Math Lesson for the Feeble Minded

[ilia25]

He is the President, the one promoting a budget that will surpass $20 trillion of debt. What the fuck would be the point of bitching about how much past presidents/Congresses contributed to that debt? We either deal with the situation we face today or we don't. Obama is the face of what we're dealing with today, just as Bush was a decade ago. Do you stand against more debt or not? That's all that matters.

You're whining and complaining about something that hasn't even happened, but what has already happened isn't important? Does that sound sensible or logical to you?

Unsustainable debt has already happened.

Only if you cannot add. Investors can, and so today they are lending money to the US government for 30 years term at 3.5% interest.

Fiat money has already happened. A majority of the citizenry reliant upon entitlements has already happened. If you know your economic history, you'd know what comes next. It isn't pretty.

Welfare state is more than 100 years old, and fiat money are even older. Nothing bad happened so far.

But if you think otherwise, you are free to lose your money on gold investments.

 

[eflatminor]

You're whining and complaining about something that hasn't even happened, but what has already happened isn't important? Does that sound sensible or logical to you?

Unsustainable debt has already happened.

Only if you cannot add. Investors can, and so today they are lending money to the US government for 30 years term at 3.5% interest.

Fiat money has already happened. A majority of the citizenry reliant upon entitlements has already happened. If you know your economic history, you'd know what comes next. It isn't pretty.

Welfare state is more than 100 years old, and fiat money are even older. Nothing bad happened so far.

But if you think otherwise, you are free to lose your money on gold investments.

Yes and 100 years is the entirety of economic history. No problems then, thanks.

 

[Dragonlady]

Yes and 100 years is the entirety of economic history. No problems then, thanks.

Well there wasn't a problem until Reagan cut taxes for the wealthy drove up the deficit, doubled the national debt, and and increased the number of people requiring social assistance.

It was Republican economic policies that threw the whole system out of whack, increasing the number of poor needing food stamps by more than 30% in his first term. Republicans kept adding to Medicare and Medicaid throughout the Republican years, without funding the increases with spending with offsetting taxes.

The Democrats may tax and spend, but at least they have the good sense to fund the programs and the get the order right.

 

[eflatminor]

Yes and 100 years is the entirety of economic history. No problems then, thanks.

Well there wasn't a problem until Reagan cut taxes for the wealthy drove up the deficit, doubled the national debt, and and increased the number of people requiring social assistance.

No problems during the FDR years, eh? Are you beginning to see just how stupid you are? No? Let's dig a little deeper then...

When Reagan's tax rate cuts were implemented in 1983, the economy expanded by 3.5% and in 1984 by 6.8%, which was the highest single-year growth rate in 50 years. Inflation also decreased by two thirds. Further, tax revenues actually increased. In 1986, Reagan cut tax rates even further. The economy continued to grow...and tax revenues grew even more. Despite a minor recession in late 1990, Reagan's cuts ushered in an unprecedented period of economic growth. Even the government agrees - The National Bureau of Economic Research in 1999 declared the period 1982-99 "the longest sustained period of prosperity in the 20th century".

It is true that Reagan spent too damn much, in my opinion. The debt did increase. Of course it was a pittance compared to Bush II, which was nothing compared to what Obama added to the debt.

It was Republican economic policies that threw the whole system out of whack, increasing the number of poor needing food stamps by more than 30% in his first term. .

We'll just overlook the increase in food stamps under Obama then...

Republicans kept adding to Medicare and Medicaid throughout the Republican years, without funding the increases with spending with offsetting taxes

Here's the rub...when Reagan decreased tax rates, tax revenues increased. When Clinton increased tax rates in the early 90s, revenues fell.

In 1989, federal revenues were 19.3% of GDP. In 1991, after the tax rate hikes, revenues slipped to 19.1%. According to the WSJ, the rich in particular paid LESS taxes after the rates where raised - $6.5 billion less! The WSJ report stated "81% of the revenues expected from the 1990 budget deal failed to materialize"

Clinton raised tax rates again in 1993. The economy had grown at 4.5% in the 12 months before the tax hikes. In 1993 and 1994, it slipped to 2-3%. Bummer...

Only when Clinton LOWERED the capital gains tax rate in November of 1994 did tax revenues increase.

Now what were you saying about "offsetting taxes"???

The Democrats may tax and spend, but at least they have the good sense to fund the programs and the get the order right.

Really? Programs like those championed by LBJ and his so called "great society", the goal of which was to end poverty and racism. Well guess what? Nearly 50 years and trillions of dollars later, poverty is UP 2%.

So much for funding the right programs...

But hey, the Black man is thriving, right?

The facts do not support your assertions.

 

[Freewill]

Who was it that claimed deficits don't matter?

Interest free? Hahahahaha.

Deficits don't matter, debt don't matter. You are in deficit spending when you go into debt to buy you home or car. It doesn't matter until you can't afford the payment. Obama has taken us well past that point long ago. Thank you Grandchildren, sorry we stuck you for no good reason.

 

[neomalthusian]

At the end of Obama's second term, the U.S. National Debt will be $20 trillion. Annual interest on this debt will be:

1% = $200 billion
2% = $400 billion
3% = $600 billion
4% = $800 billion
5% = $1 trillion (1/4 of federal budget)

Do you think the rest of the world is going to loan us all the money we want at zero per cent interest forever?

No, but our Federal Reserve Bank will.

 

[neomalthusian]

Well there wasn't a problem until Reagan cut taxes for the wealthy drove up the deficit, doubled the national debt, and and increased the number of people requiring social assistance.

It was Republican economic policies that threw the whole system out of whack, increasing the number of poor needing food stamps by more than 30% in his first term. Republicans kept adding to Medicare and Medicaid throughout the Republican years, without funding the increases with spending with offsetting taxes.

The Democrats may tax and spend, but at least they have the good sense to fund the programs and the get the order right.

What is with this desperate need to deflect to Republican presidents? The Congress is mostly responsible for the spending, and we can't change the past. We have a Congress and President RIGHT NOW who are on pace to double the debt every 8 or so years, and this has been going on for at least a decade now. Is that or is that not a problem?

If debt-doubling when a Republican was President was a problem, is it a problem that we're debt-doubling right now?

Every politician I can ever remember hearing has warned during their campaign against irresponsibly high government spending, and then when they get into office something happens instantly. They no longer say or do anything that indicates the slightest concern about spending. Either they're lying during the campaign, or something is corrupting them as soon as they get into office.

 

[Dragonlady]

What is different NOW is that the economy has been completely wrecked by Republican tax and cut policies. ALL of the current deficit is the result of Bush's wars, tax cuts, and his gift to the elderly of Medicare Part D - another unfunded government giveaway. ANY massive cut to government spending before the economy improves will stop the recovery in its tracks.

No one is suggesting that the deficit can continue at these levels. No one wants to see the debt continue to pile up. We want a balance budget with a fair tax code. You can't reverse the damage done to the US economy by Reagan and the Bushes without continuing some of their stupid policies, until consumers start spending again which means jobs and more income for the poor.

The defense budget could be cut in half, but there are a lot of private sector jobs dependent on bases remaining open, and armaments and supplies for the troops. So no drastic cuts to defense yet either, although that is the most bloated budget and the easiest to cut.

 

[neomalthusian]

What is different NOW is that the economy has been completely wrecked by Republican tax and cut policies. ALL of the current deficit is the result of Bush's wars, tax cuts, and his gift to the elderly of Medicare Part D - another unfunded government giveaway.

This is complete and utter partisan spin.

ANY massive cut to government spending before the economy improves will stop the recovery in its tracks.

And once the economy does improve, the warning will be that any massive cut to government spending will affect the economy deleteriously. Don't believe me? Dig back and find out what guys like Paul Krugman were suggesting the newly elected Democrat Congress do back in ~2006, when the economy was roaring in bubble mode. There will ALWAYS be an excuse not to cut spending.

The defense budget could be cut in half, but there are a lot of private sector jobs dependent on bases remaining open, and armaments and supplies for the troops. So no drastic cuts to defense yet either, although that is the most bloated budget and the easiest to cut.

You've successfully argued yourself into a catch-22. You've insisted that cuts will ruin the economy and admitted that continuing these deficits will ruin the economy.

Maybe that's the conclusion we can all agree on: we're on course to ruin the economy one way or another.

 

[ilia25]

Here's the rub...when Reagan decreased tax rates, tax revenues increased. When Clinton increased tax rates in the early 90s, revenues fell.

For starters, that's a flat-out lie (and yes, that's what WSJ is feeding those dumb enough to read it):

As you can see in the chart above, the only time the revenues actually fell was right after the Reagan tax cuts. The revenues were always growing under Clinton.


Then again, for a 100th time -- the tax revenues are very sensitive to the economic growth. It means you can cut taxes during fast economic growth, and the revenues would still be rising fast -- until the growth slows down.

As for the economic growth, taxes, especially on the rich have very little effect. The Reagan recession was caused by the Fed fighting inflation, and recovery bounced as soon as Fed lowered rates. Taxes had nothing do to with either. And Clinton was rising taxes after the recession hit -- the effect cannot precede the cause.

You really should start using your own head, instead of repeating the right-wing fairy tales.

 

[ilia25]

And once the economy does improve, the warning will be that any massive cut to government spending will affect the economy deleteriously.

No. The negative effect of spending cuts can then be compensated by the Fed lowering rates. The problem now is that the rates are at 0.

Also, the deficit will go down significantly as the economy recovers. Already it went down to 1 trillion from the peak of 1.5 trillion.

 

[eflatminor]

...yes, that's what WSJ is feeding those dump enough to read it...

Oh that's precious. Thanks for the laugh.

 

[francoHFW]

The mindless obstructionist Pubs can only stall the recovery for a couple more months...swine and fools.

 

[francoHFW]

A recovery and O-care will take care of these problems, dupes. Get out of the way.

 

[ilia25]

...yes, that's what WSJ is feeding those dump enough to read it...

Oh that's precious. Thanks for the laugh.

You are welcome. Not that I expected you to write anything on the substance.

 

[Misty]

Government in general is corrupt both sides are power-hungry and greedy. That's why they should all have less power and influence in our lives.

And yes that includes gay marriage and abortion. And especially taking my money to pay for entitlements that I don't want and will never use.

 

[Dragonlady]

The ACA should force down insurance premium. Insurance companies are being restricted on the amount of profit they can make and the amount of administration they can charge. Any monies not paid out in claims over and above the stipulated administration amount and the stipulated profit, has to be returned to the policy holder. With a wider pool of insured, costs should go down.

 

[SniperFire]

Who was it that claimed deficits don't matter?

Interest free? Hahahahaha.

No one has to claim it dumbass, they only need to act it.

Swing and a miss.

"Reagan," Vice President Dick Cheney famously declared in 2002, "proved deficits don't matter." Unless, that is, a Democrat is in the White House. After all, while Ronald Reagan tripled the national debt and George W. Bush doubled it again, each Republican was rewarded with a second term in office. But as the Gallup polling data show, concern over the federal deficit hasn't been this high since Democratic budget balancer Bill Clinton was in office. All of which suggest the Republicans' born-again disdain for deficits ranks among the greatest - and most successful - political double-standards in recent memory.

Reagan Proved Deficits Don't Matter* | Crooks and Liars

Cheney did not claim 'deficits don't matter' as you presented it. He was speaking specifically to the prospects of a re-election of a POTUS.

As Obama just proved, he was exactly right.

You have taken it out of context, as you know, and proffered it up as just another Liberal Lie.