Government debt and business debt are two different things
The purpose of government is common good, we’re all in this together. Quality of life for all is the metric.
As they say in finance, the purpose of a business is to make money. They make money by taking money, the more they take, the more they make. Business is always trying to take more money.
Business debt feeds commitment, competition, innovation, development, scale, and profit, private profit.
Government debt, on the other hand, feeds the bank.
Government debt and business debt need to be seen as two very different types of debt.
We should see our governments’ budgets similar to the budget of a homeowner’s association. This simplistic, but relevant comparison works to illustrate the difference between government debt and business debt.
This microcosm of government, the HOA, shines light on the realities of revenue –the money comes from the people who live there and any money given to the banks is wasted money.
HOA debt is to be eschewed. Debt will only make HOA costs and monthly fees more expensive with additional financial overhead in terms of interest, fees, and other costs.
HOA debt is a slippery slope. New HOA debt is terrible, as we now have even higher HOA costs because we couldn’t afford the new asphalt to begin with. Maybe we should have gone one more year or two more years on the old asphalt.
Anything but debt –as debt will only make things worse. Every dollar we give to Chase bank is like throwing that money into a trash can. As an HOA we know this.
Terms like “leverage” and “financial return” make no sense pertaining to HOA debt. There’s no leverage and no financial return on HOA debt. Government debt is NOT leverage, it’s NOT an investment, it’s an expense.
Government debt is like HOA debt –it’s NOT business debt. When we see this, it becomes clear that government debt is not going to help the situation one bit.
Many factors are driving government debt
Excessive government competition is one factor driving government debt. Most corporate welfare programs are driven by this excessive government competition. Corporate welfare and government debt go hand-in-hand.
Government competition based on creating good and decent laws and tax policies for all involved is a very different competitive situation than competing on the basis of which government can give away the farm as it accumulates more and more forever debt.
Government planning, based on debt, often stems from a race to empire –my Empire, my State, my City, all about me. This is a win/lose situation that we all experience together.
Government competition needs to be based on the purpose of government to begin with –common good for all, not win/lose. Government competition based on corporate welfare leads to more debt. Government competition based on debt is excessive and counter-productive.
Our States, our Cities, should not be lured into debt based on competition via corporate welfare. This competitive race to beat the other side, to grow our government before they do, is often referred to as, “a race to the bottom.”
This race results in a win/lose situation for our States, for our Cities. This race to empire is a frantic race always taking on more debt in hopes to get there, to get there.
Just one more hit of Opm and we’ll get there. There’s a banker on every street corner selling that Opm (other people’s money). Government debt is so available –and so counter-productive.
Government plans based on debt are driven by greedy politicians and greedy financial systems. Political ego meets banking crap.
Government debt is greedy policy presented as democracy
Government plans based on debt require, on average, twice as much tax-payer money, as this is exactly how debt gets repaid. 5% this year, 5% next year, in just fourteen years out we pay twice as much as the actual cost.
Government debt is political greed – presented as NEED. What we need to do is to avoid new debt so that we have more money for the budget. Zero actual service comes from every dollar of debt service.
Government debt cuts the budget in half as we give our public budgets to Chase bank and other banks. We address twice as much NEED, per tax dollar, when we do not use debt to get it done. Basic math my friends.
Our government takes our money and then hands it to the billionaires. For example, Warren Buffet has $330 billion in cash, much of this cash is in treasury bills collecting 4.5%.
This interest is money from the teachers, the nurses, the restaurant workers, the retail workers, the factory workers, the truck drivers. Government debt is a perfect example of private-profit/ social-cost.
Dear government: you keep taking our money and giving it to the banks and the billionaires. No wonder we struggle too much in order to get the rent paid.
Like maxed out credit cards, government policies based on debt are just extending the forever debt. This forever debt is forever a trickle-up of money –from the People to the banks. Our government plans are not so important that we should put the next generation into debt for their entire lifetime.
We need to map out a new course, a new course with-out new debt. This will be more difficult at first, and then in the near future it will be less difficult, rather than altogether too difficult for the next generation.
A quick 3-minute video of Jason Robert Bailey at Denver City Council talking about the difference between government debt and business debt—two very different animals.
