Republicans fall quiet in face of Obama deficit success

[JQPublic1]

Gawd, liberals are stupid!

Sometimes they are but since I am neither Liberal OR conservative I guess I'll take a pass on this one!

Still, any stupidity shown here by me is entirely of my OWN making, I take full responsibility for it unlike YOU, SJ. I came here to learn and discover the truth... If I err along the way, not too often, I will admit it when my error is pointed out! So what is your complaint?

 

[AmazonTania]

The last Republican doofus obliterated a surplus.

What surplus would that be?

 

[AmazonTania]

NOTE THAT THE GDP/DEBT chart is different from the GDP/DEFICIT chart during the same time periods.



That could be significant! For instance, the 1940-41 GDP/Debt ratio peak was close to 100% while
the 1940 -41GDP/DEFICIT chart shows a much lower peak ratio near 30%.

The Deficit, in fact , has never been more than 30% of GDP and, notably, it is almost imperceptible on the graph during the Vietnam War years!

Deficits are only but a small portion of the economy. Debt to GDP will always be larger on the granular. What you are trying to show doesn't really mean anything.

NOW, that idyllic period some call the "good 'ol days" has all but faded away in the face of Nixon's visit to China, NAFTA and other government efforts to undermine the American workforce

No one is undermining the American workforce except the America people.

 

[AmazonTania]

Actually the revenues dropped more like a trillion if compared to pre-crisis trend. But it must be Obama's fault since he signed the budget.

Tax revenue decreasing in a recession...

I really don't understand why that would happen.

 

[AmazonTania]

I don't think there is such a thing. Japan, for example, has debt to GDP ratio three times bigger than the US, yet they can borrow at lower interest than we do.

Japan is good for it's debt. It's the largest creditor nation in the world with a huge trade surplus, second only to China. America is not. It's the largest debtor nation and a broke loser merely living off the charity of the rest of the world.

Also, it is very naive to view debt as some sort of evil. Debt is what makes our economy running. Even money are nothing more than IOUs (that is paying off all debt in an economy would destroy whole money stock). And it's not some recent invention, gold money 1000s years ago were no different.

Of course bad things may happen when some entity ends up with too much debt. That is why it makes sense for the government to try and reduce its debt load when it is safe to do so. But history shows that a country that borrows in its own currency can deal with very high debt loads -- much higher than what we have now.

Until interest rates will be forced to rise. Then you're screwed.

 

[ilia25]

Japan is good for it's debt. It's the largest creditor nation in the world with a huge trade surplus, second only to China. America is not. It's the largest debtor nation and a broke loser merely living off the charity of the rest of the world.

Really? Since when the rest of the world has become so charitable? Sorry, but I don't think you know what you are talking about.

Until interest rates will be forced to rise. Then you're screwed.

And why interest rates would be "forced" to rise, and by whom? Why hasn't it happen already?

 

[ilia25]

Actually the revenues dropped more like a trillion if compared to pre-crisis trend. But it must be Obama's fault since he signed the budget.

Tax revenue decreasing in a recession...

I really don't understand why that would happen.

I hope you're joking

 

[JQPublic1]

NOTE THAT THE GDP/DEBT chart is different from the GDP/DEFICIT chart during the same time periods.



That could be significant! For instance, the 1940-41 GDP/Debt ratio peak was close to 100% while
the 1940 -41GDP/DEFICIT chart shows a much lower peak ratio near 30%.

The Deficit, in fact , has never been more than 30% of GDP and, notably, it is almost imperceptible on the graph during the Vietnam War years!

Deficits are only but a small portion of the economy. Debt to GDP will always be larger on the granular. What you are trying to show doesn't really mean anything.

HAHAHA! After a few beers It really made sense at the time...What I was trying to show was the difference in revenue available during peak debt periods. With that info, it was my intent to provide a base for analyzing those differences; for instance by overlaying those periods of GDP/Debt peaks representing WW2 and those representing the Vietnam Era and then comparing them with their respective GDP/Deficit peaks I could then formulate questions as to why the shorter war(WW2) showed more of a spending curve than the much longer Vietnam Conflict. Ultimately, I wanted to apply that paradigm to our present day scenrio and look for a solution! Perhaps in my beer induced haze I did not quite present my data as intended... but....NOW you know the rest of the story! Thanks for at least giving me a chance to explain.

NOW, that idyllic period some call the "good 'ol days" has all but faded away in the face of Nixon's visit to China, NAFTA and other government efforts to undermine the American workforce

No one is undermining the American workforce except the America people.

I think the off shoring of jobs has hurt the American workers more than any other single factor. NAFTA and Nixon's visit to China seems to have been instrumental in all but destroying our manufacturing base and thus the jobs provided by that base. Perhaps a review of my controversial charts might be useful in plotting a rise in the National Deficit as tax revenue was lost when China began to take our manufacturing jobs and buy our debt
through treasury Bonds! More IOUs to add to those already being generated by Social Security and MEDICARE!///clear enough?

 

[AmazonTania]

Really? Since when the rest of the world has become so charitable? Sorry, but I don't think you know what you are talking about.

Since central bankers around the world are willing to devalue their own currency to prop up the value of the US dollar. Since countries around the world are allowing America to get away with paying for their imports, not with exports, but with US dollars. In exchange for allowing paying for imports with US dollars, these countries loan us back those same US dollars so Americans can continue to maintain their artificial lifestyle.

This has been going on for quite some time. Especially since the Trade Deficit has ballooned in the 90's and 2000's. Especially since the US economy is failing to recovery in a meaningful way and other economies maintain stronger currencies relative to the US dollar.

Countries around the world are willing to increase the cost of living in their own country, at the expense of America. Others are willing to live way below their means so you can live way above yours. That sounds pretty charitable to me.

And why interest rates would be "forced" to rise, and by whom? Why hasn't it happen already?

It hasn't happened yet because the Federal Reserve hasn't let it happen. And they're not going to let it happen because in their eyes, inflation is very low, regardless of how high prices are increasing. Also, demand for US bonds has kept interest rates artificially low, but the demand is artificial in itself. The Federal Reserve is the largest buyer of US debt, followed by China. Japan use to be the third largest, but they've recently entered the bond market themselves.

They will eventually be forced to, as there is no way interest rates can stay low for very long. Not unless they are willing to destroy the value of the US dollar. Either this will happen, creditors will stop purchasing US bonds which will force rates to rise and nothing the Fed does will help to keep it low.

 

[AmazonTania]

HAHAHA! After a few beers It really made sense at the time...What I was trying to show was the difference in revenue available during peak debt periods. With that info, it was my intent to provide a base for analyzing those differences; for instance by overlaying those periods of GDP/Debt peaks representing WW2 and those representing the Vietnam Era and then comparing them with their respective GDP/Deficit peaks I could then formulate questions as to why the shorter war(WW2) showed more of a spending curve than the much longer Vietnam Conflict. Ultimately, I wanted to apply that paradigm to our present day scenrio and look for a solution! Perhaps in my beer induced haze I did not quite present my data as intended... but....NOW you know the rest of the story! Thanks for at least giving me a chance to explain.

The economy was still under the Gold Standard during this time. In cases when money is tight, people and Foreign Banks will turn in their gold in exchange for dollars. During WWII, gold was turned in for the creating of new money and majority of it went into the war. This was generally not allowed to happen during the Vietnam war, up until the Gold Standard was abandoned in 1971.

I think the off shoring of jobs has hurt the American workers more than any other single factor. NAFTA and Nixon's visit to China seems to have been instrumental in all but destroying our manufacturing base and thus the jobs provided by that base.

As I've said, no one is destroying American manufacturing jobs except Americans. American is the only developing nation in the world which really has this problem of exporting jobs to least productive nations which are still in the process of developing.

Perhaps a review of my controversial charts might be useful in plotting a rise in the National Deficit as tax revenue was lost when China began to take our manufacturing jobs and buy our debt through treasury Bonds! More IOUs to add to those already being generated by Social Security and MEDICARE!///clear enough?

China hasn't taken anything. Jobs have gone away because America has decided that they no longer want to be competitive. If America can't manufacture at it's current cost of manufacturing, then it shouldn't be in the business of manufacturing at all.

China also has the ability to purchase your debt through all the trading you have done with them. Not because the US actually exports to them, but because the United States is too broke and un-competitive that it would rather trade worthless paper, in exchange for Chinese exports.

 

[AmazonTania]

Actually the revenues dropped more like a trillion if compared to pre-crisis trend. But it must be Obama's fault since he signed the budget.

Tax revenue decreasing in a recession...

I really don't understand why that would happen.

I hope you're joking

No, I really want to know. The suspense is killing me...

 

[Mertex]

The last Republican doofus obliterated a surplus.

What surplus would that be?

If you don't know you are not as bright as you think you are.

 

[AmazonTania]

The last Republican doofus obliterated a surplus.

What surplus would that be?

If you don't know you are not as bright as you think you are.

Have you ever seen a budget surplus which makes the public debt increase for 3 years in a row?

 

[JQPublic1]

The economy was still under the Gold Standard during this time. In cases when money is tight, people and Foreign Banks will turn in their gold in exchange for dollars. During WWII, gold was turned in for the creating of new money and majority of it went into the war. This was generally not allowed to happen during the Vietnam war, up until the Gold Standard was abandoned in 1971.

I am not sure I follow you here! You seem to be saying that the Gold Standard had something to do with the high National Debt and deficits of WWII but that the relatively mild debt and deficits incurred by the Vietnam conflict were due to a the absence of the Gold Standard!
I would certainly like to see some validating data to support that premise

In a previous post I said:
"I think the off shoring of jobs has hurt the American workers more than any other single factor. NAFTA and Nixon's visit to China seems to have been instrumental in all but destroying our manufacturing base and thus the jobs provided by that base."

You responded with:

As I've said, no one is destroying American manufacturing jobs except Americans.

Agreed! Who could possibly be responsible for off shoring American jobs BUT American manufacturers? How could you think I meant anything else after reading my post above?

American is the only developing nation in the world which really has this problem of exporting jobs to least productive nations which are still in the process of developing.

Are you saying China is one of the least productive nations in the world? And I don't think America is a developing nation... I think you might have had too many beers when you wrote that!

 

[AmazonTania]

I am not sure I follow you here! You seem to be saying that the Gold Standard had something to do with the high National Debt and deficits of WWII but that the relatively mild debt and deficits incurred by the Vietnam conflict were due to a the absence of the Gold Standard!
I would certainly like to see some validating data to support that premise

Under the Gold Standard, Gold is redeemed in exchange for Federal Reserve notes. The new money and increased liquidity keeps interest rates low enough so that the US Treasury could sell bonds to fund the war effort. This allows Government to accumulate debt at very little cost. The same thing could not have been accomplished during the Vietnam War, as interest rates were much too high compared interest rates during the second World War, which were at .375 basis points.

Agreed! Who could possibly be responsible for off shoring American jobs BUT American manufacturers? How could you think I meant anything else after reading my post above?

Manufactures only respond to the incentives given to them. Contrary to popular belief, people American producers want to employ Americans. Theoretically, a producer can still make money if they had a factory in both America AND China. There is only one reason why they don't keep the factor in America open: This factor is losing money.

If these manufacturers had their way, they wouldn't have to deal with all of these regulations and taxes attached with the cost of business. Someone had to impose it on them, and they don't willing impose these restrictions on themselves.

Are you saying China is one of the least productive nations in the world?

In terms of GDP per hours worked, yes. When you factor productivity by this metric, China is probably the lowest, if not among the lowest. Low productivity brings lower wages.

And I don't think America is a developing nation... I think you might have had too many beers when you wrote that!

It's called a typo, buddy. Relax.

 

[JQPublic1]

Perhaps a review of my controversial charts might be useful in plotting a rise in the National Deficit as tax revenue was lost when China began to take our manufacturing jobs and buy our debt through treasury Bonds! More IOUs to add to those already being generated by Social Security and MEDICARE!///clear enough?

China hasn't taken anything. Jobs have gone away because America has decided that they no longer want to be competitive.

Without clarifying which Americans you are talking about your point is meaningless! ANd I will forgo China's brand of "competitiveness" anytime for living wages and a healthy environment.
What I see in your statement is an affinity for corporate greed. American companies have lost that jingoistic quality that made them loyal to their American workforce. Our economy
fares far better when the workforce has money to spend.

Now the factories of our our Corporate expatriates are relentlessly belching toxins into China's air and many are the catalysts behind some of China's most notorious sweatshops. Better thee than me!

If America can't manufacture at it's current cost of manufacturing, then it shouldn't be in the business of manufacturing at all.

In America, Labor is the highest cost associated with manufacturing. But with emerging technology, something that Americans are noted for, labor of all types may be less of a factor in production. Those offshore jobs might be coming home sooner than you think. IMHO the key to our future success lies in education. I also think we ought to shut down immigration for a decade and close out borders except for tourists!

China also has the ability to purchase your debt through all the trading you have done with them. Not because the US actually exports to them, but because the United States is too broke and un-competitive that it would rather trade worthless paper, in exchange for Chinese exports.

The United States is NOT broke! And your "uncompetitive" remark drips with sarcasm but you really mean that American workers wanting a fair wage and healthy work environment are making our country uncompetitive! I disagree! Obviously, U are NO United States Citizen although you might be from one of the Americas! Thanks GOD I live in the USA and not where you come from!

 

[Mertex]

What surplus would that be?

If you don't know you are not as bright as you think you are.

Have you ever seen a budget surplus which makes the public debt increase for 3 years in a row?

No.


Debt held by the public relative to GDP rose rapidly again in the 1980s. President Ronald Reagan's economic policies lowered tax rates and increased military spending, while congressional Democrats held fast against attempts to reverse spending on social programs.[12][13] As a result, debt as a share of GDP increased from 26.2% in 1980 to 40.9% in 1988, and continued to rise during the presidency of George H. W. Bush, reaching 48.3% of GDP in 1992.[10][14]

Debt held by the public reached 49.5% of GDP at the beginning of President Clinton's first term. However, it fell to 34.5% of GDP by the end of Clinton's presidency due in part to decreased military spending, increased taxes (in 1990, 1993 and 1997), and increased tax revenue resulting from the Dot-com bubble.[10][11][15][16][17] The budget controls instituted in the 1990s successfully restrained fiscal action by the Congress and the President and together with economic growth contributed to the budget surpluses at the end of the decade.[18]

In the early 21st century, debt relative to GDP rose again due in part to the Bush tax cuts and increased military spending caused by the wars in the Middle-East and a new entitlement Medicare D program. During the presidency of George W. Bush, debt held by the public increased from $3.339 trillion in September 2001 to $6.369 trillion by the end of 2008,
National debt of the United States - Wikipedia, the free encyclopedia

 

[AmazonTania]

If you don't know you are not as bright as you think you are.

Have you ever seen a budget surplus which makes the public debt increase for 3 years in a row?

No.


Debt held by the public relative to GDP rose rapidly again in the 1980s. President Ronald Reagan's economic policies lowered tax rates and increased military spending, while congressional Democrats held fast against attempts to reverse spending on social programs.[12][13] As a result, debt as a share of GDP increased from 26.2% in 1980 to 40.9% in 1988, and continued to rise during the presidency of George H. W. Bush, reaching 48.3% of GDP in 1992.[10][14]

Debt held by the public reached 49.5% of GDP at the beginning of President Clinton's first term. However, it fell to 34.5% of GDP by the end of Clinton's presidency due in part to decreased military spending, increased taxes (in 1990, 1993 and 1997), and increased tax revenue resulting from the Dot-com bubble.[10][11][15][16][17] The budget controls instituted in the 1990s successfully restrained fiscal action by the Congress and the President and together with economic growth contributed to the budget surpluses at the end of the decade.[18]

In the early 21st century, debt relative to GDP rose again due in part to the Bush tax cuts and increased military spending caused by the wars in the Middle-East and a new entitlement Medicare D program. During the presidency of George W. Bush, debt held by the public increased from $3.339 trillion in September 2001 to $6.369 trillion by the end of 2008,
National debt of the United States - Wikipedia, the free encyclopedia

I am willing to forget the fact that you confused Debt to GDP with Total Public Debt Outstanding IF you point out where the surplus is:

09/30/1997 - 5,413,146,011,397.34
09/30/1998 - 5,526,193,008,897.62
09/30/1999 - 5,656,270,901,615.43
09/30/2000 - 5,674,178,209,886.86
09/30/2001 - 5,807,463,412,200.06

Government - Historical Debt Outstanding - Annual 1950 - 1999
Government - Historical Debt Outstanding - Annual 2000 - 2012

Never seen a budget surplus which increases the national debt. Not only for just one year, but for three years of a 'surplus.' Strange anomaly that was...

 

[AmazonTania]

Without clarifying which Americans you are talking about your point is meaningless! ANd I will forgo China's brand of "competitiveness" anytime for living wages and a healthy environment.

When I say 'America' I am referring to all Americans. Left or right, Republican or Democrat. Regardless of whether you wanted this outcome or not, everyone in some way, shape or form allowed it to happen. They have no one to blame but themselves.

And I don't recommend adopting China's brand of Competitiveness, but they are doing all of the right things. They have the largest middle class in the world, their consumer market is increasing which suggest their economy is transforming from a producer nation to a consumer nation and they are projected to have the world's largest economy in less than a decade, along with stealing the reserve currency from right under your nose.

America was in the same position China was in many years ago. It would be better to learn from them, rather than to pound your chest and suggest that you're better than them. So far, that has gotten you nowhere.

What I see in your statement is an affinity for corporate greed. American companies have lost that jingoistic quality that made them loyal to their American workforce. Our economy
fares far better when the workforce has money to spend.

The problem is that Americans do too much spending. The spend on consumer goods which are not even produced in America. They spend without any regard of what the future may bring Even when they have less money to spend, they find a way to spend more. Americans need to start saving and start producing.

Now the factories of our our Corporate expatriates are relentlessly belching toxins into China's air and many are the catalysts behind some of China's most notorious sweatshops. Better thee than me!

The more sweatshops, the better. These sweatshops are just one of the building blocks in which China can increase its overall productive capacity and grow as an industrialized nation.

Of course, there are many things holding the country back but for now this is a good thing as many developing nations has gone throw this phase in their economic expansion.

In America, Labor is the highest cost associated with manufacturing. But with emerging technology, something that Americans are noted for, labor of all types may be less of a factor in production. Those offshore jobs might be coming home sooner than you think.

No... No they aren't. Manufacturing base is the lowest it's been since we started using the manufacturing industry to provide weapons for the military to kill people and break things.

IMHO the key to our future success lies in education. I also think we ought to shut down immigration for a decade and close out borders except for tourists!

Good luck getting your own citizens to work in your grape fields.

The United States is NOT broke!

Total national debt to the penny is 16,736,576,618,573.30. Total consumer debt as of 2,807 Trillion. Trade Deficits averaging -$500 Billion dollars a year. Current Account Balance -$424 Billion as of Q4 of 2012.

You're broke and in more ways than one. But I suppose the more debt you owe, the wealthier you are. That is a very neat lesson that I have learned from our very own congressmen, Pete Stark.

And your "uncompetitive" remark drips with sarcasm but you really mean that American workers wanting a fair wage and healthy work environment are making our country uncompetitive! I disagree!

It's not just that. It's typically incentives (or lack thereof) which allows a thriving business environment. Whether this be lower wages, lower taxes, less regulations, lower compliance cost, lower labour cost, etc, etc.

Obviously, U are NO United States Citizen although you might be from one of the Americas! Thanks GOD I live in the USA and not where you come from!

Oh, thank you for noticing. I'm actually from London, which is not doing very well as you can tell. I have also noticed that you would prefer to swing your pendulum in our direction instead of the direction of economic freedom. Well, good luck with that.

And no, I do not wish to be an American citizen. As the powers that be have decided that one of the privileges of being a citizen of your once great nation is that you must pay taxes on anything you earn, no matter where you are in the world.

Thanks, but no thanks.

 

[ilia25]

The problem is that Americans do too much spending. The spend on consumer goods which are not even produced in America. They spend without any regard of what the future may bring Even when they have less money to spend, they find a way to spend more. Americans need to start saving and start producing.

Man you've managed to unload just about every popular myth and misconception about economics here!

Americans do need to spend more. Your spending is my income and vice versa. The economy is depressed because we don't spend enough to employ all those looking for a job.

Debt is not a problem for the economy as a whole. Your debt is my savings, and vice versa. We only have problem when debtors try to reduce their debt to fast and savers don't pick up the slack by increasing their spending. But that is not a fundamental problem - rather it's a technical issue, which can be easily resolved given some political will.

Competitiveness, or lack of it, do not cause unemployment. Here, if you really want to learn something:

http://www.pkarchive.org/global/pop.html

Same for trade deficit -- having them does not mean the nation is broke or something.

Decline in manufacturing is global phenomenon and the world is better because of it:

http://mjperry.blogspot.com/2011/04/decline-of-manufacturing-is-global.html

Anyways, try to read some knowledgeable economist, like Krugman or DeLong. Good luck