Guest Post by Ron Paul
This week the US government reached its 31.4 trillion dollars borrowing limit, better known as the “debt ceiling.” This led to a showdown among House Republicans, President Biden, and congressional Democrats.
House Republicans are demanding that President Biden and Senate Democrats agree to include spending cuts with the debt ceiling increase. However, President Biden and the congressional Democrats are refusing to negotiate with Republicans. Rather, they and their allies in the mainstream media are lambasting Republicans for their “irresponsibility” in seeking to include spending cuts with an increase in the debt ceiling.
America’s national debt is approximately 122 percent of the gross domestic product (GDP), meaning the government owes more than the population produces. Interest payments on the national debt follow in size behind other federal budget big spending areas of Social Security, Medicare, and “defense.” While interest payments are made, the national debt continues to grow each year.
Government spending steals resources from the private sector. Thus, there is less capital available for private businesses to grow and create new jobs. Government spending also contributes to price inflation and the declining value of the dollar as the Federal Reserve monetizes the debt. One reason the Fed cannot allow interest rates to rise anywhere near where they would be in a free market is that it would cause the federal government’s interest payments to rise to unsustainable levels. Considering these facts, it should be clear that the irresponsible ones are those who think the government should increase its credit limit without cutting spending.
This is not to say that establishment Republicans like House Speaker Kevin McCarthy are heroes of fiscal restraint. Rather, McCarthy, like most Republicans, objected neither to increased spending nor to debt ceiling suspensions when Donald Trump was president. Further, any Republican spending plan will likely continue increasing spending on the military-industrial complex while refusing to address the looming cost problems with Social Security and Medicare.
While some Republicans are willing to discuss reforms to Social Security and Medicare, most are still too afraid of the “senior lobby” to support any changes in the programs — even if such changes will not harm current beneficiaries. Consequently, it is unlikely Congress will pass meaningful entitlement reform — at least until it is forced to do so because the Medicare and Social Security Trust Funds run out of money. Insolvency is projected for the Medicare Trust Fund in five years and for the Social Security Trust Fund in 12 years. Of course, Congress may be able to avoid making tough choices since the Federal Reserve will likely cut government benefits, along with workers’ wages and the value of savings, via the inflation tax.
Following early reports that the House Republican leadership was open to supporting cuts in military spending, there arose a predictable cry from Republican hawks that any reduction in spending would leave the US and its allies vulnerable to our enemies. The limited cuts considered, though, would still keep America with a military budget exceeding the combined military budgets of the next nine biggest spending countries. After some pressure from the military-industrial complex’s loyalists and propagandists, most Republicans retreated from supporting defense cuts.
A problem with many fiscal conservatives is they accept the premise of the welfare-warfare statists. Thus, they are unable to make consistent principled arguments supporting spending cuts and opposing spending increases. The key to restoring a free society is for a critical mass of individuals to reject statism.
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CTRL-P to the rescue!
How do you ‘invest in the future’? By borrowing $210 million every hour. That’s what the Government of the United States is doing. It’s spending one-fifth of a billion dollars it doesn’t have every hour of every day of every week – all for your future…..
This whole debt ceiling theater is boring. I’d rather see the GOP dig its heels in over something on the culture war side. Like banning puberty blockers on minors. “We’ll only raise the debt ceiling in exchange for banning chemical castration of children.’
The key is to quit paying your tax dollars to the feds. All red states have to do is STOP collecting and sending the feds money. Simple.
Don’t feed the beast is a good idea in the abstract but still not viable. Most people pay federal taxes because they accept so and are afraid of the consequences of not doing so. In order to stop paying, in the case of a typical wage earner, you would have to claim say 10 exemptions on a W-4 and have that go through the employers payroll system.
In fact, back in the day, this was done quite often. The person would then not file an income tax return. Back then the IRS would assume that person had passed away if they didn’t receive a tax return for three years. The system did not receive death information from the SSA about a person’s demise at that time. A lot of people dropped off the system or Masterfile as it was called.
The Service is a lot more sophisticated today although their system is certainly antiquated compared to the private sector. Information is gathered from so many sources and cooperation is fostered from employers, government entities and businesses like funeral homes. Eventually most people engage in a way that the system picks up activity.
Most people are not willing to engage in, whether one thinks it or not, criminal activity. Most people want a quiet life. The system may not be fair but it just is. There are no red or blue states-just areas. The way to a more just outcome may be a consumption tax. The idea of not having government and “every man for himself” is appealing from a certain perspective but I think every outcome in that scenario is a dead end in the long run. I don’t trust human nature.
They are whistling past the graveyard….
Global South: Gold-backed currencies to replace the US dollar
Let’s start with three interconnected multipolar-driven facts.
First: One of the key take aways from the World Economic Forum annual shindig in Davos, Switzerland is when Saudi Finance Minister Mohammed al-Jadaan, on a panel on “Saudi Arabia’s Transformation,” made it clear that Riyadh “will consider trading in currencies other than the US dollar.”…
Second: The Central Banks of Iran and Russia are studying the adoption of a “stable coin” for foreign trade settlements, replacing the US dollar, the ruble and the rial. The crypto crowd is already up in arms, mulling the pros and cons of a gold-backed central bank digital currency (CBDC) for trade that will be in fact impervious to the weaponized US dollar…
Third: South Africa holds this year’s rotating BRICS presidency. And this year will mark the start of BRICS+ expansion, with candidates ranging from Algeria, Iran and Argentina to Turkey, Saudi Arabia and the UAE.
South African Foreign Minister Naledi Pandor has just confirmed that the BRICS do want to find a way to bypass the US dollar and thus create “a fairer payment system not skewed toward wealthier countries.”…
One key takeaway is that energy-intensive major industries are going to be moving to China. Beijing has become a big exporter of Russian liquified natural gas (LNG) to Europe, while India has become a big exporter of Russian oil and refined products such as diesel – also to Europe. Both China and India – BRICS members – buy below market price from fellow BRICS member Russia and resell to Europe with a hefty profit. Sanctions? What sanctions?
Meanwhile, the race to constitute the new currency basket for a new monetary unit is on.
https://thesaker.is/global-south-gold-backed-currencies-to-replace-the-us-dollar/