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April 05, 2005


I hate to get into a pissing match with you here, and I assure you I am a strong progressive in my views but consider this. Federal intra-agency debt is not the same debt as public debt (debt owed someone outside the federal government). Intra-agency debt is held separate from public debt, and its real meaning is an intention by the federal government to honor an idea in the future. I know many folks say the SS trust fund money is not the fed's money, but the people's money! However, you could really say that about all federal revenues.

The best analogy I can give would be to look at your family budget. Let's say you had intentions to set aside money in an account to buy a boat, but you never had any excess funds to put in that account each time interval after paying other more pressing expenses. Are you obligated to put that collective funding obligation to yourself back in the boat account in the future?

Maybe this isn't the greatest analogy, but it does point out that we are really just talking about internal (important) categories in a budgeting process!


You're approaching this with nuance, which wasn't Bush's intention. Like the stupid "it's not the government's money, it's your money" crap that ignored federal debt that we all agree is real and not a marker for interagency budgetary intentions, this was essentially an attempt to create belief in the mindlessly literal. It's as if he's saying "look, all that's here is some paper, and we all know that you can write anything on a piece of paper. Surely something supposedly worth billions of dollars would take up more space than a binder in a filing cabinet. Therefore, it doesn't exist."

Which, like I argued, contains some absurd implications.

I wonder where your rights to ever withdraw money from your private account will be held...possibly a filing cabinet in Washington? I'm not sure I can find many modern financial transactions that aren't IOU's in the basic sense. When was the last time any actually kept stock certificates in their basement? Don't we all just have IOU's from our broker? It's up the federal government to make our broker honor those IOU's too. What an idiot.

Look at all these dollar bills in my wallet. They're just pieces of paper with a bunch of words and pictures printed on them! Sure, they SAY they're worth something, and the Treasury will back them up, but what does that really mean? I wish somebody would strengthen my wallet and turn these worthless pieces of paper into ASSETS for me!

This is becoming quite the clown show.

To answer your question: yes. I have heard more than a few people (who voted Bush, naturally) say that this should be the ultimate goal of US monetary policy.

Yes, the US is so down in the world that its "full faith and credit" is worth less than some lumps of shiny dirt.

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