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Comments about ‘Business, Government, and Cheap Debt; now is not the time for Uncle Sam to borrow’

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Published: Wednesday, June 13 2012 6:56 p.m. MDT

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Eric Samuelsen
Provo, UT

As has become typical in this debate, the author makes an ideological argument, possibly a moral argument (though I would suggest that increasing unemployment in this economy is hardly a moral act), but not to any degree whatsoever an economic argument.

Rifleman
Salt Lake City, Utah

People who understand interest earn it while those who don't pay it. In just 2012 alone the State of California is spending $16 billion more than it is bringing in. The taxpayers are stuck paying interest on that debt.

101Ways
Taylorsville, UT

Borrowing, debt, are weak struggles to try and compensate for a loss of economy. Rather than downsize, movement thinks is has to expand and provide more services and goods to the public in and effort to stave off a recession. One thing government forgets is that it did not create the recession, it was business greed and unpaid labor that created the recession.

Expendable worker incomes equals a healthy economy and economic growth. Debt by consumers and government has replaced income and assets, interest rates are a negligible influence on the economy when borrowing cant be repaid. Debt replacing tangible asset is why we are stuck in this poverty state of the nation. Sustaining debt depletes the economy and government.

Consumers are the economy but business and government try to erase prosperity (expendable incomes) from the american dream of asset, and debt is about to implode.

Government is not took big to fail either, its a current work in progress event that will turn cities into ghost towns. Cities can disappear but the people and our constitution will survive to rebuild on, so all is not lost and failure is an acceptable option.

Blue
Salt Lake City, UT

There are hundreds of billions of dollars worth of desperately needed infrastructure repairs in this nation. "Deferred maintenance" has been going on for so long in state and local governments that we've lost sight of just how bad our roads, public water systems, bridges, airports, canals and dams have become.

Undertaking these desperately needed and economically vital repairs would employ hundreds of thousands of unemployed or under-employed Americans in the construction industry.

With bond prices as cheap as they are now, governments can essentially get money _for free_. No interest. Seriously.

These are repairs that HAVE to be made. Our economy depends on them. Making these repairs would be a huge boost to both employment and the greater health of our economy.

Governments would be seriously out of their minds to not bond NOW for these projects, because money will never be cheaper and these projects are critically important.

Conservatives are being "penny wise but pound foolish" by arguing against these projects.

If Obama came out in favor of oxygen, conservatives would advocate the benefits of suffocation.

SG in SLC
Salt Lake City, UT

@Blue

Well said. You've hit the nail on the head. I work for a Wasatch-front county government, and deferred infrastructure and capital asset maintenance is a HUGE issue. Taking care of deferred maintenance protects the county's investment of taxpayer dollars in infrastructure and other public assets. It also addresses health and safety issues that often arise from neglecting infrastructure and assets. And finally, as Blue said, spending the money to take care of deferred maintenance now takes advantage of historically low interest rates, as well as comparatively low capital construction costs brought on by the major decline in the construction industry during the recession.

It wouldn't surprise me to see the county I work for raise property taxes in order to tackle our deferred maintenance problem. As unpopular and painful as that process would be, it would be even worse to for our buildings and infrastructure to continue to deteriorate to the point where they have to be replaced instead of just repaired.

SEY
Sandy, UT

Murphy is correct, but it really doesn't matter. Keynesians are in charge and they're going to spend like there's no tomorrow. Paul Krugman would like us to spend like we're preparing for war with aliens. Apparently, current war costs are too small. And Eric, there you go again. Unless the analysis is Keynesian, it isn't economics, right? How long will it take you and those in power to understand that economics isn't a hard science? At most, it's a social science that doesn't reliably reflect predictions through formulas and equations mythologized by econometricians. At most, you can analyze past human action and possible future choices made by real people.

VST
Bountiful, UT

The argument is being made that there are hundreds of billion dollars worth of infrastructure work that could be done by borrowing more money now (adding to the national debt) to accomplish these repairs, which would be good for the economy and should be done simply because the interest rate is cheap. That is a simple-minded fallacious argument.

Why? Because that was the claim in 2009 when ~$800 billion was authorized to be spent in the name of "stimulating the economy." As of today, the results are, we still have a very weak and staggering economy with only a 1.9% GDP growth rate and an unemployment rate of 8.2%. The return on investment was a staggering failure. Furthermore, much of that argument is based upon the false premise that the government owns the entire economy; it does not.

That "experiment" did not work. Been there - done that. Don't do it again.

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