Saturday, July 31, 2010

The Problem with America's Debt Problem

In a recent Washington Post column, Michael Gerson says, "America's debt problem is mainly an entitlement spending problem."

He is WRONG.

There is NO shortage of money--for the simple fact that the government can create as much money as it needs out of thin air. Somebody in the Treasury Dept just has to enter the correct character strokes on the right computer and - wa-la - the Federal Reserve conjures into existence as much money as is needed.

Inflationary you say?

HA - you haven't been paying attention. We're in a DE-flationary spiral. The money supply has been steadily SHRINKING. This economy needs NEW MONEY, not a redistribution of tender from my pocket to Lloyd Blankfein's.

Increases the debt?

OK, eliminate the step involving the Federal Reserve. Instead of issuing Treasury Bonds and trading them for legal tender, just declare (Congress can do this) the bonds themselves to be legal tender. End the Fed, and one more parasitic bureaucracy bites the dust. Good riddance. Call in and retire the existing bonds, and say goodbye to the national debt.

Comrades, when you hear corporate mouths, such as Gerson, tell you to sacrifice and accept austerity, look the [expletives] in the eye and reply calmly, "No thanks."

That's all.

Just Say No.