{"id":615,"date":"2012-01-03T18:34:58","date_gmt":"2012-01-04T00:34:58","guid":{"rendered":"http:\/\/www.nathanhunstad.com\/blog\/?p=615"},"modified":"2012-01-03T18:36:53","modified_gmt":"2012-01-04T00:36:53","slug":"the-reality-of-debt","status":"publish","type":"post","link":"https:\/\/www.nathanhunstad.com\/blog\/2012\/01\/the-reality-of-debt\/","title":{"rendered":"The reality of debt"},"content":{"rendered":"

It may be the night of the Iowa caucuses, but I don\u2019t feel like commenting on the hilarity therein: if you want to read about how Michele Bachmann thinks one of the most important issues facing the U.S. is light bulbs<\/a>, how Rick Santorum wants to allow states to outlaw birth control<\/a>, or how Herman Cain thinks he is qualified to be Secretary of Defense because he was on a Navy boat once<\/a>, there\u2019s plenty of places to do that. Instead, let\u2019s talk about debt!<\/p>\n

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Paul Krugman has a very good article on government debt<\/a>. Government debt is not like owing a mortgage to the bank. For most government debt, the debtor and the borrower are one and the same. As a taxpayer, I am \u201cresponsible\u201d for a portion of the U.S. debt. But I also own a portion of that debt in my retirement account. Much of that debt is similarly owned by fellow citizens. In addition, as the blog post points out, we own a lot of foreign government debt too, and overall, we haven\u2019t had a huge net increase in foreigners owning U.S. debt. People may complain about how China and Japan \u201cown\u201d the U.S. now, but that\u2019s not really true. We own ourselves.<\/p>\n

Miniscule bond yields mean that nobody is clamoring for us to pay the bill soon. The best analog to the U.S. debt problem is not a family that is six months late on their mortgage payment. Instead, it\u2019s probably the credit card that thinks so highly of us that they are going to extend our 0% teaser rate a bit longer. That makes a big difference as to what course of action to take.<\/p>\n","protected":false},"excerpt":{"rendered":"

It may be the night of the Iowa caucuses, but I don\u2019t feel like commenting on the hilarity therein: if you want to read about how Michele Bachmann thinks one of the most important issues facing the U.S. is light bulbs, how Rick Santorum wants to allow states to outlaw birth control, or how Herman… Continue reading The reality of debt<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"om_disable_all_campaigns":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[4],"tags":[193,276],"class_list":["post-615","post","type-post","status-publish","format-standard","hentry","category-politics","tag-debt","tag-economics","entry"],"aioseo_notices":[],"aioseo_head":"\n\t\t\n\t\n\t\n\t\n\t\n\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t