A band of radical new congressmen (the "Tea-partyers") has turned a routine administrative procedure into a international crisis.
So what do you think?
It does appear that government over-spending is handled much differently than individual or family over-spending. With the former, agreeing to keep going further into debt results in BETTER terms for borrowing than if govt insists upon living within its means and avoiding additional debt. If an individual or family keeps going further into debt, the point comes where they either cannot borrow additional money (not a good risk) or the terms for going further into debt would be a higher rate of interest on additional amounts borrowed (again, reflecting their being a bad risk).Well the irony is that the increased interest rates that would result from a default would cost us far more just serving the debt we have now- whats more- increased interest-rates would ripple through the entire economy killing any chance of a recovery.
Of course, there are some who think this is just their goal- to wreck the economy so bad Obama will be defeated in 2012. But this is like burning down the house to gain ownership- any Republican would be a fool to want to inherent the ashes that would be left.
I've been saying we were heading downhill to a second-rate country status- but this is like taking a turn right over the cliff.
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What is good for the government or for the country as a whole may not necessarily be good for me as an individual.The government doesn't BUY bonds- it SELLS them- so there is no way higher interest rates would be "a good thing" for the government or the country as a whole.
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