"When the people find that they can vote themselves money, that will be the end of the Republic." Benjamin Franklin
Are we losing our country due to high inflation, enormous national debt, and inept elected officials? How did we get into this mess, and what can we do about it?
Our national debt is over 31.8 trillion dollars. Compared to the next highest debt per country, we have China at 14.4 trillion dollars, Japan at 13.3 trillion, and Germany at 3.3 trillion dollars. What does this mean, and what does it have to do with me?
Inflation is caused when you spend more than you take in. Simply put, when we do not pay off our credit card each month, we are inflating our net worth and applying for credit. The banks love this because they get to charge us an exorbitant amount of interest. Compared to buying a car, boat, or house, credit card debt is potentially a millstone around our neck that will drive us to bankruptcy if we don't pay it off. The credit card interest rate is much higher than a bank loan.
Even though the IRS collects a lot of money monthly, the country's expenses are quite high. In the Constitution, our Federal Government is authorized to apply for credit to fund the government and pay for the goods and services needed to operate the country. This is done through marketable securities, such as Treasury bonds, bills, notes, floating note rates, and Treasury inflation-protected securities. (TIPS) Individuals and countries can purchase these securities. Since the US has always paid its debts, these securities are considered very safe investments.
Most cities and states are forced to stay solvent by their charters or constitutions, with some exceptions. California is a classic example of not staying in the black. The federal government is not held to this standard, so Congress and the President can spend whatever they like if they hold a majority in Congress.
What can we do about this mess? We have all heard about calling or writing to our congressmen, senators, and even the President. This can have an impact. I have had some success with this, but most of the time, it does not work because there is not enough pushback from the voters to force the legislators to change their vote.
One more significant attempt to cause change is to join a focus group that espouses your opinion. Abortion rights or right-to-life groups, gun rights, civil rights, immigration (Build the Wall), the groups that need your help are endless. Joining a local chapter of your political party puts you in touch with like-minded people who seek to make the government listen to them. OK, you are not a joiner. You want to be left alone. Let someone else do it. It is always the same. During the Revolutionary War, one-third of the colonists were loyal to the Crown, one-third had no opinion and wanted to be left alone, and just one-third of the colonists were willing to fight King George, the Tories, and his empire to rid America of the tyrannical tax acts and edicts that were levied on the colonies.
What if the government defaults on the debt or the US dollar is not the world's standard currency? I hate to break it to you, but this has started to happen. Several countries are opting to use their own currency as a standard. Russia and China are examples of countries that want to dislodge the US from controlling the world's currency. Due to the high inflation in the US caused by the printing of too much money to fund frivolous projects, the dollar is falling, and it will only get worse. (See the link below for more details) The government pays the interest and leaves dealing with the massive debt for some later time. Some call this kicking the can down the road.
Since the US is off the gold standard, meaning we do not use gold and silver to back our currency, our creditworthiness is determined by our good faith and credit. The US has a printing press that allows it to print money at will with nothing to back it. When this is abused, it leads to insolvency and bankruptcy. Our creditors begin to think we will default on our debt. We will probably not go bankrupt, but it will not be pretty. Interest rates will go up. It will be harder to finance a business, buy a house, or a car. The US has never defaulted. However, other countries have. (See the Link below if you want to know more)
For the U.S., defaulting on the debt would likely mean less access to capital, higher borrowing costs, and lower stock market values, among other effects. Having the world's reserve currency has allowed the U.S. to run large deficits in terms of both international trade and government spending. If foreigners no longer want to hold dollars for savings, it would force significant belt-tightening at home.
How do we, as individuals, get out of debt? First, you must decide to do it even though it will be painful. Stop spending on non-essential items and pay off your credit cards and debts. There is much information and help for this on the Internet and in brick-and-mortar stores if needed. Ask your accountant.
I am not an economist or a prepper, but here are some things you can use to barter with if the dollar fails:
Gold, silver, and silver
90% silver coins dated before 1965 (dimes, quarters, halves, and silver dollars) (No copper showing on the edge of the silver coin.)
Bullets (9 mm, 5.56, .45, 40 cal, .308, etc.)
Cigarettes
Batteries
Food
Water
Works of art
Some collectibles
You get the idea. Anything that will be in demand when the sh*t hits the fan.
Please let me know what you think of this article in the posts.
Link to more detailed information: What Happens If the Dollar Looses Reserve Status?
Countries that have defaulted on their bonds.
Why do you have bullets listed as barter items? That sounds extreme.