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On July 26 2011 00:57 DeepElemBlues wrote:
Of course, the Democrats are certainly not 'cynically' attempting to 'stymie' Republicans by doing things like declaring spending on Obamacare off the table. No, not at all. Of course both sides are trying to stymie the other and jockey for position as the party not to be blamed by the public.
Technically speaking Republicans have shown themselves repeatedly adamant about cutting just about everything that isn't nailed down. See boyfriend Paul Ryan.
There is also a marked difference between Dems wanting to protect health care from Republicans but otherwise proposing cuts (I said 75-25 earlier in the thread; I meant 85-15), and Republicans declaring that a budget solution must be attained purely through cuts or else.
They're not even talking about tax hikes anymore (which even the fucking Economist says must be done) and just closing loopholes in the tax system,
On July 26 2011 00:57 DeepElemBlues wrote:
The dispute is over raising taxes now, not some idea John Boehner threw out in negotiations that was not part of any deal at all.
Yeah, that has nothing to do with a proposed "revenue ceiling."
On July 26 2011 00:57 DeepElemBlues wrote:
Also he didn't even say that, he said that "in effect" the US has already lost it's AAA trading, in other words that the market has been behaving as if that has happened. [...] So, no, the GOP pushing for a "short-term ceiling rise" is not the reason the USA's AAA status is in danger, the reason it is in danger is because we went from having yearly deficits of around half a trillion dollars to having yearly deficits of a trillion and a half dollars in a very short time, and that is expected to rise to even more.
The deficit led to a revision from stable to negative, but it's this squabbling more than anything else (link). Advanced notice was already given that a failure to propose a plan for deficit reduction in conjunction with raising the debt ceiling would result in a downgrade.
Ideological differences regarding how large the rise should be and what should be done to ameliorate the deficit are what's holding things up, although Obama has been largely centrist, right of his own caucus even, throughout this whole affair, and Boehner and moreover his dysfunctional caucus (teehee) have been impossible to negotiate with.
On July 26 2011 00:57 DeepElemBlues wrote:
Also, you are being misleading. First of all, the debt ceiling isn't measured in time, it's measured in dollars. So a "long-term" debt ceiling rise would just be a large increase in the debt ceiling. Second, whether or not the rise is large or small is totally irrelevant, Moody's and the IMF and others have already said multiple times that it is the rate of increase of the US debt that is the problem. A "long-term" ceiling rise would do nothing to fix this.
First, you misunderstand me. "Long term" and "short term" are not in reference time; they're in reference to all factors involve that would delay the necessity of having to have this bullshit debate play out all over again. Hence, not only the size of rise but accompanying reduction plan and I can barely believe I have to clarify this.
As for the rest, cf. McConnell's wariness about how this debate plays out come election time next year and here. Both parties have reelection campaigns in mind, but Obama/long and Boehner/short (teehee) is an actual issue.
On July 26 2011 00:57 DeepElemBlues wrote:
Most of those 800 days they controlled both houses of congress, and for the entirety of them have been in control of the Senate).
Did that filibuster reform go through? I forgot.
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On July 26 2011 01:25 Teejing wrote:
Honest question: Would would happen if debts just would be erased?
Trust in the one with the debt would be reduced to zero, which would suck pretty hard for said person since money is nothing but portable trust.
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the reason the us debt is so big and why so many eu countries are in the shithole and need to be saved by Germany (irony, anyone?) is because people kept talking out of their ass about how they were going to solve x y and z problems.
wait a minute this all sounds very familiar...
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On July 26 2011 01:25 Teejing wrote:
Honest question: Would would happen if debts just would be erased?
If I loaned you $50, and you decided to erase that debt (default), how likely do you think it is that I, or anyone for that matter, would ever loan you money again? Defaulting is not conducive to any long-term goal.
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On July 26 2011 01:43 jon arbuckle wrote:Show nested quote +On July 26 2011 00:57 DeepElemBlues wrote:
Of course, the Democrats are certainly not 'cynically' attempting to 'stymie' Republicans by doing things like declaring spending on Obamacare off the table. No, not at all. Of course both sides are trying to stymie the other and jockey for position as the party not to be blamed by the public. Technically speaking Republicans have shown themselves repeatedly adamant about cutting just about everything that isn't nailed down. See boyfriend Paul Ryan. There is also a marked difference between Dems wanting to protect health care from Republicans but otherwise proposing cuts (I said 75-25 earlier in the thread; I meant 85-15), and Republicans declaring that a budget solution must be attained purely through cuts or else. They're not even talking about tax hikes anymore (which even the fucking Economist says must be done) and just closing loopholes in the tax system, Show nested quote +On July 26 2011 00:57 DeepElemBlues wrote:
The dispute is over raising taxes now, not some idea John Boehner threw out in negotiations that was not part of any deal at all. Yeah, that has nothing to do with a proposed "revenue ceiling." Show nested quote +On July 26 2011 00:57 DeepElemBlues wrote:
Also he didn't even say that, he said that "in effect" the US has already lost it's AAA trading, in other words that the market has been behaving as if that has happened. [...] So, no, the GOP pushing for a "short-term ceiling rise" is not the reason the USA's AAA status is in danger, the reason it is in danger is because we went from having yearly deficits of around half a trillion dollars to having yearly deficits of a trillion and a half dollars in a very short time, and that is expected to rise to even more. The deficit led to a revision from stable to negative, but it's this squabbling more than anything else ( link). Advanced notice was already given that a failure to propose a plan for deficit reduction in conjunction with raising the debt ceiling would result in a downgrade. Ideological differences regarding how large the rise should be and what should be done to ameliorate the deficit are what's holding things up, although Obama has been largely centrist, right of his own caucus even, throughout this whole affair, and Boehner and moreover his dysfunctional caucus (teehee) have been impossible to negotiate with. Show nested quote +On July 26 2011 00:57 DeepElemBlues wrote:
Also, you are being misleading. First of all, the debt ceiling isn't measured in time, it's measured in dollars. So a "long-term" debt ceiling rise would just be a large increase in the debt ceiling. Second, whether or not the rise is large or small is totally irrelevant, Moody's and the IMF and others have already said multiple times that it is the rate of increase of the US debt that is the problem. A "long-term" ceiling rise would do nothing to fix this. First, you misunderstand me. "Long term" and "short term" are not in reference time; they're in reference to all factors involve that would delay the necessity of having to have this bullshit debate play out all over again. Hence, not only the size of rise but accompanying reduction plan and I can barely believe I have to clarify this. As for the rest, cf. McConnell's wariness about how this debate plays out come election time next year and here. Both parties have reelection campaigns in mind, but Obama/long and Boehner/short (teehee) is an actual issue. Show nested quote +On July 26 2011 00:57 DeepElemBlues wrote:
Most of those 800 days they controlled both houses of congress, and for the entirety of them have been in control of the Senate). Did that filibuster reform go through? I forgot.
Anymore? They weren't discussing them from the start. The Republicans are downright fanatic in their desire to protect the pockets of the rich.
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There will be deal made in Washington. But it's probably not going to be a long-term solution. Man, I wished Obama was more iron-fisted. He let Republicans just toss him around.
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On July 26 2011 00:57 DeepElemBlues wrote:
Of course, the Democrats are certainly not 'cynically' attempting to 'stymie' Republicans by doing things like declaring spending on Obamacare off the table. No, not at all. Of course both sides are trying to stymie the other and jockey for position as the party not to be blamed by the public.
While it is true that both parties are trying to play their usual political game and make the other look bad, it definetly seems to me as if the Republicans are losing the battle. They continue to deny any tax hikes, saying that spending is the only cause of debt.
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On July 26 2011 01:35 HoodedAvatar wrote:Honest question: Would would happen if debts just would be erased? not a good idea, because the investors who are owed money would not be pleased at all.. the only way to erase debt is by defaulting, and that not only ruins ur credit rating but also, leads to no future investment in ur coutry. Just look at germany after world war 1. Thats what happens when u erase debt.
actually the hyperinflation was a result of the huge amounts of debt and reparation payments of WW1... the erasing of debt was a result out of that. ( fun fact the relation of the old currency to the new one was 1.000.000.000.000 M : 1 RM ) not the other way around.
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On July 26 2011 02:19 XXhkXX wrote:Show nested quote +On July 26 2011 00:57 DeepElemBlues wrote:
Of course, the Democrats are certainly not 'cynically' attempting to 'stymie' Republicans by doing things like declaring spending on Obamacare off the table. No, not at all. Of course both sides are trying to stymie the other and jockey for position as the party not to be blamed by the public. While it is true that both parties are trying to play their usual political game and make the other look bad, it definetly seems to me as if the Republicans are losing the battle. They continue to deny any tax hikes, saying that spending is the only cause of debt.
Actually, go look at this morning's news. Republicans are winning the debate and Democrats are about to cave.
Also, we're running $1.4 trillion ANNUAL deficits. You simply can't tax enough to close that gap without destroying the economy. Even if the government passes the ~$3 trillion, 10-year plan that Boehner and Reid are working on, we'd still be running $1.1 trillion ANNUAL deficits.
It's sheer lunacy to argue that the US deficit is not primarily the result of a spending problem.
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..... Money is paper... Printed by the Federal Reserve
how do you pay back something that's printed for us?
Don't you guys see that it's a no win situation?
It's never going to go away. We are slaves to secret organizations that we will never learn about
All this politics talk and wall street nonsense is just a balance system
We can never pay back the debt, ever. It won't happen. The more people we have and more things we get our hands into the bigger it will grow
You all are eluding yourselves with this debate, and it's quite funny
Just enjoy your life while you can, soon we will not have an economy or currency at all, and the food you have and water you have will be your biggest concern of wealth
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On July 26 2011 00:49 RoarMan wrote:Show nested quote +On July 25 2011 06:08 TheDraken wrote:+ Show Spoiler +On July 24 2011 04:25 jmack wrote:It's pretty clear at this point large INTERNATIONAL banks / financial sectors are guilty of fraudulent banking, or at least swindling millions of people out of TRILLIONS and disregarding any respect for their customers interests. Deregulation is retarded. Retarded. Do you know what the word greed means? What did people think would happen if they allowed the greedy to run free? Tax the rich; hard. There should be large government SPENDING not CUTS ( cuts is moronic ). And before anyone claims I don't know what is it I'm talking about let me paint you a picture: You are currently allowing the government to tell you that if the rich get tax CUTS they will create jobs; what jobs? What jobs and where are they? Deregulation and wealthy tax cuts have been around for a decade and now that the bubble has burst it's clear the attempt was a complete failure. With that in mind, you're allowing your ELECTED officials to present more ideas following the same broken logic. No corporation can create jobs if there's no demand for their product ( regardless of how much the company pays it's CEO's ) IF THE PEOPLE WHO BUY THE PRODUCTS HAVE NO MONEY. A serious move towards a socialist ( don't be ignorant and overreact to the word; go do some research and tell me it isn't a more ideal system we should be striving to move toward ) nation is a great way to actually recover the economy. This is not just information I am posting on TL forums; it is being screamed at you by those stuck behind the main stream cable media. No matter what your beliefs, no matter what they are; I have a hard time believing ANYONE supports the notion that millions should go hungry/poor while working 60hrs a week for minimum wage while CEO's of THE BANKS collect half billion dollar bonuses for doing nothing. The banks and their CEO's are the modern day version of medieval lords of land, seemingly immune to the law and collecting absurd wages based on the misuse and exploitation of their slaves. Yes we're slaves; we're slaves living on the illusion that we're free and that one day we can be the "wealthy". I look forward to your views, discussing them and reflecting on my own. + Show Spoiler +Yes I am angry and disgusted. The more I learn about our system the sweeter the word "revolution" sounds. As a member of the American "rich", I can tell you that your blind rage will only cause further damage to the economy since you clearly do not understand the environment at the top. There is a MASSIVE difference between an American millionaire and a billionaire. One is 1,000 times poorer than the other. To put them in the same income bracket (making 250k or over) and raising taxes on all of them is disproportionately unfair to the millionaires who do not walk away with the corporate profits you have described above. Most American millionaires are people who have been very successful managing a company of 100 employees or less, and they are not the type of people shipping jobs overseas. The real problem is the convention of classifying corporations as "people" with their own monetary and legal rights. The obscene profits posters have listed belong to corporations. Not people. Almost no one is walking home with a billion dollars more in their pocket at the end of the year. If you think that you can just tax the hell out of those few that in fact do walk away with that much, you'd be sorely disappointed by the small pool of people you're trying to tax from. The things that need to change are corporate taxes and corporate regulations, not personal income taxes. Even if you got your way and taxed the hell out of us "rich", you still wouldn't fix anything. There just aren't enough of us to make any appreciable dent on the debt. Besides, personal income taxes would only hurt the lower portion of the top 1%, since the higher up you go the more people earn money through capital gains. I don't see anyone talking about capital gains taxes, which are far lower than income taxes. Please educate yourself before raging on the internet and spewing unfounded hatred. It disgusts me to see people engage in blind "me against them" fanaticism when they clearly have no idea what they're talking about. Few deny that trickle down policy didn't work, but to think that chopping off the top 1% and feeding it to the bottom will fix everything is just crude ignorance. So having millions of dollars is not enough? Just because someone has 1000x more than you doesn't mean you're in a bad situation, there are many people who are 1000x poorer than you, people who can't even afford to come online and post their opinions ffs. I'm not mad at anyone, I feel like people who have lots of money must have done something to get there and I can totally respect that. Chopping off the top? Will taxing the rich really hurt them that much? Let's think, even at a 50% tax someone who rakes in 1 million dollars still has a lot more than someone who rakes in 100,000 dollars at 10% tax. I know I'm giving a crude example but the I think the messege is very simple. Maybe it's my twisted view of ethics or what I think is right or wrong but I do feel like those with the many, or those at the top have a responsibility to take care of those at the bottom. Do you know what greed is? Greed is saying your rich and then complaining about the deficit between you and the billionaires. Many people would love to be able to even think about this. America is in trouble and as someone said there's no one really willing to help if we compare this situation to Greece's economic trouble, it's something the republicans and democrats have to work out and this rate both parties are just fighting each other. Economic classes aside at the end of the day you're all fellow Americans, are you just gonna watch your country just crumble? I don't have the answers or solutions nor do I even know much about economics, but TheDraken I think you have to consider everything on the table.
Let my country crumble? My post never implied that. I offered multiple suggestions that would target the people that politicians keep referencing (extremely wealthy corporate officers) without unfairly burdoning the less wealthy members of society with taxes they don't really deserve. Let me be clear that when I say that I am specifically referring to a rise in personal income taxes and personal income taxes alone, which disproportionately affect the lower rich more than the upper rich. People carry the misunderstanding that the balloon of American wealth is stored in private bank accounts. It's not. It's tucked away in company coffers and rainy day funds in case the economy turns even more sour. A model company that runs on this model is Ford Motor Co., which has managed to survive (unlike other American competitors) precisely because of their gargantuan liquidity stock. Companies don't pay personal income tax.
Take the CEO of Ford, who has been earning in the ballpark of 50M USD per year. If he's like any other CEO, he takes one or two million in cash salary and the rest of it in stock options. Should he choose wait just one year before cashing them instead of exercising them immediately, he will pay long term capital gains tax. NOT personal income tax. In essence, he takes most of his paycheck and avoids paying 80% of it to the government. A good portion of the middle class doesn't even get to keep that much. If he's smart, he'll even do some clever chip trading and land himself some overseas assets taxable at an even lower rate. This goes on top of all the deductions he and most wealthy citizens that run companies can make. If I use my car to conduct business for my company, I can deduct a certain portion of its cost proportional to the extent to which it is used for company matters. Nothing says I can't make that car a Ferrari. It's garbage like that that the government allows people to get away with (deductions like that are the main skeleton in the closet for the lower rich) that should be and can be prevented.
So we have a few options. Raise personal income tax like everyone wants to on the rich. What will they do? Well the lower rich will feel the pain from it, but the mega rich couldn't give half a shit about it since almost none of their wealth can be taxed as personal income. On top of that, it doesn't solve the massive company bank accounts, which don't belong to any real "persons". Hm, guess we didn't solve the wealth bubble at the very top. How about we raise capital gains. Suddenly we hit everyone on Wall Street and almost no one from the lower and middle classes. How about we cut deductions, close loopholes, and increase the cost of moving large sums of money around? Suddenly it becomes unfavorable for companies to be playing with large pools of money and they'll seek to invest it like we've been wanting all along.
The problem? American politics is virtually owned and funded by Wall Street. Won't happen. Personal income tax increases on the top 1% is as close as they'll get to appeasing the masses without actually affecting any of the people they claim to target (the corporate jet owners). It's unfortunate. It's political theater. And believe me, I don't like the wealth bubble any more than you do... especially when I'm not one of the corporate jet owners but I'm facing a country wanting to tax the living fuck out of me.
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On July 24 2011 04:12 No_Roo wrote:
Most of the americans on TL are actually the people in the process of inheriting the debt, as such we're a little cranky about being stuck with the bill.
I think our world is in need of a Tyler Durden tbqh. Sadly I don't think a few soap bars with body fat is going to solve the problem like in the movie...
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In both the corporate world and personal finances, we can leverage our assets to get cash upfront. Unfortunately governments can't do the same thing. There is very little the US actually owns.
For a default to occur, it means no one wants to buy the government bonds anymore. Essentially, the government buys back existing bonds all the time, but now can't actually sell them again.
If you raise the interest rates, the bonds are much more appealing and people are more willing to buy them. If you create more bonds you create inflation and people are less willing to buy them.
The US has always had a huge advantage over other countries because of their economic clout. It was the safest investment out there. However, it's losing it's security by amassing such large amounts of debt, and the government will be spending more of it's GDP on interest payments rather than investments.
As for actual cutbacks, the most important one is defense spending. It's quite simply - ABSURD. If the debt gets big enough, it pretty much means the forced disbandment of the armed forces in general. IT's happened to plenty of countries and empires in history.
However, the whole debt issue is somewhat blown out of proportion. In 2010 interest payments on national debt were a fairly slim 2.8% (414billion on 14.7 trillion gdp). You want to maintain a interest payment less than the gdp growth, so you can see how raising interest rates to make bonds more appealing is very dangerous to economic health.
So in general, it is a big issue when investors lower their ratings on your government since it means you'll be spending lots more on interest.
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The US isn't going to default, and people aren't losing faith in its ability to pay it off. It'd be good if we raised taxes and/or cut spending now, because that's a lot less painful than doing it (more) later, but people are really blowing this out of proportion.
Look at this: National debt as percentage of GDP
US debt is 59% of GDP. That's a lot. It should definitely be lower. But really... Japan is at 226%, and the country is functioning just fine. Belgium is at 99% and Germany is at 79%. And people are not worried at all about Germany - in fact, they're expecting Germany to help out Greece with its bigger debt problem.
The disaster scenarios are really, really unrealistic.
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debt to foreigners and exports ratio tells it all basically. us cant pay back jack, thats kinda how it works, its all deck of cards relying on reserve status which is collapsing
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On July 26 2011 04:01 aristarchus wrote:
US debt is 59% of GDP.
No, the US debt is 95% of GDP - 14.2 trillion debt to 14.7 trillion gdp. If you notice the footnote beside the figure given you'll notice it's fairly substantial one.
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the US has enough cash and revenue to pay back its current liabilities. the problem is their accounts payable - social security, medicare, defense etc.
obama is following the keynesian idea of how to get a nation out of a recession, which is for the government to spend -- however, the thing that is being overlooked here is that keynes meant for this spending to be funded out of savings, not debt. the US, in attempting to stimulate the economy, has taken on enormous amounts of debt in order to fund federal programs and stimulate the economy, which has not worked for obama at all. that isn't to say that the previous administration did a good job managing the budget. in fact, bush's administration was, fiscally speaking, incredibly irresponsible. obama inherited this, so the entire blame cannot be placed on him, but the policy decisions he has made during his tenure have made the previous president's look prudent in comparison.
the taxation issue really rests on how far left or right you lean ideologically.
as margaret thatcher once said -- "the problem with socialism is that you run out of other people's money."
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From the Washington Post---
Obama kills bipartisan deal, then Reid resorts to smoke and mirrors
By Jennifer Rubin
As I reported earlier, the president rejected a bipartisan congressional deal that would have calmed the markets, resolved the debt-ceiling crisis and restored faith in Washington politicians. President Obama was having none of it, demonstrating once and for all that the problem is NOT the House Republicans, but the election-obsessed White House.
So then the parties begin to devise separate congressional plans. The Post reports, “Senate Democrats are preparing to introduce legislation that would avert a national default on Aug. 2 and achieve $2.7 trillion in deficit savings over the next decade without raising taxes.”
But Senate Majority Leader Harry Reid is devising a sham that will never pass muster in the House. A Capitol Hill source with knowledge of the plan tells me: “It includes $1.2 trillion in OCO [Overseas Contingency Operations] savings . . . which was assumed anyway, $1.2 trillion (over $1.1 trillion less than [Majority Leader Eric] Cantor identified in the Biden talks) and $300 billion in interest savings.” A Senate aide says dryly that Reid “has about a trillion in ‘savings’ from ending the war in Iraq that’s already going to end.” And a disgusted House adviser bluntly tells me that Reid’s plan “isn’t real.”
We shouldn’t be too harsh on Reid. HE DID reach a bipartisan deal with the House. But the president squashed it. (Note to Congress: Next time don’t ask, just pass it and leave town.) Now we are back to gamesmanship.
It is extremely telling, however, that Reid’s plan contains NO tax hike. As I suspected, Obama doesn’t have enough support even in his own party (and particularly from Senate Democrats facing reelection) to pass the massive tax increases that he and his liberal base demand. And yet Obama at the last minute in negotiations with the speaker of the House last week threw in $400 billion in more taxes. There could only have been one purpose for that, since the Senate is as tax-hike-averse as the House: to create a crisis. We have finally found the president’s strong suit.
http://www.washingtonpost.com/blogs/right-turn/post/obama-kills-bipartisan-deal-then-reid-resorts-to-smoke-and-mirrors/2011/03/29/gIQAF3YLYI_blog.html
Can we finally just admit and accept that democrats simply haven't offered any meaningful spending cuts?
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the taxation issue really rests on how far left or right you lean ideologically.
but the tax code has to be reformed in the states, regardless of which party is in power. you can only cut so many programs in a growing country. and to be honest, just cutting spending won't do. but it's not so much as the tax rates, as it is the tax "loopholes" that exist. most americans don't even pay taxes. i mean, how can you run a country with social programs when most people don't contribute?
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EPT
