With the expansion of the debt, however, foreign investors with huge dollar surpluses, like German and Japanese banks, can put their dollars directly into the U.S. economy. Trade deficit is thus transformed into national debt. Currencies, exchange rates, and markets are stabilized and everybody with lots of money is happy. In and of itself, financial manipulation means little. At bottom, economy is about production.
Money is only the means to the end of deciding who gets what.
The real problem of the national debt is that, despite all the pumping from the government financial machine, Reagan could find no productive uses for his enormous increases in expenditures. He put the money mainly into an increased military budget, which produces nothing. Therefore, since capitalism can no longer increase production, the debt has turned into a deadly burden on the federal budget. Now Clinton is passing the burdens along to the masses. The pols mean that it costs too much for the government to provide things like food, education, medical care, and housing.