From Judge Andrew Napolitano..
From April 1917 to November 1919, when President Woodrow Wilson borrowed $30 billion to pay for World War I, he was able to do so because of the promise he made to lenders that the commitment to repay them would be backed by the full faith and credit of the United States government.
At the time, the government’s total debt was about $14 billion, so Wilson’s painful gambit tripled it.
In reality, it was not the full faith and credit of the federal government that promised to repay; it was not the creditworthiness of the federal government at stake; it was not the federal government that paid back the money that was borrowed. That’s because the government has no credit or creditworthiness or disposable wealth. Only the taxpayers have that.
This is not an academic difference. Wilson knew his creditors could not seize government buildings if he or a successor could not repay the loans in a timely manner. However, the Internal Revenue Service could seize private wealth if taxpayers didn’t cough up.
Read the rest via NAPOLITANO: A rising torrent of debt and destruction – Washington Times.
- Debt and Destruction (lewrockwell.com)
- Judge Andrew Napolitano on Obama’s Government-Induced Inflation (reason.com)