US Government Expands Deficit and National Debt

Politics International Politics
1

Remember when Republicans campaigned against the excessive of government spending, deficits, and debt? It was last month. They won the election by historic margins. Well, they don’t care about that stuff anymore. From CNN:

[quote]President Barack Obama plans to sign an $858 billion tax deal into law on Friday afternoon.

The House of Representatives gave final approval late Thursday night to the deal, negotiated by the White House and top Senate Republicans. The final vote of 277-148 had almost equal numbers of Democrats and Republicans in support.

The package includes a two-year extension of the Bush-era tax cuts set to expire December 31. It also would extend unemployment benefits for 13 months, cut the payroll tax by 2 percentage points for a year, restore the estate tax at a lower level and continue a series of other tax breaks.

The bill, which cleared the Senate 81-19 on Wednesday, passed despite objections from both the left and the right. However, the pending expiration of the lower tax rates dating back to 2001 created a deadline that forced both sides to accept provisions they had long opposed.

Obama and congressional Democrats yielded in their opposition to extending the lower tax rates to wealthy Americans and also agreed to a lower estate tax than had been scheduled to take effect. In return, Republicans led by Senate Minority Leader Mitch McConnell agreed to extending unemployment benefits along with the payroll tax cut and other tax breaks that conservatives generally oppose as government stimulus measures.

Senate Republicans insisted on all taxpayers getting the same treatment. They used filibusters to block Democratic measures that would have limited the extended tax cuts to individuals earning less than $200,000 a year and families earning less than $250,000 a year, and then those earning less than $1 million a year.[/quote]

2

President Obama has now signed the bill into law. It appears that this may actually increase taxes for the very poor by about $200 next year. From CNN:

3

Yes, Gao, I thought this would be bigger news on this board, and a much longer thread, by now. Maybe people are simply too poor to type, now?

It’s impressive, for sure, that this kind of thing happens. The American public MUST have the attention span of a gold fish and the conscience of a toad. And I’m an American.

God bless America. God bless us, every one.

4

Maybe Americans have just lost faith in their government and feel powerless to do anything because they’re unnerved at the thought that maybe it’s not the fault of the people in government but government itself.

In other words, a system invented in the 18th century which might have been just right for a nation of three million is just completely broken in the 21st century trying to serve a nation of three hundred million. It’s broken most particularly in the sense that politicians soon learn that the only way to survive in the system is to say one thing and do another and despite overwhelming evidence of that fact the American people just haven’t caught on yet.

The politicians, of course, have no incentive to rat on themselves and the inherent shortcomings of the system they serve because it’s their bread and butter and, besides, even if they did, no one would likely pay any attention to them or take them seriously:

– retiring Republican Sen. George V. Voinovich, Ohio.

5

GBH -

Uhhh…just to be technically accurate…those “Republicans” who were overwhelmingly elected by the American populace do not take office until January…2011…thats next year.

But hey…a running start is good for extending your jump!.. :sunglasses:

Oh…and by the way…REAGANOMICS WORKED!… :thumbsup:

6

[quote=“housecat”]Yes, Gao, I thought this would be bigger news on this board, and a much longer thread, by now. Maybe people are simply too poor to type, now?

It’s impressive, for sure, that this kind of thing happens. The American public MUST have the attention span of a gold fish and the conscience of a toad. And I’m an American.

God bless America. God bless us, every one.[/quote]
No, plenty of people fought it. I made the obligatory phone calls to my reps and senators and even wrote emails to the President and to those same reps (yeah, I know, not a paper letter, but they weren’t “click here to send our canned message” emails either).

I think people have lost heart and it’s very hard to see how to continue to race the Bullshit Train. It’s already left the station (even though, as pointed out, the “Tea Partiers” haven’t actually boarded yet), and it appears ready to run down everyone who doesn’t make at least $200k. Whooooo-whoooo, chugga chugga, indeed. Shit. Next station, New Reaganomics. It’s cold and dirty and doesn’t have a decent place to eat for less than $100, just like Old Reaganomics.

These tax changes will actually result in more money in my family’s bank account. WE DON’T WANT THAT. We want the wars to end, but it’s easy to see that taxes need to go UP on all but the poorest to fund the government and begin to bring down the hellish debt. I don’t want services cut to the bone; agriculture subsidies, kickbacks to Halliburton, etc., yes, of course. But let’s not destroy Social Security and let’s make sure that the unemployed don’t become the foreclosed-upon homeless people of tomorrow. Except like I say, that train is ready to run us all down, and I think it’s too late. :astonished:

Taiwan seems like heaven these days. I can’t WAIT to get back. :yay:

7

Um, who voted them in?

Perhaps the US could reduce govt spending by stopping all military spending for three years.

They could even provide universal health care and education for the entire population and still come out ahead.

But of course, that won’t wash with a certain crowd (some of whom have just posted here), now will it?

8

Um, who voted them in?

Perhaps the US could reduce govt spending by stopping all military spending for three years.

They could even provide universal health care and education for the entire population and still come out ahead.

But of course, that won’t wash with a certain crowd (some of whom have just posted here), now will it?[/quote]

Having voted with my feet I’m not in any position to defend the American people and their continued participation in a corrupt and broken system. I’m just pointing out the fact that they no longer believe in their own system of government but refuse to do anything about it:

Even though I’m a conservative I’m all for reducing military spending to pay for universal health care and improved schools as military spending now is far in excess of what the U.S. needs to defend its own shores. Being a conservative though I also believe such policies should be accompanied by true long-term structural reform in taxing and spending policies.

9

If that’s conservative than I am conservative. US elites have totally sold the future of the United States. It’s been very painful being out here and watching Washington and Wall Street conspiring to wreck the nation. What is there to be done?

10

America’s system of government needs to be dragged into the 21st century and restructured so it doesn’t reward putting tribal interests ahead of national interests. Unfortunately Americans lack the vision, courage and will to make such fundamental changes and indeed fear that any such attempt will only make things worse because they don’t trust themselves and their fellow citizens.

Odds are then that America will plunge off the cliff at some point in the not distant future and only then be rebuilt from the wreckage as something suitable for living in the 21st century. For individuals the only real hope is to avoid being trapped in the wreckage.

11

If you’re poor, there are measures in place–all over the place–to keep you poor and make you poorer. You can’t do a damn thing if you’re poor. So who’s to stop those who can from doing as they wish? The US works (worked) because of checks and balances that are, um, not so well balanced these days.

If you don’t have the cash to pay for the ticket, all you can do is stand by the side of the tracks and watch the train plow through your house.

BUT!! How did things get to be this way? I sat in AR in my crumby little appartment three years ago (or four?) and watched the talking heads on my tv talk about where the economy had gone in a handbasket and wondered WTF? We are supposed to have people running things who know enough about how stuff works to keep that kind of thing from happening!

But no one in the States minds the minders any longer. People get their “news” in thirty second sound bites from Fox. This is NOT an informed public. And ultimatly, in a democracy, it’s the People who are responsible, no?

12

Whatever anyone’s personal position on taxes and their role in economic policy might be, one cannot ignore a salient fact: This is not the tax scheme Obama wanted; it was what he had to agree to, based on the wave of GOP power in the house. Yes, as president, he needs to take responsibility. However, this was a compromise with the new Repub congressional influence. Delaying the decision until his hand was forced would have created economic uncertainty. And the Repubs in Congress would have been able to block the progress of any bill that didn’t also extend tax cuts to wealthier Americans. The previous cuts, I believe, will expire in 2011, so now was also a necessary time to extend or revise them.

So, in short, he could either: a) try to do what he wanted and fail; b) delay and undermine the economy, and fail later; c) make a compromise.
Obviously, he chose the best option, c).

The consequences of this choice was lowered tax revenues, which alter the bottom line. To whit, a higher deficit and debt.

And TT: Do you think Reaganomics would work in today’s America?

13

I e-mailed both of my senators, my representative and the White House opposing the deal.

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[quote=“politbureau”][\What do you do in your personal life when you can’t afford something you need?

a) go deeper into debt by borrowing money you won’t be able to pay back in order to pay for it
b) take the money by force from someone who has more than you
c) cutback on discretionary spending so you can afford the necessities[/quote]

And what are the ABC choices for when you can’t afford the necessities and already don’t have any discretionary spending to cut back on?

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[quote=“housecat”][quote=“politbureau”][\What do you do in your personal life when you can’t afford something you need?

a) go deeper into debt by borrowing money you won’t be able to pay back in order to pay for it
b) take the money by force from someone who has more than you
c) cutback on discretionary spending so you can afford the necessities[/quote]

And what are the ABC choices for when you can’t afford the necessities and already don’t have any discretionary spending to cut back on?[/quote]

Except that it depends upon how you define necessities. The world’s poor would look on in amazement at the 300lb poor with their Playstations and sneakers worth what they make in a month at their sweatshop making sneakers… The world’s poor would look on in amazement as people with access to free education throw it away, as many do in developed nations. Likewise, the world’s poor would look on in amazement at how America and other developed nations tax the crap out of things such as tobacco and alcohol, and yet the developed world’s poor still manage to consume such things – necessities, no doubt – in greater excess than the rich.

Here are some simple choices for America’s (and other developed countries’) poor:

Stay in school. Come to class with a pen, some paper and a textbook (not even necessary in many places as such things are provided for them). Stop clowning around. Do your homework. Study.

Don’t have five different kids to three different men, none of whom stick around, all by the age of twenty-three. Treat women with respect. Don’t sire an infinite number of unknown kids and abandon them and their mothers.

Don’t smoke, drink, do drugs or gamble.

Don’t get into fights or gangs or any of that other nonsense. Don’t commit crimes.

Don’t hang out with people who do self-destructive things.

Eat better and exercise. Cook at home. Grow your own vegetables if necessary. You’ll be healthier and you’ll save money. If you’re in good shape, you’ll get better jobs, have more energy in them (so progress further) and take less time off work.

Forget the Nike sneakers. Forget the Playstations. Forget all that other nonsense. It costs you a bundle and makes you dumber. Turn off the TV. Go to the local library. Learn something, be it knowledge or a skill.

Improve yourself and stop blaming others for your self-inflicted problems.

16

politbureau: If an ever increasing % of wealth continues to be concentrated in a smaller % of the population, the middle class disappears and the ranks of poverty keep increasing, THEN you will see some class warfare. That’s not theory, that’s reality.

GIT: If someone follows your advice, they will be guaranteed to be financially secure?

17

No, because I did all that. I worked my ARS off! I went from having nothing but two suitcases of clothes to having an advanced degree and being marginally middle class in 5 years. I NEVER went out. There was NOTHING extra. Well, I splurged on a pizza maybe five times in five years. At the end of it all was utterly exhausted–and no where NEAR financially secure. My “good” Blue Cross Blue Sheild health insurance was hugely expensive. Due to that and the tax man, I took home just slightly more thn 50 percent of what I earned.

I did all the right thing, and I did them correctly.

And not everyone is able to do all the right things. There are cultural realities that make things more difficult for the poor to get anywhere. Yes, they could go to school–but most will not–because it’s not valued highly enough by those they live with or are friends with. Having an education will put a wall between them and their support/social network.

And most of them will never have anything other than a hand to mouth, paycheck to paycheck, cash-in-my-pocket economy–thus will never understand anything else, or why it might be better to save that “extra” couple hundred dollars you earned with overtime this month instead of bying that x-box or whatever.

You can judge people out of hand all you want, but these people are DIFFERNT than the people who make the laws, budgets, and run the country.

18

Even people who go to school, work hard, avoid drugs/alcohol, etc, still hit brick walls from time to time. Economic downturns exacerbate the problem. While your advice can increase the chances of stability, it’s no guarantee. People still get laid off…

19

CraigTPE: Of course I can’t guarantee it. Name me one outcome of our behaviour that we can guarantee. I could look both ways when crossing the road and still get hit by a car (especially in Taiwan!), but it’s less likely than if I just walk across the road. Telling someone to stay in school and get an education is, of course, no guarantee of success, but it’s probably far more likely that the person who does so will be successful than his classmate who plays truant or class clown. Isolated cases I can put down to luck, but when you’re talking about major sociological trends, I think there’s more to it than that.

housecat: I’m not unconditionally justifying what takes place in the U.S. Not by a long shot. Yet people move to the U.S. and other developed nations and make it all of the time. Your experience is the polar opposite to my mother’s. The rest of her family and extended family have turned out to be marginally messed up to complete walking disasters. Despite having a shocking upbringing (or perhaps because of it), my mother decided at a young age to escape all of that and make sure her children didn’t end up like that even down to little things like saying “ask” instead of “aks” like some of her family members. I went to school with kids who had moved to Australia with their parents from Vietnam, or been born here. Their parents were boat people for Christ’s sake, and they didn’t even speak English when they got there. Yet they worked hard, started businesses, sent their kids to good schools, and now their kids are highly educated and paid professionals. My mother’s sister mocked my mother and father for putting all of their money into paying off their mortgage quickly and sending their kids to good schools, instead of drinking it away. Likewise, they mocked my father for starting his own business. Now, of course, my parents are “lucky”. Now, of my four cousins to that aunt, two finished high school and two didn’t. The two who didn’t are struggling, and will always struggle. One recently moved to Europe (because her father is Dutch, so she could live and work there) but couldn’t stay long because she was finding it really hard to survive as a waitress but couldn’t get any better kind of job. She’s thirty and she’s still stuck in the same dead-end line of work she’s been in for almost half of her life. One of the two who finished high school went to a Mickey Mouse university to do a Mickey Mouse degree, but she and her husband still don’t have any sense with money and are living the middle class dream (i.e. struggling with debt because they’ve bought too much shit they don’t need, and unless they change course, retirement is going to be a very rude awakening for them in a few decades), and the other is a tradesman, who despite earning reasonable money, lets money slips through his fingers like water on whatever fancy comes his way. This is in stark contrast to my sister and me. Aside from our higher levels of education, the major advantage we have over our cousins is that money doesn’t burn a hole in our pockets and we can plan more than a week in advance.

The major curse of most of the working poor? Poor impulse control that they, and those around them, never got a handle on from a very young age. It manifests itself in everything they do (or don’t do).

Culture is too often a millstone around people’s necks, and maybe more people need to think about it and disregard it, including those people who would continue to drag them down. Who needs a social support network of cons, ex-cons, people who don’t value education, people who mismanage their money, or all of the above? You could have better, more supportive enemies than that! Maybe it makes me weird for saying and doing so, but I’ve dropped “friends” who have repeatedly shown themselves to be self-destructive and who have been only too glad to drag others down with them.

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[quote=“housecat”][quote=“politbureau”][\What do you do in your personal life when you can’t afford something you need?

a) go deeper into debt by borrowing money you won’t be able to pay back in order to pay for it
b) take the money by force from someone who has more than you
c) cutback on discretionary spending so you can afford the necessities[/quote]

And what are the ABC choices for when you can’t afford the necessities and already don’t have any discretionary spending to cut back on?[/quote]

The only other options I can think of are:
d) beg
Or e) hire someone else to take the money for you so you don’t have to face the person you’re taking the money from. Have the hired muscle tell the guy it’s just a tax like school taxes or road taxes so it won’t seem like he’s being robbed and the “tax” will ensure that nothing bad happens to him.

Can you think of any other options when faced with an income versus outgo problem?