US Government Expands Deficit and National Debt

Turn on the printing presses baby and let inflation wipe your debt away!*

*Not recommended unless you want to turn into a third-world banana republic.

Turn on the printing presses baby and let inflation wipe your debt away!*

*Not recommended unless you want to turn into a third-world banana republic.

I’m just curious how democrats deal with the issues of budgeting, spending and debt on a personal level – do they have the same values that they do at the macro level or are things different for some reason?

politbureau: I’m sure it cuts across party lines. Many Republicans support farm subsidies, military spending and all sorts of other indulgences the country can’t afford. Pork is always bad, so long as it’s someone else’s pork. One’s own pork is a necessity, of course. Buying stuff you can’t afford is always bad, so long as it’s someone else doing it. My best friend in Taiwan comes from a family who are very Republican. They’re currently very underwater on their mortgage and in huge debt. Still, I’d be interested to see a breakdown of whose supporters fall where in terms of personal financial responsibility.

Care to name a few of these measures? Yes there are supposed to be checks and balances and yes they’ve been eroded but by whom? Isn’t the government supposed to be in charge? Doesn’t the responsibility for the presence of these measures you allude to and the erosion of these checks and balances fall at the feet of the various branches of your government? How does giving the government more money solve this? How much more money do you suppose the government needs?

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. [/quote]

That’s great melodrama but the truth is if all you have the where withall to do is stand by and watch then yes there isn’t much you can do.

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! [/quote]

That’s exactly how things got to be this way. People assume that getting elected suddenly confers knowlege of “how stuff works to keep that kind of thing from happening”. During the BP oil spill It was interesting to watch how Boobus Americanis critized Obama for the length of time it took to stop the oil flow. Like winning an election somehow transformed some community organiser from Chicago into a world class Peteroleum Engineer. Americans have gotten used to handing off responsibility and the power that comes with it in exchange for short term benifits and easy answers. Run up a larger debt? Sure no problem I won’t be around when it’s repayment time.

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? [/quote]

Well to be fair the other half get their ‘news’ in thirty second sound bites from MSNBC or God forbid, the Daily Show. Yes in a democracy it’s the People who are responsible so if that’s the case why do so many look to the government to fix their lives? God help the politician who proposes the tough medicine it will take to get America back on its feet.

I think it’s time we asked George Carlin what he thinks:

Fair enough, TC. But nearly all currently serving Republicans were re-elected, and they campaigned on the same party platform as the incoming freshman: cut federal spending, cut the deficit, lower the national debt. It’s a platform that certainly resonates with the American people, and is one I agree with. But don’t you think it’s a bit odd that just a month later those same Republicans (the ones who were re-elected) are voting in favor of a bill that costs $858 billion?

I’ve said it in previous threads and I’ll say it here: Americans can only solve our financial dilemma through collective sacrifice. We’re going to have to endure both reductions in federal spending and tax increases. The president’s bipartisan fiscal commission and the Bipartisan Policy Center both issued reports in November saying the same thing. I’m not picking on just Republicans here. There were plenty of Democratic Congressman irate at the mere notion of reducing federal entitlements (as was recommended by those bipartisan groups). It seems that America is so deeply politically divided that we can’t make even the obvious compromise.

“A bond market crisis is likely unless we do something about the budget deficit.”
– Alan Greenspan, December 18, 2010

Man the lifeboats. Every man for himself.

[quote=“politbureau”]“A bond market crisis is likely unless we do something about the budget deficit.”
– Alan Greenspan, December 18, 2010

Man the lifeboats. Every man for himself.[/quote]

Always love it when the arsonist comes by to say “you should really do something about that fire”

As usual, Sat TV Jr. is making false statements with nothing more than anecdotal stories from this “buddies” as evidence. No offense, kid, but please stop polluting my thread with your ignorance.

Back on topic. The US will certainly be faced with higher taxes. The president and the Congress agreed to a temporary two-year extension of the Bush tax cuts, but after that the difficult but obvious decision will have to be made. Either allow the Bush tax cuts to expire, or institute a national sales tax (as advocated by the bipartisan groups). At the same time, we’ll need deep spending cuts. Social Security, Medicare, Medicaid, and the CHIPs should be on the table. At the same time, so should military spending, agricultural subsidies, and all other discretionary programs.

When the Canadians went through a similar crisis, they ended up cutting 6 or 7 dollars for every 1 dollar raised in taxes (mostly through a VAT). That seems pretty reasonable to me. Of course, Canada also enjoyed a booming American economy to which they could export. Still, I think similar austerity measures are in order.

Well you won’t have to worry I think he managed to get himself banned. It’s too bad really, I was enjoying the irony of having some kid tell me how the world works. Especially given the fact than I can pretty much sum up his life so far and 10 years into the future as, “been there done that”.

Yes, at some point, Americans will have to address the underlying issues with their economy, but they just seem to want to keep delaying the day of reckoning indefinitely. That’s not possible, and the longer they take, the worse things will get. The defecit won’t go away by itself.

Indeed. Raising taxes and cutting spending are the inevitable stopgap “medicines” required to keep the American economy afloat but they have the combined effect of sucking money out of the economy which will only make Americans poorer.

If Americans want to both maintain their standard of living and keep their economy afloat structural reform will be required. That structural reform will take the form of reducing the cost of producing goods and services in the United States so American goods and services are once again competitive on the world market, thereby creating the wealth necessary to pay for both government services and a first-world standard of living.

politbureau: Of course. Structural reform is going to be the only long term solution. Otherwise, America will become the Argentina of the 21st Century with a continuous fall from grace (though that process might not be a smooth fall at all). There’s going to be a lot of pain whatever is done in the short to medium term, but I don’t think people truly realise how less painful that will be than letting the defecit spiral out of control. There may come a point (if it hasn’t already happened already) where money is being borrowed just to service the debt. Shortly after that point comes default. Shortly after that comes the real pain.