Tuesday, June 28, 2011

Should the U.S. declare bankruptcy?

A recent CNNMoney article says that Congressman Ron Paul thinks the United States should declare bankruptcy. You can read the article here.

Paul cites Greece as an example that the United States should watch carefully. What do you think - is the best option for the United States to default?


Hempy said...

Under no condition should the US default or declare bankruptcy.

Rand Paul is advocating his atheistic idol, Ayn Rand’s repudiation of the Abrahamic covenant that it’s in our mutual interests to work for the good of all.

Ayn believes that the market and state should be separate. With her fictional “Atlas Shrugged” she envisions a world that never was, never will be, nor was ever intended to be.

If Rand Paul had any understanding of capitalism he would know that its father, Adam Smith, advocated a social capitalism that embraced the values of the Abrahamic covenant.

Smith said that any economic activity is a source of revenue to defray the expenses of the whole society. Likewise Alexander Hamilton.

Rand Paul is a traitor not only to capitalism but also to American values and the Constitution that contains those values. Now he’s advocating the downfall of America via economic default.

This need not happen. Sources of additional revenue are the unregulated and untaxed derivatives markets. The domestic OTC derivatives market generates about $600-trillion-a-year. The foreign exchange derivatives market about $4-trillion-a-day. Bank laundered drug market is about $1.5 trillion a year.

If a proportional rate tax that maxed out at 5% were levied on these transactions it would generate revenue in the quadrillions. Yet Rand Paul wants the US to declare bankruptcy. Rand Paul is Kentucky’s national disgrace.

Logan said...

Hempy -

You have proven that you do not read posts before you begin baselessly attacking them.

Rand Paul was not mentioned in the post or the article linked to.

Dan from Lexington said...

Wow, Hempy, it's been a while since I saw anyone use a blog to attack an unrelated / unreferenced third party with such ridiculous straw-man quackery and undocumented claims. Should have remembered the old adage about staying silent and having people assume you're a fool. Too much hemp, perhaps?

To get back to the actual post, bankruptcy is the ultimate declaration of failure. "I cannot repay you what you loaned me. My only remaining option is to abandon the trust you have placed in me. I am unworthy of future trust without proving that I have changed my behavior that lead to this."

Sadly, bankruptcy lawyers, high-profile finance "gurus" like Donald Trump and Robert Kiyosaki (Rich Dad, Poor Dad,) and politicians of various ilk have spun bankruptcy into a palatable and reasonable alternative.

For the US to declare bankruptcy is to declare to the world that America is an economic failure. Do we have problems? Heck, yeah. As painful as fixing them will be, they're better than bankruptcy.

In this area, Ron Paul is dead wrong.

Logan said...

Dan from Lexington -

I tend to agree with you on this. We should not admit failure when we still have the capability to make tough decisions and turn things around.

It would be difficult but I certainly think it is possible.

Sally_Oh said...

Denial is not an option, folks. Bankruptcy now or later, we get to choose. It is inevitable: we cannot pay back what we have borrowed. Impossible.

But, heck, let's leave it to our kids to deal with. Rock on!

Hempy said...


Sorry. Ron Paul.

However, Rand Paul is a devotee of Ayn Rand, and buys into her philosophy.