Saturday, November 21st, 2009

Would it help the economy if the Government eliminated all Debt?

Government Debt
Mr. Trump asked:


Not Government debt… just personal and business debt.

Lets say the U.S. Government declared that as of February 1st.. all businesses and individuals are completely FREE of their prior debts. This means any debt you get into after Feb. 1 you have to pay back. BUT you would be freed from all the debt you got into before Feb. 1.

This would mean every person and business would get a clean slate and not own ANYONE money.

What impact would this have on the economy? Please be as detailed as you like.

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6 Responses to “Would it help the economy if the Government eliminated all Debt?”

jurd Says:
November 21st, 2009 at 10:49 pm

This would create total inflation.

James T Says:
November 23rd, 2009 at 11:47 pm

No, because if the debts are elimintated, it would put the person/business who is supposed to get paid, out of money. They usually (if business) require interest, so they make a profit from it. In conclusion, it’s good for the person in debt, but it has just as much negative effect on the other person/businessess. (What would happen to all the business loans? My mother last year loaned $300,000!)

w_a_richard Says:
November 26th, 2009 at 3:11 am

The economy as it now based would be in shambles. Credit is maintained to pay interest. That interest pays people who have nothing to do. How loud would the protest be if they didn’t get their paycheck they earned from the principle they loaned? The government, individuals, or companies do not borrow money. They buy it at the seller’s price. That is called interest. The seller expects to make a certain profit margin and the buyer’s decision to purchase.

axesenzon Says:
November 28th, 2009 at 6:56 pm

the US government is not them– it’s us (at least for now).
Having the government pay off all debts (forgetting about the harm it may produce directly for a moment)
that is still our debt, it doesn’t vanish.
Gov is us, we are them… its really a disservice to yourself to assume that they are not responsible to us etc…

Jantina Says:
November 30th, 2009 at 10:47 pm

Thats a fantastic idea ! It would be even better if the the banks went bankrupt and all computor records destroyed of morgages , loans and credit card transactions.On a more serious note ,they are talking about printing more money but this is only allowed if the bank of England has enough gold reserves otherwise money would not be worth the paper its written on.

wasicus Says:
December 3rd, 2009 at 4:19 am

A better idea would be for individuals to stop living on the credit as much as possible from today forward and work hard to pay off their past debts.If America would live within their means as much as possible,we might not solve the Government crisis,but we could sure solve our own.

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