U.S. Treasury Secretary Geithner warned that the national debt, now standing at $14 trillion, will (some time between March and May) hit the limit set by U.S. Congress last year at $14.3 trillion.  He warned that failure to raise the limit would cause a default by the U.S.

He chooses to ignore the fact that if the limit were hit and it could not issue any more securities, the U.S Treasury would only default if it refused to request that the Fed honors all payments due, as explained here. Read the rest of this entry »

This is a subject where there’s a lot of confusion, don’t you agree? This is why we are inviting students to send us questions, queries and concerns about the size of the U.S. public debt.
A group of students from Franklin College Switzerland sent us a bunch of questions, including the following set, which begins our discussion.  More will follow. Read the rest of this entry »

Whenever the health of the U.S. economy is debated these days, one of the topics that consistently surfaces is the size of the U.S. public debt.  As a special topic of exploration, we have chosen to offer a series of posts where we aim to clarify and answer questions, doubts, queries, and concerns regarding the U.S. public debt.

Here are some links on the issue, ranging from those that (irresponsibly) spread the debt fears and those that take care to explain the true nature of public debt. Read the rest of this entry »

Mainstream economics claims that full employment brings inflation, and some unemployment (often called ‘natural’) is inevitable. During bad times, like today, unemployment rises significantly from its ‘natural’ level and bites even more harshly. We at Mecpoc believe that full employment should be the primary target of economic policy. As our chosen topic of exploration, we set out to ask Franklin students for their opinion on unemployment and the implications their major has taught them. Here include extracts of the responses from three Franklin College students: Caitlin Morris (Comparative Literature and Culture Studies major), William Turner (International Relations major), and James Jasper (History major).

Read the rest of this entry »