DEBT'S LONG SHADOW

 

Debt is the kind of delicate problem that nobody wants to talk about, but that's keep hiding in the background...

You can't borrow and borrow and borrow as if there's no tomorrow. But then, everybody seems to act in that manner: individuals, families, companies, governments. These days, prosperity seems to be everywhere, but the truth is things appears mostly like that simply because debts are invisible. They're kept in dark places, out of view.

Even the most powerful country in the world, though, has to pay its debts and assume its responsibilities. The case of the United States is a good example of that. Debt servicing, in that country, may soon exceed the level of the US defense budget, the world's largest by a long shot.

In the time of low interest rates, debts were seen as not important. The present rising rates, however, shows that this is not the case. What will happen when the borrowing costs exceeds the US ability to pay?

Today's politicians (and I mean most ot them, not just the American ones) have become good at buying votes with expensive social programs, uncaring and unthinking about the annual deficits that this produce and that feed an ever-growing debt.

The mentality is simple, comfortable, and typical of a complacent and short-sighted society. Let somebody else deal with that problem! In twenty years, we'll all be dead anyway!

With that kind of budgetary irresponsibility, the future may prove to be bleaker than it should be. If democracy disappeared one day, it may be because of a sea of debts, accumulated by generations of irresponsible politicians willing to please irresponsible voters by making irresponsible promises, each generation thinking that the next one will take care of things and solve the problem once and for all.

Will human nature ever change?

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(Article base upon a series of tweets published today, November first, 2022, as a reaction to the following post:

https://www.cnn.com/2022/11/01/economy/inflation-fed-debt-military/index.html )