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Nancy Pelosi Hoot of the Day “Government Spending Reduces Debt”

March 12, 2022

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9:17 pm

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35 comments

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Economics

House Speaker Nancy Pelosi from YouTube video clip, annotations by Mish

Words of Theoretical Wisdom

.@SpeakerPelosi: “When we’re having this discussion, it’s important to dispel some of those who say, well it’s the government spending. No, it isn’t. The government spending is doing the exact reverse, reducing the national debt. It is not inflationary.” pic.twitter.com/6HKE5gX2SP

— The Hill (@thehill) March 12, 2022

“When we’re having this discussion, it’s important to dispel some of those who say, well it’s the government spending. No, it isn’t. The government spending is doing the exact reverse, reducing the national debt. It is not inflationary.”

US National Debt In Practice

US National Debt courtesy of DebtClock.Org

For a continually updated look at US national debt, please see US Debt Clock

If you haven’t clicked on that link at least once, please do so now.

Down the Rabbit Hole

I went down the Alice in Wonderland rabbit hole the other day looking for Fed Chair Jerome Powell or President Biden.

Instead, I happened to overhear a conversation between Nancy Pelosi and the Red Queen.

Pelosi. “How did the US national debt get to exceed $30 trillion?”

Red Queen: “To bring down the national debt, you must spend tens of trillions of dollars much faster than you are now.”

“Inflation is high because of inadequate government spending,” added the Red Queen.

“Thanks, I’ll give a speech on this,” responded Pelosi, ending the conversation.

Biden Down the Rabbit Hole

Apologies offered, but I missed President Biden’s conversation with the Red Queen.

The result was Biden’s Lie of the Day: “Make No Mistake, Inflation is Largely the Fault of Putin”

This post originated on MishTalk.Com.

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35 Comments

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Six000mileyear

4 years ago

Pelosi’s comment ranks up there with the VietNam era quote, “We had to destroy the village in order to save it.” But Pelosi’s quote isn’t as insensitive as, “Let them eat cake!” by Marie Antoinette during the French Revolution.

Call_Me

4 years ago

Reply to Six000mileyear

Not cake, ice cream-

https://nypost.com/2020/11/12/progressives-slam-pelosi-ice-cream-stunt-in-election-post-mortem/

Call_Me_Al

Webej

4 years ago

Ha. It’s true. Government spending, particularly money creation at the behest of Wall Street, (temporarily) reduces the debt problems of the nation’s speculative class!

Doug78

4 years ago

She is in her mid 80’s. Frankly I don’t understand why the Democrat party allows someone of her age to be in the position she is in. I know she is a great money-raiser but she is an embarrassment.

StukiMoi

4 years ago

Reply to Doug78

The more incompetent, the better. The only way a system which is trivially idiotic to anyone literate can perpetuate itself, is to ensure only illiterates are handed reigns to all possible resources. So you end up with Pelosi and Biden and Trump in charge of the nominally “public” sector. And equally stupid and illiterate Wall Street welfare recipients in charge of the nominally “private” one. Literate people, if they had any resources at all which which to push back, would’t put up with any of them. So, literate people don’t. Hence all power to Pelosi, hedge fund apes and their illiterate ilk.

Webej

4 years ago

Reply to StukiMoi

It’s not incompetence that makes them particularly suitable.

It’s being compromised that makes them suitable objects of political patronage … malleable to influence and intel community pressure.

-1

Six000mileyear

4 years ago

Reply to Webej

Illiterate is a compromised state of being that has been shown to lead to incompetence and corruption.

StukiMoi

4 years ago

Reply to Webej

Competent people have no interest in acting “compromised.” A side effect of being competent, is being competent enough to not need to compromise yourself in order to get ahead.

These morons, OTOH, owe all they have not to any accomplishment of their own, but rather solely due to government and central bank machinations.

StukiMoi

4 years ago

What do you do, when you wake up in the morning and find you are THAT singularly stupid?

Unfortunately, it looks as if you don’t have enough compassion for your fellow earth dwellers, to simply shoot yourself in the head, before your almost infinite outright stupidity causes even more harm than it already has.

It’s mindnumbing how stupid it is possible to be, while still retaining enough functioning neurons to coordinate inhaling and exhaling. Fruit flies are more intelligent that this bag of putrid trash.

honestcreditguy

4 years ago

Pelosi, another San Francisco Democrat Mafia member…..when you live in the city of liberal dystopia, you need to get down in the street to see the grime, it permeates our of city hall and all things from the center of progressive beginnings. Jim Jones was a democrat favorite, progressive idea casting back in 1970’s….Heck 2 democrats were there for the punch party…..

Naphtali

4 years ago

Nancy has always struck me as a shyster real estate broker rather than a worthy representative. I cannot help but think of Plato’s disdain for democracy when coupled with the ignorance of the populace.

Casual_Observer2020

4 years ago

Reply to Naphtali

She’s struck me more as a stock trader than anything else. Taxes from stock trades are what ballooned the California general fund to its highest levels ever in 2021 and 2022.

shamrock

4 years ago

Who is Red Queen?

prumbly

4 years ago

Reply to shamrock

Putin on his off days

Captain Ahab

4 years ago

Reply to shamrock

You cannot not know Through the Looking Glass

Mish

4 years ago

Reply to shamrock

Red Queen – Alice in Wonderland

Captain Ahab

4 years ago

Saturday, he’s been in the garden again. Peyote night?

Dr_Novaxx

4 years ago

We just didn’t get the full thought: Government spending will reduce the debt…of the recipients.”

thimk

4 years ago

2 things caught my eye on the debt clock dashboard :

1.) Tariff tax revenue 58 billion

2.) USA workforce now 158 million . USA workforce 2000 159 million . ????

pelosi is giddy from too much insider trading (free market ya know)

https://www.usnews.com/news/politics/articles/2021-12-15/pelosi-defends-lawmaker-stock-trades-citing-free-market

scroll down usnews link (great political cartoon ) on Russian oil .

Roadrunner12

4 years ago

What is also noteworthy that on the debt clock page, is that one of the Medicare plans becomes insolvent in a few years and as well Social Security becomes insolvent in 6-10 years necessitating more spending? Also the defence budget goes up to $770 billion this year, (isnt that more that all other countries combined?) so does that mean the national debt will be going down?

Add in Build America Back Better, increased interest rates and now we”re really talking. And we havent even accounted for a recession on the horizon.

Like someone said, Im going to the bank first thing Monday morning and take out the biggest loan the bank will give me to reduce my debt. I had this debt thing all backwards!!!

TexasTim65

4 years ago

Reply to Roadrunner12

Don’t forget to spend that loan on stocks. Preferably leveraged. Thats how you really make money. Lol

TexasTim65

4 years ago

It seems more and more likely that the mid terms are going to be decided over the inflation topic since it’s the one thing that hits everyone equally (democrat/republican) and is equally hated by everyone.

Voters don’t want to hear who is to blame and who isn’t so claiming it’s Putin or corporate greed or whatever is basically pointless. What voters will want to hear is what’s your plan going forward to get inflation / gas prices etc under control. If the plan is Build Back Better (or whatever it’s name is now) or Pelosi’s claim that more government spending reduces debt then that’s what the Democrats should campaign on. Vote for us and we will implement this to reduce inflation. The Republicans should float their own plan for dealing with inflation. Then let the voters chose the plan they think will help/work.

honestcreditguy

4 years ago

Reply to TexasTim65

actually if you don’t pay taxes, you should have little say in voting, none whatsoever when spending bills, bond measure, providing free everything, handing out more money etc….

a nation of sheep, easily herded, 60% of them not paying in, what do they care, 2 million illegals using our resources, terrorizing taxpayers……..party on garth…

StukiMoi

4 years ago

Reply to honestcreditguy

“..if you don’t pay taxes, you should have little say in voting, none whatsoever when spending bills, bond measure, providing free everything, handing out more money etc….”

More accurately, without paying for it; no government should protect your stuff. The more stuff you want protected, the more you pay. Just as is the case for any other service. Any other form of “taxes,” is just arbitrary robbing of others, in order to hand the loot, in the form of “services,” to connected leeches.

Eddie_T

4 years ago

Biden and Pelosi suddenly spouting MMT theory should hit all of us like a bucket of ice water to the face. They didn’t read that stuff in the NYT. They are being schooled…..by Yellen and Brainard and Kelton and the banking cartel. This is a huge tell. The next phase of currency debasement is about to begin, and we should all be afraid. Very afraid. This will not end well, and the ending might well be on our watch.

It is absolutely imperative to understand what is coming in order to protect you personal wealth, if you have any….and I’d suggest that tangible assets held with low/no leverage have never been more important than now. Paper assets are going to appreciate like crazy in nominal terms, but they will lose value in real terms. This is reality and it is coming. Maybe during the next big financial crisis, which might not be the far in the future.

TexasTim65

4 years ago

Reply to Eddie_T

Your 2nd paragraph is gold standard advice.

It appears the rest of 2022 and perhaps all of 2023 and beyond is going to get really ugly.

Captain Ahab

4 years ago

Reply to Eddie_T

Given what ‘might’ be coming down the turnpike, to be valuable, your ‘assets’ need to be income-producing (or have the potential to be), not exposed to excessive regulation, not easily taxed or taken away, not dependent on government funding, ideally located in at least two relatively stable countries…

Eddie_T

4 years ago

Reply to Captain Ahab

There are no assets that can’t be taxed or taken away. Don’t kid yourself. And a perfectly safe jurisdiction does not exist in this world today.

I’ll take my chances with cash flow real estate in and around my chosen home town, here in Austin. That is where the bulk of my net worth came from, and where I’ll stay invested, until I’m much older. Risk assets in commodity and commodity equities are just a new way I am trying to add to my wealth. So far it’s working out okay. I’m not under any false pretenses that it is without substantial risk.

What countries do you consider relatively stable? I’ve given the entire world a long look, and I see no better place than here.

StukiMoi

4 years ago

Reply to Eddie_T

“There are no assets that can’t be taxed or taken away.”

Anonymous ones.

Or, even, just ones “sufficiently” hard to find and take, to make sure that it costs more money to take them from you, than what can be taken.

As always: To avoid being governed/oppressed; The key is to make it costlier to govern you, than what the oppressors can get out of you. Then they’ll leave you alone. Like they all end up doing with the Afghans.

Mish

4 years ago

Realist: ‘Here, the “only” reason for a recession is the fed and Biden. Give me a break.’

I did not use the word “only”. And the fact of the matter is I have criticized Bush, Obama, Trump, and Biden for spending.

That was after a slew of mountains of other nitpicking. And I do not ever tolerate being misquoted, especially when it’s on purpose.

And it’s a mystery why Realist could not find what he said, when my threat to ban was in direct response to that statement.

That said, it’s damn obvious that both the Fed and Biden (add Congress) are to blame. Also Trump. And Covid, but more so Biden’s inane response to Covid. That third round of stimulus and continued eviction moratorium were over the top stgupid and inflationary.

I tend to criticize the party in power the most, and when Trump was President, I repeatedly hammered him over numerous things.

One has to have their head up their as* to say “Give me a break.” Especially when one adds “only” , in quotes, a word I never said in the entire post.

Mish

Green_Squirrel

4 years ago

Maxing out my credit cards, reduces what I owe…

A report issued in the Summer of 2019, stated that by 2029 the US will have to pay $7 Trillion on just the interest of our National Debt.

“If everything stays the same.” Covid hit/Ukraine invasion…And now by 2029(in 7 yrs) the US will have to pay over $10+ Trillion in just interest alone. The Handwriting is on the Wall folks…The US dollar will collapse suddenly and without warning. Gold will shoot to well over $4500, Silver will shoot to well over $175 an ounce. Place your bets, place your bets…Where she stops nobody knows…So much for all the hype and talk of everyone driving an EV…as the Cost of purchasing an EV will be well over $350,000.

TexasTim65

4 years ago

Reply to Green_Squirrel

That would mean a ~20x increase in debt payment (400 billion to 7 trillion) in 7 years or roughly 1 trillion increase per year. Do you think we are going pay 1.4 trillion this year and 2.4 next year and so on? Interest rates would have to be running wild for that to happen so it seems quite unlikely we will pay 7 trillion in 2029.

Captain Ahab

4 years ago

Reply to TexasTim65

Using the current debt of $30Trillion

$30T at 1% interest per year = 0.3T interest per year

$30T at 5% interest per year = $1.5T per year.

What should the interest rate be on T-bills to induce people to buy? Inflation + real risk-free rate (equal to GNP in real terms is a good starting point)

What will the Fed debt be in 2029? At the current rate of increase, I’d guess $50T or higher, so unsustainable except at artificially low interest rates.

What to do about it? Put a guillotine in The Mall. On Fridays, heads fall.

Bronco

4 years ago

Pelosi?

“We have to pass the bill to find out what’s in it,”

Playing 4D chess while we mortals stuck with checkers.

RonJ

4 years ago

Safe and effective.

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Nancy Pelosi Hoot of the Day “Government Spending Reduces Debt”

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