The President and Congressional leaders strain and pain to reach agreement on the right combination of spending cuts and tax increases before raising the federal debt ceiling. Yet they continue to ignore changing our monetary system, which could eliminate our nation’s debt.
The United States could simply issue its own debt-free money — similar to the Greenbacks introduced by Abraham Lincoln. Why do we continue to allow our nation’s money system to be privatized (more like corporatized)? Banks issue money as debt when they create it out of thin air as loans to people and the government. This represents by far the single largest federal subsidy in this nation.
As Treasury bonds, notes and bills come due, rather than rolling them over as new debt, the US government should simply pay the holders with US debt-free currency, thereby extinguishing the debt. Laws can limit the amount of money issued by the government so it creates neither inflation nor deflation.
Our Constitution provides our federal government the authority to issue its own money. Democratizing our monetary system will not only put We the People in charge of this essential national function, but can also eliminate our national debt.