townpete
Corn Field
- May 30, 2008
- 4,654
- 3,634
- Banned
- #1
Another myth busted:
No, the U.S. will not default on its debt, no matter what
On any given month, the tax revenue flowing into the Treasury far exceeds interest payments — by a lot. Last month, for example, the Treasury took in $365 billion in tax receipts and made $21 billion in interest payments. For fiscal 2015, which ended Sept. 30, those figures are $3.2 trillion in tax receipts versus $402 billion in net interest.
The U.S. government’s ability to service its debt — the principal can be rolled over — should not be an issue. But Treasury has made it one, claiming in 2011 and 2013 that it lacks the authority to prioritize debt payments, something households do all the time. Confronted with insufficient funds for both the monthly mortgage payment and credit-card interest, guess what they do? They pay the mortgage because the consequences of missing a payment are much more serious.
Treasury publicly denies it has the authority to pick and choose among 80 million monthly payments, saying its computerized system would have to be re-programmed.
No, the U.S. will not default on its debt, no matter what
On any given month, the tax revenue flowing into the Treasury far exceeds interest payments — by a lot. Last month, for example, the Treasury took in $365 billion in tax receipts and made $21 billion in interest payments. For fiscal 2015, which ended Sept. 30, those figures are $3.2 trillion in tax receipts versus $402 billion in net interest.
The U.S. government’s ability to service its debt — the principal can be rolled over — should not be an issue. But Treasury has made it one, claiming in 2011 and 2013 that it lacks the authority to prioritize debt payments, something households do all the time. Confronted with insufficient funds for both the monthly mortgage payment and credit-card interest, guess what they do? They pay the mortgage because the consequences of missing a payment are much more serious.
Treasury publicly denies it has the authority to pick and choose among 80 million monthly payments, saying its computerized system would have to be re-programmed.