EPTA Discussion of US Debt - Page 4
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Fruscainte
4596 Posts
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Rflcrx
503 Posts
On April 09 2011 21:03 Rabiator wrote: Its the same in germany as well, where the debt has risen to ridiculous amounts after the unification. From 500 Billion in 1990 to 2000 Billion Euros right now. http://www.staatsverschuldung.de/ The bottom line is that every second Euro we pay in taxes is used to pay for the interest of our debts. If we didnt have as much debt we could have our children eat from golden platters in their daycare ... But unlike the US the german government actually focusses on reducing debt. Schäuble has always loled about Westerwelles attempt to cut taxes and he will do so in the future, no matter which moron will lead the FDP in the future. If the german government will continue its course for the next couple of years (maybe 25?) it could work. The US hasn't even started and their political debate is full of irrational people. However, if the US economy fails everybody is in a world of pain anyways. | ||
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bRuTaL!!
Finland588 Posts
On April 09 2011 15:05 RebirthOfLeGenD wrote: I always wondered if it was possible to just tell everyone we owe money to to just fuck off. I mean I know geopolitically it would make us look like complete assholes and no one will want to lend us money anymore, but I think that would be a fine solution. It's not like there is any way to force the US to pay money to whoever it owes it to. I was wondering if anyone could answer why that is completely impossible, since I am sure if it had any merit some insane politician would be campaigning with that idea already. It hard to know what would happen. But the mildest shit storm is still worse than the worst case scenario of any other option. Including hyperinflation. Any government assets outside your borders would be frozen/confiscated. Any debt towards your goverment would defaulted on. Dollar would collapse. 25-100 million lost jobs. In most countries american companies' and citizens assets would be frozen/confiscated. You could no longer buy anything with dollar, youd nee tangible assets to trade. Good luck getting the oil, minerals, food, machinery & technology you need. Most banks would fail. Complete disaster for US as well as all other developed countries. . | ||
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Rabiator
Germany3948 Posts
On April 09 2011 21:20 Fruscainte wrote: Well I for one believe that we are pretty secure from conventional threats and we can stop spending more than the entire world combined on our military programs. We have the largest navy, largest air force, and most technologically advanced ground army in the world. Yet, for some reason, we keep pressing on with this. We spend $120 BILLION dollars a year (Yes, 10 BILLION a month) on the war on Afghanistan -- just Afganistan. It cost even more years ago when the fighting first started. We are trillions of dollars in debt from pointless wars that had nothing to even do with the Terrorist Attacks other than what is now considered bad information and we continue to spend on it, and we continue to spend ridiculous amounts on our military. Yeah, we're the best military in the world. We get it, but we don't need to economically screw ourselves to keep that title. The Soviet Union fell apart because they couldnt afford the arms race anymore which Ronald Reagan starts ... Star Wars and so on. Maybe it is time the US realizes that they themselves have to stop spending ridiculous amounts on their military and that "a few millions for some super smart bombs" is just too much. Super expensive technology isnt needed to fight terrorists who are hiding among a population in any case ... the military doesnt work like the industry and more technology doesnt produce more / better results. P.S.: War SHOULD BE bloody so it isnt started lightly ... | ||
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enzym
Germany1034 Posts
On April 09 2011 11:36 jdseemoreglass wrote: To put this number in perspective, current federal revenue totals approximately 15 percent of GDP. So what the IMF in effect is calling for is an immediate and permanent doubling of our personal income, corporate and federal taxes as well as the payroll levy set down in the Federal Insurance Contribution Act. Such a tax hike would leave the U.S. running a surplus equal to 5 percent of GDP rather than a 9 percent deficit. [...] The number of companies alone in the U.S. whose profit margin is less than such a projected increase in the tax rate reveals the unfeasability of this suggestion. The average American is already struggling under personal debt, how can they be expected to foot the bill either? It would result at the minimum in a decades long recession, at the worst a complete depression. Then why not raise taxes on the people and companies who can afford it? I'm sure you must know that wealth hasn't disappeared as much as it has been redistributed into the hands of fewer but wealthier people. Surely you also know that many of the most successful corporations pay near zero taxes due to a large amount of loopholes in the legislation and their tax evasion (or avoidance, as they call it) tactics. The reason why credit isn't becoming dangerously expensive yet is because other countries realize that all the U.S. needs to do in order to pay it back is to raise taxes on the people or corporations that do have the money. The only thing preventing that might be the awesome streams of money flowing into the politician's hands to ensure less responsibility for the richest, and the streams of money spent on PR campaigns to make people believe in that agenda and having them vote against their own interests (hello Ron Paul supporters). | ||
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vetinari
Australia602 Posts
On April 09 2011 21:12 revy wrote: I don't have too much to add to this discussion as I'm an engineer by trade and economics is so interconnected, I just cant spend the time to take it apart and analyze it right now. I'm interested in the last part where you speak of silver. Recently I've been trying to order some electrically conductive epoxy (essentially 40-80% silver by volume) and have been running into supply issues because there is currently a shortage of silver. Speculators have been buying up all the silver they can. Its appreciated by 50% this year, I believe. | ||
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Trowa127
United Kingdom1230 Posts
On April 09 2011 21:56 bRuTaL!! wrote: It hard to know what would happen. But the mildest shit storm is still worse than the worst case scenario of any other option. Including hyperinflation. Any government assets outside your borders would be frozen/confiscated. Any debt towards your goverment would defaulted on. Dollar would collapse. 25-100 million lost jobs. In most countries american companies' and citizens assets would be frozen/confiscated. You could no longer buy anything with dollar, youd nee tangible assets to trade. Good luck getting the oil, minerals, food, machinery & technology you need. Most banks would fail. Complete disaster for US as well as all other developed countries. . Joined this conversation very late, but pretty much correct. The US defaulting on its national debt obligations is pretty much a no-no, especially considering how much emerging markets rely on US paper to forecast there budget obligations. I can't even begin to think about what would happen if the US (or any developed nation) defaulted. | ||
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Robinsa
Japan1333 Posts
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Sqalevon
Netherlands523 Posts
On April 09 2011 22:44 Robinsa wrote: The US is fine. Japans got like GDP x2 in debt. But Japan is recovering from a depression ( right? ) And not steaming in one, head first. Japan already made the culture/mentality switch to recover. Or am I completely off here ? | ||
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enzym
Germany1034 Posts
On April 09 2011 22:53 Sqalevon wrote: But Japan is recovering from a depression ( right? ) And not steaming in one, head first. Japan already made the culture/mentality switch to recover. Or am I completely off here ? You are right in that the U.S. is more paranoid by magnitudes. | ||
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Trowa127
United Kingdom1230 Posts
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Zato-1
Chile4253 Posts
That's right, the politicians are more worried about who they're going to blame when the shit hits the fan than on trying to avert the crisis. As a Chilean, I'm well acquainted with both the Chilean and American political establishments, and the American one is a disgrace by comparison. Blaming the politicians is easy, but this situation is also the fault of every American citizen who considers himself to be too disgusted / disenchanted / apathetic with respect to their federal / state politics, and thus decides to not vote / not participate in politics in any way. The deficit problem the US has on its hands is very real, and rather big. On April 09 2011 11:36 jdseemoreglass wrote: To put it bluntly, the U.S. is nearly bankrupt. There is no foreseeable solution to dig us out of the hole we are in. Our economy as it is has been artificially grown through lax interest rate policy set by the Federal Reserve perpetuating decades long mal and overinvestment throughout a long history of "bubbles," and is on weak footing already. I disagree with this. The problem is that US spending is too high, and revenues might be too low. One of the "big four" issues concerning the sustainability of US debt (Medicare, Medicaid, Social Security, Military spending) could be solved easily from an economic point of view; change your Social Security Ponzi scheme for the private capitalization pension scheme we use in Chile and the Social Security part of the deficit vanishes. There are some really obvious and high-impact solutions that would be of tremendous help to deal with the US's current woes, but the worst kind of deafness is that of the man who refuses to listen. | ||
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arbitrageur
Australia1202 Posts
But seriously, it's a complex debate with economists on both sides... If you don't have extensive education in economics or work in the indutsry don't you think your opinion is going to be uninformed? | ||
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Trowa127
United Kingdom1230 Posts
On April 09 2011 23:07 Zato-1 wrote: There are some really obvious and high-impact solutions that would be of tremendous help to deal with the US's current woes, but the worst kind of deafness is that of the man who refuses to listen. Excellent post, so very true. The issue is (we are experiencing this in the UK now) that people are not willing to accept a lower standard of living that is more in line with government revenue. As people have noted, you have two options - lower public expenditure or raise taxes, and the second option really isn't possible in a service centric knowledge economy as there is always the possibility of a mass exodus of employers to Countries with lower taxes and laxer regulation. It honestly boggles my mind that people can think that the levels of public spending we have are even close to sustainable. | ||
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Garbels
Austria653 Posts
On April 09 2011 22:44 Robinsa wrote: The US is fine. Japans got like GDP x2 in debt. Is the dept mentioned in the OP not more than 12 times the GDP ? | ||
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Zergneedsfood
United States10671 Posts
On April 09 2011 22:58 enzym wrote: You are right in that the U.S. is more paranoid by magnitudes. Why are you talking about a depression? America isn't close to one. Besides we only label depressions decades after the fact anyway (at least that was a case with the Great Depression). If anything, by definition we are no longer in a recession because we've already past two quarters of consecutive growth. >.> | ||
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gchan
United States654 Posts
On April 09 2011 23:20 Garbels wrote: Is the dept mentioned in the OP not more than 12 times the GDP ? As I mentioned in page 3, the OP makes misleading statements about how the government reports debt. There's also a few other incorrect assumptions made by the OP with respect to Social Security. | ||
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ghrur
United States3786 Posts
On April 09 2011 23:07 Zato-1 wrote: The US deficit is a hot potato that's just being thrown from one government to the next, where politicians are hoping that when (and not if) it blows up, it blows up in the other party's face and they can point their fingers and try to lay all the blame on their opponents' shoulders. Hmmm, reminds me of vietnam | ||
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MangoTango
United States3670 Posts
http://www.teamliquid.net/forum/viewmessage.php?topic_id=210568 | ||
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HellRoxYa
Sweden1614 Posts
On April 09 2011 21:58 Rabiator wrote: The Soviet Union fell apart because they couldnt afford the arms race anymore which Ronald Reagan starts ... Star Wars and so on. Maybe it is time the US realizes that they themselves have to stop spending ridiculous amounts on their military and that "a few millions for some super smart bombs" is just too much. Super expensive technology isnt needed to fight terrorists who are hiding among a population in any case ... the military doesnt work like the industry and more technology doesnt produce more / better results. Seriously? There's a reason the military invests in technology, and it's not just to spend money. | ||
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