National Debt isn't as bad as we make it out to be
Debate Rounds (4)
My argument will be that our national debt (U.S.A.) is not in a crisis situation, and is in fact very manageable. Let's lay out some definitions, at least the ones I am using for my arguments.
National Debt- The total amount of money the government has borrowed, by various means.
GDP- Gross Domestic Product, or the monetary value of all the finished goods and services produced within a country's borders in a specific time period, though GDP is usually calculated on an annual basis.
The exact U.S. national debt can be found in the link below, but for purposes of simplifying the debate we will use $16 trillion dollars.
If we round it then our GDP is about $15 trillion dollars. A source for this will be provided below.
Apologies to the fact that source 2 also includes all other countries. Remember that we are using the most recent GDP, listed under 2012. My opponent may start his argument when he accepts, but I will be starting in R2 with my points. BoP is shared, as I must provide evidence to why it isn't in crisis, and con must provide evidence to why it is. Thank you, and I look forward to a great debate.
Okay, I thank my opponent. I will start off by stating some common problems people believe about national debt.
1. $16 Trillion is an insane amount of cash.
When talking about national debt people will often cite that $16 trillion dollars is too much debt, because of how mind-boggiling large a number like that is. But this number is not so bad when we compare it to our GDP. Using the above numbers our national debt divided by our GDP comes out to 1.06, or 106%. This makes us better than Germany, Japan, and the United Kingdom. Therefore our national debt is not bad because of the size of our economy. In history economy has always trumped debt. For example in World War 2 we accumulated a lot of debt, but because of the booming economy afterward it was irrelevant.
2. It will take forever to pay it back
$16 trillion is still going to take a while to pay back. Right? Well, not really. Because we actually only pay back interest, not the debt itself. The government could start to pay back that debt, and it has in the past, but it doesn't have to. Looking at what we pay back on interest it would be $220 billion. Our national revenue from taxes is around $2.7 trillion on the federal level.
3. What if China wants it's money back?
There is a common fear that China owns so much of our debt that we should be terrified. What if they want that debt back and we don't have the money to give it back? Well, China only owns about 8% of our debt. That's pretty insignificant. Also they buy treasury bonds, which you wouldn't be able to call back anyway. They buy them to keep currency low, which is good for trade. Also we pour a lot of money into China itself. Plus let's say they could call back that debt. That would be economic suicide for them, as they make a good deal buying treasuring bonds. Also easy to forget is that for every dollar we owe, other countries owe us 89 cents.
I will leave it at that for now, and eagerly await my opponents responses.
1. The debt is a national security issue.
At $16 trillion dollars (with a t) and amounting to over 100% of the gross domestic product of the entire country, the debt is no longer an economic problem, it is a national security problem where the current calls for sequestration and fighting the deficit includes a devastating $500 billion in automatic defense cuts across the board for the next 10 years. If these current cuts to defense are not reversed, the United States Military could see its smallest size and weakest level of readiness not seen since before 1914. And this isn't anything like Obama's ill informed cuts to "horses and bayonets," these lavish cuts are real and devastating to our national security strategy, and as a result the Pentagon has had too acknowledge in its strategic review of 2012 that it can no longer support operations in a two front war, the twin theaters in Iraq and Afghanistan of today are going to be impossible with the military force of tomorrow, and its no wonder that prior to retirement in 2011, Adm. Mike Mullen, former chairman of the joint chiefs of staff, stated that the "The single biggest threat to national security is the national debt."
2. The debt puts the dollar in danger losing its status as the world's reserve currency.
Because of the debt, the US has had it's credit rating dropped from AAA to AA status, this is important because it discourages other nations from lending the US money for its debt and using its dollars. And If American dollars can no longer offer the kind of security and reward that other nations and investors have come to expect, then they will seek more reliable currencies elsewhere. As it stands, the dollars share of the worlds currency marketplace is at a 15 year low, while the number of IOUs coming from the Fed continues to climb. If the value of the dollar is not improved, and more and more countries begin to switch focus to the Chinese Yuan, then the United States may be forced to pay off its debt. The kind of mindless printing, borrowing, and cash inflection that the Fed has recently used to keep the US economy on life-support will be impossible.
3. The debt won't be easy to pay back.
The debt provokes the worst kind of partisan politics from Washington, where the only means to make any progress towards actual fiscal responsibility is to either threaten default or government shutdown. Already we've seen how useless super-committees can be, which only resulted in sequestration and handicapping the military, and it only gets worse from there when the only viable options to continue to pay for the debt in the long term is for either party is to accept massive tax increases or more massive spending cuts. The idea however, that the US economy can go back to 90s level tax increases is irrational and must assume that today's economy is actually somewhat similar to a 90s economy, which any member of the record number of American citizens on food stamps knows its not. Furthermore, few politicians have the moral courage or the guts necessary to make the necessary spending cuts to social security, Medicaid and Medicare, or entitlements out of fear of loosing their jobs. Solving the national debt, at over $50,000 per person living inside the United States, will not be the easy -and incredibly unrelated- post World War II boom that my opponent makes it sound.
I now look forward to counter arguments.
1. National security issue.
First off I would like to note that our deficit and the national debt aren't exactly the same thing. A government doesn't normally want to be in a deficit, but it is when the economy is down in order to save it. Cutting the military budget is part of the cutting that is brought along with the eventual turn back to an even budget, or a much smaller deficit. It is not a question of national security. Also my opponents assertion it will lead us to the size of our military pre-WW1 is certainly untrue. Seeing as our technology is much farther advanced we would certainly have a stronger military. Also let's not forget that this $500 billion cut is not like taking $500 billion out right here and now. Rather it is over an entire decade. Plus let's say that we did cut our budget by $500 billion, right now. That would STILL put us at the number one spot in largest defense budget. Our budget is so large that we should probably cut it to put money in other more useful budgets.
I would like to say first that our dollar being the world's reserve currency has little effect on our economy as a whole. World currency is meant to make trade easier by using a common, and singular unit of monetary value. Right now it's the U.S. dollar. Also if the dollar becomes obsolete that does not mean people will not turn to us for money. We will still hold prominence as one of the most reliable sources of money. Also the national debt has little to do with it, and more the increasing economy of China, and use of the euro.
3. Debt won't be easy to pay back.
No one said it would be easy. Except we don't need to pay it back very fast either. Because we only need to pay interest back, because of how the U.S. sells treasury bonds, we only have to pay interest. We could keep that debt there for as long as we want. This is obviously not sound policy, but the government does not need to rush into paying it back. We can take it slow, and chip away at our debts. And if we are cutting 500 billion dollars, then we might be able to use that money.
I believe I have countered most of my opponents points. I look forward to the next round.
1. The Debt and National Security
In both retirement speeches, former four star general, David Petraeus and former Secretary of Defense, Robert Gates both warned that massive cuts to defense would lead to greater security risks and to a diminished US role in the world. While I acknowledge that both men are no longer in the nation's service, I think my opponent would be very hard pressed to find more credible security experts than General Petraeus and Secretary Gates, especially when it comes towards preparing the military for future threats.
Fixing the deficit also would not be an immediate problem if it was not for a huge $16 trillion dollar debt that my opponent continues to underestimate, and the need to occasionally raise the debt-ceiling at the risk of a "fiscal cliff" and government shutdown, which happened twice already in 2011 and 2013. How my opponent can argue that the debt is just a run of the mill economic problem and not a viable national security concern is beyond understanding.
My opponent also errors tremendously in his strategic military thinking. The responsibilities and security needs of the United States are far greater than they were in 1914, security needs went from "land and sea" to "land, air, sea, space, cyberspace, and global terrorism." Current levels of modern technology, procurement, and funding make no difference if the capabilities of the military are not there to meet the security needs of today or tomorrow, which Secretaries Gates and Panetta both expressed in their many testimonies before Congress over proposed defense cuts. As it stands, the current fleet of Air Force planes is the oldest in USAF history, the USN has the smallest number of ships since WWI, the Army and Marines will soon be at one of their weakest troop levels and readiness ever, and I shouldn't even have to remind the folks what happens to a nuclear deterrent once it reaches its expiration date.
One could say historically that the debt has been one of America's greatest defense asserts - we've been able to fund the most powerful military in the world without fear of economic collapse. But the amount of money we pay alone on debt interest to China (some $74 million a day) equals a brand new F-22 fighter jet every other day, or three new aircraft a week plus change - one might say America's debt is now bankrolling the Chinese military buildup.
$74 million a day
2. The debt and reserve currency status
My opponent errors, being the world's reserve currency has plenty to do with the US economy as a whole. It's a main reason why the United States can afford to spend and buy more than it actually makes. Banks worldwide hold onto large reserves of dollars to facilitate trade because most important goods on the world marketplace -like food and oil- are priced in US dollars. Having US dollars at hand for its reserve status also backs their own weak currencies. These obvious benefits in turn -baseline price for goods and constant demand for US dollars by foreign banks- backs the value of the dollar, allowing the US to print even larger amounts of its currency with relatively little inflation. And if my opponent pays attention to the news these days, he will agree with me that its been the FED, with their aggressive cash injection into the US economy combined with low interest rates, that has kept the US economy on life support. Losing that neat ability to print money however, should the US be forced to pay off its debt after losing its currency status to the Chinese, followed by a dollar collapse, would be catastrophic.
3. Can't keep passing the debt down the road and payback should not be slow,
Everyday the US fails to pay its debt, it adds future hardship to future younger generations of Americans who WILL BE forced to pay off that debt. Already we've seen the beginnings of civil unrest with the Tea Party and Occupy Wall St movements, and its only going to get worse once America goes broke through Social Security and Obamacare, or tries to increase taxes, all of which might begin to occur within the next ten years. Chipping away at the debt is just an excuse is to say you put a cork in a sinking ship without actually really doing anything significant to save the ship. It's only a matter of time before the ship does sink, which is going to happen if the US just continues to raise the debt ceiling without actually summoning the political courage to curtail spending, cut entitlements, or reform the tax code.
1. National security
You bring up the point that the need for our military has been increased. And certainly cutting the budget will produce a definite decrease in our role as a military superpower. But a good question to ask is how much of that defense do we truly need? Terrorism is down, we have very little hostile countries with an intention of attacking us. And the ones that do have laughably weak militaries. Our biggest threat is perhaps North Korea, but their spending amounts to 9 billion dollars, which is miniscule compared to the budget we'd have as a result of cuts. Plus you are mistaking the power of strong allies. While the world may not like us as much as we do, we are certainly vital, and are of their interest to keep going. We should be able to use diplomatic means as well. They do not always work, but are certainly better than going to war. Most of our militarry engagements are generally frowned upon.
2. Global currency
There is no question that replacing our currency would be dramatic to the United States. However it is still not realistic. Let's take the chinese yuan for example. First off the yuan is not freely convertable. That is a major roadblock. Second China's currency is not easily accessible outside of China. The U.S. dollar is. Plus investors still find the U.S. government very safe. Our rate being dropped was a result of politicians holding the economy hostage. They could've EASILY raised the debt ceiling with no problem. But they didn't, so that is why we got dropped. The debt ceiling is a way to keep our government checking to make sure that we are not spending too much when we don't have to. But during an economic recession we definitely need to spend more. We could and should cut in areas that are worthless. Or where we waste money. But we lost credit because of political reasons.
3. Slow payback is not an option
You bring up that the U.S. cannot not pay back our debt. It sounds insane, because you know that everyone pays back their debt. But this is wrong, because it compares our current debt with personal debt. At a personal levelunpaid debt leaves consequences. But at the international level people are paying the government for the interest you get paid back for it. It is not a loan, andyou cannot tell thegovernment to give you your money back. Another issue is that paying back slowly is too little too late. But the government needs to continue spending to keep the economy afloat until it gets back on its feet. Cutting spending right now is like drilling a hole in that ship you talked about. The debt is aresult of the economy, not the other way around. Therefore we shoupd focus less on debt and more on our economy as a whole. Thank you.
In my points I have proven that the debt greatly impacts the stability of the economy through jeopardizing our credit rating and the value of our dollars; while also harming national security, which of course is effected through the lack of procurable funding for our military. My opponent of course has tried to dismiss the merit of these points by stating in his opening three points that in history "economy has always trumped debt," believing that the worlds largest economy will carry us through. Yet this logic must fail when my opponent himself admits that the national debt is now over 100% of GDP - the debt, my friends, trumps the largest economy. The debt is a huge national crisis where it is painstakingly clear from all mathematical standpoints that the only viable longterm solution to fixing our spending problem is to commit to great sacrifices - which of course will test the average citizen's courage and might like none other.
I thank my opponent for a great debate.
1 votes has been placed for this debate.
Vote Placed by donald.keller 3 years ago
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Reasons for voting decision: The Con kept ignoring the very first thing the Pro said. National debt is measured by economy. He kept saying $15 trillion!!!! He ignored the argument that the Debt is not that bad compared to the economy, and is not the largest. The Con ignored it over and over again. He finished by saying the debt is huge, at 15 trillion. This blatant ignoring of a prime argument is terrible. Pro wins my vote in argument and conduct. S&G and Sources are even.
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