The Instigator
Pro (for)
5 Points
The Contender
Con (against)
0 Points

Deficit spending is the best thing for the current economy and the future (see details)

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Voting Style: Open Point System: 7 Point
Started: 11/29/2011 Category: Politics
Updated: 4 years ago Status: Post Voting Period
Viewed: 1,053 times Debate No: 19560
Debate Rounds (4)
Comments (1)
Votes (1)




In the current American economy, and for the future the best thing (economically, and socially) would be for the government to borrow more money and spend it on infrastructure and other spending projects.
My opponent can making an argument first or just accept. However if my opponent makes an argument in round 1 he/she will not be allowed to make an argument at the end of round 4 in order to make sure we both get the same number rounds with actual arguments.


I accept, good sir.
Debate Round No. 1


1)A) Infrastructure is something that is required to have a modern economy. We need transportation, power lines, water, and energy in order for the economy to perform. Now and in the future infrastructure will need to be build and replaced regardless.
B)The first question is how much infrastructure will we need in the next 0-20 years or so. The EPA estimates that we will need to spend 300 billion dollars on water infrastructure it the next 25 years.
Yearly the USA spends around 140 billion on just highway infrastructure (2.8 trillion over 20 years).
Another infrastructure upgrade we will need is an upgraded electric grid,that will cost around 450 billion.
Other infrastructure that we will need is more power plants which is estimated that in the next 20 years we will need to invest at least 1.5 trillion in order to provide the economy enough electricity.
C)So just adding those together over the next 20 years or so we will need to spend at least 5 trillion dollars on infrastructure.

I will now list the reasons why it would be beneficial for the economy and society for the government to borrow a lot of money now to pay for all this infrastructure.

2)It will save us money in the long run, by reducing congestion, increasing energy efficacy, and increasing the use of cleaner energy. The sooner we update this infrastructure the sooner we start saving money
A)Example 1: Investing 450 billion to update the electric grid would save 2 trillion over 20 years. It does this by decreases the amount of wasted energy and improving energy efficiency.
B)Americas currently outdated transportation, water, and building efficiency infrastructure costs the country 200 billion a year (2trillion over 20 years). The costs include car, airplane congestion, wasted water from leaky pipes, and outdated homes/buildings that are not insulated or have poor energy efficiency appliances/fixtures.
C)Updating and mandating building codes that promote energy/water efficiency would save consumers a net of 400billion dollars over 20 years.
D)Infrastructure upgrades that update power plants so that they emit less harmful chemicals and pollution would save billions b decreasing health cost associated with the pollution. The cost to benefits ratio of upgrading those plants gets as high as 1-22. Meaning these investments will save at least 640 billion dollars over 20 years.
E)So in total just those 4 examples will save over 5 trillion dollars over 20 years, and remember this is investments that we must make some time or another, and the sooner we make them the sooner we start saving.

3)A) Better safety. Remember that bridge that collapsed in the Midwest that killed a bunch of people? That occurred because we don't spend enough on infrastructure. One report estimates that around 12% of America's bridges are structurally deficient and potentially dangerous. Updating our infrastructure will make traveling safer for everyone.

4)Most infrastructure spending creates more economic benefits then it costs.
A)For example train infrastructure reduces congestion, pollution and commute times, saving more money than it costs to build those trains. Two separate studies find that every dollar spent on train infrastructure creates around 1.5-2.5 dollars in economic benefits.
B)When you take into account the health and environmental costs of coal/oil you find that clean energy costs twice as less. This is because emissions from coal/oil increase your chance to have cancer, heart and lung disease, autism, and many other diseases. Two separate studies find the same results. This means that the sooner we invest in energy infrastructure that we will need the sooner you stop getting sick and start saving money.
C) Also when you account for all the people who die because of this pollution it enters the hundreds of thousand. Over 20 years 300,000 people will die just from coal pollution.

5)Now the second question is why is it beneficial for the government to upgrade all the infrastructure we will need in the current recession. There are several reasons:
A)Currently there is over 9% unemployment, meaning 9% of the labor force is sitting idle. Every day millions of hours of labor is wasted that can never come back. If the government built up our infrastructure now it would result in the saving of millions upon millions of hours of work that would otherwise go wasted.
B)The capital utilization rate is very low (around 70%) To explain what this means ill use an example. If the capital utilization rate for farms was 65% it would mean that 35% of farms that could produce crops were not producing them. This means that a lot of factories, farms and mines are sitting idle; infrastructure spending would result in the use of resources that would otherwise sit and do nothing.
C)Inflation is very low and for parts of 2008-2011 there has been deflation. Enough government spending could easily get us out of the deflation/low inflation that we are in further improving the economy.
Every day a bunch of land, factories, and resources sit idle and go to waste; we could put these to use if the government just employed a bunch of people to build things that we need to build while simultaneously saving thousands of lives and trillions of dollars.
D)Some interest rates on US debt are as low as they've ever been some are even negative. This means that essentially the government is paid (once adjusted for inflation/other factors) to borrow money in the short turn. This means that building infrastructure now will be cheaper than if we do it in the future. Building it now will also be cheaper because with so many unemployed people wages are pressed down.
E)Many studies have found that being unemployed is bad for ones health; government spending that employs people to build things we need to build that will make it so everyone especially the unemployed will have better health and be happier.

Conclusion: Government deficit spending now to build infrastructure that we will need will eventually results in saving hundreds of thousands of lives, saving trillions of dollars, putting to use labor and resources that would otherwise be wasted, end high unemployment, make people healthier/happier, all while costing less than if we do it in the future.


-----The Resolution-----

Firstly I would like to point out that the resolution isn't solely on the benefits of building infrastructure, but the method of obtaining the money to pay such infrastructure. "...for the government to borrow more money and spend it on infrastructure and other spending projects."

As such, Pro's burden of proof is to show that the advantages of printing/borrowing more money to pay for these programs would outweigh the disadvantages.

-----The Cost of Debt-----

The U.S. Government operated with a $1.29 trillion deficit in 2010[1]. This brought our total debt to $14 trillion[2]. The interest payment on this debt was $197 billion in 2010, and with rising interest rates and debt rates, is expected to rise to $800 billion by 2020[3]. Total tax revenue in 2010 was approximately $2.3 trillion[4].

In 2010, we spent 8.5% of total tax revenue solely on interest. If we continue as projected in the CBO report[3], we will see upwards of 20% of total tax revenue spent solely on interest. Excess governmental spending is spiraling out of control, and no amount of digging will ever get us out of the hole we are falling deeper into. The power of compound interest must never be forgotten. There is a point you can reach where the interest becomes too much to ever overcome.

-----The Cost of Printing Money-----

Printing money directly impacts the strength of the US Dollar. In essence, it changes the real value of every US Dollar. As an example, we can currently trade 1 USD for 77.5 Japanese Yen[5]. If the government were to print enough money today to double the total number of dollars in the US economy, every other nation would acknowledge that we had doubled the number of dollars by only considering them to be worth half of what they were before. In other words, we would only be able to get 38.75 Yen for every Dollar. The reason for this is because money is representative of the total wealth/GDP of a nation. Printing more money doesn't really create new wealth. There are a myriad of other problems that come with printing money, including higher costs of living(as every dollar devalues).

-----How to Fix the Economy-----

Our economy is heading in the right direction. Jobs are increasing, and that is one of the most important factors to look at. When people are employed, they have money. When they have money, they spend it. That spending creates demand. Demand creates the opportunity for new jobs, and so the cycle continues. Since Jan 2010, we have created 2,196,000 jobs[6]. We need to allow the economy time to fix itself. These new jobs will inject new money and demand into the market, and we will continue to recover.

-----Why We Shouldn't Borrow to Create Jobs-----

The thought may come up, 'If jobs are so great, why don't we borrow money to create new jobs with infrastructure projects?'. While it is a good question, there are many downsides to such an approach. Firstly, the borrowed/printed money will devalue the existing money in the economy, driving up already-high prices. Secondly, these types of jobs aren't real, permanent jobs. The government can borrow to employ 100,000 people for a year, but when the project is over, 100,000(or nearly) people lose their jobs, and the government is in more debt. Just as the stimulus plans didn't save our economy by injecting fake, temporary cash-flow, these jobs aren't a real solution to the problem either.

-----What We Should Do-----

If we do decide that the temporary increase in stability and cash-flow to the economy is desired, we should fund governmental projects that have the best investment:job creation ratio, and the most potential for new permanent jobs due to the project's completion. The key point is, we should fund this money with what we already have, instead of digging the hole deeper. There are many projects that we can take funding out of. The Defense budget in 2010 was $689 billion[7]. Other discretionary spending accounted for another $660 billion. We should take some of the money that we are spending that isn't helping our economy to use on these types of projects, rather than borrowing more.

In addition, there are many other things the government can do to encourage jobs without costing more money. As an example, regulations stopping or delaying oil drilling and production can be removed. This way, the private sector can step in, and use its own money to create new jobs.

[1] - Table 1
[2] - Table 1
[7] - Table E7
Debate Round No. 2


----The Cost of Debt-----

As I already posted in my first post interest rates on new government debt are currently negative this makes your argument completely invalid.

-----The Cost of Printing Money-----

First off you are incorrect, there are many things that effect the value of the dollar. For example since 2008 the FED has been printing lots of money and the governments has run deficits in the trillions of dollars yet the value of the dollar has not fallen.

Second your math is completely irrelevant. You can't take random numbers and then plug them in to a random equation and say it results in the value of the dollar dropping by half. The government borrowing 5 trillion dollars over 2-4 years wouldn't cause a doubling of the amount of US dollars in the US; and that doubling wouldn't result in a 50% fall in the value of the dollar.

Third many people say that a reason the US economy is bad is because we no longer produce goods; a decrease in the value of the dollar makes US exports cheaper and therefore increases the purchase of those goods and therefor increases the production of exports. This would increase GDP.

------How to fix the economy-----------

I am going to copy and paste what you said, "When people are employed, they have money. When they have money, they spend it. That spending creates demand. Demand creates the opportunity for new jobs, and so the cycle continues."
According to that sentence of yours you advocate for infrastructure spending because it creates jobs.

-----Why We Shouldn't Borrow to Create Jobs-----
So according to my opponent jobs that create roads, railroads, energy efficient buildings, power plants, water plants, repairs leaky pipes, and upgrades the energy grid are not worth it; this means according to my opponent roads, railroads, energy efficient buildings, power plants, water plants, repaired pipe, and a modern energy grid are not worth it. Do I even need to explain how my opponent is wrong?

-----What We Should Do-----
The government's deficit is currently above 1 trillion dollars even if we eliminated the whole military budget which I doubt most people think we should do we would still have to borrow in order to finance projects.
Also that other discretionary spending includes spending for the type of projects you advocate. So basically you are saying we should eliminate spending that creates large benefits in order to pay for the spending we just eliminated.

I am now going to summarize my reasons for borrowing lots of money to fund infrastructure projects none of which my opponent replied too.
1)We have to have infrastructure and will eventually have to pay for it.
2)Updating our infrastructure now means we save more money by increasing energy efficiency, decreasing congestion and modernizing buildings.
3)The spending will create more benefits then they cost and will save the economy more money than they cost over time.
4)Repaired bridges are less likely to collapse meaning Americans will be safer.
5)Building infrastructure now will cost less than later because now interest rates on government debt are negative, and there are lower wages and prices for goods now.
6)Infrastructure spending now would bring us back to full employment, providing jobs for everyone who needs one which has shown to make people healthier and happier.
7)Upgrading our energy infrastructure will result in less harmful pollution meaning less cancer, less heart attacks, less lung ailments and a lot less sickness.



1A - Yes, infrastructure is important, but that in and of itself doesn't justify borrowing or printing money to pay for it. When considering a budget, the most important things should be taken care of first, rather than just saying 'we can always borrow money later'. Just like going to the movies when you don't have enough money to pay rent is a bad idea, borrowing money to pay for something important, when you have spent your money on less-important items, is similarly a bad idea.

1B/1C - $5 Trillion over the next 20 years, or $250 Billion a year. As I stated before, tax revenue in 2010 was approximately $2.3 trillion, so we should consider approximately 10-11% of the Federal budget as mandatory infrastructure spending. Pro would have the government add the $5 trillion on top of our current debt. If we were to do that, and continue at our current pace of adding approximately $1 trillion to our debt each year, then we would be at a staggering $40 Trillion dollars of debt by 2031.

2A - Pro's source states that the $450 billion cost of updating the infrastructure would mostly be paid by current customers. There are just over 110 million households in the U.S.[1], meaning each household will pay on average up to $4000 to pay for these upgrades. Either way, this argument is irrelevant to the resolution.

2B - Pro doesn't mention any costs for transportation upgrades. He quotes the amount of money currently spent each year(140 billion), but nothing shows what amount of money is actually needed, so no 'savings' can be derived.

2C - Updating building codes doesn't have anything to do with governmental deficit spending.

2D - Again, this has to do with regulations, not governmental spending.

2E - Pro has failed to show actual savings from actual deficit spending.

3A - Of course safety is a concern. The FHA needs about $6.5 billion more per year to keep bridges up to date. We can easily find that kind of money in a budget of $3.5 trillion, much of which isn't 'necessary' spending.

4A - It's not a question of strict dollars to dollars. It's a question of whether or not borrowing or printing more money is worth it. The study doesn't cite the cost of the train network it would put in, so I can't compare benefits. Similarly for the article,(which has no sources) it isn't a question of benefit, but who will pay for it and how.

4B - Again, clean energy is a great thing, but Pro doesn't address what kind of energy, who will pay for it, or how.

4C - Similar to other arguments, Pro isn't actually talking about government spending, costs of the deficit spending, and amount of savings. There is no actual point being made to argue against.

5A - Baseless claims. What projects would create how many jobs, and at what cost? What would happen when those jobs are no longer needed?(Most of these governmental jobs would be temporary). This is just a different kind of stimulus. We gave cash to people to spend, trying to create temporary fake demand. This kind of spending just uses governmental money to give people pay checks to create temporary fake demand.

5B - Pro doesn't address how and to what degree any projects would have an effect on utilization. He simply states that it would help.

5C - Link doesn't lead to anything specific I can see. Pro is apparently arguing that we need more inflation... Inflation is "The rate at which the general level of prices for goods and services is rising."[2] More inflation means prices of everything would rise, and in our current situation, that would be very, very bad. Printing money is one cause of inflation.

5D - I would appreciate direct links, rather than links to blogs about blogs about blogs about data. Pro confuses real interest and nominal interest rates. The government isn't going to get paid to borrow, it is still going to pay. The difference is when it is going to pay.

-----Rebuttal Conclusion-----

Pro hasn't provided any real example of the type of government spending he is talking about. His figures have been twisted from his sources to try and argue his point. Again, I reassert that it is better for the government to spend money it has on infrastructure, rather than borrowing or printing more.

Debate Round No. 3


Willoweed forfeited this round.


TheTruthAnalyst forfeited this round.
Debate Round No. 4
1 comment has been posted on this debate.
Posted by TheTruthAnalyst 4 years ago
I let my round forfeit because I had real-life issues, and I figured it would leave the match even. I still appreciate comments and votes.
1 votes has been placed for this debate.
Vote Placed by Boogerdoctor 4 years ago
Agreed with before the debate:Vote Checkmark--0 points
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Total points awarded:50 
Reasons for voting decision: Pro made more convincing arguments. Con is unable to establish why deficits matter. They don't.