Comment Re:Debt is not the cause of wage stagnation (Score 1) 688
Can't repay them? The US debt as a percent of GDP isn't even the highest it has ever been. It was higher right after WWII. The way to reduce the debt is simple - either raise taxes or reduce spending or both. We merely lack to political will to do this at the present. The notion that we have debts that "cannot" be repaid is nonsense. As for individuals there is copious data showing that individuals and households have been paying down debt levels significantly since 2008. Companies have balance sheets that are historically very strong with large amounts of cash and relatively low debt levels overall.
Actually, we cannot pay off our debts. Most of the money in circulation is created by the banks creating loans. These loans have to be paid back, with interest. We owe more money to the banks than actually exists. Or in other words, if everyone tried to pay back their loans, we'd end up in a situation where the banks would literally have all the money, yet the loans would still not be paid off.
The only way the system keeps on running is that new debt is constantly created to pay off the old debt. Well that, and the money the fed creates out of thin air.