On Jan 31, 2012, at 11:45 AM, Aaron Thomas wrote:
> Debt spending is a vitally important way out of major crises.
> Consider on a
> personal level, that one needs occasionally to take on debt to
> study, or
> make an investment of other types. The national case is also clear.
And of course try running an inventory-based business without debt!
As Krugman and others have pointed out, national debt is money owed
to ourselves. A country shouldn't be required to turn a profit, or
necessarily even be revenue-neutral.
The problem we have is that people want infrastructure and services
that are natural monopolies and thus appropriately provided through
collective action, but don't want to fund them through taxes. They
want them to be as free as they appear.
You can't have a market in roads or water supply etc--I can't go out
my door and choose from among five or six streets depending on which
street purveyor has a sale on this morning! Likewise water, sewage,
and fire & police protection, et al. Health care has also proven to
be something that the market provides inefficiently and ineffectively
(US vs. Europe & Japan).
Back to inventory--cities (and nations) provide inventories of spaces
and services--including squares, utilities, transport facilities, and
often transportation modalities themselves (eg, rail services; in
Japan private and government rail services coexist and cooperate);
none of this can be done with]out debt even in a high-tax society.
What we suffer from here is the perception prevalent among Americans
that everything must be bought and sold and that life is better when
you do so, and that taxation impedes the buying and selling of every
physical and social aspect of the culture.
Cars are so desperately defended by the neandercons because they are
thought to be a way of privatizing naturally public spaces.
Carfree cities, transit, national health insurance, and bicycling are
seen as threats to the "market," event though the market has
historically failed at providing transportation, water, and health
care in an equitable and effective manner.
Government debt, like business debt, simply provides a means to
engage in long-term projects, and is paid back to the public with
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