Obama's budget is a nervous breakdown on paper

[ilia25]

I did not get that -- you mean reducing the cost of Medicare will not reduce the budget deficit?

No, I mean Congress will not reduce the cost of Medicare.

Medicare is an insurance, its cost is determined by the treatments it pays for. If Congress keeps its funding, but Medicare does not have to pay for treatments, then it will have a surplus, and that surplus will balance the budget.

I think they will understand that curing cancer might have something to do with it. Look, people are not that stupid. They can figure out that SS is for those too old to work, so it does not apply to them.

I think we will have flying cars powered by wind, but I wouldn't bet on it. I would, however, bet we will get those wind powered flying cars before we cure cancer.

As for people not being stupid, I simply supply this.

Why Do Republicans Hate Social Security?

You think Bernie Sanders would oppose changing the SS eligibility so it does not pay to people who can support themselves? SS is for people who can't work any more.

Sure it isn't. You just said we are in a liquidity trap. If that is actually true the rest of the world isn't going to be borrowing in dollars either.

And this would rise US borrowing costs? How?

Why? What's wrong with borrowing money if you can afford it? Besides, we are in a depression, cutting now will be a disaster. Greece had to do it because it borrowed in euro, but we don't have to.

We are not in a depression, we are in a recovery from a recession.

Yes, we are recovering, but the economy is still depressed -- its output is below potential and a lot of able and willing workers cannot find jobs. The recession is over, but the depression is not.

If you know enough about Keynes to think he was right about liquidity traps you should know he strongly advised that governments not run a deficit during boom times

You really think we are living the boom times? With millions unemployed?

Or you could just admit you do not really agree with Keynes and we can go from there.

I agree with Keynes, I don't agree with your description of the current economy as booming

Well, most Americans disagree -- they find the welfare state very useful. So do I -- and I don't understand why do you think we should be the only developed country in the world that does not have it.

I am willing to bet right here and now that no one disagrees, including you. Welfare programs are not required to run the government, they are run by the government. There is a difference.

I don't see how this difference matters -- we still have to pay for the welfare programs. So, unless you want them terminated, we can't reduce spending.

 

[ilia25]

If we assume that liquidity traps actually exist, which is highly debatable, the normal actions have no effect on the economy. That means that government spending won't work, which is the same thing I said.

Only the monetary policy is losing its effectiveness. That is why Keynes suggested that the fiscal stimulus, e.g. increasing spending, should be used instead to stimulate the economy.

BTW the fact that Fed injected 600 billion of freshly printed money into the system with no significant effect on inflation or economic growth is a very good indication that liquidity trap exists and we are living it.

I see you are actually ignoring the fact that government spending has actually increased under Obama, and that it has had no appreciable affect on the economy.

How do you know it has had no appreciable effect? If not for that increase the economy would have contracted even more than it actually had.

BTW, the fact that quantitative easing didn't work is simply evidence, and can be interpreted according to multiple theories.

Well I don't know any theory that would explain what has happened better than Keynes'.

You do know that, by arguing that the economy recovered before WWII, you are actually arguing against Keynes, don't you?

I never said that the economy fully recovered before WWII. My point was that it had started recovering in 1932.

 

[saveliberty]

You didn't show me a thing, but a little box with a red x in it.

As in the present economy, the stimulus extends the length of time a recovery takes.

 

[Listening]

How do you know it has had no appreciable effect? If not for that increase the economy would have contracted even more than it actually had.

How do you know it would have contracted more ?

You question one person assertion and turn around and commit the same mistake.

 

[ilia25]

How do you know it has had no appreciable effect? If not for that increase the economy would have contracted even more than it actually had.

How do you know it would have contracted more ?

You question one person assertion and turn around and commit the same mistake.

I can explain my logic, and it is not a rocket science. The recession was caused by a drop in private sector demand, when everyone decided to increase savings. Isn't it obvious that the if the government were to cut its spendings as well, it would made the recession worse?

 

[Luddly Neddite]

no recovery? The guy has no shame:

the economy started to recover in 1932, but it took long time to bring down the unemployment. Btw see that mini recession in 37? What happens is that roosevelt decided that the recovery is well under way so he can start reducing the deficit and cutting spendings.

it is a well known and accept fact that the us economy did not recover until after wwii. Britian didn't follow your messiah and the us did. Your theory is a total failure. Even keynes abandoned keynes.

well, you are an idiot. I just showed you the numbers but you keep repeating your dumb slogans. That is how people end up voting for republicans -- by denying the facts they don't like.

bingo!

 

[saveliberty]

I can explain my logic, and it is not a rocket science. The recession was caused by a drop in private sector demand, when everyone decided to increase savings. Isn't it obvious that the if the government were to cut its spendings as well, it would made the recession worse?

The recession wa caused by a drop in consumer demand because they were out of work idiot. Increased savings? How did that happen with all the personal debt? Oh yeah, they stopped making payments and shoved it in the bank. Government spending made business owners leary of making investments in equipment and jobs. Also, slowed the rate of lending to businesses. Your Wall Street fantasy doesn't play out on Main Street.

 

[saveliberty]

Unemployment didn't return to pre1929 levels until 1945.

The recession was one of the longest in US history.

Most importantly, it didn't work this time either.

 

[Too Tall]

The long run will not happen tomorrow. Those problems will be fixed by making the rich paying more taxes in 2013 and by the health reform, which will ease the pressure on Medicare. We might also need to rise the retirement age for those not doing a physical labor.

When he realised that his priority should be getting the economy back on track, not the spending cuts.

Obama's budget assumes those things are going to happen, and is still unsustainable.

Unsustainable when, in 30 years? I don't think it's time to worry about that.

What spending cuts? When did Obama ever cut spending?

Obama offered Republicans $2 (or $3) of cuts for each dollar of tax increase. Thank God they were stupid enough to refuse that offer.

I will assume you have the link to the offer Obama made, and he, of course, put the offer in an official document. Or, was he just talking about it like he usually does?

 

[The T]

Unemployment didn't return to pre1929 levels until 1945.

The recession was one of the longest in US history.

Most importantly, it didn't work this time either.

No it didn't. Obama is officially on record for worst extended economy below Carter.

 

[Quantum Windbag]

Medicare is an insurance, its cost is determined by the treatments it pays for. If Congress keeps its funding, but Medicare does not have to pay for treatments, then it will have a surplus, and that surplus will balance the budget.

Is that supposed to be funny?

You think Bernie Sanders would oppose changing the SS eligibility so it does not pay to people who can support themselves? SS is for people who can't work any more.

Yep. He wanted to increase the taxes, not reduce the payout.

Congressional Democrats offered a vastly different plan to tackle Social Security’s long-term funding issues by expanding payroll taxes. Sen. Bernie Sanders, I-Vt., introduced a bill Wednesday that would require people earning more than $250,000 to pay the Social Security payroll tax on all of their income, not just the first $106,800, as is required by current law.

Reforming the ‘Ponzi Scheme’: How Herman Cain, Bernie Sanders Would Fix Social Security - ABC News

And this would rise US borrowing costs? How?

If you don't understand how the US dollar no longer being the reserve currency of the world will negatively impact the economy and cause inflation I don't understand why we are having this conversation in the first place.

Yes, we are recovering, but the economy is still depressed -- its output is below potential and a lot of able and willing workers cannot find jobs. The recession is over, but the depression is not.

The output of the economy will always be below potential, I don't see that as an argument for the government to make things worse by draining more money from the economy.

You really think we are living the boom times? With millions unemployed?

I agree with Keynes, I don't agree with your description of the current economy as booming

Are you trying to imitate rdean?

Well, most Americans disagree -- they find the welfare state very useful. So do I -- and I don't understand why do you think we should be the only developed country in the world that does not have it.

Please go back, read my posts, and then come back and actually address the arguments I am making.

I don't see how this difference matters -- we still have to pay for the welfare programs. So, unless you want them terminated, we can't reduce spending.

You don't think the distinction between what the government needs to survive and what it needs to accomplish the things people want it to do make a difference? I can think of plenty of ways to reduce spending without actually eliminating any of the social programs the government does. If we actually put some effort into it we could eliminate some of the redundancies in the system and the programs that don't actually work and save even more.

 

[Quantum Windbag]

How do you know it has had no appreciable effect? If not for that increase the economy would have contracted even more than it actually had.

I know it had no appreciable affect because every time I make that statement somebody comes back with the vague argument that it might have been worse without it. If that is the best defense you can come up with 2 years after the fact I don't need to prove anything.

Well I don't know any theory that would explain what has happened better than Keynes'.

Of course you don't.

I never said that the economy fully recovered before WWII. My point was that it had started recovering in 1932.

As I said, it did so without Keynes, which makes you pointing to it as proof of his theories rather idiotic.

 

[FA_Q2]

No, that's not a fact, that is a pure speculation on your part. You don't know how expensive future treatments will be.

Take polio for example. This was a devastating decease and very expensive to treat -- until they came up with the vaccine costing peanuts.

You really expecting a vaccine for old age?

I am not expecting anything -- I am just saying that a lot could change in 30 years. So it would be premature to fix now the fiscal problems that are projected 30 years down the road.

And that is asinine. It is projected to become a disaster 30 years down the road, a disaster that cannot be adverted last minute. I guess global warming is no longer a problem then because it is not going to cause any problems for decades. We should not have to worry until it's too late, right....

 

[ilia25]

How do you know it has had no appreciable effect? If not for that increase the economy would have contracted even more than it actually had.

I know it had no appreciable affect because every time I make that statement somebody comes back with the vague argument that it might have been worse without it. If that is the best defense you can come up with 2 years after the fact I don't need to prove anything.

How is it a "vague" argument? You cannot prove that the economy would end up in the same shape w/o the stimulus -- and that is it.

Well I don't know any theory that would explain what has happened better than Keynes'.

Of course you don't.

And neither do you.

I never said that the economy fully recovered before WWII. My point was that it had started recovering in 1932.

As I said, it did so without Keynes, which makes you pointing to it as proof of his theories rather idiotic.[/QUOTE]

I never said that US followed Keynes advice to recover from the Great Depression. This was a statement by saveliberty:
"By contrast, the U.S., where government intervention - in line with Keynesian thinking - was much more pronounced, did not begin to recover until the outbreak of World War II"

Medicare is an insurance, its cost is determined by the treatments it pays for. If Congress keeps its funding, but Medicare does not have to pay for treatments, then it will have a surplus, and that surplus will balance the budget.

Is that supposed to be funny?

No. Why?

You think Bernie Sanders would oppose changing the SS eligibility so it does not pay to people who can support themselves? SS is for people who can't work any more.

Yep. He wanted to increase the taxes, not reduce the payout.

That is because now SS pays to the people who can't work anymore. If in the future people will be able to work in their 80s, then Bernie Sanders and anyone else would agree that the retirement age should be raised.

If you don't understand how the US dollar no longer being the reserve currency of the world will negatively impact the economy and cause inflation I don't understand why we are having this conversation in the first place.

My original statement was about Greece unable to service its debt because it did not borrow in its own currency. Countries like UK, Japan or US borrow in their own currency, which allows them to support much bigger debt loads than Greece (which is actually true in case of Japan).

Now how in the hell the US dollar no longer being the "reserve currency of the world", whatever that means, refutes my statements above? You think Japan can have debt bigger than Greece and borrow at interest lower than US because its yen is the "reserve currency of the world"?

The output of the economy will always be below potential, I don't see that as an argument for the government to make things worse by draining more money from the economy.

Would you please stop making idiotic statements?

You really think we are living the boom times? With millions unemployed?
I agree with Keynes, I don't agree with your description of the current economy as booming

Are you trying to imitate rdean?

No, but I think you've chosen to play dumb.

You don't think the distinction between what the government needs to survive and what it needs to accomplish the things people want it to do make a difference?

No, I don't see that distinction -- because the government exists not to survive, but to accomplish the things people want it to do. And I still don't see can you cut 3/4 of the spending w/o eliminating social programs. Because those programs plus the military account for more than 80% of the spending.

 

[ilia25]

You really expecting a vaccine for old age?

I am not expecting anything -- I am just saying that a lot could change in 30 years. So it would be premature to fix now the fiscal problems that are projected 30 years down the road.

And that is asinine. It is projected to become a disaster 30 years down the road, a disaster that cannot be adverted last minute.

We still can wait 10 years -- 20 years is hardly last minute.

 

[ilia25]

I can explain my logic, and it is not a rocket science. The recession was caused by a drop in private sector demand, when everyone decided to increase savings. Isn't it obvious that the if the government were to cut its spendings as well, it would made the recession worse?

The recession wa caused by a drop in consumer demand because they were out of work idiot.

And why they were laid off, genius?

Increased savings? How did that happen with all the personal debt? Oh yeah, they stopped making payments and shoved it in the bank.

No, they reduced spending to increase the payments.

Unemployment didn't return to pre1929 levels until 1945

And you think it should had happened overnight? No, it took 10 years from the start of recovery around 1933 and the final stimulus in the form of building the Arsenal of Democracy.

 

[Neotrotsky]

His budget is not serious, just a political tool

Sad, our country faces real issues

 

[Quantum Windbag]

How is it a "vague" argument? You cannot prove that the economy would end up in the same shape w/o the stimulus -- and that is it.

Strange, I don't remember making that argument, all I said was it had no appreciable affect. You countered that with the claim that, if we did not do it, it might have been worse. On the other hand, if you had actually bothered to ask me to defend my claim that it had no appreciable affect instead of demanding to know how I know that I would have pointed out that roughly half the funds are still sitting in government accounts because they haven't been spent. The most that could be said of the stimulus is that it delayed a few things that ended up happening anyway, mostly in the hope that the delay would allow the economy to fill in the gaps. That, obviously, did not happen.

That makes the stimulus a boondoggle that had no appreciable affect, despite the claims that it might have been worse without it. Please keep using that argument though, it saves me a lot of typing when you do.

And neither do you.

Actually, I know of two specific theories, and a general class of economic theories that help explain it. You should go look up Austrian theory and educate yourself a little more broadly.

I never said that US followed Keynes advice to recover from the Great Depression. This was a statement by saveliberty:
"By contrast, the U.S., where government intervention - in line with Keynesian thinking - was much more pronounced, did not begin to recover until the outbreak of World War II"

And you argued that it actually worked, which prompted me to point out that Keynes had nothing to do with it.

No. Why?

Because it being an attempt at a joke at least gave you an out for not sounding like a complete idiot.

That is because now SS pays to the people who can't work anymore. If in the future people will be able to work in their 80s, then Bernie Sanders and anyone else would agree that the retirement age should be raised.

Let us get something straight. SS does not pay to the people who cannot work anymore, it pays people who are over a certain age unless their income exceeds a certain level, SSI pays disabled people a supplementary income unless their regular income exceeds a certain threshold. There is no "can't work" test for SS, there is simply a "do not work enough" test.

My original statement was about Greece unable to service its debt because it did not borrow in its own currency. Countries like UK, Japan or US borrow in their own currency, which allows them to support much bigger debt loads than Greece (which is actually true in case of Japan).

Germany doesn't borrow in its currency either, yet it manages to service its debt. Come to think of it, so do most of the Euro nations. I guess that proves the problem is something other than not borrowing in your own currency, like, as a guess, borrowing too much.

Now how in the hell the US dollar no longer being the "reserve currency of the world", whatever that means, refutes my statements above? You think Japan can have debt bigger than Greece and borrow at interest lower than US because its yen is the "reserve currency of the world"?

It wouldn't be the reserve currency under those conditions, which is why arguing that the US can get away with doing it look stupid and shortsighted.

On the other hand, the idea that we can put off dealing with the debt until 30 years down the road when we are looking a lot more like Greece than we do now is also stupid and shortsighted, so you are at least being intellectually consistent. You are actually causing me to question whether consistency is a good thing.

Would you please stop making idiotic statements?

Pretty chart. Am I to take it that this means you believe that RPGNP is equivalent to economic potential, and that, further, the RDGNP charted by the Fed is actually the correct one? I can easily provide a list of economists that disagree with the latter, and the former is easily disproved by the fact that economic production can actually exceed RPGNP.

No, but I think you've chosen to play dumb.

Because I disagree with you, and can actually back up my statements, you think I am trying to play dumb.

No, I don't see that distinction -- because the government exists not to survive, but to accomplish the things people want it to do. And I still don't see can you cut 3/4 of the spending w/o eliminating social programs. Because those programs plus the military account for more than 80% of the spending.

People want the government to promise everyone a job that pays above average wages. that cannot be done, therefore it is, by your definition, impossible to have a government that can sustain itself. Since you know that is impossible why are you even arguing for it?

 

[ilia25]

How is it a "vague" argument? You cannot prove that the economy would end up in the same shape w/o the stimulus -- and that is it.

Strange, I don't remember making that argument, all I said was it had no appreciable affect.

"No appreciable effect" has the same meaning as "end up in the same shape", you fucken moron.

I would have pointed out that roughly half the funds are still sitting in government accounts because they haven't been spent.

And that proves that the stimulus did not work? It proves it has not been tried.

And neither do you.

Actually, I know of two specific theories, and a general class of economic theories that help explain it. You should go look up Austrian theory and educate yourself a little more broadly.

Those theories have been proven wrong again and again, that is why Austrians are a joke.

And you argued that it actually worked, which prompted me to point out that Keynes had nothing to do with it.

Yes, the stimulus worked wherever it has been tried, no matter whether Keynes was personally involved or not.

Because it being an attempt at a joke at least gave you an out for not sounding like a complete idiot.

I asked you to explain why that statement sounded like a joke or stupid. And you keep playing a dumb, arrogant fuck.

Let us get something straight. SS does not pay to the people who cannot work anymore, it pays people who are over a certain age unless their income exceeds a certain level

And that certain age is set at in 60s and not in 40s because most people become too old to work in their 60s. So if in the future most people will be able to work in their 80s, then everyone would support rising the retirement age, Bernie Sanders included.

Germany doesn't borrow in its currency either, yet it manages to service its debt.

Euro is Germany's currency. ECB monetary policy targets inflation in Germany, but it does not give a fuck about inflation (or lack of it) in Greece. That is why the investors treat Germany as they do Japan or US.

It wouldn't be the reserve currency under those conditions, which is why arguing that the US can get away with doing it look stupid and shortsighted.

What conditions, like those in Japan with its 200% debt to GDP ratio? You still think that yen is the reserve currency?

Pretty chart. Am I to take it that this means you believe that RPGNP is equivalent to economic potential, and that, further, the RDGNP charted by the Fed is actually the correct one?

Aren't you the smart one.

I can easily provide a list of economists that disagree with the latter, and the former is easily disproved by the fact that economic production can actually exceed RPGNP.

I would be impressed if you could also explain why we should give a fuck about what those "economists" say. As for the economy briefly exceeding the potential, it only means that that state cannot be sustained for long.

People want the government to promise everyone a job that pays above average wages.

No, they don't, and that is what makes the democracy a viable construct.

And you know it -- but asking you to stop making idiotic claims is pointless.

 

[Quantum Windbag]

"No appreciable effect" has the same meaning as "end up in the same shape", you fucken moron.

Not really, but feel free to insist otherwise.

And that proves that the stimulus did not work? It proves it has not been tried.

If no one did anything with the money then the stimulus could not possibly have accomplished anything, unless you think that a vague promise of future spending has magical properties that make things better in the past.

Those theories have been proven wrong again and again, that is why Austrians are a joke.

No they haven't.

Yes, the stimulus worked wherever it has been tried, no matter whether Keynes was personally involved or not.

Keynes theories have never been tried in the history of the world. Governments always listen to other people about what should be done instead of following his simple guidelines. That means that, even if they do work, it does not prove anything about his theories.

I asked you to explain why that statement sounded like a joke or stupid. And you keep playing a dumb, arrogant fuck.

Did you?

You said:

Medicare is an insurance, its cost is determined by the treatments it pays for. If Congress keeps its funding, but Medicare does not have to pay for treatments, then it will have a surplus, and that surplus will balance the budget.

Medicare is supposed to pay at a rate that is tied to inflation, yet Congress has consistently approved a larger increase than that every year since medical costs start going up at a higher rate than inflation. Obamacare contains a provision that balances the budget on the assumption that Congress won't actually pass the doc fix, then Obama turns around and urges Congress to pass the doc fix. Given the way the real world works, how can I interpret what you said as anything other than a joke or really stupid?

And that certain age is set at in 60s and not in 40s because most people become too old to work in their 60s. So if in the future most people will be able to work in their 80s, then everyone would support rising the retirement age, Bernie Sanders included.

Bernie Sanders will be dead and buried before he supports raising the retirement age. When Paul Ryan proposed a modest increase in the retirement age being phased in for people who are not even working yet Sanders responded by calling his plan "The most right-wing extremist piece of legislation I have ever seen."

[ame=http://www.youtube.com/watch?v=J2de6rx9m04]Bernie Sanders Ryan Budget "Is The Most Right-Wing Extremist Piece Of Legislation I've Ever Seen!" - YouTube[/ame]

Euro is Germany's currency. ECB monetary policy targets inflation in Germany, but it does not give a fuck about inflation (or lack of it) in Greece. That is why the investors treat Germany as they do Japan or US.

If it doesn't give a shit about inflation in Greece why is it imposing austerity measures?

What conditions, like those in Japan with its 200% debt to GDP ratio? You still think that yen is the reserve currency?

I never did.

Aren't you the smart one.

Only on days with a y in them.

I would be impressed if you could also explain why we should give a fuck about what those "economists" say. As for the economy briefly exceeding the potential, it only means that that state cannot be sustained for long.

Because the Fed was wrong about the housing bubble?

No, they don't, and that is what makes the democracy a viable construct.

And you know it -- but asking you to stop making idiotic claims is pointless.

There you go trying to be funny again.