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On July 24 2011 05:11 Zergneedsfood wrote:Show nested quote +On July 24 2011 05:09 travis wrote:
Isn't money made up anyways? What exactly is it that keeps the government from perpetually saying "there isn't a financial crisis, and the debt doesn't matter" ? What if it was just never paid back? For the longest time, the debt really didn't matter, and to me, it still doesn't. But the government can't keep saying that it doesn't matter forever, because it's got payments. A debt is fine so long as the government can keep generating the revenue to perpetually keep up with the interest it needs to dish out on its loans. But now, the US is hard pressed to do that because we literally are out of money.
So basically every country that builds up debt basically says "fuck you" to whatever country they owe debt to? Because eventually they just aren't going to be able to pay it and it will have to be renegotiated. Seems kind of weird that other countries don't get too upset about that...?
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On July 24 2011 05:13 travis wrote:Show nested quote +On July 24 2011 05:11 Zergneedsfood wrote:On July 24 2011 05:09 travis wrote:
Isn't money made up anyways? What exactly is it that keeps the government from perpetually saying "there isn't a financial crisis, and the debt doesn't matter" ? What if it was just never paid back? For the longest time, the debt really didn't matter, and to me, it still doesn't. But the government can't keep saying that it doesn't matter forever, because it's got payments. A debt is fine so long as the government can keep generating the revenue to perpetually keep up with the interest it needs to dish out on its loans. But now, the US is hard pressed to do that because we literally are out of money. So basically every country that builds up debt basically says "fuck you" to whatever country they owe debt to? Because eventually they just aren't going to be able to pay it and it will have to be renegotiated. Seems kind of weird that other countries don't get too upset about that...?
Fortunately thats not quite how it works, especially considering that many countries are still quite interested in investing in the US, huge debt notwithstanding. In many cases, these investments are made in hopes that the receiving country not pay back anytime soon, as the invested dollars allow the lending country a certain amount of security. China is basically betting on American success with the huge amount of money they've invested here.
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How exactly do Americans look at their own debt, and compare it to the current crisis in Europe?
From what I've read and seen in interviews, the news,etc. I always get the feeling that the general US spokesperson shrugs at the US debt, and then redirects attention to the EU (eg Greece).
All one really has to do is look at the difference in yields between US bonds and Greece/Italy/Spain/Irish bonds to get a sense of why the EU debt situation is way worse at the moment.
However, you must not be aware that our current U.S. crisis is whether or not Republicans will agree to raise the debt ceiling, with most economists warning that the US economy will enter a recession if the debt ceiling is not raised by August 2. Republicans have been very adamant about getting a ton of budgetary cuts in exchange for raising the debt ceiling (even though historically this sort of thing passes all the time without much fanfare). And then there's the whole Tea Party movement whose modus operandi is simply to whine about the debt. So, yeah, if anything Americans care way more about the US debt than the EU debt, even though they really shouldn't.
Also framing this as a US vs. Europe thing is stupid. Everyone gets hurt if Greece defaults (which would probably lead to Italy defaulting, which would pretty much implode the European banking system). Everyone gets hurt if the US doesn't raise its debt ceiling. This isn't a "whose shit smells worse" competition, and it's immature to frame it as such.
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On July 24 2011 05:04 cfoy3 wrote:
Fix the tax code. Everyone I have talked to knows that the tax code is a mess. Its based on the idea that if you do not tax the wealthy, they will take that money and reinvest it into the economy. Now I do believe that they could do this a hell of a lot better than the government, but their is no guarantees that they wont hoard the money or invest it over seas. If we at least adapted measures that guaranteed low tax rates for insurances that the money is going to America, and cut out all the BS loop holes we would all be better off. Then we need to institute some term limits and a balanced budget amendment that is flexible not to lead us into ruin during a crisis, but will keep us in line during normalcy.
This is the problem with holding companies accountable. If American companies are being constantly restricted in what they can do with their businesses, the investor classes will go invest in China. Why invest in something that you KNOW won't make as much money as the companies overseas? Please realize it's not only the billionaires investing. It's the small businessman in Maryland who's looking for money to expand his business. It's the worrisome stock analyst in New York who needs to tell 2000 everymen what they should be doing with their money. As more and more companies in America get neutered, more and more people will invest overseas. With China quickly becoming the "next big thing" in investing already, it's getting to a point where it might become rather silly. Especially considering China's on the verge of having a huge bubble-bursting, I'd say we're in for some serious shitstorms in the near future.
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On July 24 2011 05:18 Farkinator wrote:Show nested quote +On July 24 2011 05:04 cfoy3 wrote:
Fix the tax code. Everyone I have talked to knows that the tax code is a mess. Its based on the idea that if you do not tax the wealthy, they will take that money and reinvest it into the economy. Now I do believe that they could do this a hell of a lot better than the government, but their is no guarantees that they wont hoard the money or invest it over seas. If we at least adapted measures that guaranteed low tax rates for insurances that the money is going to America, and cut out all the BS loop holes we would all be better off. Then we need to institute some term limits and a balanced budget amendment that is flexible not to lead us into ruin during a crisis, but will keep us in line during normalcy. This is the problem with holding companies accountable. If American companies are being constantly restricted in what they can do with their businesses, the investor classes will go invest in China. Why invest in something that you KNOW won't make as much money as the companies overseas? Please realize it's not only the billionaires investing. It's the small businessman in Maryland who's looking for money to expand his business. It's the worrisome stock analyst in New York who needs to tell 2000 everymen what they should be doing with their money. As more and more companies in America get neutered, more and more people will invest overseas. With China quickly becoming the "next big thing" in investing already, it's getting to a point where it might become rather silly. Especially considering China's on the verge of having a huge bubble-bursting, I'd say we're in for some serious shitstorms in the near future.
I agree that having an anti-business tax policy would be bad because there are a lot of people that fill in the gap between middle and large businesses.
At the same time, this administration has been rather tax friendly to Americans. Tax rates are at their lowest (in terms of in the top $250,000 or over) since the 1950s (IIRC....I'm bad at citing stats off the top of my head from reknown analysts/professors).
But when I look at China and how the country is going, I don't seen a large danger of a bubble burst having too many shockwaves. This is probably because the authoritarian state along with massive capital reserves are pretty good buffers between itself and a dangerous crisis. The danger is there, and it might be enough to stunt some of China's growth, but since I was expecting that to happen anyway, I'm not too worried at the moment.
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On July 24 2011 05:18 Farkinator wrote:Show nested quote +On July 24 2011 05:04 cfoy3 wrote:
Fix the tax code. Everyone I have talked to knows that the tax code is a mess. Its based on the idea that if you do not tax the wealthy, they will take that money and reinvest it into the economy. Now I do believe that they could do this a hell of a lot better than the government, but their is no guarantees that they wont hoard the money or invest it over seas. If we at least adapted measures that guaranteed low tax rates for insurances that the money is going to America, and cut out all the BS loop holes we would all be better off. Then we need to institute some term limits and a balanced budget amendment that is flexible not to lead us into ruin during a crisis, but will keep us in line during normalcy. This is the problem with holding companies accountable. If American companies are being constantly restricted in what they can do with their businesses, the investor classes will go invest in China. Why invest in something that you KNOW won't make as much money as the companies overseas? Please realize it's not only the billionaires investing. It's the small businessman in Maryland who's looking for money to expand his business. It's the worrisome stock analyst in New York who needs to tell 2000 everymen what they should be doing with their money. As more and more companies in America get neutered, more and more people will invest overseas. With China quickly becoming the "next big thing" in investing already, it's getting to a point where it might become rather silly. Especially considering China's on the verge of having a huge bubble-bursting, I'd say we're in for some serious shitstorms in the near future.
With the sorts of profits and overall success of the top 2% of Americans, I'd hardly call American corporations neutered. How can record setting profits amidst economic downturn be interpreted as anything but an indication that businesses are allowed far too much leeway. Besides, in terms of intellectual capital, the US is and will continue to be at the forefront, we must simply seek a way to properly capitalize on it.
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On July 24 2011 05:13 travis wrote:Show nested quote +On July 24 2011 05:11 Zergneedsfood wrote:On July 24 2011 05:09 travis wrote:
Isn't money made up anyways? What exactly is it that keeps the government from perpetually saying "there isn't a financial crisis, and the debt doesn't matter" ? What if it was just never paid back? For the longest time, the debt really didn't matter, and to me, it still doesn't. But the government can't keep saying that it doesn't matter forever, because it's got payments. A debt is fine so long as the government can keep generating the revenue to perpetually keep up with the interest it needs to dish out on its loans. But now, the US is hard pressed to do that because we literally are out of money. So basically every country that builds up debt basically says "fuck you" to whatever country they owe debt to? Because eventually they just aren't going to be able to pay it and it will have to be renegotiated. Seems kind of weird that other countries don't get too upset about that...?
The debt is not just owed to other countries. It's owed to investors, including a lot of american citizens, as well as pension funds, insurance companies, banks, etc. All these people think it's safe to lend money to the US because the US will never default.
If the US defaults it will mean bad news for a lot of people who thought they were going to get their loans paid back, and not just rich businessmen. Also, it will mean that the US will have a hard time borrowing any more money in the future, which will mean huge, abrupt spending cuts to all sorts of things like social programs, seniors entitlement programs, education, etc. So basically a default would be really bad.
On the other hand, some people think that the never-ending cycle of increasing debt has to end and that it's worth some kind of a crisis to bring government spending back to reality.
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@Farkinator
I really do not understand you mindset. You are telling me that as a government if we decide to hold a business accountable and regulate it we are just destroying ourselves? I agree that too much regulation is bad, but I refuse to accept that we should just let our cooperation's get a free ride, because it might hurt us. We can make it so that if you want to invest in those other economies and use your money to help them, that's fine just expect taxes because that money came from us Americans. however if you want to invest in America and create new jobs here than you get a lighter tax burden. That way we don't neuter those business that invest here. That just makes sense.
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On July 24 2011 05:32 cfoy3 wrote:
We can make it so that if you want to invest in those other economies and use your money to help them, that's fine just expect taxes because that money came from us Americans. however if you want to invest in America and create new jobs here than you get a lighter tax burden. That way we don't neuter those business that invest here. That just makes sense.
That's the stupidest thing I've ever heard, no offense. America is the richest large country in the world, and you want to punish companies for investing in poorer countries? The ones that need it the most? Seriously?
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On July 24 2011 05:33 domovoi wrote:Show nested quote +On July 24 2011 05:32 cfoy3 wrote:
We can make it so that if you want to invest in those other economies and use your money to help them, that's fine just expect taxes because that money came from us Americans. however if you want to invest in America and create new jobs here than you get a lighter tax burden. That way we don't neuter those business that invest here. That just makes sense. That's the stupidest thing I've ever heard, no offense. America is the richest large country in the world, and you want to punish companies for investing in poorer countries? The ones that need it the most? Seriously?
I think you misunderstand the role of American corporate interests abroad. In the cases of US businesses moving infrastructure to poorer countries, they do out of explicit self-interest. In fact, many poorer countries where American businesses have "invested" in, take Malaysia or Vietnam for example, the net effect of American corporate ventures is negative. Tax shelter and cheap labor are the reason companies move there in the first place, and when those advantages are negated they will move elsewhere.
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On July 24 2011 05:39 farvacola wrote:Show nested quote +On July 24 2011 05:33 domovoi wrote:On July 24 2011 05:32 cfoy3 wrote:
We can make it so that if you want to invest in those other economies and use your money to help them, that's fine just expect taxes because that money came from us Americans. however if you want to invest in America and create new jobs here than you get a lighter tax burden. That way we don't neuter those business that invest here. That just makes sense. That's the stupidest thing I've ever heard, no offense. America is the richest large country in the world, and you want to punish companies for investing in poorer countries? The ones that need it the most? Seriously? I think you misunderstand the role of American corporate interests abroad. In the cases of US businesses moving infrastructure to poorer countries, they do out of explicit self-interest. In fact, many poorer countries where American businesses have "invested" in, take Malaysia or Vietnam for example, the net effect of American corporate ventures is negative. Tax shelter and cheap labor are the reason companies move there in the first place, and when those advantages are negated they will move elsewhere.
This is a common left-wing argument but I think it's basically just not true. Do you have any evidence for this claim?
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@domovoi
It doesnt have to be all of their money goes in America, just a vast majority. But in regards to your question as regards to investing in poorer countries, yes I do expect them to help out our country. I am sorry about those other countries, but you can not get around the fundamental problem of scarcity. We are not the world police, when did it become our responsibility to care for the entire world? If the American people want to support higher taxes and want international aid be a priority then we should. But we are under no responsibility to them. As far as I am concerned that as long as our dealings our fair than that is enough.
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On July 24 2011 05:39 farvacola wrote:Show nested quote +On July 24 2011 05:33 domovoi wrote:On July 24 2011 05:32 cfoy3 wrote:
We can make it so that if you want to invest in those other economies and use your money to help them, that's fine just expect taxes because that money came from us Americans. however if you want to invest in America and create new jobs here than you get a lighter tax burden. That way we don't neuter those business that invest here. That just makes sense. That's the stupidest thing I've ever heard, no offense. America is the richest large country in the world, and you want to punish companies for investing in poorer countries? The ones that need it the most? Seriously? I think you misunderstand the role of American corporate interests abroad. In the cases of US businesses moving infrastructure to poorer countries, they do out of explicit self-interest. In fact, many poorer countries where American businesses have "invested" in, take Malaysia or Vietnam for example, the net effect of American corporate ventures is negative. Tax shelter and cheap labor are the reason companies move there in the first place, and when those advantages are negated they will move elsewhere.
I don't give a shit about the "net effect of American corporate venture," which I doubt is true regardless (that rise in GDP goes somewhere, you know). All that really matters is stuff like this:
http://www.wolframalpha.com/input/?i=China poverty fraction at $1.25/day&lk=1
http://www.wolframalpha.com/input/?i=India poverty fraction at $1.25/day
http://www.wolframalpha.com/input/?i=Vietnam poverty fraction at $1.25/day
Giving companies a subsidy to invest in the U.S. is grossly regressive.
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On July 24 2011 05:24 ziggurat wrote:Show nested quote +On July 24 2011 05:13 travis wrote:On July 24 2011 05:11 Zergneedsfood wrote:On July 24 2011 05:09 travis wrote:
Isn't money made up anyways? What exactly is it that keeps the government from perpetually saying "there isn't a financial crisis, and the debt doesn't matter" ? What if it was just never paid back? For the longest time, the debt really didn't matter, and to me, it still doesn't. But the government can't keep saying that it doesn't matter forever, because it's got payments. A debt is fine so long as the government can keep generating the revenue to perpetually keep up with the interest it needs to dish out on its loans. But now, the US is hard pressed to do that because we literally are out of money. So basically every country that builds up debt basically says "fuck you" to whatever country they owe debt to? Because eventually they just aren't going to be able to pay it and it will have to be renegotiated. Seems kind of weird that other countries don't get too upset about that...? The debt is not just owed to other countries. It's owed to investors, including a lot of american citizens, as well as pension funds, insurance companies, banks, etc. All these people think it's safe to lend money to the US because the US will never default.
Actually the Federal Reserve is now largest holder of Treasuries, and before then it was other central banks.
The guy who said governments never pay back their debt is correct. America will default either defacto or by inflation. But to be honest, I dont think its time yet. Interest rates are still way too low.
Some folks have been talking about this for over a decade. Timing is everything. Im not putting my bets down yet.
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Taxing investment differently across borders would be plausible if we were like China and strictly controlled flows of capital across our border. But we don't, and taxes on countries should, all other things held constant, be equal whether they invest outside of this country or not. Free trade>tariffs.
...of course, this is assuming corporations aren't doing things like dodging regulations or making tax havens. When they do, penalties should be invoked.
Debt ceiling in a nutshell:
http://www.washingtonpost.com/blogs/ezra-klein/post/a-small-deal-wont-cut-it/2011/07/11/gIQAJ17WVI_blog.html
In short: **** somewhere around 50% of Congress.
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We just have a self manufactured "crisis" because Republicans decided we needed one. Bond markets are still buying up US debt cheaply.
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On July 24 2011 05:46 domovoi wrote:Show nested quote +On July 24 2011 05:39 farvacola wrote:On July 24 2011 05:33 domovoi wrote:On July 24 2011 05:32 cfoy3 wrote:
We can make it so that if you want to invest in those other economies and use your money to help them, that's fine just expect taxes because that money came from us Americans. however if you want to invest in America and create new jobs here than you get a lighter tax burden. That way we don't neuter those business that invest here. That just makes sense. That's the stupidest thing I've ever heard, no offense. America is the richest large country in the world, and you want to punish companies for investing in poorer countries? The ones that need it the most? Seriously? I think you misunderstand the role of American corporate interests abroad. In the cases of US businesses moving infrastructure to poorer countries, they do out of explicit self-interest. In fact, many poorer countries where American businesses have "invested" in, take Malaysia or Vietnam for example, the net effect of American corporate ventures is negative. Tax shelter and cheap labor are the reason companies move there in the first place, and when those advantages are negated they will move elsewhere. I don't give a shit about the "net effect of American corporate venture," which I doubt is true regardless (that rise in GDP goes somewhere, you know). All that really matters is stuff like this: http://www.wolframalpha.com/input/?i=China poverty fraction at $1.25/day&lk=1http://www.wolframalpha.com/input/?i=India poverty fraction at $1.25/dayhttp://www.wolframalpha.com/input/?i=Vietnam poverty fraction at $1.25/dayGiving companies a subsidy to invest in the U.S. is grossly regressive.
So... the subsidy encourages investment within the U.S., which would create more jobs within the US. And you're against this...?
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I think you do not understand. America is not the good guys. We do whats best for us. Now that doesn't mean we have to repress everyone and subject them to slavery, that is up to those people, but what is does mean is that their is a limit of how much we are willing to hurt ourselves to help others. We should give aid, but at the expense of our lively hood, our general wellfare? You can excuse me if I want to actually have a job. First we must look after ourselves before we try to be the savior's of humanity.
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On July 24 2011 05:55 ploy wrote:Show nested quote +On July 24 2011 05:46 domovoi wrote:On July 24 2011 05:39 farvacola wrote:On July 24 2011 05:33 domovoi wrote:On July 24 2011 05:32 cfoy3 wrote:
We can make it so that if you want to invest in those other economies and use your money to help them, that's fine just expect taxes because that money came from us Americans. however if you want to invest in America and create new jobs here than you get a lighter tax burden. That way we don't neuter those business that invest here. That just makes sense. That's the stupidest thing I've ever heard, no offense. America is the richest large country in the world, and you want to punish companies for investing in poorer countries? The ones that need it the most? Seriously? I think you misunderstand the role of American corporate interests abroad. In the cases of US businesses moving infrastructure to poorer countries, they do out of explicit self-interest. In fact, many poorer countries where American businesses have "invested" in, take Malaysia or Vietnam for example, the net effect of American corporate ventures is negative. Tax shelter and cheap labor are the reason companies move there in the first place, and when those advantages are negated they will move elsewhere. I don't give a shit about the "net effect of American corporate venture," which I doubt is true regardless (that rise in GDP goes somewhere, you know). All that really matters is stuff like this: http://www.wolframalpha.com/input/?i=China poverty fraction at $1.25/day&lk=1http://www.wolframalpha.com/input/?i=India poverty fraction at $1.25/dayhttp://www.wolframalpha.com/input/?i=Vietnam poverty fraction at $1.25/dayGiving companies a subsidy to invest in the U.S. is grossly regressive. So... the subsidy encourages investment within the U.S., which would create more jobs within the US. And you're against this...?
Because I'm not a racist xenophobe who thinks Americans deserve everything and the rest of the world can go fuck themselves. Or if you want numbers:
http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)_per_capita
search for "United States", "China", "India" and "Vietnam" and tell me we should only care about the US.
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I guess this is a "proper debate" OP because it contains no information, data, sources, links, or actual opinion or analysis. More like "what do random individuals who are mostly ignorant of the situation think?"
The debt sucks. It sucks for the people who are going to end up paying for it and suffering from it. For those who are living now and reaping all the debt-ridden benefits, it sure is great! We shouldn't change a thing!
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EPT
