Debt Destroys Individuals, Businesses and Nations

Foxnews.com recently reported:

FRANKFURT, Germany – At least four police cars were set alight and two officers injured Wednesday as authorities confronted violent anti-austerity protesters ahead of the inauguration ceremony for the European Central Bank’s new headquarters (here). …Protesters said they are targeting the central bank because of its role in supervising efforts to restrain spending and reduce debt in financially troubled countries such as Greece. (end of Foxnews.com excerpt)

This violence is, of course, part of demented socialism. Because in order to correct debt you must restrain spending, which these protesters oppose. And if your family was in debt these protesters would never tell you to reduce your spending and to use your money frugally. No, they would simply tell you to find another source of income, like going on welfare or sending grandma out to work.

This refusal to take serious action against debt is how individuals, families, businesses and entire nations destroy themselves. And once you have debt the only reasonable thing to do is to stop accumulating it. But not to these people on the socialist side. No, they just call for more and more and more debt and taxes long after the citizens and the economy are tapped out. Then the most indebted nations have the worst economic problems – always have and always will.

These protests, and the thinking behind them, come from the far political left and the communist left. Under socialism/communism the economy gets so burdened down by government control and the consequent spending (debt) on every possible program that it can never recover. That is why communist nations are always poor, dispirited and deprived, contrary to the theory that that ideology produces “equality” and human happiness.

Spain is perhaps the most left-wing nation in Europe with one of the worst economies, astronomical unemployment (equal to US unemployment rates in the depression of the 1930s) and a huge national debt. And a new leftist party is making big political gains in Spain because that party is telling the people that Spain does not need fiscal austerity, that Spain can simply tax more and borrow more and more money to finance more and more government jobs and handouts to ease the economic crisis brought on by debt in the first place.

Amazing. This is precisely what Obama has been doing in the US. Even worse, socialism also thwarts economic growth through excessive taxes, regulation, bureaucracy, government thievery and now extremist environmentalism. So the economy gets slammed from both sides by socialism – on the spending side, and also on the wealth-creating side. This combines to form a toxic atmosphere in which the people are always the victims.

In America today, millions of younger, skilled and educated people are fleeing the most liberal states and going to the conservative states for the opportunity there. This comes after decades in which American liberals have said over and over that conservatism and capitalism are evil, that we need more and more government programs and taxes and bureaucracy. Yet even Massachusetts now has a Republican governor who is seeking to clean up the mess that decades of Democrat control have created.

Greece collapsed in 2008 under a mountain of debt. Recently a far-left leader was elected there who is fighting back against the austerity mentioned above. Because the Greek people have not been allowed by their biased media and political and intellectual classes to comprehend the roots of their crisis, which we capitalists and conservatives have explained for millennia – that you should be thrifty when times are good because then you will have a much easier time when things go bad, which they always do from time to time.

In the post-World War II period economic growth was strong worldwide. Naturally socialists spent every cent that they could get their hands on, and then much more. Because the money was there. That is how Europe got into so much spending and debt.

Japan has been in a severe recession since 1990. The main reason is because its debt load is the highest in the industrialized world, almost three times the debt load per person of the US today. One of the big contributors to the crisis was the enormous debt built up by the government-owned Bullet Train system, which was finally privatized in 1987 to stem the river of red ink. Japan recently privatized another major arm of its national rail passenger system because it also was bleeding so much cash under government control.

There are people on the political left and in the American media like Paul Krugman at the New York Times who say that all of this debt is really not such a bad thing. This is false. Debt destroys, and anyone who says otherwise is leading us to ruin, as we have seen in Japan, Spain and Greece, and in America today.

Certainly some low level of debt is understandable and can be tolerated and can be useful, like taking a loan to own a home. But once you pass a certain level, you are in the danger zone. The US under Obama entered that danger zone way back in 2009 and we will never recover our past economic vigor until we start paying off this terrible burden. American taxpayers currently shell out more than $400 BILLION every single year just to service the interest on this debt, but not to pay off a single penny. This is shameful.

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