PDA

View Full Version : 9 Takeaways From the CBOs New Budget Report



Chris
09-20-2013, 04:29 PM
These are predictions, uncertain one. Is this, as the article asks the calm before the storm? I think we're headed for disaster, sooner than later--what about you?

9 Takeaways From the CBOs New Budget Report (http://reason.com/blog/2013/09/17/9-takeaways-from-the-cbos-new-budget-rep)


1. Over the next few years, debt levels are expected to be stableand even decline slightly....

2. The long-term federal debt trajectory is unsustainable....

3. The biggest factor is the growth of entitlement spending....

4. The other big projected growth area for the federal budget is debt service....

5. Spending on governmental functions aside from entitlements and debt service is set to decline as a percentage of the economy....

6. The coming rise in debt wont be driven by low taxes....

7. Rising debt will probably coincide with rising interest rateswhich means that borrowing and carrying debt will cost us even more....

8. Higher debt levels will have multiple negative effects on the budget and economy....

9. The policy responses to mitigate rising debt levels are all politically difficult....

midcan5
09-20-2013, 05:37 PM
The only thing one can honestly say about Reason magazine and its affiliated members is there is very little reason evident and there is a clear reason for that. Reason is a corporate puppet organization, one of so many created to brainwash Americans. Money manages the minds of so many on the right, especially libertarian types. This sort of doom and gloom is the reason (pi) America is becoming a banana republic, dummies with money create more dummies. Always look at the funders to understand the motives.

http://www.sourcewatch.org/index.php/Reason_Foundation

"And yet over the course of the decade the old skepticism toward business that had been born in the Great Depression and reawakened for a new generation in the Vietnam era finally began to disappear. The economic transformations of the decade would be interpreted through the framework of the free market vision. The 1970s campaigns to revive the image of capitalism among college students bore fruit in the 1980s. Universities created new centers for the study of business themes such as entrepreneurship. Students in Free Enterprise, a group started in 1975 to bring students together to "discuss what they might do to counteract the stultifying criticism of American business," thrived on small college campuses, funded by companies like Coors, Dow Chemical, and Walmart (as well as the Business Roundtable). The group organized battles of the bands, at which prizes would be doled out to the best pro-business rock anthems, helped silkscreen T-shirts with pro-capitalist messages, and created skits based on Milton Friedman's writings, which college students would perform in local elementary schools. In the workplace, the decline of the old manufacturing cities of [he North and Midwest and the rise of the sprawling suburbs of the Sunbelt metropolises marked the rise of a new economic culture, dominated by companies such as Walmart and Home Depot and Barnes & Noble." Kim Phillips-Fein ('Invisible Hands')

Chris
09-20-2013, 06:07 PM
The only thing one can honestly say about Reason magazine and its affiliated members is there is very little reason evident and there is a clear reason for that. Reason is a corporate puppet organization, one of so many created to brainwash Americans. Money manages the minds of so many on the right, especially libertarian types. This sort of doom and gloom is the reason (pi) America is becoming a banana republic, dummies with money create more dummies. Always look at the funders to understand the motives.

http://www.sourcewatch.org/index.php/Reason_Foundation

"And yet over the course of the decade the old skepticism toward business that had been born in the Great Depression and reawakened for a new generation in the Vietnam era finally began to disappear. The economic transformations of the decade would be interpreted through the framework of the free market vision. The 1970s campaigns to revive the image of capitalism among college students bore fruit in the 1980s. Universities created new centers for the study of business themes such as entrepreneurship. Students in Free Enterprise, a group started in 1975 to bring students together to "discuss what they might do to counteract the stultifying criticism of American business," thrived on small college campuses, funded by companies like Coors, Dow Chemical, and Walmart (as well as the Business Roundtable). The group organized battles of the bands, at which prizes would be doled out to the best pro-business rock anthems, helped silkscreen T-shirts with pro-capitalist messages, and created skits based on Milton Friedman's writings, which college students would perform in local elementary schools. In the workplace, the decline of the old manufacturing cities of [he North and Midwest and the rise of the sprawling suburbs of the Sunbelt metropolises marked the rise of a new economic culture, dominated by companies such as Walmart and Home Depot and Barnes & Noble." Kim Phillips-Fein ('Invisible Hands')



Ad hom followed by a canned response that doesn't fit the topic at hand.


The topic is government, deficits, debt, and where all that's headed, thank you.

Mainecoons
09-20-2013, 06:18 PM
Can you address the points, MidCan?

Otherwise, you're wasting space and not contributing to the discussion. Some of these points seem pretty inevitable and this particular source is hardly the only one that has been pointing them out. A number of us have cited the same conclusions from multiple sources. Have you been paying attention?

Mainecoons
09-20-2013, 06:20 PM
I'd say that the points cited are pretty much inescapable. Particularly the point about the cost of debt servicing. You may recall that under Clinton, debt financing was shifted from long term to short term. The rates for the latter are lower than the long term but much more volatile.

The other point that is obvious is the one about entitlements. The baby boom demographic is about to bite us all in the ass. Again, that one has been documented and discussed ad nauseum.

Peter1469
09-20-2013, 07:15 PM
These are predictions, uncertain one. Is this, as the article asks the calm before the storm? I think we're headed for disaster, sooner than later--what about you?

9 Takeaways From the CBO’s New Budget Report (http://reason.com/blog/2013/09/17/9-takeaways-from-the-cbos-new-budget-rep)

A regarding #4, if interest rates rise to their historical average, servicing the debt will rise to the top of government spending and crowd out much of our discretionary spending.

Mainecoons
09-20-2013, 07:20 PM
Sometimes I wonder if that would be a good thing since so much of it is counterproductive.

Probably not, but I'd wager we could do quite nicely without at least half of it and half the agencies that feed off of it.

Chris
09-20-2013, 07:56 PM
But would government stop doing that, stop discretionary spending even when overwhelmed with servicing the debt? Keynes would have said just print more pretend money, it's as good as real.

Peter1469
09-20-2013, 07:59 PM
But would government stop doing that, stop discretionary spending even when overwhelmed with servicing the debt? Keynes would have said just print more pretend money, it's as good as real.
Actually Keynes said that debt should be repaid during times when the economy was doing well.

Chris
09-20-2013, 08:16 PM
Actually Keynes said that debt should be repaid during times when the economy was doing well.

And increased when not, which is where we're at, and the future looks worse.

The problem with citing Keynes is he said a lot of things, much of it contradictory.

Mainecoons
09-21-2013, 09:42 AM
There's nothing contradictory about the concept of lowering taxes during recessions and raising taxes and paying back the debt during booms.

The problem is that politicians only do the former, never the latter.

OK, we do have Obama who has raised taxes in a recession and enacted legislation that has destroyed full time jobs by the millions.

But generally, we don't elect such stupid people to office. I hope that the fact this is true since the year 2000 doesn't mean we will continue to do so.

I'm not optimistic at this point.

Chris
09-21-2013, 09:45 AM
There's nothing contradictory about the concept of lowering taxes during recessions and raising taxes and paying back the debt during booms.

The problem is that politicians only do the former, never the latter.

OK, we do have Obama who has raised taxes in a recession and enacted legislation that has destroyed full time jobs by the millions.

But generally, we don't elect such stupid people to office. I hope that the fact this is true since the year 2000 doesn't mean we will continue to do so.

I'm not optimistic at this point.



That's true and I believe something Keynes argued but neo-Keynesians like Krugman perverted.

Mainecoons
09-21-2013, 09:53 AM
Krugman is such a charlatan and a fraud as an economist that he preaches we can print money and incur debt forever.

Interesting that he shares a Nobel prize with another fraud, Barack Obama.

Peter1469
09-21-2013, 10:16 AM
Krugman is such a charlatan and a fraud as an economist that he preaches we can print money and incur debt forever.

Interesting that he shares a Nobel prize with another fraud, Barack Obama.

Krugman is now a political hack. But I think his Nobel (http://en.wikipedia.org/wiki/Paul_Krugman#Nobel_Memorial_Prize_in_Economic_Scie nces)was legit, unlike Obama's.


2008, Nobel Memorial Prize in Economics (http://en.wikipedia.org/wiki/Nobel_Memorial_Prize_in_Economics) for Krugman's contributions to New Trade Theory (http://en.wikipedia.org/wiki/New_Trade_Theory).[86] (http://en.wikipedia.org/wiki/Paul_Krugman#cite_note-86)