Why we should know about the National Debt

Every thinking citizen should know about the National Debt. For it has many different effects:

1. the government forces tax payers to produce interest payments
2. only rich individuals and privileged institutions can buy government bonds to benefit from secure interest payments
3. the State abdicates its power to issue its own money (Cash) free of interest
4. the State foregoes the income of Seigniorage that comes with producing Cash
5. the State passes its power to create money to the banks – at the cost of its citizen.

By letting banks create Credit in an uncontrolled fashion, while Cash has been consistently reduced over decades, the State fuels a process of “monetary inflation”. This means the steady growth of the supply of “credit money”, which requires interest and compound interest. People thus have to borrow to make interest payments.

Is that not enough to know about the power of creating money and the politics of controlling the supply of Cash versus the creation  of Credit?


4 responses to “Why we should know about the National Debt

  1. The rate these fools in Congress keep spending, I would not be surprised if we do not have another crisis within a few years. All it would take is for foreigners to not want to buy our debt. Then we cannot constantly refinance thru auction which we do now. That would cause a cycle of severe inflation and many other issues. It might not start here, it could start in another country first that has debt issues, then the domino effect takes over.

    • The problem is not only CURRENT spending. The problem is that every annual budget contains already millions of interest payments. New borrowings just keep adding to not only paying interest but also compound interest, i.e. interest upon interest. With these large figures, capital can hardly ever be paid back. And thus those privileged to be able to buy government bonds get richer and richer – at the cost of the taxpayer.

      Besides, the value of the currency for REAL goods (as opposed to “financial products”) goes down and down and down… But more and more people like you are beginning to wake up!!!

  2. That governments have no alternative but to finance essential activities by borrowing what is effectively public money from private institutions is an enormous deception and an absurdity. The political elites are generally complicit in deceiving the people over this. How can democracy be anything other than meaningless with this level of abrogation of responsibility?

    • Good point, Ken!

      Once we see through this, the question is: what can we do about it?

      I read recently that “information” is the currency of democracy which encourages me to spread the “right information”. How about you?

      Many thanks for your comment!

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