An alternative to popular faith
Well, they just keep on doing it. The February 8, 2010 Forbes Magazine’s cover story is titled, “The Global Debt Bomb,” by Daniel Fisher.
It contains the usual scary words, for instance: “The world has issued so much debt in the past two years fighting the Great Recession that paying it all back is going to be hell –for Americans, along with everybody else. Taxes will have to rise around the globe, hobbling job growth and economic recovery.” Etc., etc., etc. You get the idea.
Never mind that this is exactly the same “sky is falling” commentary — even using the words “debt bomb” — we have been hearing from pundits since 1940 (See http://rodgermmitchell.wordpress.com/2009/11/24/federal-debt-a-ticking-time-bomb/). Never mind that “government debt” is an exact synonym for “government money,” which needs to grow if an economy is to grow.
Never mind that “paying it back” is not, and since 1971 (the end of the gold standard) never will be, a problem for a sovereign nation with the unlimited ability to create money. Never mind that using this unlimited ability has not caused inflation, which in any event could be cured by raising interest rates. And never mind that taxpayers do not pay for federal debt and tax rates are not related to federal debt.
In short, never mind history, and just keep making the same old, wrong predictions, using the same old words, because let’s face it, fear-mongering sells magazines, and why make up new words when cribbing the old words is so much easier.
Pick up that issue of Forbes, read Fisher’s article, and wherever you see the word “debt” replace it with the word “money.” That will show you the reality. Also, if you know how to contact Fisher, you might ask him to supply historical proof that, as he says, “. . . the taxpayer will have the devil to pay.”
Rodger Malcolm Mitchell