The Rational Debt Voter

During the recent election run-up, I often heard some version of the following:

"We're more than $16 Trillion in debt.  How can you vote for a president who is adding a trillion dollars a year to that and, essentially, has no plan to repay the debt?"

Sounds like a rational position. But is it?

$16 Trillion is a lot of money. In fact, it so much money it's hard to imagine. So let's make the numbers easier to relate.

Imagine your family has an income of $100,000 annually.  Imagine, also, that you find yourself $500,000 in debt. Fortunately for you, your debt has a low interest rate, so you're able to just barely meet the interest payments.  But not only can't you make any principal payments, you're adding $30,000 a year in new debt.

So you go to two debt counselors -- Ron and Dan. Ron says:

Look. You have to stop spending. You can't afford to live the way you have been. Stop sending your kids to expensive schools. Stop taking vacations. Stop eating out so much. Turn in your cellphone and pull the plug on your cable TV. Stop shopping. If you really cut back, you'll at least be able to stop incurring more debt. You might even be able to pay down a little of it someday. Sure it won't be fun, but it's the responsible thing to do.

Dan says:

Look. Let's be honest. There's not a chance in hell that you're ever going to be able to repay this much debt.  The smart thing to do is to spend even more. Take on even more debt. Enjoy yourself while you can. Sure, eventually your credit will get cut off, but then you'll just tell your creditors that you can't pay them. You'll declare bankruptcy, stiff them for 20 cents on the dollar, and start all over. It's done all the time. Yes, you'll be embarrassed, but what's the better alternative? Austerity for the next ten years trying to pay back what you borrowed? Don't be the sap. Let your creditors be the saps. you deserve it.

Which counselor would you follow? Ron might be touting the moral High Road, but it sounds like a lot of work. Would it be irrational to follow Dan? Neither one is claiming that you'll ever be able to repay your debt. Why not enjoy life while you can. Vote for Dan. FORWARD!