Comment by DarkmSparks
8 hours ago
The administrations choices are fairly binary now.
Inflate away the $40Trillion+ debt they can never pay back
Or
Hard default on the debt, and be the one holding the hot potato as the union breaks up.
Fed is trying to thread the needle between the two and keep the music playing as long as possible.
Or just fail for 4 years like every Republican administration since the 80s and wait for a Democrat to fix the economy...
You give the people in charge too much credit regarding any long term thinking or goals in general.
The goal is to win the next election but I think the populace is to blame for this more than anything.
The populace is who is too interested in winning politics as a sport that the politicians have really no choice other than to focus entirely on winning the next election.
If the voters treat politics as a constant form of sports entertainment, constantly checking the latest news and events, then voters are actually the fundamental problem as to why the politicians can not do anything in terms of long term planning.
I always hear this accusation of people treating politics like sports, but what do you want? It's a FPTP system, which favors entrenching two parties. In order to maintain the backing (funding, importantly) of one of those two parties, candidates can't fall too far out of line. If you can't get your outsider preferred candidate above 50%, considering there is also likely another main-party candidate with significant policy overlap, you get nothing.
If you want to reduce the spectacle, replace FPTP with a better system that eliminates the need for primaries, and get rid of Citizens United. Good luck.
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Or thinking
They definately think.
The thinking process is just line their pockets with as much as possible before they lose their position to someone else.
Once you understand that everything is rational. If not desirable.
> Fed is trying to thread the needle between the two
Not really, inflating it away is the only possible choice.
Can’t inflate it away for the same reason we can’t stop climate change. We would have to stop the behavior that caused the problem in the first place, and we all know that’s not going to happen. Remember during Clinton’s presidency the government ran a surplus and started paying down the debt, and there were news articles worrying about the future disappearance of treasury bonds? The party of “fiscal responsibility” took care of that problem in no time at all.
There is one obvious choice here, the policy is inflation and always has been.
From the adminstration
Fed independance is about tempering that policy so UST still has buyers.
Fed policy is explicitly controlled inflation (2% target).
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yet many "third world" countries managed to pay their debts just fine. some even more than once in recent history.
American exceptionalism even in failure?
How is it failure? You use your military to force trade to occur using your tokens. You control the supply of said tokens. You leave some other loser holding the bag for your debts. You win.
Or you could, you know, raise taxes. There’s policy solutions to these problems they just happen to be painful in a way that is easier to point to.
You could also reduce spending on military. The U.S. accounts for 42% of the global military budget. Virtually every empire in history has fallen due to overspending on an excessively large military.
Not that I'm a fan of this administration, but inflating away remaining our only option is not related to Trump. It was the only choice for the past administrations since at least the subprime crisis; probably even since the Iraq war. My 2c.
You're missing choice #3 - spend more money on stupid shit, cut taxes some more, pile on more debt, blame Obama Hussein Hunter Biden for the debt as the opening salvo of the third-term run in 2028.