"Jim Devine" <[email protected]> wrote: > <[email protected]> wrote: > > I think the plan to have high government debt is just a way for the wealthy > > to have another way to get surplus value from workers who pay taxes which > > result in payment to bond holders.
> How does this work? the way I can see it is if the government cuts > programs that help the working class while raising taxes on the > working class in order to pay the interest on the debt. That seems to > be the trend. A high income person would rather buy bonds than pay taxes. IIRC, high income/wealth individuals own a considerable portion of US debt. > It's true that the existence of the government's debt usually leads to > a redistribution upward, to the interest-earners. It also makes > government officials more dependent on the kindness of _rentiers_ (or > at least think that they are so). A socialist government (under > capitalism) wouldn't run significant deficits and pile up debts, > except perhaps to invest in infrastructure and the like. A big improvement in the government budget deficit has to come from a cut in defense spending. A socialist government on both a federal, state, and local basis would probably buy corporations by issuing bonds. > It's true that interest rates are likely going to rise in the future > (since they're so low now) but to some extent the government has > locked in low rates by issuing and selling long-term bonds. I'll have > to check how much they've done that, but if they're smart this is the > strategy they have followed. Federal debt mostly consists of bills, notes, bonds, and TIF securities. The average maturity is about 5 years. Bonds are issued with a maturity greater than 10 years, but only comprise 11% of the debt. -- Ron
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