Don’t like foreign debt? Don’t buy imported goods

Jim Gabbert is even more confused about money management than Ben Carson ('Taxes fund debt, and this reduces spending,” April 12).

When the Federal Reserve wants to create money to combat recession, it buys assets to put new dollars in the system.

When it wants to combat inflation, it sells assets to take money out of the system.

It works much like the stock market and the Fed gets no money from the government. Any net interest from the transactions goes into the Federal Treasury.

The foreign debt you read about is created by the American public buying imported goods and it is paid off by countries buying goods from us.

When countries have accepted paper IOUs for their products, if we paid them off with tax money, the countries would just be accepting new paper money for old paper money we gave them.

You pay off trade purchases with products, not paper IOUs.

Countries can either buy goods from us or sit on our paper IOUs.

If you don't like foreign debt, don't buy imported goods.

Dean E. Owens

Palo