Thread

1. valleyer · 1790820524 · focus · HN ↗

   Oy. I'm no fiscal conservative, but the US federal government absolutely needs to balance its budget. Otherwise, it's bound to either choke on interest payments, devalue the dollar, or both.

   Unlike most Trumpists, I see the the problem as a revenue issue, not expenditures; unlike many non-Trumpists, I doubt "tax the rich" is going to be enough to plug the hole.

   Government healthcare payments would be a good start -- it seems likely that the amount most employees already (effectively) pay for health insurance could fund equivalent government coverage with some money left over to help pay for other government expenses.

   1. margalabargala · 1790820823 · focus · HN ↗

      I'm unconvinced that "balance the budget" is the issue here.

      Interest rates are a function of inflation and joblessness. Both of which the current administration has created via terrible (for the country; great for the family members of the administration) policies.

      The terrible policies are destroying jobs and causing the prices of goods to go up, thus increasing interest rates. The administration could balance the budget, but that would not correct the interest rate problem unless they also stop enriching themselves at the expense of the rest of the country.

      1. valleyer · 1790821582 · focus · HN ↗

         How are interest rates a function of joblessness? Do you mean inversely?

         My amateur understanding is that prevailing interest rates are more directly a function of supply and demand for capital; I agree that higher prices increase demand for capital. Joblessness would seem to be correlated with lower demand; the unexpected combination of high employment and persistently low interest rates in the 2010s was a source of a lot of commentary, as I recall.

         1. margalabargala · 1790886843 · focus · HN ↗

            > How are interest rates a function of joblessness? Do you mean inversely?

            To copy/paste my other response:

            The organization responsible for setting the interest rate, has two mandates: full employment and low inflation. Jobs are an important aspect for that reason.

            Low interest rates drive job creation and inflation. High interest rates decrease inflation and decrease job creation.

      2. __MatrixMan__ · 1790821759 · focus · HN ↗

         I'm sure jobs are an important aspect here, but I kind of doubt that we can fix this without also finding a way to refocus our efforts on endeavors that most people approve of. As it is, letting the US succeed is bad and letting it fail is worse. That's unlikely to remain stable forever.

         1. margalabargala · 1790823442 · focus · HN ↗

            What I mean is, that the organization responsible for setting the interest rate, has two mandates: full employment and low inflation. Jobs are an important aspect for that reason.

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