Journal Bill Dog's Journal: tackling the deficit 11
I wouldn't, because I'm against that. Our debt is the actual problem, of course. If we were currently debt free, this year's deficit would be absolutely no problem. But given how much debt we have, even if we balanced the budget this year, we would still have the exact same-sized problem. So our problem is independent of the deficit, so focusing on that is just what the big-spending political class and their supporters (the neocon wing of the Right, and the entire Left) hope they can keep most of us conned into doing.
Our national debt is $14.9 trillion, and our just-ending federal fiscal year encompasses $2.3 trillion in receipts and $3.6 trillion in outlays for a shortfall of $1.3 trillion. Scaling these absurdly astronomical and uneasily grappled-with numbers down by a factor of 28,750,000, that's like your household having a (net) annual income of $80K but spending over $125K for the year, adding over half your annual income onto your credit card debt that's already at a balance of $518K!
And most of the time it's not even expressed as in the title of this JE, but more often in the terms of "bringing down the deficit". To continue with my example, with your spouse playing the role of the big-spending political class and their supporters, she urges you to not only not focus on the over half million dollars you owe on your credit cards (albeit at the low interest rate of 3% (FY2011 interest on the debt was $450 billion)), but to not even focus on all of the shortfall that's getting added to it.
So how did we get into this mess? We've been living beyond our means, borrowing from the future to do it, for quite some time. Both parties have wanted to keep govt. spending high but to keep taxes low for what is stereotypically considered each's respective voting constituency. And "compromise". The Left wants to grow govt. a lot, the Right doesn't want it to grow at all, so we end up with the compromise of govt. growing a little. Year after year.
Earlier this year during the so-called budget crisis I had to hear about how spending cuts weren't enough, we had to compromise, and have some tax hikes as well. The problem with that is that I don't believe the problem is too little govt. spending, but too much. Not only do I believe that such a household as in my example above doesn't need to be spending $125K every year, but it doesn't even need to be spending all of the $80K that it takes in, but ought to be able to live comfortably on about $60K after taxes, and be able to put about a fourth of its take-home pay towards paying down that massive debt. That would be on a schedule of paying it off in 26 years, which is entirely reasonable, as it's like the timeframe of a traditional home mortgage.
But Herman Cain's 9-9-9 plan got me thinking that I am actually willing to compromise on this. Half of all American households pay no federal income tax. I believe everyone should have skin in the game. Everyone uses and benefits from our infrastructure, the enforcement of our laws, etc., so everyone should be paying for it. It's time the 51% pay their fair share. They're not contributing to the federal kitty via the income tax, so I guess they can do their part via a federal consumption tax. Whatever, either way, I'm willing to compromise my usual no tax hikes stand and strongly support raising taxes on the freeloading half of us (and I'm impartial on the economic strata included in this), from the zero (or *less*) that they're paying now, and thereby adding a revenue increase component to the mix, as urged by the Left.
As for cuts, notably in the news Ron Paul released a plan. I've always kinda considered him a fraud, talking dispassionately about limiting govt. while with fervor and at length about our militarism and imperialism. He's always struck me as a Lefty trying to masquerade as somewhat of a libertarian. Not unlike a few Slashdotters I've encountered here. He calls for eliminating certain dept.'s completely, and freezing the budgets of some others, which is all music to my ears, but I question some of the picks. And why just freeze or eliminate, and not also go with the option of putting some on a gradual downsizing path.
And therein lies the problem with this approach. How do you decide, and justify, who gets cut and who doesn't. That's why I'm for an across-the-board cut. That would be just as unfair to one political interest as another. My example household above ought to be able to live okay on $60K per year, which translates to a federal spending level of $1.725 trillion per year, or about the 1999/2000 spending level. Let economic growth fund any expansion of entitlement spending, but keep paying down the debt $575 billion a year, and be on a path to have dug ourselves out of our hole by 2037. And for those who for some reason care about (or claim to) teh dephussit, that'll be fixing that too.
It's much worse than that. (Score:2)
Because it's only 1/3rd of the problem. Business debt and consumer debt, in addition to governmental debt, is a huge problem. It's been 40 years since USA Inc even came close to making a profit. Any bank willing to lend to us must know something I don't, because the way I see it, we are bankrupt many times over and nobody investing in the USA has any chance of ever breaking even, let alone making a profit.
I wrote something on this in Outside the Asylum recently, provoked by yet another pro-trade article
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You're right about these other debts as being the other parts of the problem, but only because we have a bailout subculture as part of our overall entitlement culture, where we expect daddy govt. to make everything all better no matter how badly we screw up. Business and consumer debt is what private entities run up amongst one another, and I shouldn't have to pay for that, but I'm made to. I had been only thinking about govt. debt because it's the only one that one should rightfully expect that we should a
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I'd like to put all the neocons and Lefties on a boat and ship them to China, which they both seem to love much more than America anyways, and leave this country to the Tea Partiers and whatever you are (as long as you remain a *small-scale* (and totally voluntary) distributist).
Who says YOU'RE not the ones who should be put on a boat and shipped off somewhere else?
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Well, for one at least Tea Partiers and Distributists are loyal- and will fight for the land they love. Given what Occupy has done in downtown Portland, loving the land is decidedly not a part of their agenda, whatever their agenda is.
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Any bank willing to lend to us must know something I don't, because the way I see it, we are bankrupt many times over and nobody investing in the USA has any chance of ever breaking even, let alone making a profit.
Because people who are investing in the US are still making money, because the US is still paying its bills. Credit card companies will happily send you billions of credit card offers for as long as you keep paying your bills (even if you're mortgaging your house to pay for your credit card bills). Why? Because even though you're nominally bankrupt, you're still paying them now.
Economics is largely run on short-term goals. "Should I buy stock in a company that might fail in the next 10 years, or should I bu
NOT THE ENTIRE LEFT (Score:2)
It's not the entire left that wants us to focus only on the deficit. Many in the left want to raise taxes and/or cut defense spending so that we can pay off our debt...
But of course, it's easier to flail at strawmen...
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"The entire Left" as a *generalization* (and in contrast to about a half of the other side). If "many" on the Left actually want to pay off our debt, they're doing an excellent job of keeping everyone on the Left silent about it, as I haven't heard bupkis on this (and since you guys speak the loudest, and, to mix metaphors, how you can't hardly swing a dead cat without hearing what Liberals think...). I'll accept that you and maybe someone you know on the Left want that, but it doesn't seem to be anything t
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"The entire Left" as a *generalization* (and in contrast to about a half of the other side). If "many" on the Left actually want to pay off our debt, they're doing an excellent job of keeping everyone on the Left silent about it, as I haven't heard bupkis on this (and since you guys speak the loudest, and, to mix metaphors, how you can't hardly swing a dead cat without hearing what Liberals think...). I'll accept that you and maybe someone you know on the Left want that, but it doesn't seem to be anything that's any kind of priority for the *vast majority* of the Left. It's not even in character -- you guys would much sooner spend a surplus on expansion of govt. (and the good that you guys think could be realized from it) than to take a measure to forestall what might be the eventual collapse of a system you guys think is inherently evil anyways.
And all of the right as a generalization seem ready to sink the government in a pool of absolutely no taxes. I mean, you can make the generalization that the left is ready and happy to spend a surplus on expanding government, or what have you, but we know what the right does with a surplus... what kind of person would look at their paycheck being enough to actually cover everything and say, "hey, let's give that extra money back to my employer!"
Every single Republican candidate for president has signed a pl
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The difference is, you've had to add the weasel-word "seems" to your statement. Because it's not valid, not founded, and not equivalent. The equivalent generalization of the Right to my assertion would be that the entire Right is for lower taxes than what we have now, even if it means a significant impact to the govt. Because that's generally true. Your statement would be equivalent to my having said
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The difference is, you've had to add the weasel-word "seems" to your statement.
The weasel word is my leftist desire for being entirely accurate getting in the way of showing you how ridiculous your statement is.
Because it's not valid, not founded,
And neither was yours.
and not equivalent.
Absolutely was.
The equivalent generalization of the Right to my assertion would be that the entire Right is for lower taxes than what we have now, even if it means a significant impact to the govt. Because that's generally true.
Except you've had to insert the weasel word "generally".
Your statement would be equivalent to my having said that the entire Left wants to confiscate all income. Which is not generally true of "the entire" Left.
What you said wasn't true of the entire Left either, and that's what I was trying to point out. As a counter-example, I presented myself, and thus your statement is not true of the entire Left.
If you want to be upset that my example was over-exaggerated then go complain to hyperbole and