US Budget

[GuyInTaiwan]

At what point will the brinkmanship stop?

http://news.yahoo.com/s/ap/20110419/ap_on_sp_ot/us_debt_rating

A downgrading of the U.S.'s credit rating would be disastrous and you'd probably see a major jump in terms of how big a slice of the pie debt servicing would take.

Both sides have proposed cutting $4 trillion from future deficits over the next 10 to 12 years.

What the hell does that even mean? Would that actually reduce the current defecit? Am I reading that correctly by assuming the answer is "no"?

[Dr. McCoy]

Fuck it. Let's just attack somebody.

Oh. We did already.

Never mind.

[Jaboney]

Invade Swaziland. Or Sweden. You know, that place where they keep all the money in Swiss banks.

[housecat]

At what point will the brinkmanship stop?

http://news.yahoo.com/s/ap/20110419/ap_on_sp_ot/us_debt_rating

A downgrading of the U.S.'s credit rating would be disastrous and you'd probably see a major jump in terms of how big a slice of the pie debt servicing would take.

Both sides have proposed cutting $4 trillion from future deficits over the next 10 to 12 years.

What the hell does that even mean? Would that actually reduce the current defecit? Am I reading that correctly by assuming the answer is "no"?

That's how it reads to me. It's not about NOW, although the article says that the American government could be out of opporation by July 8--this year--at the latest if things aren't changed. I don't get it.

And this quote

S&P noted that the U.S. deficit grew to 11 percent of economic activity in 2009, a risky percentage. The deficit averaged less than half that percentage in the previous six years.

is pretty starteling, too. Does that mean that the deficit swelled to 21 times it's size in one year? Surely, that's my own dumb misunderstanding?

[Mr He]

How is mentioning that the US govt debt is nearing 100% of GDP?

It's plain wrong, it's not.

If the states debt and the unfunded promises qua the social programmes are calculated in, you end up at a figure closer to 600%.

"
"Anything them Greeks can do, we can do better".

The US will cut like crazy, and taxes will go up.... And living standards will fall.

[Gman]

How is mentioning that the US govt debt is nearing 100% of GDP?

It's plain wrong, it's not.

If the states debt and the unfunded promises qua the social programmes are calculated in, you end up at a figure closer to 600%.

"
"Anything them Greeks can do, we can do better".

The US will cut like crazy, and taxes will go up.... And living standards will fall.

I think rating agencies lost their credibility a long time ago. But, this is the beginning. When the US is downgraded for real interest rates are going to soar and the cost of servicing the debt is going to impossible and the government will be left with two choices;

1. Default
2. Inflate the currency

[Dr. McCoy]

http://www.tnr.com/blog/jonathan-chait/ ... -too-small
I thought this was interesting about the Republican strategy on the budget ten years ago. They wanted exactly what they want today--tax cuts. So the standard operating procedure is that you find some 'Think Tank' to say that the government economists are wrong, we have lot more money than 'they' say, because 'they' are liberal elite smart guys.
Ten years and three wars later they find they are totally wrong so what do we need to do? Tax cuts. That'll fix it. This time for sure. eh? he he he

Ten years ago, the Republican pose was surplus hysteria. The surplus is huge, we must eliminate it it lest the government pay off the entire national debt and start buying up private industry. As part of this argument, conservative Republicans were fervently insisting that the Congressional Budget Office was underestimating surpluses over the next decade.

[Gman]

others have talents that could benefit society in non-monetary ways or skills that need time to mature

What examples of this can you give me?

The anthropology professor / museum curator who wants to be an organic farmer to give one I met recently. It's taken him until his early 50's to be able to make a start on it via semi-retirement but he still needs to go to a job he hates 4 days a week. How many great rock bands, artists etc have sprung from people working 9-5 and how many from those solely dedicated to music and art? What about the hobbyist inventor who spends nights and weekends tinkering - imagine if he were free to dedicate all week to coming up with new inventions.

All it requires is recognizing that society must benefit society not a select few individuals.

Let's look at your professor / farmer example. He developed a skill as a professor / museum curator that people where willing to pay for. With the money he made from that he is able save enough capital to make a start on his dream of being an organic farmer. It sounds like this is a case of the free markets working. If he can produce food people are willing to pay for at a price that people are willing to pay he will be successfull and he'll be able aford to switch to full time. What's your alternative? Have the government just hand over land and some starting capital to anyone who says they want to be a farmer?

In terms of rock bands, I have no idea. But, Rod Stewart, for an example, worked as a grave digger, before making it big. And what do you propose? That the government just subsidise anyone who says they want to be an artist, or and inventor? How many people do you think would suddenly declare an interest? Let's look at Rod Stewart as an example. Here's a guy that worked as a grave digger (and other jobs) he did those jobs to earn a living wage while he pursued his musical asperations. Guess what? Society benifitted from the minute he picked up a shovel and will benfit until the day he hangs up his microphone (if he hasn't already). Now if we take your idea, how does society benifit? Rather than having various jobs done, society is funding hundreds of thousands potential Rod Stewarts. Of which only a very few will suceed so how does society benifit? How does society recovers it's investment. After all I doubt one Rod Stewart pays for all the failed Rod Sterwarts out there? And what do we now do to all the failed Rod Stewarts now that they've washed out and can't earn a living having never developed any other markatable skill that will allow them to earn a living in the real world or do we just fund them until death?

[reztrop]

The Ryan budget is mindblowing for its dumbness and apathy toward the middle class. The GOP's continued push for more tax cuts for the wealthy never cease to amaze me. I'm no fan of Obama, but if you do the math, a budget (whether it's the government or a family household) will go deeper in debt if you continue to lower your income without cutting spending.

Common sense: The most effective way to get rich is to increase your income level and spend less. Both parties are too chicken to tackle entitlement spending. And the GOP loves tax cuts just for the sake of loving tax cuts, without doing the math. Everyone is so scared of raising taxes. How come the US is so lacking in cojones? It makes the Chinese government look like a true man.

The simple solution is to raise taxes and cut spending. End the tax cuts for the wealthy, then follow up with a gradual plan for reverting everyone to Clinton-era tax rates. Next, end the mortgage interest deduction credit.

Raise the Social Security retirement age to 68. Start taxing income above $106,800 for Social Security OR stop Social Security payments for people who earn more than $106,800. Finally, overhaul Medicare and stop funding Medicaid.

Give targeted tax cuts for small businesses.

Cut wasteful defense programs. As Eisenhower warned, we don't need a military-industrial complex.

[Gao Bohan]

Finally, overhaul Medicare and stop funding Medicaid.

That's exactly what the Ryan plan does, which you oppose because it hurts the middle class. And there's no need for a gradual return to Clinton-era taxes. Congress simply has to let the Bush-era tax cuts expire in 2012, and we're back. I don't buy the idea that we'll slip into a double dip recession because of a modest tax hike.

It isn't true that both parties are too chicken to go after entitlements. The Ryan plan does just that, and Obama has signaled a willingness to accept entitlement reform; he just thinks Ryan's plan goes too far. It also repeals the ACA, which obviously Obama isn't going to support. Obama has compromised on numerous major pieces of legislation with the Republicans since their November victory. If entitlement reform doesn't go through, it's because the Republicans are being too intransigent on tax hikes.