There is so much at stake in this election, and it just got bigger by ten fold with the Republican front-runner Donald Trump having no clue how economics or debt works for governments.
In a Politico article this morning the following was said by Donald Trump:
Those who said he wants to buy debt and default on it are “crazy,” he added.
“This is the United States government. First of all, you never have to default because you print the money. I hate to tell you. So there’s never a default. But the point is it was reported in the New York Times incorrectly,” he said, referring to a critical Times article that ran on Friday.
You have got to be kidding me! Has this guy ever read a book on economics, or have any understanding of history?
The national debt is one of the biggest threats we face in this country with over $19 Trillion and counting. We have a real possibility one day defaulting on the debt because we will not be able to make the necessary payments. You can’t just print more money in order to fend of the growing obligation we face as a country.
If Donald Trump had any brain, and any recollection of history, he would know that paper money is a fiat currency that has no real value. We only give that money value by mutual agreement, not by the backing of commodities, or anything that has real value. If you just print more money then the value of that paper goes down. Just ask Germany during the Wiemar Republic! They suffered through years of high inflation and a collapse of their economic system. You can’t just print your way out of a problem that has been brewing for decades and centuries. It sounds like the typical answer you get from middle school kids when you try to teach them finance. “Why can’t you just print more money?” Because you can’t! Money doesn’t grow on trees.
Bonnie Kristian over at Rare writes,
Seriously, this proposal is so economically ignorant it is difficult to know how to respond. It’s the sort of thing you’d see if any half-decent economist got a guest writing gig at The Onion. If there were no video evidence, I’d be convinced it was satire.
All that new money would not magically create new wealth. It would simply dilute the purchasing power of the money that already exists—in other words, it makes the cash you have in your wallet worth less.
We are supposed to believe that this man will make a great President because he is a “Business Man?” Apparently his college education didn’t pay off, and writing a book about business doesn’t make you an expert. This type of statement from him is irresponsible and outright terrifying!