Lumpenproletariat
Veteran Member
- Joined
- May 9, 2014
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- ---- "Just the facts, ma'am, just the facts."
I need an answer to this question:
How is the principal on the National Debt paid back? (not the interest)
What am I missing?
Doesn't the PRINCIPAL have to be paid back just as the INTEREST is?
Every year the current interest is paid back and is stated in the Federal Budget Pie Chart. Simple.
But doesn't the PRINCIPAL also have to be paid back, every year? I.e., the current principal due to the lenders? Why isn't there also a place in the Federal Budget pie chart indicating payback of the current principal due to the bondholders?
Why is it so easy to find where the money comes from to pay the current interest, but there's nothing to show how the PRINCIPAL is paid? i.e., where the money comes from? Isn't the current principal paid also, to the lenders, just as the interest is?
(Does the above image show? not sure if these show on all screens -- someone advise me if it's a blank.)
Maybe there's a "roll over" of some kind, where the new lending replaces or pays back for the previous lending. And yet, all the new borrowing/lending, or the current federal deficit, is used to pay for the current federal budget, not to pay back principal due to the lenders from years earlier.
So, what am I missing? I can remember as a kid cashing in a $25 bond, given to me by my grandma, and I was paid not only the interest, but the entire principal + interest = $25.00. Those bondholders are paid back not just interest (which is shown in the pie chart), but also the principal. So, where is this payback shown somewhere, and where does the money come from? For the interest payment the money comes from the current total government revenues (tax revenue + new borrowed money). So, where does the money come from to pay the principal which must also be due and must be paid in order to not default to the individual bondholder?
I am very annoyed at the difficulty of finding an answer to this question. It's so easy to explain how the interest is paid, and paying the interest is a common topic. Yet paying back the principal is never discussed anywhere. It's as though somehow it's not ever paid, and is just out there, in Limbo, as an eternal debt that is never paid back. And yet that doesn't make sense.
What is the explanation for this?
I asked this question once at the Reddit site. The first response was from some expert who supposedly understood everything, and he rattled off a barrage of national debt talking-point facts. But when I responded and asked specifically how the PRINCIPAL is paid back, he disappeared.
I know that the total national debt -- now around 25 trillion -- is not all the annual deficits going back to 1776, all added up and totaling 25 trillion. No, most of that past borrowed money has been paid back, to the lenders. It's not true that the lenders all the way back to the beginning have never been repaid. That's ridiculous. Somehow most of them were paid back. So, where did the money come from? Why is this not shown in the pie chart like the interest payment is?
How is the principal on the National Debt paid back? (not the interest)
What am I missing?
Doesn't the PRINCIPAL have to be paid back just as the INTEREST is?
Every year the current interest is paid back and is stated in the Federal Budget Pie Chart. Simple.
But doesn't the PRINCIPAL also have to be paid back, every year? I.e., the current principal due to the lenders? Why isn't there also a place in the Federal Budget pie chart indicating payback of the current principal due to the bondholders?
Why is it so easy to find where the money comes from to pay the current interest, but there's nothing to show how the PRINCIPAL is paid? i.e., where the money comes from? Isn't the current principal paid also, to the lenders, just as the interest is?
(Does the above image show? not sure if these show on all screens -- someone advise me if it's a blank.)
Maybe there's a "roll over" of some kind, where the new lending replaces or pays back for the previous lending. And yet, all the new borrowing/lending, or the current federal deficit, is used to pay for the current federal budget, not to pay back principal due to the lenders from years earlier.
So, what am I missing? I can remember as a kid cashing in a $25 bond, given to me by my grandma, and I was paid not only the interest, but the entire principal + interest = $25.00. Those bondholders are paid back not just interest (which is shown in the pie chart), but also the principal. So, where is this payback shown somewhere, and where does the money come from? For the interest payment the money comes from the current total government revenues (tax revenue + new borrowed money). So, where does the money come from to pay the principal which must also be due and must be paid in order to not default to the individual bondholder?
I am very annoyed at the difficulty of finding an answer to this question. It's so easy to explain how the interest is paid, and paying the interest is a common topic. Yet paying back the principal is never discussed anywhere. It's as though somehow it's not ever paid, and is just out there, in Limbo, as an eternal debt that is never paid back. And yet that doesn't make sense.
What is the explanation for this?
I asked this question once at the Reddit site. The first response was from some expert who supposedly understood everything, and he rattled off a barrage of national debt talking-point facts. But when I responded and asked specifically how the PRINCIPAL is paid back, he disappeared.
I know that the total national debt -- now around 25 trillion -- is not all the annual deficits going back to 1776, all added up and totaling 25 trillion. No, most of that past borrowed money has been paid back, to the lenders. It's not true that the lenders all the way back to the beginning have never been repaid. That's ridiculous. Somehow most of them were paid back. So, where did the money come from? Why is this not shown in the pie chart like the interest payment is?