The Financial Sustainability of the United States: Debts, Taxes, and the Power Dynamics

When discussing the US National Debt, it's important to understand the underlying economic and social dynamics. Just as the question arises about how long a household can sustain itself with an unlimited supply of gold, we must also consider the broader implications of how the US government manages its financial affairs. Is it a sustainable system, or is it a mechanism for perpetuating wealth inequality?

One of the key points to consider is the fact that the US government has the unique ability to print its own currency, denominated in dollars. This means that while the potential exists for the value of the dollar to be diminished through excessive printing, the government itself cannot “run out” of money. However, this does not necessarily mean that borrowing is sustainable if the underlying mechanisms and motivations are flawed.

Why US dollars held in a Federal Reserve Bank are liabilities, not assets: US dollars are actually a form of debt, a promise to pay in any US bank, commonly known as a Federal Reserve Note. Any accountant will confirm that for every credit (asset), there must be a corresponding debit (liability). In the case of the US government holding US dollars, the debit is absorbed by the collective wealth of American taxpayers. This is a critical point that highlights the true cost of national debt.

The Question of Borrowing

The practical answer to the question of how long the US can keep borrowing is that it likely depends on the wealth and resources of the nation. The US is by far the wealthiest country in the world, so the theoretical limit of borrowing based on that enormous wealth is virtually limitless. This leads to the important question: Why does the wealthiest country in the world borrow so much when it is not necessary?

At the heart of this issue is the method used by those in power to redistribute wealth. By manipulating tax policies to decrease taxes for the wealthy (through so-called trickle-down tax cuts), and then borrowing the money to fund the resulting deficits, the rich essentially are taking more wealth from the rest of the populace. This is not just an economic issue; it is a matter of political and social justice.

Understanding the Structure of Debt

The working class ends up paying for the debt through new taxes enacted to cover the deficit, effectively becoming de facto slaves to the wealthy. The goal of borrowing trillions of dollars, according to some, is not to create financial unsustainability, but to create a system where a small elite class benefits disproportionately while the rest of society shoulders the burden. If the wealthy were forced to pay the full debt, there would be no need for borrowing, no national debt, and a more equitable burden share.

From this perspective, financial accountability becomes a critical issue. If the wealthiest individuals in the nation were required to pay their "fair share," it would halt the cycle of borrowing and debt accrual, leading to a more sustainable economic system. Currently, the imbalance leads to a situation where the burden of debt and taxation disproportionately affects the working class, creating a fundamentally unjust and unsustainable financial structure.

Conclusion

While the US government has the technical ability to borrow indefinitely, the sustainability of this system is deeply interconnected with the broader issue of wealth distribution. Understanding the motivations behind borrowing and tax policies is crucial for addressing the root causes of financial instability and inequality. A more equitable system, where the wealthiest individuals contribute their fair share, would lead to a more sustainable and just society.