dems v. debt

[lehr]

2006 every demokrat in senate voted against raising the debt limit - even tho we were losing the iraq war = = 2011 demokrats in the senate and komrade obama said they wanted to raise the debt limit =

 

[waltky]

Granny says it gonna blow up on us an' dem politicians gonna put us all inna poor house...

As debt talks break down, clock ticks toward crisis
6/24/2011 - Day of reckoning is coming, but nobody can say when

The breakdown of talks between the White House and congressional Republicans has intensified worries about the financial bomb known as the national debt. Without serious budget reforms, that bomb will almost certainly explode — with widespread collateral damage to the U.S. economy and the global financial system. But no one can say for certain just when the bomb will go off. The fuse may be longer than many people assume. Debt-reduction talks came grinding to a halt Thursday when Republicans pulled out, blaming Democrats for demanding tax increases rather than accepting cuts in federal services.

The clock is ticking. The Congressional Budget Office said this week that the national debt is on pace to equal the gross domestic product within a decade, and warned of a European-style crisis unless Congress moves to realign the budget. “There comes a point when you have a reckoning,” said former New York Gov. George Pataki, a Republican who chairs No American Debt. “You see that in Greece. If we don't get our house together we'll be the next country to deal with that.” There’s widespread agreement among economists that without big changes that day of reckoning is coming. They also agree on the likely scenario when the bomb explodes. As buyers of U.S. debt get increasingly nervous about the government’s ability to make good on its IOUs, they demand higher interest rates.

Those higher rates raise the cost for businesses to borrow for new trucks or capital equipment. Home buyers have to pay more for mortgages. Those higher rates put the brakes on the economy. “Rising rates also means that the government needs to pay more interest, and that in turn gets piled onto the debt,” said Mark Zandi, chief economist at Moody’s Analytics. “That makes investors more worried and they jack up rates even more. So you get into this negative feedback loop and ultimately, you have default.”

But there’s far less agreement on just when that day of reckoning will arrive or what, exactly, creates the tipping point that sends rates spiraling higher. One widely cited — and much debated — paper published last year by economists Carmen Reinhart and Kenneth Rogoff looked at decades of data for 20 developed countries to better understand the impact of public debt on economic growth. They concluded that rising debt has relatively little impact on growth until it reaches about 90 percent of GDP, after which there are clear indications of slower growth.

More National debt time bomb ticks toward crisis - Business - Eye on the Economy - msnbc.com

 

[wimpy77]

Hence the reason why I have covered my shorts and I'm totally prepared to pull all of my money out of equities.

 

[editec]

Your posts might be taken more seriously if you spelled it: D e m o c r a t.

 

[RetiredGySgt]

Your posts might be taken more seriously if you spelled it: D e m o c r a t.

Did he lie? Is he wrong? I notice you don't criticize the posters that misspell Republicans.

 

[waltky]

Granny says make all dem countries dat bad-mouth us after we give `em foreign aid an' fight their wars for `em pay it back...

Bankruptcy could be cure for U.S. debt
06/28/11 - Rep. Ron Paul (R-Texas) said Monday that bankruptcy could be the best solution for the United States to address its mounting debt.

Paul, the libertarian Republican presidential candidate, suggested that bankruptcy would be a good option — as would, short of that, refusing to repay obligations to the Federal Reserve. During an appearance on Iowa's WHO radio, Paul, in a conversation about the debt crisis in Greece, called on that country to declare bankruptcy, reasoning that the Greek debt was insurmountable and thus that the country could not avoid bankruptcy.

"Are we going to experience — are you predicting, in essence, if bankruptcy is the cure for Greece, is it also the cure for the United States?" asked host Jan Mickelson. "Absolutely," Paul responded. The Texas congressman has been a longtime critic of fiscal and monetary policy in the U.S. Paul has called for allowing gold and silver currency to compete openly with the U.S. dollar. He said he wasn't dreading the potential default on U.S. debt in early August because, in his view, the U.S. was constantly defaulting due to inflation-related devaluation of the dollar.

One solution, Paul said, would be to eliminate the Federal Reserve, and in turn, wipe out the debts owed to the Fed. "I know this is pretty strange for people to even think about this — but you know, we owe, like, $1.6 trillion because the Federal Reserve bought that debt, so we have to work hard to pay that interest to the Federal Reserve. They're nobody; why do we have to pay them off?" he asked. "Why don't we just take that away from them and reduce the debt by one and a half trillion dollars or whatever?"

The comments are nothing if not consistent for Paul, who's said that he won't vote to raise the debt limit. He said that he didn't actually expect fellow lawmakers to follow his lead and allow default, but that if the U.S. were to default on its obligations to the Fed, it "might reassure the bondholders." Speaking in the key primary-cycle state of Iowa, Paul even suggested that the Chinese government had even become more capitalistic than the U.S. government.

MORE

 

[Wiseacre]

dems and debt, sorta like

love and marriage
horse and carriage
salt and pepper
ham and cheese
the birds and the bees
the flowers and the trees, I'm about to break out in song any minute.

No debt to big, no taxes too high, no gov't too large, no union too influential for a democrat.

 

[waltky]

Granny says, "Well den - dey better raise dat debt limit...

Debt-limit delay would jeopardize Social Security payments
28 June`11 - Analysis shows the government would be unable to make payments due Aug. 3 to Social Security recipients.

WASHINGTON — Social Security payments to millions of retirees and people with disabilities could be threatened if President Obama and Congress can't agree to increase the government's debt limit by Aug. 2, a new analysis shows. Although the Treasury Department likely could avoid delaying Social Security checks, the analysis by the Bipartisan Policy Center points up the depth of the cuts that would be needed if the $14.3 trillion debt ceiling isn't raised. It shows that in August, the government could not afford to meet 44% of its obligations. Since the $134 billion deficit for that month couldn't be covered with more borrowing, programs would have to be cut.

If Social Security, Medicare, Medicaid, unemployment benefits, payments to defense contractors and interest payments on Treasury bonds were exempt, that would be all the government could afford for the month. No money for troops or veterans. No tax refunds. No food stamps or welfare. No federal salaries or benefits. Want to protect the social safety net? That would be possible — but only if Treasury stopped paying defense contractors, jeopardizing national security. Plus virtually every federal agency and employee. "We should be honest with ourselves what this would be like, and the answer is it would be chaotic," said Jay Powell, a former top Treasury official in President George H.W. Bush's administration. "There is no way to avoid really serious pain."

The Bipartisan Policy Center studied Treasury Department receipts and spending for August 2009 and 2010 and found that the government likely would not have enough revenue to make the full $23 billion payment to Social Security recipients due Aug. 3. That's the first Wednesday of the month, when a majority of Social Security and Supplemental Security Income checks go out.

Things wouldn't improve much as the days pass. The first major interest payment to creditors would be due Aug. 15 — $29 billion, more than the $22 billion due to arrive in revenue. On that day, Treasury would have to roll over nearly $500 billion in maturing debt — necessitating an auction which, by that time, might have fewer takers than usual. If demand declines, interest rates would rise. As the center foresees it, the picture would get worse: layoffs and lawsuits. Global market reaction and media glare. A possible downgrade in the U.S. credit rating, perhaps followed by the loss of market access. The effect on the country, said former Republican senator Pete Domenici of New Mexico, would be "irretrievable."

Source

 

[waltky]

Rand Paul on the debt...

U.S. Debt 'Number One Threat to Our Country'
Thursday, June 30, 2011 – Sen. Rand Paul (R-Ky.) met with other Republican senators on Wednesday to explain why they are pushing for a balanced budget amendment in their negotiations with Democrats over increasing the federal debt limit, which currently is $14.29 trillion, stressing that the primary “threat to our country is the national debt.”

At the Capitol, Paul said, “Our country is in grave danger. The number one threat to our country is the national debt. “I firmly believe we will not ever surmount our fiscal problems until we amend the Constitution,” said Paul. “We must have a balanced budget amendment, and I hope the Democrats will join us.” Senate Minority Leader Mitch McConnell (R-Ky.) said the GOP push for a balanced budget amendment was a “good first step” in the negotiations over raising the debt ceiling. “Our view is: A good first step is a balanced-budget amendment to the Constitution,” said McConnell. “It’s pretty clear that, regardless of what we are ultimately able to negotiate here in the short-term, that we put the federal government in this kind of fiscal straight jacket for the future so that we cannot get into this position again.”

The debt limit is the amount of money the federal government can legally borrow. The amount is voted on by Congress and signed into law by the president. The current legal limit on the federal debt, $14.294 trillion, was signed into law by President Obama in February 2010. The federal government bumped up against that debt limit on May 16. Sen. Orrin Hatch (R-Utah) is the lead sponsor of the balanced budget amendment, which has the support of all 47 Republican senators. “A balanced budget amendment is simply the best way to cut out the smoke and mirrors when it comes to federal budgeting,” said Sen. John Cornyn (R-Texas), chairman of the National Republican Senatorial Committee. “We all know we are spending about 40 cents out of every dollar of borrowed money and the primary purchaser of our debt is China, which owns about a third of our national debt.”

“This is, as Admiral [Mike] Mullen said, the number one threat to our national security – our debt is,” said Cornyn. Senate Rules and Administration Chairman Chuck Schumer (D-N.Y.) offered his response to the Senate Republicans’ effort at the Capitol on Wednesday. “First, practice what you preach,” he said. “The Ryan budget [in the House] had, I believe, $9 trillion dollars in deficits. It did not balance the budget. Second, we did it, we balanced the budget under, when Bill Clinton was president – practice what you preach – and third, there are all kinds of different balanced budget amendments.”

Schumer continued, “The balanced budget amendment they’re introducing, I’m told, gives a real break to very wealthy people because it would be much harder to get them to chip in a fair share, and it is going to focus on the middle class and pain on the middle class.” The Congressional Budget Office (CBO) said the deficits under Rep. Paul Ryan’s (R-Wis.) proposal “would be around 2 percent of GDP in the 2020s and would decline during the 2030s. The budget would be in surplus by 2040 and show growing surpluses in the following decade. Federal debt would equal about 48 percent of GDP by 2040 and 10 percent by 2050.” Treasury Secretary Tim Geithner has said lawmakers must raise the debt limit by Aug. 2 or the government will default and may fall into another recession or even an economic depression.

Source

See also:

Debt Increased More Under Geithner Than Under Any Treasury Secretary in U.S. History
Thursday, June 30, 2011 – Treasury Secretary Timothy Geithner oversaw the largest increase in the national debt of any Treasury secretary in American history, presiding over a $3.7 trillion increase in the debt.

According to data from the Treasury Department’s Bureau of the Public Debt, the national debt has increased $3,723,575,990,130.10 from Jan. 26, 2009 until June 30, 2011, Geithner’s entire tenure to date as Treasury secretary. When Geithner took office the total national debt stood at $10.6 trillion. As of June 30, 2011, it had risen to $14.3 trillion. In fact, the debt accrued under Geithner is greater than all federal debt accrued in the first 204 years of the nation’s history. The national debt did not reach $3.7 trillion until October 1991, according to historical Treasury data that reaches back to 1791.

Geithner, who reportedly may step down from his position soon, has overseen the accrual of more federal debt (in only 2.5 years) than every Treasury secretary combined from Alexander Hamilton to Nicholas Brady, who was Treasury secretary in October 1991 when the national debt reached $3.7 trillion. Since then, the federal debt has increased by historically large amounts under each Treasury secretary since Brady but not to the level it is today under Geithner. The debt increases under those secretaries are presented below.

Nicholas Brady (9/15/88-1/17/93): $1,564,862,000,000.00

Lloyd Bentsen (1/20/93-12/22/94): $559,880,257,144.59

Robert Rubin (1/11/95-7/2/99): $815,560,432,731.13

Lawrence Summers (7/2/99-1/20/01): $109,651,004,604.88

Paul O’Neill (1/20/01-12/31/02): $677,930,718,549.89

John Snow (2/3/03-6/30/06): $2,040,609,369,491.81

Henry Paulson (7/10/06-1/20/09): $2,218,644,118,047.16

Source

 

[waltky]

Granny says dem politicians gonna keep playin' tug-o'-war with the debt till the country's bankrupt...

Partisan Divide Endures in US Debt Negotiations
July 03, 2011 - With weeks to go before the United States risks defaulting on its $14 trillion national debt, Democrats and Republicans are sticking to conflicting, partisan prescriptions for improving the nation’s finances.

Lawmakers of both major political parties agree the federal government must cut spending to reduce a $1.6 trillion deficit. But they disagree on how deeply to cut and whether additional revenues should be part of a formula to bridge the budget gap. Republican Senator John Cornyn of Texas on the Fox News Sunday television program. “Republicans are opposed to any tax hikes, particularly during a fragile economic recovery," he said. "The last thing that employers need is further disincentives to hire people, and that is what higher taxes would mean. Instead of tax hikes, Cornyn advocates deep spending cuts in most federal endeavors other than national defense.

Democrats say a one-sided approach to deficit reduction would stunt national progress and harm the vulnerable. President Barack Obama made the case for eliminating special tax breaks for corporations and the wealthy in his weekly radio address Saturday. “If we choose to keep those tax breaks for millionaires and billionaires, or for hedge fund managers and corporate jet owners, or for oil and gas companies pulling in huge profits without our help - then we will have to make even deeper cuts somewhere else," he said. "We have got to say to a student, ‘You do not get a college scholarship.’ We have to say to a medical researcher, ‘You cannot do that cancer research.’ We might have to tell seniors, ‘You have to pay more for Medicare.’”

Senator Cornyn says he would support ending tax breaks as part of a larger tax-reform package in which overall tax rates are reduced, thereby making the initiative revenue-neutral. He does not favor altering the federal tax code to boost government revenue. “I think the American people understand that raising taxes grows the size of the federal government," said Cornyn. "They want government to get smaller, not bigger. They feel government has become far too intrusive in their lives.” The partisan stand-off comes as an August 2 deadline looms for raising the federal borrowing limit. Absent a deal to cut the deficit and slow the growth rate of the national debt, many Republicans say they will not vote to increase the debt ceiling. Without additional borrowing authority, the federal government risks defaulting on its debt obligations, which could spark a financial crisis.

Some Democrats have argued President Obama could end the standoff by challenging the constitutionality of the debt ceiling and ignoring the law. The 14th Amendment to the U.S. Constitution states that the public debt of the United States “shall not be questioned.” Senator Cornyn blasted any attempt to sidestep the debt ceiling as “crazy talk”, saying it would be an abdication of the president’s responsibility to arrive at a negotiated solution to the nation’s debt woes.

Source

 

[expat_panama]

...With weeks to go before the United States risks defaulting on its $14 trillion national debt...

The US has gone without a budget several times in the past few decades and has never defaulted, in fact there was never even talk about default but this time is different. What's different now may be that the executive branch may love power and hate America so much that it fully intends to refuse to redeem mature bonds while it continues to collect taxes and fully fund NPR, the arts, Obamacare, and vacations for the first family.

 

[CrusaderFrank]

2006 every demokrat in senate voted against raising the debt limit - even tho we were losing the iraq war = = 2011 demokrats in the senate and komrade obama said they wanted to raise the debt limit =

Obama, Failed Leader.