NewburyportNews.com, Newburyport, MA

Opinion

September 28, 2013

Anderson: Government shutdown? Don’t blame the GOP

So here we are, in late September, being told that the government might shut down next week and then default on its debt in mid-October. And it’s all some Republicans’ fault.

Let’s make sure I understand this. Starting with the basics:

Unlike our state and local budget years that begin on July 1 (with mandated balanced budgets, by the way), the federal government budget year begins on Oct. 1. The House has the constitutionally mandated responsibility to initiate all spending bills, including budgets. The Senate then agrees or disagrees; the president gets to sign or veto. This last step is supposed to be done by Oct. 1.

There is no requirement that the federal budget be balanced: If expenditures exceed revenues, the federal government can borrow the difference and add it to the national debt – which, as of last weekend, was $16,745,555,054, of which my twin grandchildren owe $105,746.

Sometimes the federal government borrows from other countries, like Japan and China; sometimes it borrows from itself, or a form of itself called the Federal Reserve, which buys government bonds. Where does the Federal Reserve get the money to buy the bonds? Thank you for asking, but it’s not your job to question where the money comes from.

It’s your job to spend it, perhaps by taking out loans to start a business even if you don’t have any particular interest in starting a business, which the market may or may not want. Or you should borrow money to buy a house you can’t really afford even with Fed-determined low interest rates, so you can default someday like over-extended homeowners in the last decade. Spend — so that jobs are created to provide what you are spending on, even if most of the money involved in this process is borrowed/printed/made up or taken in taxes from people who then can’t spend their own money or save it in accounts from which it can be borrowed for genuine economic activity.

Text Only | Photo Reprints

NDN Video
Weird 'Wakudoki' Dance Launches Promotional Competition Chris Pratt Adorably Surprises Kids at a 'Guardians of the Galaxy' Screening Chapter Two: Designing for Naomi Watts NOW TRENDING: Peyton Manning dancing at practice "The Bachelorette" Makes Her Decision Thieves pick the wrong gas station to rob Golden Sisters on '50 Shades' trailer: 'Look At That Chest!' Staten Island Man's Emotional Dunk Over NYPD Car - @TheBuzzeronFOX GMA: Dog passes out from excitment to see owner Baseball Hall of Famers Inducted 'Hunger Games: Mockingjay Part 1' Sneak Peek Florida Keys Webcam Captures Turtles Hatching Morgan Freeman Sucks Down Helium on 'Tonight Show' Robin Wright Can Dance! (WATCH) She's Back! See Paris Hilton's New Carl's Jr. Ad Big Weekend For Atlanta Braves In Cooperstown - @TheBuzzeronFox Chapter Two: Becoming a first-time director What's Got Jack Black Freaking Out at Comic-Con? Doctors Remove 232 Teeth From Teen's Mouth Bradley Cooper Explains His Voice in 'Guardians of the Galaxy'
Special Features
NRA Waterfront Plans