The Concord Coalition, a nonpartisan budgetary watchdog group, had an open letter to President Bush and Congress in the New York Times urging them to improve fiscal discipline and address long-term fiscal challenges. “Chronic heavy borrowing is gradually weakening our long-term economic strength,” the letter noted. “Moreover, failure to address the vast unfunded obligations of Social Security and Medicare — $39 trillion at last count — risks a generational conflict in which the children of today’s baby boomers will face the terrible choices of much higher taxes, dramatic cuts in their parents’ entitlement programs, greatly diminished ability to set their own spending priorities, or unsustainable debt.” Its prescriptions include: restore budget caps and pay-as-you-go rules, negotiate a bipartisan plan to balance the budget, and include long-term projections in the budget resolution.
Posted by Phillip Brownlee
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82 Comments
I want to know why the government is allowed to mismanage money at a level of incompetence that warrants criminal investigation. Have Americans become so fatty complacent that they no longer care where their money goes? I am beyond disgusted that the American citizenry as a whole just sits back and lets our money go. Oh sure, that’s how I balance my check book. What is wrong with you people?! Stop it! Yes, if we all got off our couches, or metaphorical couches, and demanded a fiscal account from the government they would be obliged to reply. We can sit comfortably or otherwise and complain about “government spending” and the mismanagement will continue. Would you sit so complacently if you found your bank had shorted you $40? Demand an account of financial spending from our government, just as you would from your bank. Such a demand requires less effort than when you call your bank! Get up, stand up, stand up for your rights. You would have more money in your pocket if you took a stand against how our government wastes money.
It is announced over and over on the news that if a Certified Public Accountant took a look at the government’s book, it would be found criminally bankrupt. People, demand your government to account for spending as you demand account for your own household budget. Our Federal Government is cooking the books! Make them stop! To do so would take so little effort by so many. Look it, I am the poster queen for sitting idly by and doing nothing. I realize the idle sitting is what allows the criminal misuse of our tax dollars. Stop sitting! Demand accountability. Yes, it is true. If enough Americans demand accountability, we will be answered…in a rude sort of way at first. But, remember and hold to your heart: A government of the people, by the people and for the people. Stop the ruling class and bring our government to heel. We are not subjects of a tyranny. We have the freedom and rights to hold our government accountable. Get up, stand up, and just do it.
Where were you one, two, three or four years ago with your letter? Spending didn’t just spin out of control.What happened, we were on our way in 2000 with the surplus that would have started to address our problems with Social Security and the debt.People were saying that you can’t continue to cut taxes and fund a war, but Bush and the Republican Congress choose not to listen.Who is going to pay to get us out of debt now?
Interesting how the WE is so worried about government spending on one hand but promotes government spending on the other hand.
Naturally the government spending increase should only be on the things that the WE believe are the right things to spend money on.
Makeup your mind either you want spending to get under control or you don’t. You cannot have it both ways.
Leaders of both major parties are the same. Both want to increase their vote buying spending habits. The slight difference is how they want to pay for it. However nobody ever asks anymore, “Should the government even be doing X?”
Unfortunately, today nobody recalls that we are supposed to have government that protects our rights and doesn’t interfere with our lives. Instead it’s a ‘what can your government do for you’ society.
PM wants to live in Somalia.
That’s the perfect example of a non-function government that does nothing.
I’m sure the taxes are very low or non-existant.
Proudman’s paradise.
*******
There’s only one reason why the debt has shot up stratospherically: Reagan cut taxes and raised spending, Daddy Bush cut taxes and raised spending.
Clinton cut spending and raised taxes. This balanced the budget over a few years and sent the debt plunging downward. People talked seriously about what would happen if we eliminated the national debt.
Then GW Bush and RespendiCONs came into office. They grew gov’t spending by 9 percent a year EVERY YEAR. They also slashed taxes for the rich.
As a result you see what you see.
Worst.President.Ever.
“Moreover, failure to address the vast unfunded obligations of Social Security and Medicare — $39 trillion at last count — risks a generational conflict in which the children of today’s baby boomers will face the terrible choices of much higher taxes,….”
True, but the largest impact on Social Security is the “Social Security Totalization Plan”. That plan adds to the SS roles ALL the illegal aliens and they qualify for benefits in as little as 18 months of pay ins. The regular American Citizen has to pay in 40 QUARTERS to qualify for Social Security Benefits.
SO this “Totalization” plan adds MILLIONS to the roles, and they can withdrawl the same benefits as a US Citizen with less than one tenth of the contribution.
You need to watch this and contact your representatives.
Also the Times is being disingenous lashing Medicare with Social Security.
Medicare is in serious deficit RIGHT NOW and has been for a number of years.
Social Security may be in deficit in 40 years if Bush’s worst-case scenarios come true. Most people (who don’t already have the agenda of wanting to destroy Social Security because they hate the idea of gov’t programs like this) think it much more likely that Social Security will not melt down in the future.
There’s a big difference between Medicare and Social Security.
The chance to control spending has passed. The Republican Congress had no spending discipline and the president let it happen.
Now, with the Dems in control of Congress, all bets are off. Hold onto your wallets.
The only good thing that may come of this is that the president may discover he has veto power.
Yup, Asbestos, that’s one silver lining to the illegal alien “cloud.”
Most of them have fake SS numbers so they can work here–they pay in billions and can’t take anything out.
Good deal for us. Not a good deal for them.
I agree we shouldn’t pay illegals government benefits though.
I see the would-be feudal lord is helping me to his wisdom. Belief in limited government is not anarchy idiot. I don’t expect you to understand that, being as sophisticated as a comic-book character. No wonder you like big government, forcing everyone to do as you want. Like some pathetic school bully with a chalkboard.
Here’s one for the files.
Outlanding in his field has predicted that deficit spending will increase under the Democratic Congress.
And when he’s wrong, again, I’m sure he’ll admit it.
NOT.
Wow, PM.
When you take out all the ad-homenims and cheap-shots from your last post, the amount of actual argument that remains is zero.
Yup, he’s a CONservative.
It’s OK not to understand little one.
Condescendsion.
Add that one to the list of PM’s non-sequitors.
BTW, PM, can you name ONE modern industrialized country that does what you want?
No, you can’t. Every major first world country in the world has MORE gov’t than the US, not less.
We’re at the extreme end of lack of gov’t programs domestically. And we’re at the extreme end of military spending–we spend more on our military than all the gov’t’s in the world put together.
Our spending as a percentage of GDP is three times that of most European countries and twice that of England and even South Korea.
Because people around the world see the value in working together through government to achieve the common good. And they don’t see the value of a huge military for imperialist domination.
Not you though. You’re so much smarter than 99.9 percent of all the people in the best countries of the world.
Has it never occured to you that you’re being used like a tool for wealthy interests . . . so they can stay wealthy and keep you the way you are?
Nope, probably not.
I think bush’s deficit spending is by deliberate design.
Not by HIM of course. He aint that smart.
No I think it is a deliberate and final assault by some in his party on any and all societal entitlements.
As the bills mount, they will cluck and tsk and opine that “Well it was nice to have social security and those things. But we simply cannot afford them anymore.”
And then they will abadon a majority of the American people to the tender mercies of the “free” market.
Hang on Proud Man. We may yet get the feudal state that YOU are looking for. I don’t think you’ll like how it tastes.
The Eagle endorsed Bush, Tiahrt and Brownback, three people who advocate and voted for increased deficit spending. Perhaps they should of thought about their prior four years of deficit spending before endorsing them.
The so-called baby boomers like myself have paid into the Social Security system and medicare as long or longer than any other age category. I think those who have a substantial investment in the fund should have a substantial say.
Nothing against the younger folk like the age of my children, but they have lots of option on investment that we didn’t have when I was their age. I would think it prudent that they divest from the Social Security nanny and more into their own coop funds.
JM Agree. Let us younger generation keep our money and invest it how we want it. We need to end the ponzi scheme.
Well comic-book-boy, try to enlarge your mind by considering that people can work together without the government. Those of you who want more government are only interested in forcing your solution onto society. Is that not why you always turn to government to achieve your goals? At the end of the day, the only tool that government has is to use force.
Government should be used to protect people’s rights and their freedoms, not force them to act in the ‘proper manner’.
Not to worry J R, I’m sure your vision of a communist (or is it feudal?) society will rise again.
Yeah, let us invest our retirement in companies like Enron rather than something safe and financially secure like Social Security which has lifted millions out of poverty. With people like Tiahrt in charge keeping wages low that means when our investments dry up we can work for poverty wages until we drop dead in the fryer.
And why are we surprised that George W. Bush and his cronies have run up so much debt? The Bush Administration is arrogant. They do not believe the laws apply to them. But the shame of the last 6 years has been the participation and encouragement by the GOP party and especially the Christian Conservative Republicans. Without all the warring about gay marriage and abortion, maybe the rest of the country would have been noticing what Bush and Company have been doing.
And let’s not forget, congress has voted themselves a fat little raise and they are also into all that lobbyist money that is just sitting there for the taking.
So if we expect politicians to clean up their money act, we are barking up the wrong tree.
ProudFlesh writes “try to enlarge your mind by considering that people can work together without the government.”
See, this is what I’m talking about. It’s exactly what I’m talking about.
I ask for a specific example of a modern industrial state that’s done anything like what he wants, and he comes back with a theoretical possibility.
Yeah, I know. If only we could get the Arabs and the Hebrews to sit in a circle and sing “kumbaya.” The CONs are always accusing us liberals of delusional, unrealistic thinking.
But ask them to show how lower taxes have benefitted society, or how Hurricane Katrinia victims are “better off” left to rising waters and snakes, and all they can do is quote Milton Freidmann.
Wait, scratch that, all they can do is quote Rush Limbaugh’s dumbed down version of Milton Freidmann.
The way to shut a CONservative down?
Ask for specific examples.
They ain’t got any ’cause there ain’t none.
Of the top ten nations’ by standard of living, all of them have more gov’t programs and less military than we do.
Hey Doug,
A small investment consumer investing their life’s hope into one company needs an education on how investment works.
Does diversification of investment portfolio enter your mind at all?
JM–
Does Enron forcing employees to buy and hold its stock enter your mind at all?
Mind? What mind?
Blame the victims. Yup, those damn Iraqi kids keep running under our bombs.
BTW, JM, three problems with “diversification” and do it yourself investing.
One, people don’t make as much by diversifying. You make big money by picking the right stocks–not by watering down your investment with a few good ones, a few bad ones and a bunch in between.
That’s what the investment guys often don’t tell you. Trouble is, it’s practically impossible for an average schmo to pick winners all the time . . .
Two, diversification wouldn’t have helped much if you had bought heavy into the Dow in 1999 and watched it crash from almost 12,000 to 7,500 and slowly claw its way back up over six or seven years.
Granted it’s up now. But what were you supposed to live on while you were making nothing for six years?
NASDAQ isn’t even close to its historical high from six or seven years ago . . .
Three, a lot of people–that is a sizable minority if not a majority–just lack the education and skills to optimize their savings for retirement.
That’s why Soc Security was invented, remember? If forty percent of our great grandparents could not amass enough wealth to retire above the poverty line then (back before 60’s liberals when everybody believed in God and hard work), why should we be able to do it now?
Again, JM, you substitute theoretical possibilities with proven examples from the historical record.
Well comic-book-boy, let’s take a look at this so-called thought process. Actually, can’t do that since you are involved. You are asking for an example. Of course you are. Being a collectivist, you couldn’t possibly come up with something on your own. Face it, you are like the caveman who says, “the wheel is dumb. Name one group who uses the wheel. You can’t so we shouldn’t use the wheel.”Let’s look at the examples you whine with:How have lower taxes benefited society? You are aware of the increased government revenue following the Kennedy, Reagan, and Bush tax cuts? Isn’t more money for government a benefit to society in your mind?How are Katrina victims better off left to rising waters and snakes? I never took that position, but your assumption that only government could ’save’ them is small-minded. What else would you expect from a comic-book-hero?Alas, of course most countries have less military than we do! Countries like France, Germany, or Costa Rica depend on the US to deter open invasion. Why build a military when you can get someone else to build and pay for it. Sounds very left-wing doesn’t it? The rich (US) can afford to provide for me!Finally, you want an example of a country that has lower taxes, less government with a better economy in a modern industrialized nation? No problem. It’s the United States. I think we can go farther in that direction and be even better.
I find the current situation to be beyond belief – we had a balance/surplus budget in 2000. Now Bush is bragging about a proposed budget that will cut the deficit in half by 2012!
Cutting the budget deficit in HALF is something to brag about?!?!?
If that is the case, when the hell do we plan to return to SURPLUS budgets so that we can begin to pay off our massive National Debt.
How large will the National Debt be when we finally begin to pay on the principal?
Ten trillion?
Twleve trillion?
Twenty trillion?
For Christ’s sake, the percent of our current budget that is spend to merely SERVICE the debt by paying interest is already OVER thirty percent!
Out actual debt is closer to FIFTY TRILLION DOLLARS with everything included and George W Bush is bragging that he has come up with a budget (sorry, war not included) that cuts the deficit in half.
Christ, does anyone REALLY think that this situation can be addressed WITHOUT massive tax increases?
As John Lennon said, “we’d all love to see the plan.”
Proudman clearly has a limited knowledge of what feudalism is.
Hey Proud? I’m PROBABLY more capitalistic than you are. Dif is? I want everyone to have an equal chance. YOu know as opposed to those who have all the wealth reserving it to themselves and using the power inherent in that to abuse their fellow American for profit and fun?
In any transaction where one person agrees to trade some of their freedom for sustenance, there is the opportunity for abuse. I say it is governments role to protect against that abuse.
50 trillion dollars WS Clark? Where on earth did you get that number? Or do I want to know if it came out of an orifice.
Federal spending outlays are growing at a 7.6% rate.Federal tax receipts are growing at a 14.2% rate.
14.2% is greater than 7.6%…
…therefore, if those trends continue, receipts will equal outlays in 2.7 years
Explain to me CapnAmerica how your superior knowledge on Economics explains the dynamics of T-Bonds and how rollover affects that dynamics?
Who is the largest holder of T-Bonds CapnAmerica?
If the Democrats were to increase Taxes as they plan to do always,according to current Economic T-Bond marketing, they would have to use the extra revenue to buy back and destroy T-Bonds. This of course means destroying personal wealth as T-Bonds are one method or instrument of measuring wealth.
Or do you even understand how the National Debt is handled. Are you just spewing Democratic Political Economics 101 without any background on how T-Bonds are used to handle Debt?
Do you know who really handles National Debt?
I’ll give you a hint, here’s a book you can read:
“The Truth about National Debt”Author: Francis X. Cavanaugh, an economist who had been responsible for debt management policy at the Treasury Department, under several administrations.”"
One, JM, I added the SS and other entitlement obligations together. 39 trillion in obligations and 9 trillion in national debt total 48 trillion (there is zero dollars in the SS fund.) so 48 is nearly 50.
Second if the budget will be balanced (receipts and outlays equal)in 2.7 years, why is Bush forecasting the deficit will be cut in half in 2012?
Wouldn’t he be saying that the budget would be balanced in 2.7 years?
Just curious.
JM–
Hypotheticals and theory. Nothing specific, as usual.
He’s telling us his ideas are so good that nobody in the world wants to use them.
*****
I don’t know if all stupid people are CONservative, but it sure does look like all CONservatives are stupid.
Consider JM’s idiotic claim that since tax revenues are briefly outpacing spending, tax cuts are “working.”
All that means is that the rich are getting so much richer, their wealth is growing even faster than the Republican Congress and W can spend it.
From the New York Times: “The main reason is a big spike in corporate tax receipts, which have nearly tripled since 2003, as well as what appears to be a big increase in individual taxes on stock market profits and executive bonuses.”
http://www.nytimes.com/2006/07/09/washington/09econ.html?ei=5088&en=ec2d242da8699725&ex=1310097600&partner=rssnyt&emc=rss
That’s the short term. What about the long term. From this government web-site, you can see that the national debt has ballooned from about 5.75 Trillion (it had been going down compared to inflation under Clinton-Gore) to a SHOCKING 8.67 Trillion in six years.
Tax cuts for the rich have been working so well (heavy sarcasm) that the national debt increased 66 percent in 6 years, or an astonishing 11 percent a year.
This happened under George W. Bush and a Republican Congress.
http://www.publicdebt.treas.gov/opd/opdpenny.htm
A single turn-around in one year is welcome. But what about the other five years of Worst. President. Ever’s. misrule?
One out of six looks like a failure not a success to us to whom facts still matter.
Jeez, I am still waiting to see how some people figure that we will be able to pay off the national debt AND pay our entitlement obligations WITHOUT raising taxes.
And that 2.7 number sticks in my mind.
These are the same people who told us we had to invade Iraq because of “tons and tons of poison gas and biological weapons,” that “Saddam Hussein was six months away” from a nuclear bomb, that his “drone aircraft could attack an American city in 45 minutes.”
Only a CONservative could be stupid enough to believe them at this point.
Only a CONservative could be stupid enough to believe them at this point.
Dang it, Capn, that is just not true!
Morons, idiot and the brain damaged would believe that also.
Oh, wait.
That would be pretty much all conservatives.
Sorry, my bad.
Okay, since CapnAmerica and WSClark refuse to do their homework let’s look at the periods where national debt was reduced and a surplus was achieved by raising taxes.
What happens when we pay down the national debt?1817-1821. National econcomy starts shrinking by 18191823-1830 National economy starts shrinking1852-1873 National economy starts shrinking1920-1930 1929 economy shrinks drastically!1998-2001 recession 2001 economy shrinks
In every instance where Politicians had their hands on the wheel, the economy took a nose dive by attempting to to achieve a surplus.
In todays economics when taxes are increased, this requires the Federal Government to buy back T-Bonds (treasury bonds.)
This creates a decrease in personal wealth and confidence of bond holders, because their T-Bonds are not making any profit through normal investment.
So personal wealth in T-bonds diminish, you say so what.
Our economy is not 13 trillion dollars in size; instead, its size is $13 trillion worth of goods and services.
If personal wealth is depressed by raising taxes, then surpluses (i.e., reductions in the public’s T-bond supply) have a nasty track record of preceding economic depression. (see the years I submitted above when taxes were increased and personal wealth decreased causing government net revenue to fall.)
Like I said, read the book and get educated on the National Debt.
You are repeating Political sophistry perpetrated by scare tactics of the Tax and Spend mantra.
Instead, get the real story on National debt and deficit from”The Truth about National Debt”Author: Francis X. Cavanaugh. He is a long term US Treasury Economist who is paid to track the National Debt and Revenues.
So, JM, if the “receipts and outlays will be equal in 2.7 years” why won’t the budget be balanced in the same 2.7 years?
And, since Bush says that the deficit will be cut in half by 2012, when will the Federal budget be balanced and when will we begin to pay down the debt?
Given that we have been using the SS surplus to apply to the budget for fifty years, when will we be “solvent” as in, no debt, current or future and tax reciept will exceed expenditures?
Not real soon, eh?
“…therefore, if those trends continue, receipts will equal outlays in 2.7 years”
In other words, the Federal budget will be balanced in less than three years, according to JM.
Of course, Bush says that we will just cut the deficit in HALF in six years, but what does he know?
“Federal spending outlays are growing at a 7.6% rate.Federal tax receipts are growing at a 14.2% rate.”
Ah, JM, you are comparing two very different items.
Your numbers may have had a meaning if you started with a zero baseline. Unfortunately, we started at less than zero and you did not include the Social Security and other entitlement obligations into the equation.
That is how Reagan, Bush I and George W Bush do their math.
It just does not add up.
You cannot compare the rate of increase in tax reciepts to the rate of spending increases.
At the end of the day, you still have a Federal deficit.
And that means we are paying more interest, not paying on the principal and not funding the SS Trust fund.
All that adds up to financial disaster.
Do you even know what the Social Security Trust Fund is WS Clark?
Actually, JM, I do.
The Social Security Trust Fund is SUPPOSED to “lock box” the money from current SS receipts for future payments to SS receipiants.Logically, the money from SS withholding is NOT supposed to be used for current Federal expenditures, but it has, for the lasy fifty years.
So we are using the money that you and I pay into SS to pay for current Federal expeditures like the Bush War of Choice, etc.
Anyway, what was your question?
And yes, JM, I know that you and your conservative friends think that I am an idiot, moron, intellectually challenged, without morals, homicidal, etc.
But for once, can we debate an issue without one of you on that side of the fence actually use facts and not personal attacks?
Just answer, JM, how is this statement accurate?
….”Federal spending outlays are growing at a 7.6% rate.Federal tax receipts are growing at a 14.2% rate.
14.2% is greater than 7.6%…
…therefore, if those trends continue, receipts will equal outlays in 2.7 years”……
DA,Your math skills indicate that you’re high more than you’re not.Why not leave the more intellectual stuff to those of us that choose to remain lucid?
…and my point is made.
Of course, YOU could explain the assholes to apples math, Nutz….
….”Federal spending outlays are growing at a 7.6% rate.Federal tax receipts are growing at a 14.2% rate.
14.2% is greater than 7.6%…
…therefore, if those trends continue, receipts will equal outlays in 2.7 years”……
To answer one of your questions WSClark, I’ll put it this way:
If you have a 100 dollar loan at 5 percent/annum to pay back, how long would it take you to pay that if you earn $10.00/month in revenues. Consider that you would pay the interest first, then put any additional revenue on the principal.
If you can figure that out, then you can understand what I wrote.
If you can’t, then well…erI dunno, practice the Principal Rate Interst formula all should have learned by the 8th grade?
Jesusmotherfuckingchristgoddaminit!
Just answer the question, JM!
Your post….
“Federal spending outlays are growing at a 7.6% rate.Federal tax receipts are growing at a 14.2% rate.
14.2% is greater than 7.6%…
…therefore, if those trends continue, receipts will equal outlays in 2.7 years”
How is this accurate?
Now on the trust fund. The term “lock box” was coined (I must admit humorously) by Al Gore.
Each year, SSA turns over any surplus funds to the U.S. Treasury, which spends the funds. In return, SSA receives special-issue, non-negotiable U.S. Treasury securities, which represent an implicit promise by the U.S. government to repay Social Security when and if additional money is needed to cover benefits. These bonds are what we call the “trust fund.”
Note, this turnover of funds is required by law for any revenue producing agency in the US Government.
And it also applies to agencies who don’t spend all of their budget. That is, if they have excess funds at the end of the year, they can’t carry them over, they have to give it up to the US Treasury. (Which is why you see the crush of orders in September by Federal Agencies) heh heh
Anyway…
So, yes, there is a trust fund, representing the excess of payroll taxes over benefit claims, and it is “invested” in promissory notes issued by the government.
In simpler terms there are more funds coming in than is going out to Social Security recipients.
Borrowing the money, is equivalent of borrowing money from your wife or if your not married, a brother or a sister.
There really isn’t any real money loaned out, it’s just electronic data managed by the Treasury Department. The same thing Banks do when they have money to loan.
Now you’re probably saying “Aha! gotcha!”
The problem with that statement is :(1) Both political parties in power have always used the so-called extra revenue “Trust Fund” to pay for whatever. Always, no exceptions.
(2)The problem is not the revenue collected by Social Security and the excess loaned out by the Treasury Department.the problem comes in the future when there is a smaller ratio of people paying into Social Security than there are paying out. Our population at the lower age end has decreased (i.e. fewer taxpayers that pay into social security.)
((it’s why I want those Mexicans to continue to pay into the Social Security!!!) heh heh er… :)
A time problem has evolved where we put a XX year plan on a project such as Social Security, let’s say a 75 year plan.
This is analogous of you making a 25 year plan to pay off a home mortgage, when your future income and budge needs only allow for a 30 year mortgage.
What that means is we the people represented by Congress need to get busy working on re-designing Social Security before there is a problem.
I think we are on the same page WS Clark, in that yes, Social Security needs fixing.
But let’s get away from the blame game of it’s Bush’s fault or it’s someone’s fault. When in fact it is a reality of our shrinking youth population size and ill-conceived long range planning of the SS fund.
So……………… the fifty trillion dollar number is correct?
It is not possible to get a true picture of the debt or deficit because of the off budget stuff, the accounting tricks and the outright fraud that our government uses to conceal the truth.
Viva La Raza Blanco!!
No WSClark, the figure is not real in the sense that there is no one holding a 50 trillion dollar bill in their hands and the fact that debt is not calculated that way. :)
Okay, JM, do the math for us….
Federal spending outlays are growing at a 7.6% rate.Federal tax receipts are growing at a 14.2% rate.
14.2% is greater than 7.6%…
…therefore, if those trends continue, receipts will equal outlays in 2.7 years
Ifthese num=bers are correct, then explain how the SS lock box works.
But first, how is your math concerning the deficit correct?
Ask Al Gore how the lock box is supposed to work (which it doesn’t.)
And I already gave the formula for figuring out expenditures versus receipts.
Repsot….
Okay, JM, do the math for us….
Federal spending outlays are growing at a 7.6% rate.Federal tax receipts are growing at a 14.2% rate.
14.2% is greater than 7.6%…
…therefore, if those trends continue, receipts will equal outlays in 2.7 years
If these numbers are correct, then explain how the SS lock box works.
But first, how is your math concerning the deficit correct?
JM, explain why YOU say the budget will be balanced in 2.7 years, but Bush says it will be cut in half in 2012.
Just explain that and we can go from there.
It is my understanding that during the savings & loan “scandal” during the ‘80, the deficit was going to crush us and all our chillin’s for generations to come, but somehow that didn’t happen. What did happen? Who was wrong about that? Somehow Clinton balanced the budget, but no one was crushed. Who was wrong?
It is disingenious for CapnAmerica to use Somalia as an example of the success of what he/she terms “free markets.”
The “free” part means that people enter into transactions voluntarily, not through force and coercion.
Yet, CapnAmerica said I might be able to purchase a slave there.
Would the potential slave agree to such a transaction?
This is an example of the moral confusion leftists often exhibit.
My solution is based on a more optimistic solution than Bush. He probably uses lower (more modest)revenue growth figures than I do.
In January 05 deficit was at 408.2 billion
In January 06 deficit was at 310.9 billion(monthly treasury statements.)
That is a reduction factor of 1.3/year===============================Dividing the difference by 12 I get 8.1 billion per month.
I used a 8 percent growth for revenue growth linearly growing over a 2.7 year (32.4 months) It’s actually 8.44 percent but using a rounding.
0.08 (decimal representation) growth per year on average.===================In 20078.74 billion growth first 12 months $104.88 billion
In 20089.449 billion growth second 12 months totally $113.388 in revenue
In the partial year 20099.57 billion growth in the next eight point two(8.2)months $80.388 billion in the partial year 2009
for a grand total of 298.656 total or the 2007-2009 revenue estimates based on 8 percent annual growth.
So on the linear progression of the 32.4 month period total will be 308.226 billion growth very close to matching the 310.9 billion deficit listed in January 2006 pay off.
Mistakes may be credited to the jalepeno chili I just had. heh :)
er should be 8.44 =32.44 got my numbers mixed up, darn trifocals :D
JM–
Your figures are wholly bogus.
The national debt was going down (as a percentage of GDP) steadily from WW2 through Carter’s years.
Then Reagan-Bush cut taxes and raised spending and sent the national debt skyrocketing.
The economy was fairly strong during this period as one would expect with the stimulation of deficit spending. (See Keynesian economics.) A correctional recession emerged in 1992 which helped Clinton win.
Clinton-Gore reduced spending and raised taxes creating a surplus and paying down the debt.
The economy continued strong with again a correction at the end of a long boom.
You can make no cause-effect case that cutting taxes helps or hurts the economy based on the historical record. Reagan cut them and the economy boomed. Clinton raised them and the economy boomed.
The one cause-effect that is unmistakable is that when you raise spending and cut taxes, you get historically high national debt.
That’s what we got now, again.
As was the father, so is the son.
Here’s a nice graph showing national debt as percentage of GDP.
Anyone can clearly see that there is no relationship between national debt and booms or busts.
Oops, here it is:
http://zfacts.com/p/461.html
Check the US treasury website Capn, the month figures, it’s where I got my data.
Not from the newspaper or some liberal website.
The US Treasury.
Oh, and I was talking about the deficit and not the debt versus the GDP.
Captain you need to get the book, at least to understand the difference between deficit and debt. :)
I know the difference you dumbass.
Fer heaven’s sake, man, can you read?
You haven’t answered any of my points.
N . . . slavery is what you get when you don’t have a strong central gov’t to protect people’s civil rights.
Not that hard to understand unless you’re willfully stupid.
Which apparently you are . . .
Yeah, sure you know the difference between debt and deficit Capn, that’s why you wrote the following:
“JM–Your figures are wholly bogus.The national debt was going down (as a percentage of GDP) steadily from WW2 through Carter’s years.”Posted by: CapnAmerica | January 14, 2007 at 10:07 PM
and here…
“Here’s a nice graph showing national debt as percentage of GDP. Anyone can clearly see that there is no relationship between national debt and booms or busts.Posted by: CapnAmerica | January 14, 2007 at 10:11 PMOops, here it is:http://zfacts.com/p/461.htmlPosted by: CapnAmerica | January 14, 2007 at 10:11 PM
I was talking about the
D-E-F-I-C-I-T with WSClark which he asked me to explain my figures.
Not the D-E-B-T. :)
Mein Gott, man, you are so effing obtuse:
This is what I was responding to–
“What happens when we pay down the national debt?1817-1821. National econcomy starts shrinking by 18191823-1830 National economy starts shrinking1852-1873 National economy starts shrinking1920-1930 1929 economy shrinks drastically!1998-2001 recession 2001 economy shrinks
“In every instance where Politicians had their hands on the wheel, the economy took a nose dive by attempting to to achieve a surplus.”
I don’t give a damn what you we saying to Clark. WE’RE talking about the debt which is after all what the effing THREAD IS ABOUT.
By the way, you seem to have over-simplified (why is that not surprising) Cavanaugh’s position.
Business Forum summarized his position as follows: ‘His “One Reality” is the Federal budget must be balanced now to regain control over government spending — to help restore confidence in the government. However, he would remove interest payments on the debt from this budget, and encourage a new public debt authorization process that would assure an annual focus and debate on the appropriate size of and interest obligations on the debt. Each fiscal year, a balanced program budget would be approved by the Congress including a surplus account deemed appropriate to reduce the growth of the Federal debt. Cavanaugh explains,
“… the real reason we should hate the deficit is that politicians should not have the pleasure of spending (getting votes) without the pain of taxing (losing votes). Without that discipline, federal spending is out of control.’
http://www.businessforum.com/debt02.html
In other words, he doesn’t say that paying down the debt hurts the economy. He believes we should pay down the debt.
By the way, I didn’t know that chart belong to Cavenaugh, didn’t look at the source I guess. Did Cavenaught make it or not?
Okay fair enough, here is your model of
Surplus Economy:
The most common way the Fed creates money is by purchasing some of the public’s T-bonds on the open market. In other words, the Fed grabs a handful of that infinite potential supply of money, then trades that handful to the public in exchange for some of the public’s supply of T-bonds.
Simple enough, on the surface. But there are some important implications—one of which is that it requires that the public actually owns some T-bonds.
Five years ago, Alan Greenspan expressed concern that the public was headed for the dubious scenario of running out of T-bonds. Here’s what he had to say about that possibility:
Continuing to run SURPLUSES… brings to center stage the critical longer-term fiscal policy issue of whether the federal government should accumulate large quantities of private assets.—Alan Greenspan, Jan. 25, 2001
i.e. private individuals purchasing T-Bonds
In other words, because…
• a growing economy requires a growing money supply, and• growing the money supply requires the Fed to purchase private assets, and• the public’s “private assets” might someday no longer include Treasury bonds,then…• the Fed would have to purchase private debt or equity instruments to increase the money supply.
Who owns the majority of the national debt? US citizens do and the US goverment by about 60 percent.
T-Bond buyers buy more of the US debt than any foreign group.
Great Britain is a distant third.
And why do foreign countries buy T-Bonds? Because they consider the US a safe investment that’s why.
Now, CapnAmerica, your side wants to deplete investment of T-Bond by using the very scheme Greenspan railed against.
Why did Greenspan rail against T-Bond depletion? Because of what I wrote and
Fiscal deficits are not the cause of inflation, and
• fiscal deficits are necessary to increase the public’s T-bond supply, and• T-bonds are necessary for the Fed to create new money without creating socialism, and• surpluses (i.e., reductions in the public’s T-bond supply) have a nasty track record of preceding economic contractions, and• our children and grandchildren will never have to pay back the debt if the economy keeps growing..
The key here is that raising taxes, raiding the private sectors T-Bonds (you know your savings bonds, 1 5 10 20 year bonds, etc) will put us on the path to Socialism because the government will control completely the outcome of money supply by printing more to keep things going. Here come the inflation get out your wheelbarrows!
Old and decrepit unable to stand, no social security, working for minimum wage part-time if you can get a minimum wage job.No matter how well you plan it, it is our future.Yep – retirement is going to be great!
If you are strong, you should be protecting the weak, have you done that today?
JM –The rich people already practice Socialism and use it against the poor people.
Okay, readers, here’s the source from which JM plagiarized all that material.
http://www.optimist123.com/optimist/2006/06/how_the_fed_cre.html
It comes to the amazing conclusion that paying down the debt leads to . . . wait for it . . . “socialism.”
“When we take a step towards buying back all of the public’s T-bonds (“paying off the debt”), we are taking a step towards socialism.
“Something to think about next time you hear somebody advocating “paying off the debt,” isn’t it?”
So . . . back before WWI when we had practically no national debt, we were living in socialism and didn’t even know it?!
Amazing!
Next, let’s look at the “surpluses preceed recessions.”
http://en.wikipedia.org/wiki/List_of_recessions
When one looks at all the recessions in the last 100 years, you can see the relationship between surpluses and recessions is nil.
1991–no surplus
1988–no surplus
1982–no surplus
1973–no surplus
1953–no surplus
*****
Obviously, the federal gov’t will always have some outstanding debt.
The question is really how much debt is healthy.
You think that raising it 66 percent in 6 years is just fine.
I don’t.
BTW, JM, the graph I linked to is simply The Office of Management and Budget from Whitehouse.gov information put into a graphical form.
What a maroon . . .
And yes I am The Finger. I admit it.
• our children and grandchildren will never have to pay back the debt if the economy keeps growing..
And, JM, just how much will the conomy have to grow so that no one will have to repay the debt?
I think GHWB called that voooooodoooooooo economics in 1980.
Yeah, WS, good one.
We can grow ourselves out of debt but we can’t grow ourselves out of Social Security obligations.
Odd contradiction there isn’t it.
Side-stepping again by throwing in sideways stuff again.
To answer your question, yes there should be a debt ceiling. Under the current revenue generating economy we have perhaps 30-40 percent of the GDP, but not more. I give it a fudge factor of 10 percent because of variabilities beyond the economies control (war, national disaster, etc.)
However, I strongly with the Government holding on to too much of taxpayer money by raising taxes. They are not the generator of revenue that will keep us from reaching inflation or deflation.
And for someone admitting that they never ever troll, you just admited to it. heh(marks post for all to see)
So WSClark you would rather have Stagflation (no growth) or Inflation (devalued money) than revenue growth?
Just try to answer the question – it really is elementary – how is the debt and other obilgations going to be met?
Everything else is just side stepping the question.
How the hell do you plan on paying your obligations?
I said I never trolled before I decided to revive The Finger.
It was in response to The Eagle’s policy of letting Ian’s hate speech stand.
*****
Anyway, back to the issue: you say you favor a debt ceiling of 40 percent of GDP?!
That’s roughly HALF of what it is now.
And you think you can do that without raising taxes?
In other words, do what caused the problem to solve the problem . . .
Yeah, that’s what Bush is doing in Iraq.
Good plan.
The concept WSClark is called debt rollover. Most people think of rollover when they go to their car which is not payed off, so they rollover their older model car’s loan on to their newer car’s purchase and loan.
Rollover is a very common practice in business. This is just a business model applied to the Government.
Greenspan is in favor of some debt as it is a way to use T-Bonds to resolve the problem of generating wealth in the investors with the majority of the investors being US Citizens. Check that stack of saving bonds in your metal box. That is an example of T-Bill wealth that the government uses to borrow money and increase the wealth of the individual.
There are larger versions of T-Bills and longer periods that entities such as countries can buy.
There is simply not a good reason of not having debt. Debt is not a bad thing as long as you are generating postitive revenues.
Yes, at some point when the country is in Stagflation and the economy is not producing revenue then some artifical government interference would prove useful.
Currently, we are generating positive revenue at a tremendous rate and there is no reason to discourage that.
With that said and previously mentioned here in this thread, there should be a cap on National Debt of 30-40 percent of the GDP so the T-Bill will not fade from existence.
So, according to your economic model – debt is good – zero debt is bad – paying off the debt is bad?
There are several ways to put a cap on the national debt, but my eyes are wearing out and I need to shower, get to bed. More tomorrow. :)
Paying off the National Debt is an easy thing to do, if our leaders would do as the Concord Coalition recommended.I do believe that a secondary monetary system along with the primary monetary system would work and be necessary to maintaining the social security system.