wmspringer's Journal: Money

So, I was taking a look at my profile and I noticed I'd picked up half a dozen fans....wonder when that happened? So, I suppose I may as well post a journal article, with the warning that this will bore you if you're not in the US, and annoy you if you're a Republican.

Suppose your family of four is $89,000 is debt. You are maxed out on your credit cards, and a significant part of your income is devoted to paying off the interest. Then one day, you see that great new thing that you just have to buy.

Do you..

a) ignore it?

b) ignore it and put as much money as possible towards paying off your debt?

c) get another credit card so you have enough credit to buy it?

Obviously, b is the financially responsible choice; once you've paid off your debt, you'll be able to spend your money on what you want instead of on interest. Choice c, of course, is disasterous; you're simply digging yourself deeper into the hole you're in.

So, if this is true for a family, why isn't it true for the government? The US government is over $6.4 TRILLION dollars in debt, with a significant amount of that being owed to people outside the United States. Wouldn't you think the only sensible thing to do would be to pay down the debt as quickly as possible? Just think, if the interest was only one percent, that would still be $64 BILLION a year that could be going for other things!

Unfortunately, the currently administration seems to prefer option c: get a new credit card! Instead of paying down the debt, they're raising the ceiling...and since they seem determined not to collect enough taxes to cover the cost of government, the debt will continue to grow.

Seems like a bad disaster movie, doesn't it?