 Well, our national debt, the total of annual budget deficits, is reaching a new milestone topping $22 trillion. Stop right there. The $22 trillion number is totally wrong. As a percentage of GDP- The national debt has topped $22 trillion for the first time. The debt will dramatically increase every day, every week, every year with no end in sight. It's not good. $22 trillion. We're not going to have, literally, we're not going to have a country left. Pshh. Why are they reporting it like that? The debt held by the public is $16.1 trillion. That's a big number, but we're a big country. The other $6 trillion is money the government owes itself, so it doesn't count. Basically, it's the Social Security Trust Fund. That's what we're talking about. The Trust Fund isn't a problem, and Social Security is still in surplus right now. What's going on with the debt? It's very disturbing, and it's driven by the three big entitlement programs, Medicare, Social Security, and Medicaid. What? Social Security will go bankrupt, and it will bankrupt country with it. No. Social Security is going broke. If you look at the pie of where most government spending is, it is entitlement spending, and you have talked about reform. Congress has been raiding the dollars from Social Security to pay for annual government expenditures. It is a Ponzi scheme. Apparently before I can even start talking about the debt, I have to talk about Social Security. Let's start at the beginning. Social Security is a retirement program. Money from our paychecks goes into the Trust Fund, and it's held there until we retire, and then we get it back. You may have heard that Congress took all the money from the Trust Fund and left nothing but IOUs, but that's wrong. I mean, it happened, but it doesn't matter. Look, if you had trillions of dollars lying around, what would you do with it? You wouldn't just leave it under your mattress, I hope. After a long time, the master returned to collect his money. I buried your gold. Here it is back. You wicked and lazy servant. You should have put my money in the bank so I'd at least get interest back. You should invest it, right? But definitely in something safe. Let's see, an investment is going to be there for the long haul. Something like US bonds. US bonds are the safest investment in the world. I can't even imagine what would cause them not to be paid. These bonds shouldn't count as part of the national debt in anything but a technical way, because they're as much of an asset as they are a liability. It's debt we owe ourselves. It's like your left pocket owing your right pocket $20. I wish there was someone conservative's respect who could explain Social Security. Hmm, if only. Let's lay it to rest once and for all. Social Security has nothing to do with the deficit. Social Security is totally funded by the payroll tax levied on employer and employee. If you reduce the outgo of Social Security, that money would not go into the general fund to reduce the deficit. It would go into the Social Security trust fund. So Social Security has nothing to do with balancing a budget or erasing or lowering the deficit. Thank you, Ronald Reagan. Do Paul Ryan and Mitch McConnell have no shame? These guys have the nerve to hand trillions in public money to the rich and then turn around and say with a straight face that something completely unrelated to Social Security is what's causing the deficit. It's your tax cuts that did it and that's terrible. But you know, not really because of the deficit. It's terrible because we could have spent that money on fighting climate change or for jobs programs or on fixing our infrastructure or education or any other investment that could pay dividends for the future. We have real problems in this country that we need money to solve but the deficit, it's not one of them. It's just a number. Why do we react so strongly to this number and not to something like, I don't know, another number like the 33 million people without health insurance in the US? Why is the national debt seen as a problem at all? Maybe this Saliza guy can explain it to me. So to put it very simply, over the course of our Republic, we have spent 22 trillion dollars more than we have taken in. Imagine if it was the other way around and the government was hoarding 16 trillion in cash in a giant vault and never spent any of it. That would be a disaster. So why should we worry about any of this? Why is the debt a problem? The national debt right now is the largest it has ever been. I don't understand why presumably intelligent people on TV frame things like this except if they're trying to make us scared. The debt is not the largest it's ever been. As a percentage of GDP, it was actually larger after World War II than it is now and this guy wasn't following that and our economy was fine. If you care about the debt, I'm not sure why, we'll slap a 90% marginal tax rate on the wealthy like we had back in the 40s and 50s. That'll solve the deficit. Oh, you don't want to do that. Well, look, do me a favor and kindly shut up about the deficit then. People like Mitch McConnell just want to whine about a problem they created, but they don't want to actually solve it. Okay, let's keep going. Let's keep going. 22 trillion, which makes us the most indebted country in the world. We're not the most indebted country, not by a long shot. Our net public debt is 82% of our GDP compared to other countries that's unremarkable and totally fine. Spain, France, Belgium, Egypt, Portugal, and Italy all have higher net public debts as a percentage of GDP, with the UK not far behind. But the prize goes to Japan, which owes a whopping 153% of their GDP. Even with all that debt, Japan is the world's third largest economy. And while they definitely have some problems, they're not about to collapse anytime soon, even though they owe twice what we do. Now, the only time we paid it off was in 1835 under President Andrew Jackson, and we've been spending more than we've been taking in every year since 2001. Paying off the debt is not responsible. It's a nonsense idea. Andrew Jackson was dumb as a rock. He's been compared a lot to Trump, and I think that's accurate. He's like Trump, only dumber. I'm like a smart person. He paid off the national debt in 1835. Yes, and he vetoed the charter of the second bank of the US, causing it to expire in 1836. And both of these things led straight to the panic of 1837. Congratulations, dumbass. When I ran for president four years ago, I pledged to end welfare as we know it. And while being a much smarter guy, Clinton's budget surpluses, deregulation, and free trade policies of the 90s helped cause the recession of the early 2000s and the great recession of 2008, were still dealing with a fallout from Clintonomics today. The problem with both trade deficits and budget surpluses is that they take money away from the economy. You can't keep draining the economy of money forever and expect it to be able to keep functioning. We made up for it only by going deeper and deeper into personal debt throughout the 90s. Unlike federal debt, personal debt is unstable. And if we take on too much, we can go into defaults and bankruptcy. The same is true for state and local governments. Only the federal government can borrow money in a safe and stable way. All right, you know, we have a lot of debt and already it is impacting our economic growth. An influential paper published in 2010 by highly respected economists, Carmen Reinhart and Kenneth Rogoff, show that as government debt reached 90% of GDP, economic growth was cut in half. In the wake of the 2008 crisis, governments around the world used this research as a reason to support austerity as a way of avoiding that 90% threshold. But there was a small problem with their data. America's most prominent economists are talking about an embarrassing mistake with big implications. The mistake was hidden inside the calculations of some enormously influential research that recommended painful austerity measures to help weak economies recover. 28-year-old graduate student Thomas Herndon, how did you find the mistake? How long did it take? How many mistakes did you find? Once I got their spreadsheet, it really didn't take me long to locate the error. Rogoff and Reinhart admitted the error but stubbornly stuck to the conclusions of their paper anyway. The fact of the matter is this one result, which is that growth falls off a cliff when debt exceeds 90% of GDP. That's what the world picked up and that result is false. They have never, to my knowledge, said clearly, okay, there is no cliff at 90%. And we really need that from them. Their research was eventually replicated and oh boy. Economists Herndon, Ash and Paulin found that the average GDP growth rate of countries with debt over 90% is actually 2.2%, not negative 0.1% as Reinhart and Rogoff claim. So stick a fork in that idea. If the economy hits a major downturn, it may be impossible with such a big debt for the Fed or anyone else to stimulate the economy back into action. And that could lead to inflation or even hyperinflation where the cost of everything we buy goes way, way up and our currency starts to become not just devalued but essentially meaningless. We don't have to guess how much inflation will get during a downturn. All we have to do is look back at the last time this happened in 2008. Here's a graph of inflation from before the financial crisis. It was humming along a little above the Fed's target of 2%. At this point, the crisis hit. They started printing money like no tomorrow and, wow, I guess I'm going to have to adjust the scale here, right? Yeah, downward. Inflation was negative 0.6% in 2009, but it went up from there. And with the stimulus and bank bailout, I'm sure hyperinflation was just around the corner and no, no it wasn't. Inflation today is 1.6%, a tiny bit lower than the Fed's target rate of 2% actually. I can't tell you that hyperinflation is impossible. It happens sometimes. It's happening right now in Venezuela. But it seems like for the U.S., our worst case scenario is probably something along the lines of what happened to Japan, not Venezuela. The Japanese have been suffering through a painful period of low inflation, with the Bank of Japan having to keep interest rates nearly at zero for over a decade. Their situation is similar to what happened here after the Great Recession, and completely different to what happened in Venezuela. The economy humming back to life, the Fed has begun to raise interest rates, the amount the government will owe on its debt is very likely going to go up. And it might go way up. The Congressional Budget Office has estimated that it's going to cost the government nearly three times as much to pay off its debt in 2027 as it does right now. This is the one argument against a large debt we've heard in this video that even makes a lick of sense. But remember, interest rates aren't something that are out of our control. They're set by the Federal Reserve. If our economy improves, that's good, right? Why would we be afraid of that? And anyway, it's going pretty well right now, and neither interest rates nor inflation are shooting up really much at all. If, hypothetically, inflation did start to perk up and the Fed raised rates, first off, that's a good thing. And second, there's an easy solution for how to pay the interest without cutting spending. We can raise taxes on the wealthy. Now, Congress can refuse to do this. They can cause us to suffer because of their bad policies as much as they want. But don't tell me there isn't a simple and straightforward solution for this with basically no downside, because there is. In conclusion, what the national debt boils down to is just a record of the amount of money the federal government has put into the economy over the years. That's really all it is. At times, a yearly deficit might be too high, causing inflation, but the deficit can also be too low and that can cause a recession. Even in a worst case scenario, all a large national debt can really do beyond inflation is to cause us to spend more than we like paying the interest. Some economists believe that even this is not really a problem and that no matter how high interest payments get, they really can't stop us from spending on the important things that we need to be productive as a country. That's called modern monetary theory or MMT. Even if you don't subscribe to MMT, it seems pretty clear to me that we have much bigger problems in our country than the national debt. Let's listen to Warren Buffett, billionaire investor in a clip from 2016, and then Larry Summers, one of Clinton and Obama's top economists, talk about our current deficit under Trump. What would you say is the biggest economic change that the next president should do, must do, to close the deficit? Well, I don't regard a deficit of 3% or so of GDP as threatening to our economy. Now you sound like Dick Cheney. The deficit doesn't matter. Modern deficits don't matter. There's a lot of worry right now, you know, our budget deficit reaching a trillion dollars, big boost from last year. How worried should we all be about it? I don't think it's our biggest problem. When we've got an opiate epidemic, when our major airports in New York City are crumbling, when Americans are paying 75 cents a gallon, you can call extra automobile repair costs because of potholes in highways. We've got deficits, but the budget deficit, which we can fund for 30 years at 3% in a currency we print ourselves, that's not our biggest deficit. The first priority needs to be fixing that investment deficit. To be clear, I'm no fan of Larry Summers at all, but when he says that even something like potholes are a bigger problem than our national debt, he's right. That's how small a problem it really is. If we let our fear of what might happen cause us to fail to take action against climate change or make needed investments in infrastructure, that could lead to far larger problems than the national debt. If we're too afraid to take action because of something as unlikely as hyperinflation in this low inflation environment, well I just might increase the chances of us getting into real economic trouble. Don't believe the hype, the debt is not a problem for us right now. Well that's my opinion on that topic, feel free to tell me how wrong I am in the comments and please consider becoming a patron of this channel. I'm thinking about purchasing a video camera and I've got other expenses as well so I could really use your support. The link to my Patreon is in the description. Thanks for watching. The only thing we have to fear is fear itself. Nameless, unreasoning, unjustified terror which paralyzes needed efforts to convert retreat into advance.