Attachment Debt
Attachment - Debt, The Future is Calling: It Wants a Refund, 2019
In the future we face a crisis, not in entitlements, but in net interest on the debt, both from increased rates and growing principal. This growth will only feasible until either China or the European Union develop tradable debt instruments backed by income taxation, which is the secret to the ability of the United States to be the world’s bond issuer.
While it is good to run a deficit to balance out tax cuts for the wealthy, both are a sugar high for the economy. At some point we need incentives to pay down the debt.
The national debt is possible because of progressive income taxation. The liability for repayment, therefore, is a function of that tax. The Gross Debt (we have to pay back trust funds too) is $19 Trillion. Income Tax revenue is roughly $1.4 Trillion per year. That means that for every dollar you pay in taxes, you owe $13 in debt (although this will increase).
People who pay nothing owe nothing. People who pay tens of thousands of dollars a year owe hundreds of thousands.
The answer is not making the poor pay more or giving them less benefits, either only slows the economy. Rich people must pay more and do it faster. My child is becoming a social worker, although she was going to be an artist. Don’t look to her to pay off the debt. Your children and grandchildren and those of your donors are the ones on the hook unless their parents step up and pay more. How’s that for incentive?
If that is not enough, let’s talk raw numbers.
If you look at total debt and the fact that it is 13 times income tax collections, then the wealthy 1% are in hock to the rest of us to the tune of 7 Trillion dollars (yes, with a T). It is even more if only the top 25% must pay the surtax. Of course, a fair share of that will be paid by the A-VAT (until employees own everything) and at which point there will be no billionaire CEOs. Before then, the rich will need to pay back or redistribute the debt globally (although I am sure most of the Tera-rich have a U.S. Tax ID number). The 75% to 99% strata owe $9T, with the lower 75% owing $2.5T.
In the future we face a crisis, not in entitlements, but in net interest on the debt, both from increased rates and growing principal. This growth will only feasible until either China or the European Union develop tradable debt instruments backed by income taxation, which is the secret to the ability of the United States to be the world’s bond issuer.
While it is good to run a deficit to balance out tax cuts for the wealthy, both are a sugar high for the economy. At some point we need incentives to pay down the debt.
The national debt is possible because of progressive income taxation. The liability for repayment, therefore, is a function of that tax. The Gross Debt (we have to pay back trust funds too) is $19 Trillion. Income Tax revenue is roughly $1.4 Trillion per year. That means that for every dollar you pay in taxes, you owe $13 in debt (although this will increase).
People who pay nothing owe nothing. People who pay tens of thousands of dollars a year owe hundreds of thousands.
The answer is not making the poor pay more or giving them less benefits, either only slows the economy. Rich people must pay more and do it faster. My child is becoming a social worker, although she was going to be an artist. Don’t look to her to pay off the debt. Your children and grandchildren and those of your donors are the ones on the hook unless their parents step up and pay more. How’s that for incentive?
If that is not enough, let’s talk raw numbers.
If you look at total debt and the fact that it is 13 times income tax collections, then the wealthy 1% are in hock to the rest of us to the tune of 7 Trillion dollars (yes, with a T). It is even more if only the top 25% must pay the surtax. Of course, a fair share of that will be paid by the A-VAT (until employees own everything) and at which point there will be no billionaire CEOs. Before then, the rich will need to pay back or redistribute the debt globally (although I am sure most of the Tera-rich have a U.S. Tax ID number). The 75% to 99% strata owe $9T, with the lower 75% owing $2.5T.
posted by Michael Bindner at 1:16 PM
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