already spent over $200, but it's unlimited and I'm not supposed to go over $200. $100, but I'm already 200 deep, so I might as well use it again." And just keep snowballing and just keeps building up. like but you're
Speaker A
like wait what's happening and it just and it just never get solved and then the people in Congress too as well play big part where it's like the people behind me are going to solve this problem you know I'm going to make what
Speaker A
I'm doing now look good even if it means that I'm going to spend that $100 on that on those shoes or whatever it is and um to make myself look good at the moment versus kind of looking down the
Speaker A
road like what's really valuable for the people that come on after me. So, it's like that's another big issue. I'll say that. At least I've seen ain't it ironic that you can compare a person's overspending in credit card
Speaker A
debt to a country. I know that insane. Yeah, the article did say that it's kind of it's kind of like that, you know.
Speaker A
I wanted to ask with those with those uh huge Sorry, before you get to your discussion question, you say that really quick, too. Um, is you mentioned in ' 01 and then 08 are those big jumps because of the
Speaker A
bailouts that happened? It didn't really explain. It just showed a graph. I think 01 was after 911 and I know there's a lot of bills that came into play especially like military spending was a really big one where it's
Speaker A
like they're like let's let's get this going and then that's why like I said the private corporations come in and they're like rosion and saying let's you know buy this planes let's buy this we're going to get from the military
Speaker A
we're going to go do this this and this and then obviously 08 was the housing bubble um to where it's like the private companies of leverage on how much they can lend out. And then when they realized we lend out too much money,
Speaker A
they're like, "Oops, what are we going to do now?" And then the government came in and bailed them out. And that kind of pretty much reset the economy. Um there was like the government pretty much had to pay those company those companies off
Speaker A
because everybody kind of defaulted on their debt. But then the normal people were still stuck with their debt.
Speaker A
There's no way there's no way for that debt to go unless you file for bankruptcy. So, you know.
Speaker A
Mhm. Pretty pretty interesting. Yeah, it is. And depressing. Pretty interesting. Yeah. I have a couple questions. So, the first one I It's really like hypothetical. How should governments balance their spending especially in extraordinary events or recessions or public emergencies?
Speaker A
M like where do we how do they decide like how much money goes into something when there's an emergency like how do they not overreact or underreact or I think it it has to depend on the emergency like a pandemic. I also think businesses
Speaker A
like that should not be able to bail out um corporations because that was a major factor in '08 that we end the Silicon Valley thing. Was that 08?
Speaker A
The Silicon Valley. Yeah. I mean that was pretty when the when the banks collapsed. Was that recent? I felt like that was that was recent. That was like during COVID time pretty much. Yeah, that was pretty recent. I I
Speaker A
the main I don't I mean where I was going with that was like small businesses also had the opportunity to get bailouts from the government which obviously there should be a deeper application process for that but um we decided to shut the country down
Speaker A
number one so there was nothing coming in and then number two we decided to print money.
Speaker A
Yeah. And then we decided to fund the economy through that printed money to bail out organizations.
Speaker A
Yeah. Which is a triple whammy of what I think we should not have done.
Speaker A
Yeah. You think we would have learned from Germany's overprinting of money? Yeah. and like a lot of African countries too as well of over I think like Zimbabwe or something like that you have like a trillion dollar note you have to go to
Speaker A
the store I forgot what it is I forgot what it's called but it is it's monetary policy where you you you print money to prop up the economy to induce spending but we should have just let it tank like
Speaker A
we we yeah but then it we know the economy was going to recover some hardships were going to happen.
Speaker A
Things were going to things were going to shut down, but Mhm. we were at the top.
Speaker A
Like everything everything was at the top. I don't think we're going to see any change until we hit rock bottom to be perfectly honest.
Speaker A
Yeah, sometimes it you just it's I'm not going to go further with that. I think my second question is a little bit better. So what responsibility do current generations have to limit further growth of the national debt? We
Speaker A
all we know that the debt will forever continue to grow but when does that reach unsustainable levels?
Speaker A
Like when when are they going to realize like oh shoot this is bad? Like it's already unsustainable right now. At least in my opinion.
Speaker A
sentences. I mean, I feel like we it's it's already too deep into the hole to where it's like to get out of it. Like for me at least, like you said, we got to just let it drop and just let it go. But then
Speaker A
what implications does that have, you know? Um let's say you're employed, even if you're in the military and you have like six kids and they say, "Hey man, we got no money for you." It's like, "What are you going to do with
Speaker A
your kids or your wife and your house?" Like, "We're going to deal with that.
Speaker A
and how's that going to affect them not buying food and how that's going to affect the person at the grocery store.
Speaker A
How are they going to cuz like if I was at the grocery store buying any like and all these different things on Netflix that's why they keep putting more money but it's like it can only be perpetuated for so long to until like that wheel
Speaker A
just kind of falls off the wagon where it's like okay now we're kind of effed and there's no there's nothing else.
Speaker A
I feel like we saw a sample size of that with the ATC employees with the government shutdown.
Speaker A
Yeah, exactly. Yeah, like that will happen globally or not glo like nationally with US uh government workers.
Speaker A
Um so the only solution to that is you got to get another job and or privatize.
Speaker A
Yeah. But then it's like most companies are funded by tax payer money. And if you look like the Fortune 500 companies and see where the most of their money is coming from, it's they're getting it from the government. I feel like SpaceX
Speaker A
most of their funding is coming from the government. If you look at all even all like the car companies and stuff like that, most of their money is coming from taxpayer money and stuff like that. So it's like either way the way either way
Speaker A
you look at it it's like we're kind of at and there's there's no way there's no good way to look at you can get all the spending you want but it's like there's like this deep hole you just keep ding
Speaker A
yourself well there's a big argument there is a big argument the first place you go is overseas cut it off no but then if if but then the thing is like the US a lot of economies around the world rely on the US economy
Speaker A
and that's the thing too and and it's like like there's a lot of people that work in India that are hired by US companies and stuff like that and if that company goes under they don't have no job
Speaker A
and it's like well if they don't have any job well they can buy what they want like it just it's a big snowball effect so it's like everything is tied together and I see why they keep raising the dead
Speaker A
and I see why they keep doing it but it's like there's going to be better solutions where it's like nobody gets her is is the biggest thing. It's like how can we do it to where it's like nobody gets
Speaker A
hurt too much. What's the debt ceiling now? I don't I don't know. 50 probably. Probably but I don't know where it's at right now. But it's interesting to think about that.
Speaker A
That's kind of what he's at and just got to accept it. uh 41.1 trillion after being raised by five trillion through the one big beautiful bill.
Speaker A
What's the ceiling now? Is that 41 41.1 trillion? We're at it. Yeah, basically. That's what it says.
Speaker A
So, it's 41.5 and we're at 41.1. Yeah. So, by the end of the year, we're gonna vote on it again.
Speaker A
Yep. And they're probably push it to 40 and a quarter. 42 and a half probably.
Speaker A
That doomsday clock is just getting closer. Don't you guys feel great? I know about our country.
Speaker A
Joyce. Uh yeah, I think it comes back to a certain income tax that certain people are avoiding that certain people shouldn't be avoiding.
Speaker A
But the other thing is like if you look like like Elon Musk, most of that money, yes, he does own the company. Yes, does have that stock, but most of that money it's like you can only get so much out
Speaker A
of it cuz that money is part of the debt. You know, the reason he has so much money is because there's so much debt. So that money technically is tied to the debt and let's say he pays all of
Speaker A
it. Then the company goes under, the stock goes under, and everything kind of falls apart.
Speaker A
That would be a bad thing to be perfectly honest. No, but but then it's it's also tied to the debt though.
Speaker A
Everything is tied together. Unfortunately, you have to think about how how much of like wealthy people's because the the top 5% pay I don't know what the percentage is, but it's high. It's like 90% of the tax revenue is from the top
Speaker A
5%. So, yeah, but it's not enough. No, it's not. No. And obviously they know how to use it better. But at the same time it's like it un it's all just tied together and it it's so hard to
Speaker A
kind of entangle what we've got ourselves into because it's gone on for too long to it's like it's either we just let it all fall and then rebuild it or just keep going with the where it's going. At least for me that's just what
Speaker A
I think. Rebuild the country tech. Have we ever has have is there an example of a country rebuild in society?
Speaker A
I mean you can say during the great depression but then it took a whole war for us get to get out of that.
Speaker A
I guess Germany would be that too. Yeah that would be one to look at.
Speaker A
They were funded by the US though. Yeah, they were funded by the US after the war and all the countries that was that the after the second their country they they was that when the Mhm.
Speaker A
Yeah. I can't think of any examples. Trillions for a piece of bread. Holy smokes.
Speaker A
I can't remember how bad it was, but it was bad. Um yeah, I don't I've depressing discussion, but it's uh yeah, it's just um I guess the answer keeps coming down to I don't I don't know. And that we need
Speaker A
younger minds in in the um in the office um to shake things up. um there really should be an age limit or an age cut off. Um because I'm going to be the ages person here and say that um at at some point
Speaker A
you're you are no longer living for um the future. You're just living for yourself. Um, and um, I think a lot of people in Congress right now, they're no longer living for the future. That they don't care what happens in the future.
Speaker A
Um, they only care about how it affects them at the moment. Um, and I think if we had younger people who will experience the effects of their choices, um, we could see more change.
Speaker A
How to go about doing that, don't ask me. Um, yeah. First rule of thumb is to get people in who actually care.
Speaker A
Yeah. But then I feel like that's kind of the issue is like that's if you look through our history that's kind of what happened before. And if you look how the US was finding it was like hey man I'm
Speaker A
not liking what the kings and queens are doing. Let's move somewhere different. Let's do our own thing. And they did and it worked for a while you know but then as it goes down the road you kind of run
Speaker A
into some problem. It's like at some got too big. Exactly. And it kind of breaks down and then you kind of run into the same problems like we're getting taxed too much. What are we doing? There's only one person ruling
Speaker A
one thing. And it's like you running is the same problem over and over again.
Speaker A
But it it's it's I don't know for me it's I've thought about it many times like it's it's hard to resolve it in my opinion. And um it really comes down to human nature and um I say kindness is a big thing too as
Speaker A
well and kind of caring for the people around you and making sure like the people around you are taking care of you taken care of and stuff like that and just making sure they never across from you is is good and I feel like that goes
Speaker A
a long way because at the end of day like money is a madeup construct. I mean money doesn't mean anything. these numbers on a screen or it's a piece of paper. But with if you go out there and
Speaker A
farm and you know create your own food, you don't need money, you know, but but I I mean money is just a social construct and and it's what keeps things going around the world and stuff like this. A way to exchange value, but maybe
Speaker A
we just have to come up with a new way to where it's like we don't need money, but then it's like how you going to if I don't do anything all day, why should I get, you know, to get on the bus? Why
Speaker A
should I do this and this? You know, that's going to be a dark time. Exactly.
Speaker A
That's going to be really dark if that happens. And I hope I pray for the day that that never happens because that'll not be fun.
Speaker A
Exactly. So interesting. Very interesting indeed. You can tr you can truly compare the like height of US involvement in power to the height of British power and the height of Rome. They were all over the world. And eventually we're gonna it's
Speaker A
going to collapse more than likely and then we're just going to care about ourselves.
Speaker A
Yeah. Same with the Aztec Empire. Diane, I distinctly remember a lot of um their empires failed because they ran out of resources. They got too big um for the resources to go around. And that's just how societies tend to collapse. Um they
Speaker A
all start, they grow, and then they at some point they grow too big and it everything goes to boom.
Speaker A
Except in this case, it'll be a big entire country. I feel like it's going to be the entire world that it'll be the entire world because it's because of how deep the United States roots are in literally everything.
Speaker A
Yeah. Have to stick our fingers in everything. Yeah. I can't I can't think of like a single country where we don't have either a US company like a military base or something along those lines. And then you go to like any country and give them
Speaker A
$100 $100. It's like us $100, give them to this. There's no there's no reason they're going to say no to getting the $100. So, it's like we built so much power and so much reliability. It's like everybody kind of depends on us. So, if
Speaker A
we fail, pretty much every everything else fails. So, and I feel like right now we're in a very big turning point in our history and everything that's going on. And so it's like we got to tread very carefully
Speaker A
in the next year or so to see how things go cuz if they go wrong it's not going to turn out very pretty for anybody.
Speaker A
Mhm. So that that's the problem. We just need to we need to choose or I don't know if since we have the power to choose, we need we need people who are going to do what they can to minimize the growth of
Speaker A
our debt. Mhm. And it's it's like 99% is not going to go down. So, we just need to continue to minimize the growth and continue to lost my train of thought. Hold on.
Speaker A
You're good. You're good. It's very very interesting. I think about this all the time. So I do but at the same time I try not to because I just work I get downward spiral and it just not great.
Speaker A
Nope. Really? All righty. Oh my. Yeah. Oh, wait. Where's the meeting? I just had it. Here it is. Um, do we want to uh go over week three?
Speaker A
Taking what articles? There's only four. So, each of us um gets one, I think.
Speaker A
Okay. Oh, no. There's Yep, there's three. No, four. I can count. Yeah. Um, does anything the econ the economics of tax evasion?
Speaker A
We're gonna have fun with that one. Um, I think one of these is a video and which means I probably wouldn't want it.
Speaker A
Oh, yeah. mind Jules I guess um I like Oh, go ahead. I was going to say the tax avoidance is legal. Tax evasion is criminal. That one was interesting to me.
Speaker A
Okay. You want to do that? I'll do I'll do the one below that. Okay. Um I like um the one that just says income tax withholding.
Speaker A
Um, but I can do framing tax evasion decisions depending on whichever one you want to do, Brian.
Speaker A
I mean, I'll do the framing one and then you can do the income one. That's fine.
Speaker A
Okay. Um, and then each of us has to read a chapter. Um, does what we're doing it again. Um, what chapter name sounds good to you guys?
Speaker A
Pluck a goose is a little concerning. How to pluck a goose. How to pluck a goose.
Speaker A
Okay, you want that one? I'll do that one. Okay. Um, I'll do number 12. I'll do chapter 12.
Speaker A
Vlad the darn. Okay. Um, I guess I'll do um unless you want that. I can do chapter 15. No, no, I'm good.
Speaker A
I'm just reading the names. I guess I'd like chapter 14. I'll do chapter nine.
Speaker A
Okay, I'll make sure to not write about the book this time. Yeah, even though I thought the book was like all the articles seemed the same. Like after reading the my article which was about like um a study done on the comparing
Speaker A
mortgage rates to our debt. Anyway, it's it it all seemed like pretty linked and pretty similar.
Speaker A
So yeah, I think that was sort of the point so that we could all be on the same page when talking.
Speaker A
Yeah. Um, but yeah, they they do tend to um, you know, run into each other.
Speaker A
Um, and I think my timer went how my timer went off about 10 minutes ago, so I think we're good.
Speaker A
Yeah. Do we want to um set up next week's um Thursday still works for everybody, but do we do we want to do a different time?
Speaker A
3:30 Thursday works. It worked for me. Yeah, I'm okay with that. Yeah. Okay. Okay, then 3:30 September 10th. Um I have that one set up. So, we will do that one. Uh, we'll see you guys next week then. I'll get this sent out um as
Speaker A
soon as it finishes processing when it's done. Yeah. Yep. Okie dokie. All right. Great.
Speaker A
Awesome. Have a good rest. Yep. See you.
Topics:US national debtfederal deficitdebt reductiontax policygovernment spendingpolitical challengeseconomic impactmunicipal revenuepublic debtfiscal sustainability
