Solutions
National Debt Causes Inflation
There are two main causes of the great inflation that has been in place for the last several decades. First, is the massive federal date which is $39 trillion dollars as of this page update.
Second, is the national trade imbalance that causes our currency to experience weakness which raises the costs of imports, which constitute a large amount of price increases that get passed along to American consumers. There are many solutions to solving the trade imbalance, many of which are beyond the scope of this page. However, one I will mention, Canada has an anti-Spam email law which prevents US companies from marketing products into Canada and is a chief roadblock for a favorable US-Canada balance of trade. Other nations have similar legal roadblocks that require sophisticated corporate attorneys to identify and to unwind them. I worked with a world class corporate attorney at one of my past employers located in Delaware and was an international corporate service provider.
Back to the main point, that the national debt causes inflation. There are only three ways to handle federal finances — raise taxes, cut spending, or print money (inflate the value of the US dollar down to zero). As a point of comparison, the price of gold was about $400 an ounce about 25 years ago and now it is over $5000 an ounce. If gold was the only metric, we would think the value of the currency became worth 12X less than its 2000 value. However, due to technology enhancements, actual inflation has been less than 12X, maybe instead like 4 to 6X.
Since the government never raises taxes and also never cuts spending, they rely entirely on quantitative easing by the federal reserve (this is printing money). Federal reserve banking interference with the economy does not grow the economy; it causes massive capital misallocation (“bubbles” – Alan Greenspan warned of the bubble economy).
National Debt Paydown Movement
In order to pay off the national debt, it requires time and effort of all us to pay it down. When you go to work, and pay your taxes without being audited or without taking super aggressive or unstained tax positions, you are helping paying down the national debt.
If you can or are able to, please consider making a free will donation to the IRS as well as to the United States Treasury Sinking Fund. Please tell your friends as well and hopefully they can donate as well. Tax revenues collections have been surging lately and this is why the federal debt figures are starting to improve (before adjusting for recent military actions).
Warm Business Regards,
M.S. Travis Turner, Esquire