Can you pay down the debt WITHOUT growing the "economy"?

[daveman]

Borrowing more money that we can't pay back without borrowing more money is not helping the economy.

We can always pay it back. It is as simple as increasing income taxes.

...which decreases the amount of money circulating in the economy.

 

[Quantum Windbag]

How come when you ask a question like: Can you pay down the debt WITHOUT growing the "economy"?

Republicans are desperate to change the topic? They must have a reason for wanting to block anything that would help the country. Why won't they tell us what those reasons are?

Because it is the wrong question.

The OMB and CBO both say that, in order to ensure long term growth of the economy we need to pay down the debt. I can dig up hundreds of economists, including Krugman before Obama got elected, that will tell you that we need to pay down the debt in order to grow the economy. Yet, for some reason, you think that Obama can wave a magic wand and reverse the laws of economics.

And you wonder why everyone with a brain holds you in contempt.

 

[itfitzme]

Borrowing more money that we can't pay back without borrowing more money is not helping the economy.

We can always pay it back. It is as simple as increasing income taxes.

...which decreases the amount of money circulating in the economy.

Not necessarily, not simply.

The amount of money circulating in the economy is primarily the direct result of private sector borrowing. That is the primary function of the Fed, to manage that money supply.

Government revenues either recirculate to investors in paying balance and interest on t-bills, by purchases from contractors, or by direct paymenr of wages to govt employees. All of that recirculates the money's back into the flow.

Investors, lacking T-bill for investment can simply invest elsewhere, such as in consumer credit or the stock market. That is still in the economy.

As well, prices are based on the total amount of money being spent, not on the amount of income before taxes. So, regardless, real dollars doesn't change due to taxes.

The only way it would reduce the money supply is if a) the money supply had no other method for growth and b) the moneys did not circulate through other channels. Even then, aggregate prices are due to the money supply in circulation.

The government debt is a bit of an illusion, having very little meaning and no direct impact on the economy. The only real inpact is the rate of change of that debt which is, of course, the deficit. The deficit is the government moving monies from private sector savings into private sector consumption and production. That or into interest payments on the debt.

The government can increase taxes and reduce outlays, as well as recuce the deficit and pay down the debt, without impacting the money supply that accounts for consumption and the prices of goods as long as it does so slowly. As long as it is done slowly, the economy has time to react to the change.

Surely the free market private sector economy is capable of functioning without the government involved to the tune of $17T.

Do you suppose that the free market, private sector economy cannot function without the government constantly borrowing money?

 

[Quantum Windbag]

How come when you ask a question like: Can you pay down the debt WITHOUT growing the "economy"?

Republicans are desperate to change the topic? They must have a reason for wanting to block anything that would help the country. Why won't they tell us what those reasons are?

Government can't grow the economy, no matter what lies progressives tell each other.

Well, now that is simply not true, dave. The tax and spending multipliers are established as factual. It is simply a matter of the reality of the economy being a closed loop system. How much effect depends on the specific circumstances of the economy.

They are established as factual? Where? Just because Congress passes a law that says pi is equal to 3 does not mean that pi suddenly is not 3.1415926535897932384626433832795028841971693993751058209749445923078164062862089986280348253421170679821480865132823066470938446095505822317253594081284811174502841027019385211055596446229489549303819644288109756659334461284756482337867831652712019091456485669234603486104543266482133936072602491412737245870066063155881748815209209628292540917153643678925903600113305305488204665213841469519415116094330572703657595919530921861173819326117931051185480744623799627495673518857527248912279381830119491298336733624406566430860213949463952247371907021798609437027705392171762931767523846748184676694051320005681271452635608277857713427577896091736371787214684409012249534301465495853710507922796892589235420199561121290219608640344181598136297747713099605187072.

 

[itfitzme]

How come when you ask a question like: Can you pay down the debt WITHOUT growing the "economy"?

Republicans are desperate to change the topic? They must have a reason for wanting to block anything that would help the country. Why won't they tell us what those reasons are?

Because it is the wrong question.

The OMB and CBO both say that, in order to ensure long term growth of the economy we need to pay down the debt. I can dig up hundreds of economists, including Krugman before Obama got elected, that will tell you that we need to pay down the debt in order to grow the economy. Yet, for some reason, you think that Obama can wave a magic wand and reverse the laws of economics.

And you wonder why everyone with a brain holds you in contempt.

I am sure that you are confused about what you read..

 

[daveman]

We can always pay it back. It is as simple as increasing income taxes.

...which decreases the amount of money circulating in the economy.

Not necessarily, not simply.

The amount of money circulating in the economy is primarily the direct result of private sector borrowing. That is the primary function of the Fed, to manage that money supply.

Government revenues either recirculate to investors in paying balance and interest on t-bills, by purchases from contractors, or by direct paymenr of wages to govt employees. All of that recirculates the money's back into the flow.

Investors, lacking T-bill for investment can simply invest elsewhere, such as in consumer credit or the stock market. That is still in the economy.

As well, prices are based on the total amount of money being spent, not on the amount of income before taxes. So, regardless, real dollars doesn't change due to taxes.

The only way it would reduce the money supply is if a) the money supply had no other method for growth and b) the moneys did not circulate through other channels. Even then, aggregate prices are due to the money supply in circulation.

The government debt is a bit of an illusion, having very little meaning and no direct impact on the economy. The only real inpact is the rate of change of that debt which is, of course, the deficit. The deficit is the government moving monies from private sector savings into private sector consumption and production. That or into interest payments on the debt.

The government can increase taxes and reduce outlays, as well as recuce the deficit and pay down the debt, without impacting the money supply that accounts for consumption and the prices of goods as long as it does so slowly. As long as it is done slowly, the economy has time to react to the change.

Surely the free market private sector economy is capable of functioning without the government involved to the tune of $17T.

Do you suppose that the free market, private sector economy cannot function without the government constantly borrowing money?

Look, I'm the first to admit I don't know much about economics. Bores the ass off me; never was interested in learning much about it.

I do have a pretty good handle on common sense, though.

 

[itfitzme]

Government can't grow the economy, no matter what lies progressives tell each other.

Well, now that is simply not true, dave. The tax and spending multipliers are established as factual. It is simply a matter of the reality of the economy being a closed loop system. How much effect depends on the specific circumstances of the economy.

They are established as factual? Where? Just because Congress passes a law that says pi is equal to 3 does not mean that pi suddenly is not 3.1415926535897932384626433832795028841971693993751058209749445923078164062862089986280348253421170679821480865132823066470938446095505822317253594081284811174502841027019385211055596446229489549303819644288109756659334461284756482337867831652712019091456485669234603486104543266482133936072602491412737245870066063155881748815209209628292540917153643678925903600113305305488204665213841469519415116094330572703657595919530921861173819326117931051185480744623799627495673518857527248912279381830119491298336733624406566430860213949463952247371907021798609437027705392171762931767523846748184676694051320005681271452635608277857713427577896091736371787214684409012249534301465495853710507922796892589235420199561121290219608640344181598136297747713099605187072.

Just because you can post 100 digits of pi doesn't mean you understand how economics and the money supply works.

Starting from a belief based on home economics and then misreading some statement presented in economics doesn't make for fact.

 

[TooTall]

If you pay down the debt, you reduce the money supply. That isn't a good thing--it is deflationary. Debtors would suffer tremendously under such circumstances. And all Americans have consumer and/or mortgage debt.

Nobody has even suggested paying down the debt. The discussion is about cutting the deficit so the debt does not increase by a trillion dollars a year.

 

[Quantum Windbag]

Borrowing more money that we can't pay back without borrowing more money is not helping the economy.

We can always pay it back. It is as simple as increasing income taxes.

Lets see how good you are at math.

Under sequestration we were supposed to spend $3.8 trillion this year. I can't find figures for income for this year, but in 2012 the combined income of every single American came to $13,401,868,693. Since we ran a deficit of $700 billion this year if we increased income tax to 100% across the board we would still need to find an additional $686,598,131,307 just to cover this years deficit, and that is assuming that no income tax was collected for the year. (I would love for you to explain to the states that they can no longer collect income tax in the while you are collecting all the income to pretend we are paying down the debt.))

That means that either the math is wrong, or you are. Personally, I will bet on you being wrong.

My source for the income figure.

 

[itfitzme]

Between Quantum Windbag and Daveman, we have the following two rules.

a) we must reduce the debt to grow the economy and
b) reducing the debt reduces the money supply.

Can anyone tell us how these two statements are inconguent.

HINT: See Hume, Essay, "On Money".

 

[TooTall]

Let's make this "simple".

Let's say you had a job and a car to get to that job.

Suddenly, you had a lot of bills. Medical. Home loan. Whatever.

So you cut back spending to pay those bills.

The car breaks down. You can't get to work. So you decide to stop all spending. Do you quit your job and not fix the car so you can "save" enough money to pay your bills?

Now, compare your car to infrastructure, job training and so on. If you don't invest in jobs, can you ever pay down the debt? Think about it.

As a practical matter, the unemployment rate and the deficit track almost identically. As one goes up, so does the other. The lag is in the deficit. Both the historical number and the economic theory suggest the causation runs from employment and production to deficits and not the reverse. So you can't balance a budget in a downturn with spending cuts, period. God knows, Ike tried to do it three times and in the end learned the lesson. No president since has tried that again, and until 2010, no Congress has either.

That's because these Republicans are crazy batshit. Can you imagine how history will see them? Fighting tooth and nail to keep Americans from having health care? Could they be anymore stupid? And USMB Republicans represent.

EVERYONE has healthcare now. The fight is about who pays for health insurance. I will pay for mine and you pay for yours and as many others as you want too.

 

[itfitzme]

...which decreases the amount of money circulating in the economy.

Not necessarily, not simply.

The amount of money circulating in the economy is primarily the direct result of private sector borrowing. That is the primary function of the Fed, to manage that money supply.

Government revenues either recirculate to investors in paying balance and interest on t-bills, by purchases from contractors, or by direct paymenr of wages to govt employees. All of that recirculates the money's back into the flow.

Investors, lacking T-bill for investment can simply invest elsewhere, such as in consumer credit or the stock market. That is still in the economy.

As well, prices are based on the total amount of money being spent, not on the amount of income before taxes. So, regardless, real dollars doesn't change due to taxes.

The only way it would reduce the money supply is if a) the money supply had no other method for growth and b) the moneys did not circulate through other channels. Even then, aggregate prices are due to the money supply in circulation.

The government debt is a bit of an illusion, having very little meaning and no direct impact on the economy. The only real inpact is the rate of change of that debt which is, of course, the deficit. The deficit is the government moving monies from private sector savings into private sector consumption and production. That or into interest payments on the debt.

The government can increase taxes and reduce outlays, as well as recuce the deficit and pay down the debt, without impacting the money supply that accounts for consumption and the prices of goods as long as it does so slowly. As long as it is done slowly, the economy has time to react to the change.

Surely the free market private sector economy is capable of functioning without the government involved to the tune of $17T.

Do you suppose that the free market, private sector economy cannot function without the government constantly borrowing money?

Look, I'm the first to admit I don't know much about economics. Bores the ass off me; never was interested in learning much about it.

I do have a pretty good handle on common sense, though.

Yeah, that is the thing. "Common sense" doesn't work in economics. Macro economics isn't home economics.

 

[Quantum Windbag]

How come when you ask a question like: Can you pay down the debt WITHOUT growing the "economy"?

Republicans are desperate to change the topic? They must have a reason for wanting to block anything that would help the country. Why won't they tell us what those reasons are?

Because it is the wrong question.

The OMB and CBO both say that, in order to ensure long term growth of the economy we need to pay down the debt. I can dig up hundreds of economists, including Krugman before Obama got elected, that will tell you that we need to pay down the debt in order to grow the economy. Yet, for some reason, you think that Obama can wave a magic wand and reverse the laws of economics.

And you wonder why everyone with a brain holds you in contempt.

I am sure that you are confused about what you read..

If I was you would be able to post the CBO reports that contradict me, wouldn't you?

 

[itfitzme]

Borrowing more money that we can't pay back without borrowing more money is not helping the economy.

We can always pay it back. It is as simple as increasing income taxes.

Lets see how good you are at math.

Under sequestration we were supposed to spend $3.8 trillion this year. I can't find figures for income for this year, but in 2012 the combined income of every single American came to $13,401,868,693. Since we ran a deficit of $700 billion this year if we increased income tax to 100% across the board we would still need to find an additional $686,598,131,307just to pay off this years deficit, and that is assuming that no income tax was collected for the year.

That means that either the math is wrong, or you are. Personally, I will bet on you being wrong.

My source for the income figure.

If only the economy, income, and the price of goods didn't react to changes in tax levels and government spending.

But they do. It is a closed loop feedback system.

 

[Quantum Windbag]

Well, now that is simply not true, dave. The tax and spending multipliers are established as factual. It is simply a matter of the reality of the economy being a closed loop system. How much effect depends on the specific circumstances of the economy.

They are established as factual? Where? Just because Congress passes a law that says pi is equal to 3 does not mean that pi suddenly is not 3.1415926535897932384626433832795028841971693993751058209749445923078164062862089986280348253421170679821480865132823066470938446095505822317253594081284811174502841027019385211055596446229489549303819644288109756659334461284756482337867831652712019091456485669234603486104543266482133936072602491412737245870066063155881748815209209628292540917153643678925903600113305305488204665213841469519415116094330572703657595919530921861173819326117931051185480744623799627495673518857527248912279381830119491298336733624406566430860213949463952247371907021798609437027705392171762931767523846748184676694051320005681271452635608277857713427577896091736371787214684409012249534301465495853710507922796892589235420199561121290219608640344181598136297747713099605187072.

Just because you can post 100 digits of pi doesn't mean you understand how economics and the money supply works.

Starting from a belief based on home economics and then misreading some statement presented in economics doesn't make for fact.

The fact is that you cannot count, that was 758 digits, not 100.

 

[itfitzme]

Because it is the wrong question.

The OMB and CBO both say that, in order to ensure long term growth of the economy we need to pay down the debt. I can dig up hundreds of economists, including Krugman before Obama got elected, that will tell you that we need to pay down the debt in order to grow the economy. Yet, for some reason, you think that Obama can wave a magic wand and reverse the laws of economics.

And you wonder why everyone with a brain holds you in contempt.

I am sure that you are confused about what you read..

If I was you would be able to post the CBO reports that contradict me, wouldn't you?

So, you don't actually have anything where the CBO says that.

The CBO doesn't read your posts, so it is kind of hard for them to contradict them.

Surely you realize that we would have to post everything the CBO has written to show that they never said what you claim.

 

[Quantum Windbag]

Between Quantum Windbag and Daveman, we have the following two rules.

a) we must reduce the debt to grow the economy and
b) reducing the debt reduces the money supply.

Can anyone tell us how these two statements are inconguent.

HINT: See Hume, Essay, "On Money".

Did I say that reducing the debt reduces the money supply?

No.

Did Daveman?

No.

I guess that means here is that we have a lying sack of shit that cannot do simple math, so he is reduced to making stuff up in order to fool himself into thinking he is smart.

 

[TooTall]

Quick question....................................

What is wrong with cutting spending (like this administration is doing), and raising taxes on the rich (who can afford it)?

I mean............................raising taxes by 5 percent on the wealthy wouldn't hurt them much, but doing so on the poor and middle class would.

Why can't we tax the rich? George Bush Jr. gave them a tax cut when he saw that Clinton left him with a surplus, and he even cut the taxes again (in 2003) when we were in the middle of a war.

Tax the rich and make them pay their fair share.

In case you forgot, the Bush cut lowered taxes on ALL tax brackets. Should Obama now raise taxes on everyone, or just the so-called rich? That would make everyone pay their "fair share."

 

[Quantum Windbag]

Not necessarily, not simply.

The amount of money circulating in the economy is primarily the direct result of private sector borrowing. That is the primary function of the Fed, to manage that money supply.

Government revenues either recirculate to investors in paying balance and interest on t-bills, by purchases from contractors, or by direct paymenr of wages to govt employees. All of that recirculates the money's back into the flow.

Investors, lacking T-bill for investment can simply invest elsewhere, such as in consumer credit or the stock market. That is still in the economy.

As well, prices are based on the total amount of money being spent, not on the amount of income before taxes. So, regardless, real dollars doesn't change due to taxes.

The only way it would reduce the money supply is if a) the money supply had no other method for growth and b) the moneys did not circulate through other channels. Even then, aggregate prices are due to the money supply in circulation.

The government debt is a bit of an illusion, having very little meaning and no direct impact on the economy. The only real inpact is the rate of change of that debt which is, of course, the deficit. The deficit is the government moving monies from private sector savings into private sector consumption and production. That or into interest payments on the debt.

The government can increase taxes and reduce outlays, as well as recuce the deficit and pay down the debt, without impacting the money supply that accounts for consumption and the prices of goods as long as it does so slowly. As long as it is done slowly, the economy has time to react to the change.

Surely the free market private sector economy is capable of functioning without the government involved to the tune of $17T.

Do you suppose that the free market, private sector economy cannot function without the government constantly borrowing money?

Look, I'm the first to admit I don't know much about economics. Bores the ass off me; never was interested in learning much about it.

I do have a pretty good handle on common sense, though.

Yeah, that is the thing. "Common sense" doesn't work in economics. Macro economics isn't home economics.

Sure it does, even if you believe Keynes was right common sense still works.

By the way, if common sense doesn't work, how do you explain the fact that Germany, by using a common sense approach to economics, has managed to keep a relatively strong economy despite bailing out half of Europe?

 

[Quantum Windbag]

We can always pay it back. It is as simple as increasing income taxes.

Lets see how good you are at math.

Under sequestration we were supposed to spend $3.8 trillion this year. I can't find figures for income for this year, but in 2012 the combined income of every single American came to $13,401,868,693. Since we ran a deficit of $700 billion this year if we increased income tax to 100% across the board we would still need to find an additional $686,598,131,307just to pay off this years deficit, and that is assuming that no income tax was collected for the year.

That means that either the math is wrong, or you are. Personally, I will bet on you being wrong.

My source for the income figure.

If only the economy, income, and the price of goods didn't react to changes in tax levels and government spending.

But they do. It is a closed loop feedback system.

Yes, and increasing income taxes to 100% across the board would mean that no one would have any money to spend on anything, and the economy would immediately crash, thus destroying your attempt to save the economy by taking all the money out of it.

If you were half as smart as you think you are you would go away now.