Structural Debt: How Can We Address It?

[IMPress Polly]

We DO have a debt problem in this country (the United States), as do many countries in today's world. The question here is how that can best be addressed.

Here's my view:

The typical solutions one hears from both the political right and the political left (make poor people pay it off with cuts in social spending or make rich people pay it off with income tax hikes respectively) are rather mechanistic solutions that fail to get at the heart of the problem. The real fiscal problem we have is structural and therefore requires a structural solution. The structural problem is that we have great big recessions today. Recessions put large numbers of people out of work and reduce the general income levels, thus forcing more people onto government assistance. The government then must spend more money than usual keeping the enlarged ranks of the poor alive at the very same time that it finds itself taking in less revenue than usual as a result of people generally being poorer and thus more tax-exempt. More spending plus less revenue equals more debt. When a recession is especially severe like the one we had in the early 1980s and the most recent one, for example, major debt growth results. It can gradually be gotten back under control through deliberate deficit reduction (e.g. the 1990s), but unless and until the fundamental problem is addressed, we'll just keep having more of these economic disasters and corresponding phases of massive debt growth until eventually we go bankrupt as a nation. What we really need to do is find of way to stop having these really bad recessions. But how, you ask? Let's talk about that.

All recessions are caused by the financial industry. The better regulated and under control the financial industry is, the smaller recessions tend to be. For example, take a look at how small our recessions were between the 1930s and the 1970s. Now consider that before financial regulation came about in the early 1930s, the typical recession in this country was specifically a depression. And likewise consider that since we began rescinding moderating regulations on the financial sector in the late 1970s, we've had two great big recessions: one in the early '80s and another very recently. And now look at budgets over the same periods of time respectively: even with a substantial array of social welfare programs in place, our budgets were still basically balanced for as long as we regulated the financial industry with reasonable strictness. Now they're rarely anywhere near balanced. I'm sure you can see my point. The bottom line is that the structural solution to our debt problem is to regulate the financial industry in, at minimum, the same kind of ways we used to. That way we won't have these disastrous extra-large recessions anymore. But how do we get from here to there? Let me propose that the answer begins with re-unionizing the workforce. How do I figure? Because it was the de-unionizing of the workforce that got us to a position of dependence on debt to maintain a modern standard of living in the first place. Once workers lost their job security and started making less money (after you take inflation into account) and fewer benefits, they started having to rely on debt more and more. This increased Wall Street's grip on the economy, thus giving them increasing political muscle with which to get the regulations on their business overturned. A unionized workforce would be more economically independent of Wall Street, thus weakening their grip on the economy and therefore on the nation's politics.

So that's my idea of how to initiate a real solution. Anyone concur?

[Cigar]

IT's all Play Money ... :grin:

[Matty]

As soon as you said unions I threw up.

[Bob]

We DO have a debt problem in this country (the United States), as do many countries in today's world. The question here is how that can best be addressed.

Here's my view:

The typical solutions one hears from both the political right and the political left (make poor people pay it off with cuts in social spending or make rich people pay it off with income tax hikes respectively) are rather mechanistic solutions that fail to get at the heart of the problem. The real fiscal problem we have is structural and therefore requires a structural solution. The structural problem is that we have great big recessions today. Recessions put large numbers of people out of work and reduce the general income levels, thus forcing more people onto government assistance. The government then must spend more money than usual keeping the enlarged ranks of the poor alive at the very same time that it finds itself taking in less revenue than usual as a result of people generally being poorer and thus more tax-exempt. More spending plus less revenue equals more debt. When a recession is especially severe like the one we had in the early 1980s and the most recent one, for example, major debt growth results. It can gradually be gotten back under control through deliberate deficit reduction (e.g. the 1990s), but unless and until the fundamental problem is addressed, we'll just keep having more of these economic disasters and corresponding phases of massive debt growth until eventually we go bankrupt as a nation. What we really need to do is find of way to stop having these really bad recessions. But how, you ask? Let's talk about that.

All recessions are caused by the financial industry. The better regulated and under control the financial industry is, the smaller recessions tend to be. For example, take a look at how small our recessions were between the 1930s and the 1970s. Now consider that before financial regulation came about in the early 1930s, the typical recession in this country was specifically a depression. And likewise consider that since we began rescinding moderating regulations on the financial sector in the late 1970s, we've had two great big recessions: one in the early '80s and another very recently. And now look at budgets over the same periods of time respectively: even with a substantial array of social welfare programs in place, our budgets were still basically balanced for as long as we regulated the financial industry with reasonable strictness. Now they're rarely anywhere near balanced. I'm sure you can see my point. The bottom line is that the structural solution to our debt problem is to regulate the financial industry in, at minimum, the same kind of ways we used to. That way we won't have these disastrous extra-large recessions anymore. But how do we get from here to there? Let me propose that the answer begins with re-unionizing the workforce. How do I figure? Because it was the de-unionizing of the workforce that got us to a position of dependence on debt to maintain a modern standard of living in the first place. Once workers lost their job security and started making less money (after you take inflation into account) and fewer benefits, they started having to rely on debt more and more. This increased Wall Street's grip on the economy, thus giving them increasing political muscle with which to get the regulations on their business overturned. A unionized workforce would be more economically independent of Wall Street, thus weakening their grip on the economy and therefore on the nation's politics.

So that's my idea of how to initiate a real solution. Anyone concur?


This is one of those posts that might sound very great to those who don't understand what really did take place.

Being on the street end of this last collapse, and being deeply impacted by the collapse of 1980 and later the 90s, (yes folks, when Clinton was president, real estate also collapsed) and the recent one, Bill Clinton signed the law that ended Glass Steagal. This I believe is the regulation you speak of.

Anyway, not to beat up on the OP but to work with her to see what solution there can be,

Simple

Return to the 2000 budget of the USA. That was working per Democrats. Why do they object to going back to that budget?

[nic34]

As soon as you said unions I threw up.

Unions came about because of poor working conditions of the late 1800's.

During World War I, a U.S. soldier had a better statistical chance of surviving in battle than did a West Virginian working in the coal mines.

Don't want unions? Then treat workers fairly.

[IMPress Polly]

I would object to using the same dollar size budget as in 2000 because there's been population growth since then that using the same dollar amounts would fail to account for. And also again witness that the 2000 balanced budget lasted only one year, until new circumstances intervened. We're still relying on mechanistic solutions here. We need to get at the heart of the issue and find a structural solution, not a one-year solution that will yield a much higher rate of poverty than it did 14 years ago.

[nic34]

Return to the 2000 budget of the USA. That was working per Democrats. Why do they object to going back to that budget?

What, you mean the one before the Bush tax cuts?

[Kalkin]

The typical solutions one hears from both the political right and the political left (make poor people pay it off with cuts in social spending or make rich people pay it off with income tax hikes respectively)

Cutting social spending is not making poor people pay off the debt, it's preventing them from exacerbating it.

[Matty]

Unions came about because of poor working conditions of the late 1800's.

During World War I, a U.S. soldier had a better statistical chance of surviving in battle than did a West Virginian working in the coal mines.

Don't want unions? Then treat workers fairly.
Unions abused their power. Think Detroit. I hate unions. Think teachers.

[Matty]

I really hate public sector unions think VA.

[nic34]

If a wealthy person earns so much money that he doesn’t or can’t spend it all each year, when his taxes go down his income after taxes goes up. This is largely because there’s little or no relationship between what he “needs to live on” and what he’s “earning.” Somebody living on $1 million per year but earning $5 million after taxes can sock away $4 million in a Swiss bank. If his taxes go up enough to drop his after-tax income to only $3 million per year, he’s still living on $1 million per year and socks away only $2 million in the Swiss bank. Although his lifestyle doesn’t change, his discretionary income—some call it “disposable” income—goes down when his taxes go up and vice versa.

Most working Americans believe that their taxes and income work in the same way—something the right-wing think tanks and media want everyone to believe. So average Americans tend to support tax cuts because they think they’ll have more money in the bank as a result, but if their taxes go up, they’ll have less money in the bank. It’s pretty intuitive, and over the short term, it’s true.

But it never plays out that way. Our own experience—and the experience of the Danes and other Europeans—shows a completely different trend.

http://www.truth-out.org/article/item/1820:roll-back-the-reagan-tax-cuts

[zelmo1234]

While she is on the right track, with structure, she is providing more of what causes the problem.

And recessions are caused by many things, usually some technology putting a monster out of business.

For example when oil went to pipelines it caused a recession because the railroads were not able to have the revenue to continue to run!

And if not for Gasoline being the waste product of kerosene? the oil companies would have caused another recession!

So it is not just finance that causes recession!

So where does the money come from? Changing the entitlement system!

For example SS

By no means should it be abolished, but it could be perfected.

There is no better investment than the stock market through the ups and downs. So rather than taking 6.5% of someone's income and forcing them into poverty when they are old, lets put that money to work!

By slowly changing the system, within 2 generations both SS and medicare/caid could be abolished, and instead of people being a burden when they retire, they would still be paying taxes, they would have better healthcare and this in and of itself would eventually pay off the debt, but it would be many generations before that happens

You can't promise people entitlements galore and doom them to poverty at the same time and expect the system to work

[IMPress Polly]

Kalkin wrote:
Cutting social spending is not making poor people pay off the debt, it's preventing them from exacerbating it.

Wow. Just wow. I don't even know how to respond to that level of smug, elitist callousness.

[Kalkin]

Wow. Just wow. I don't even know how to respond to that level of smug, elitist callousness.
You can't respond because my post is factually correct. You know it, I know it, and any other intelligent person with a reasonable grasp of English knows it. If the poor were to be made to pay off the debt, they'd have to quit leeching off the system and start earning something to contribute, not just take less.

[zelmo1234]

Wow. Just wow. I don't even know how to respond to that level of smug, elitist callousness.

I would agree!

You can't just cut it but you can take a different path to replace it! And after a while you would have parents leaving fairly large amounts to their children?

changing the system so one is not dependent on the government, but on one's self is a better system

[Mister D]

If a wealthy person earns so much money that he doesn’t or can’t spend it all each year, when his taxes go down his income after taxes goes up. This is largely because there’s little or no relationship between what he “needs to live on” and what he’s “earning.” Somebody living on $1 million per year but earning $5 million after taxes can sock away $4 million in a Swiss bank. If his taxes go up enough to drop his after-tax income to only $3 million per year, he’s still living on $1 million per year and socks away only $2 million in the Swiss bank. Although his lifestyle doesn’t change, his discretionary income—some call it “disposable” income—goes down when his taxes go up and vice versa.

Most working Americans believe that their taxes and income work in the same way—something the right-wing think tanks and media want everyone to believe. So average Americans tend to support tax cuts because they think they’ll have more money in the bank as a result, but if their taxes go up, they’ll have less money in the bank. It’s pretty intuitive, and over the short term, it’s true.

But it never plays out that way. Our own experience—and the experience of the Danes and other Europeans—shows a completely different trend.

http://www.truth-out.org/article/item/1820:roll-back-the-reagan-tax-cuts



"Right wing" think tanks and media also want you to believe that tens of millions of imported poor people have had no effect on the wealth gap in the US. Hint: if they're being dishonest about the relationship between taxes and income they're probably being dishonest about that too. :wink:

[Bob]

I would object to using the same dollar size budget as in 2000 because there's been population growth since then that using the same dollar amounts would fail to account for. And also again witness that the 2000 balanced budget lasted only one year, until new circumstances intervened. We're still relying on mechanistic solutions here. We need to get at the heart of the issue and find a structural solution, not a one-year solution that will yield a much higher rate of poverty than it did 14 years ago.

I knew this would happen. Everybody has a solution but when one is shoved at them, they reject it.

I know of no magic, other than slight population increase, to account for nearly double the 2000 budget on the part of Obama. He is getting super close to double it.

Cuts won't happen unless the brave step forward and actually mean it.

Taxing the rich works if the deficit is small. But this deficit is like dynamite.

If the Feds can't cut spending, nothing else works. They refuse. No budget by Obama amounts to a budget cut other than sequestration. You suggest all cuts would harm a unique group. Called the "not that well off"

Those of us now collecting, do drain the cash stocks of the Feds. The onslaught is starting. This is going to get far worse and not better with no action. We are living with rules made in the past.

When those doing the voting, steadily build more and more spending, then refuse to cut back short of the law of sequestration, somebody needs to look over the entire package.

[IMPress Polly]

Kalkin wrote:
You can't respond because my post is factually correct. You know it, I know it, and any other intelligent person with a reasonable grasp of English knows it. If the poor were to be made to pay off the debt, they'd have to quit leeching off the system and start earning something to contribute, not just take less.

Well of course we can balance the budget if we have the government basically do nothing like it did in the 19th century (budgets were generally balanced back then too), but look at the human cost of that regime and ask yourself if it was desirable. Seriously. You'd rather that the majority live in squalor just to balance the budget? Doesn't it kind of defeat the purpose of avoiding governmental bankruptcy if you impose its consequences in order to avoid it?

[Bob]

Unions came about because of poor working conditions of the late 1800's.

During World War I, a U.S. soldier had a better statistical chance of surviving in battle than did a West Virginian working in the coal mines.

Don't want unions? Then treat workers fairly.

The laws both in states and at the Feds took over. Over time, the law made it possible that workers had full rights with no help from the union.

This is why 93 percent of the non government jobs enjoy life with zero unions.

[Chris]

We DO have a debt problem in this country (the United States), as do many countries in today's world. The question here is how that can best be addressed.

Here's my view:

The typical solutions one hears from both the political right and the political left (make poor people pay it off with cuts in social spending or make rich people pay it off with income tax hikes respectively) are rather mechanistic solutions that fail to get at the heart of the problem. The real fiscal problem we have is structural and therefore requires a structural solution. The structural problem is that we have great big recessions today. Recessions put large numbers of people out of work and reduce the general income levels, thus forcing more people onto government assistance. The government then must spend more money than usual keeping the enlarged ranks of the poor alive at the very same time that it finds itself taking in less revenue than usual as a result of people generally being poorer and thus more tax-exempt. More spending plus less revenue equals more debt. When a recession is especially severe like the one we had in the early 1980s and the most recent one, for example, major debt growth results. It can gradually be gotten back under control through deliberate deficit reduction (e.g. the 1990s), but unless and until the fundamental problem is addressed, we'll just keep having more of these economic disasters and corresponding phases of massive debt growth until eventually we go bankrupt as a nation. What we really need to do is find of way to stop having these really bad recessions. But how, you ask? Let's talk about that.

All recessions are caused by the financial industry. The better regulated and under control the financial industry is, the smaller recessions tend to be. For example, take a look at how small our recessions were between the 1930s and the 1970s. Now consider that before financial regulation came about in the early 1930s, the typical recession in this country was specifically a depression. And likewise consider that since we began rescinding moderating regulations on the financial sector in the late 1970s, we've had two great big recessions: one in the early '80s and another very recently. And now look at budgets over the same periods of time respectively: even with a substantial array of social welfare programs in place, our budgets were still basically balanced for as long as we regulated the financial industry with reasonable strictness. Now they're rarely anywhere near balanced. I'm sure you can see my point. The bottom line is that the structural solution to our debt problem is to regulate the financial industry in, at minimum, the same kind of ways we used to. That way we won't have these disastrous extra-large recessions anymore. But how do we get from here to there? Let me propose that the answer begins with re-unionizing the workforce. How do I figure? Because it was the de-unionizing of the workforce that got us to a position of dependence on debt to maintain a modern standard of living in the first place. Once workers lost their job security and started making less money (after you take inflation into account) and fewer benefits, they started having to rely on debt more and more. This increased Wall Street's grip on the economy, thus giving them increasing political muscle with which to get the regulations on their business overturned. A unionized workforce would be more economically independent of Wall Street, thus weakening their grip on the economy and therefore on the nation's politics.

So that's my idea of how to initiate a real solution. Anyone concur?



The typical solutions one hears from both the political right and the political left (make poor people pay it off with cuts in social spending or make rich people pay it off with income tax hikes respectively) are rather mechanistic solutions that fail to get at the heart of the problem.

That strawman sounds mechanistic in itself.

The solutions I hear to our spending problem, and it is a spending problem, is to, here it comes, drum roll, cut spending across the board. Not just social but corporate welfare. Not just education and healthcare but defense and every other government expenditure.

Oh, but wait, that doesn't fit your argument from strawman.



All recessions are caused by the financial industry. The better regulated and under control the financial industry is, the smaller recessions tend to be.

Another strawman, completely false. See The Political Implications of Ignoring Our Own Ignorance (http://www.american.com/archive/2011/december/the-political-implications-of-ignoring-our-own-ignorance):


A common post-crisis narrative is that banking was de-regulated in the Reagan-Greenspan era. Some pundits make it sound as if regulators behaved like parents who hand their teenagers the keys to the liquor cabinet, leave for the weekend, and say “Have a good time.” In fact, regulators believed that they had stronger regulations in place in 2005 than they did in the pre-Reagan era.

—Before 1980, mortgage loans held by banks were illiquid assets subject to considerable interest-rate risk. These problems were alleviated by the shift toward securitization.

—Before 1980, insolvent institutions were opaque because of book-value accounting. This problem was addressed with market-value accounting, enabling regulators to take more timely corrective action to address troubled institutions.

—Before 1980, banks had no formal capital requirements and there were no mechanisms in place to steer banks away from risky assets. This problem was addressed with the Basel capital accords (formally adopted in 1988), which incorporated a risk-weighted measure of assets to determine required minimum capital. In the 2000s, these risk weightings were altered to penalize banks that did not invest in highly rated, asset-backed securities.

Thus, it was not the intent of regulators to loosen the reins on banks. On the contrary, from the regulators' point of view, it was the environment prior to 1980 that amounted to leaving the teenagers with the keys to the liquor cabinet. The post-1980 regulatory changes were believed to be in the direction of tighter supervision and more rational controls.

It turned out that the regulators were radically ignorant of the consequences of their decisions.

Oops, regulations were in place but regulators, government generally, is ignorant and inept.

It is arguable, conversely, that it is government regulation that interferes with the natural business cycle that throws it out of whack.


So that's my idea of how to initiate a real solution. Anyone concur?

No, you can arrive at solutions on the backs of strawmen.

[Kalkin]

Well of course we can balance the budget if we have the government basically do nothing like it did in the 19th century (budgets were generally balanced back then too), but look at the human cost of that regime and ask yourself if it was desirable. Seriously. You'd rather that the majority live in squalor just to balance the budget? Doesn't it kind of defeat the purpose of avoiding governmental bankruptcy if you impose its consequences in order to avoid it?
I'd rather people be left to their own devices to take care of themselves instead of creating generational subsidized classes that increase our public debt. You are using fallacious liberal logic when you contend that giving away less borrowed money is somehow making the recipients pay for debt reduction.

[TheInternet]

If a wealthy person earns so much money that he doesn’t or can’t spend it all each year, when his taxes go down his income after taxes goes up. This is largely because there’s little or no relationship between what he “needs to live on” and what he’s “earning.” Somebody living on $1 million per year but earning $5 million after taxes can sock away $4 million in a Swiss bank. If his taxes go up enough to drop his after-tax income to only $3 million per year, he’s still living on $1 million per year and socks away only $2 million in the Swiss bank. Although his lifestyle doesn’t change, his discretionary income—some call it “disposable” income—goes down when his taxes go up and vice versa.

Most working Americans believe that their taxes and income work in the same way—something the right-wing think tanks and media want everyone to believe. So average Americans tend to support tax cuts because they think they’ll have more money in the bank as a result, but if their taxes go up, they’ll have less money in the bank. It’s pretty intuitive, and over the short term, it’s true.

But it never plays out that way. Our own experience—and the experience of the Danes and other Europeans—shows a completely different trend.

http://www.truth-out.org/article/item/1820:roll-back-the-reagan-tax-cuts



Except most "rich" people aren't putting their money in "swiss bank accounts". They are investing that $ in the stock market. What do you think happens when rich people invest in businesses? The business expands. When businesses expand, they hire people.

[Bob]

I would object to using the same dollar size budget as in 2000 because there's been population growth since then that using the same dollar amounts would fail to account for. And also again witness that the 2000 balanced budget lasted only one year, until new circumstances intervened. We're still relying on mechanistic solutions here. We need to get at the heart of the issue and find a structural solution, not a one-year solution that will yield a much higher rate of poverty than it did 14 years ago.

When it comes to taxes, and not spending

FAIR TAX

This will help bring America back.


https://www.youtube.com/watch?v=6szslYYlRr8

[nic34]

There is no better investment than the stock market through the ups and downs. So rather than taking 6.5% of someone's income and forcing them into poverty when they are old, lets put that money to work!



That would be all fantastic zel if there were no hills and DEEP valleys esp. when one is about to retire. How much did you lose in 2008? Good thing you weren't about to turn 65, eh?

Better to encourage diverse savings plans and leave SS as it was intended.... a safety net.

Oh and btw, a 401(k) is a bullshit excuse for a real pension, expecting everyday workers to know investing strategies even brokers take years to learn. I'm talking to you big business....

[Bob]

Return to the 2000 budget of the USA. That was working per Democrats. Why do they object to going back to that budget?


What, you mean the one before the Bush tax cuts?

Yes and well before the Obama drastically higher spending hikes.

[Kalkin]

Let me phrase it like this, Polly:
You are taking home $2000 per month, but spending $2200 per month. To rectify the situation, you decide to stop giving the bum outside the 7/11 a ten spot every time you get your coffee. Does that mean the bum is paying off your debt?
Hell no. It wasn't his money in the first place. You are paying off your debt by prioritizing your spending.

[zelmo1234]

I knew this would happen. Everybody has a solution but when one is shoved at them, they reject it.

I know of no magic, other than slight population increase, to account for nearly double the 2000 budget on the part of Obama. He is getting super close to double it.

Cuts won't happen unless the brave step forward and actually mean it.

Taxing the rich works if the deficit is small. But this deficit is like dynamite.

If the Feds can't cut spending, nothing else works. They refuse. No budget by Obama amounts to a budget cut other than sequestration. You suggest all cuts would harm a unique group. Called the "not that well off"

Those of us now collecting, do drain the cash stocks of the Feds. The onslaught is starting. This is going to get far worse and not better with no action. We are living with rules made in the past.

When those doing the voting, steadily build more and more spending, then refuse to cut back short of the law of sequestration, somebody needs to look over the entire package.

Well actually she has a point, So what if we had the same budget per capita as 200 it would still be about 3/4 of a trillion less than today?

This would mean that we would have the exact dollars per person to spend?

What would be wrong with that?

[nic34]

Except most "rich" people aren't putting their money in "swiss bank accounts". They are investing that $ in the stock market.

Sure about that? All of their money? Most?

Only poor people are that dumb....:laugh:

[Chris]

If a wealthy person earns so much money that he doesn’t or can’t spend it all each year, when his taxes go down his income after taxes goes up. This is largely because there’s little or no relationship between what he “needs to live on” and what he’s “earning.” Somebody living on $1 million per year but earning $5 million after taxes can sock away $4 million in a Swiss bank. If his taxes go up enough to drop his after-tax income to only $3 million per year, he’s still living on $1 million per year and socks away only $2 million in the Swiss bank. Although his lifestyle doesn’t change, his discretionary income—some call it “disposable” income—goes down when his taxes go up and vice versa.

Most working Americans believe that their taxes and income work in the same way—something the right-wing think tanks and media want everyone to believe. So average Americans tend to support tax cuts because they think they’ll have more money in the bank as a result, but if their taxes go up, they’ll have less money in the bank. It’s pretty intuitive, and over the short term, it’s true.

But it never plays out that way. Our own experience—and the experience of the Danes and other Europeans—shows a completely different trend.

http://www.truth-out.org/article/item/1820:roll-back-the-reagan-tax-cuts




Your argument falls apart at "sock away". The wealth is not "socked away" but invested.

You approach economics with the same static view Dr Who does.

[nic34]

"Right wing" think tanks and media also want you to believe that tens of millions of imported poor people have had no effect on the wealth gap in the US. Hint: if they're being dishonest about the relationship between taxes and income they're probably being dishonest about that too. :wink:

Give it up DEE, you look stupid bringing your road show to yet another thread....

[Mister D]

Give it up DEE, you look stupid bringing your road show to yet another thread....

That explains your devastating rebuttal. :grin:

[zelmo1234]

That would be all fantastic zel if there were no hills and DEEP valleys esp. when one is about to retire. How much did you lose in 2008? Good thing you weren't about to turn 65, eh?

Better to encourage diverse savings plans and leave SS as it was intended.... a safety net.

Oh and btw, a 401(k) is a bullshit excuse for a real pension, expecting everyday workers to know investing strategies even brokers take years to learn. I'm talking to you big business....

Yes you are correct and that is why, you would put a system in place that moved money to safety as a person aged.

But for example I lost abut 1.8 in 2008, but I did not move any of that money out of the mutual funds because that was what I had allowed for that part of my portfolio!

I was 42 at the time with plenty of time to recover. Thus you would do the same for someone in the retirement program. WHY?

Because while I had a lot less money? I had about a third more shares

Now when the market came back to about 11,000 I had all of my money back and at 15,500 I had nearly double my money?

Now in 2 years when I am 50, about 1/3 of my portfolio will move into securities were there is no chance of loss

At 57 I will take an additional 1/3 out of the market, and at 62 I will take another 1/3 out that will leave me with about 67% of investment portfolio will be safe, and 33% will still e in a growth market.


For a person following this program and historical market gains, the lifetime minimum wage earner is going to have a yearly income of our 100K and about 1.5 million in savings If we are smart in educating our children and people have long term care insurance and they purchase a decent health insurance And they live to be 85

They still are going to have about 600K to pass on to there children! so say they have 3 kids the kids would be in there 50's and get a nice 200k to help them pay off things before they retire

[Bob]

If a wealthy person earns so much money that he doesn’t or can’t spend it all each year, when his taxes go down his income after taxes goes up. This is largely because there’s little or no relationship between what he “needs to live on” and what he’s “earning.” Somebody living on $1 million per year but earning $5 million after taxes can sock away $4 million in a Swiss bank. If his taxes go up enough to drop his after-tax income to only $3 million per year, he’s still living on $1 million per year and socks away only $2 million in the Swiss bank. Although his lifestyle doesn’t change, his discretionary income—some call it “disposable” income—goes down when his taxes go up and vice versa.

Most working Americans believe that their taxes and income work in the same way—something the right-wing think tanks and media want everyone to believe. So average Americans tend to support tax cuts because they think they’ll have more money in the bank as a result, but if their taxes go up, they’ll have less money in the bank. It’s pretty intuitive, and over the short term, it’s true.

But it never plays out that way. Our own experience—and the experience of the Danes and other Europeans—shows a completely different trend.

http://www.truth-out.org/article/item/1820:roll-back-the-reagan-tax-cuts



Look,

If your goal is to have more cash in the system, then invent more.

No need to tax it. Just create more cash.

Your tome appears to be directed at the rich.

Were you to totally strip every dollar from the rich, convert it to running Government, it will NOT do that job.

It won't come close.

Polly is right to tackle the topic. Taxes will not solve it.

Bush on the budget was a fire cracker

Obama on the budget is dynamite. We can't come close in the Bush era to spending as Obama has spent.

The solution, structural solution is going to hurt. Democrats think they can hurt the rich. They don't show us facts.


https://www.youtube.com/watch?v=FC5Gkox-1QY

[zelmo1234]

Sure about that? All of their money? Most?

Only poor people are that dumb....:laugh:

If I was to give you 47k to invest? would you put in in the SS system or the market? over the life time of a minimum wage worker the difference would be the difference between about 1200 a month and 12000 a month in income

Very few people move there money to foreign banks however when the government becomes oppressive they will take drastic measures

[zelmo1234]

What, you mean the one before the Bush tax cuts?

How much in government revenue did the Bush tax cuts cost the treasury?

[Bob]

While she is on the right track, with structure, she is providing more of what causes the problem.

And recessions are caused by many things, usually some technology putting a monster out of business.

For example when oil went to pipelines it caused a recession because the railroads were not able to have the revenue to continue to run!

And if not for Gasoline being the waste product of kerosene? the oil companies would have caused another recession!

So it is not just finance that causes recession!

So where does the money come from? Changing the entitlement system!

For example SS

By no means should it be abolished, but it could be perfected.

There is no better investment than the stock market through the ups and downs. So rather than taking 6.5% of someone's income and forcing them into poverty when they are old, lets put that money to work!

By slowly changing the system, within 2 generations both SS and medicare/caid could be abolished, and instead of people being a burden when they retire, they would still be paying taxes, they would have better healthcare and this in and of itself would eventually pay off the debt, but it would be many generations before that happens

You can't promise people entitlements galore and doom them to poverty at the same time and expect the system to work

Food for thought

The rich know how to take a thousand dollars and multiply it
They do not tax the Government

The rich understand how compound interest works.

Can we say the same about the Feds?

As the post at the top of mine shows, one can do more than suck dry an economy to take care of people like me.

I said long ago, what the above says, change the system. Do not expect it to get better so long as the same current system is used.

I railed prior to retirement what would take place. Things i predicted in the 1980s are true today.

It was not magic to make those predictions. It was math.

I agree with the post to the top of this comment.

Bush wanted to change systems to one that produced funds forever. The left defeated it. I hope they are happy now that the market is in the 16,000s when they mocked using it.

[Matty]

The only way to handle the debt is to tax ALL Americans at the same rate. No exceptions, no exemptions no excuses. And that includes taxing welfare checks.

[nic34]

I was 42 at the time with plenty of time to recover. Thus you would do the same for someone in the retirement program. WHY?


I'm talking about those that were 59, 61, or 62..... they would be screwed if they relied on the market for even 30-40% and no time to recover. That is millions of folks that would be in poverty zel, and why we dedicate that 6.5% payroll to SS.

[GrassrootsConservative]

The ONLY way we will eliminate debt in this country is by eliminating the political ideology that supports it, Liberalism.

/Edit: The best way to keep a weed from coming back is by tearing it out right at the fuckin' roots.

[zelmo1234]

That would be all fantastic zel if there were no hills and DEEP valleys esp. when one is about to retire. How much did you lose in 2008? Good thing you weren't about to turn 65, eh?

Better to encourage diverse savings plans and leave SS as it was intended.... a safety net.

Oh and btw, a 401(k) is a bullshit excuse for a real pension, expecting everyday workers to know investing strategies even brokers take years to learn. I'm talking to you big business....

I know of NO 401K plan that does not have a professional that a person can talk to at no charge, I bring them in twice a year and make sure everyone know how to get ahold of them. that is what the employer pays a fee for!

So they are not left out in the cold! this is a lie and you should be ashamed

However there is NO worse investment that SS

And I have a son that works for the State of MI and he is no longer offered a pension! He is 25 years old and has 30K in his 401K

If for some reason he was not able to invest another dime? and he was able to get the historical average in the market?

He would retire at age 67 with 900K in his account and about 45K in income of this investment

If he works his 30 years and continues to put in the same amount he will retire at 54 with 3.6 million in his retirement savings or about 162000 in income

[Chris]

I'm talking about those that were 59, 61, or 62..... they would be screwed if they relied on the market for even 30-40% and no time to recover. That is millions of folks that would be in poverty zel, and why we dedicate that 6.5% payroll to SS.


Not even you ideal government can remove risk, nic.

[nic34]

How much in government revenue did the Bush tax cuts cost the treasury?


According to CTJ (http://www.ctj.org/pdf/bushtaxcutsvshealthcare.pdf), the Bush tax cuts that were passed up through 2006 (the 2001 and 2003 cuts as well as other smaller cuts in 2004, 2005 and 2006) ended up costing the Treasury approximately $2.1 trillion in foregone revenue from 2001 to 2010.

If you add interest payments, that number goes up to around $2.5 trillion.

[Bob]

Well of course we can balance the budget if we have the government basically do nothing like it did in the 19th century (budgets were generally balanced back then too), but look at the human cost of that regime and ask yourself if it was desirable. Seriously. You'd rather that the majority live in squalor just to balance the budget? Doesn't it kind of defeat the purpose of avoiding governmental bankruptcy if you impose its consequences in order to avoid it?


Polly, you have the socialists view of Government.

Fortunately for the USA, this system began the correct way.

Government was not created to produce jobs. Matter of fact, why do you suppose the founders type was created?

[zelmo1234]

I'm talking about those that were 59, 61, or 62..... they would be screwed if they relied on the market for even 30-40% and no time to recover. That is millions of folks that would be in poverty zel, and why we dedicate that 6.5% payroll to SS.

Really at age 59? if you did not move money to securities, you would have recovered by 2012 or 63 years of age 61 would be 65 and 63 would have been 67

And even if they had lost 50% at that age if they would have been investing since age 18? they would still have had 5 or 6 times the retirement income than they would have on the SS system

NOW leaving all of the money in the risk account is STUPID and it could be legislated to automatically move to securities

There is NO logical reason!

If you follow the plan that most investors subscribe to, none of those people would have lost very much money and being that in a fund when this start to look bad you hedge, It might have caused each one to work an additional year.

I am guessing that your fear and the fact that you don't know how the market works? is keeping you from investing

[Peter1469]

First, I want to put the issue in perceptive. The US has lots of debt:

Official gov't debt: ~$17.5T (http://www.usdebtclock.org/#)
Unofficial gov't debt (future entitlement spending out to 2075): ~$211T (http://www.bloombergview.com/articles/2011-06-29/stop-the-fiscal-war-against-our-children-now-laurence-kotlikoff)
Private debt (not including the toxic derivatives that are off the books): $52T (https://en.wikipedia.org/wiki/Financial_position_of_the_United_States)+ (that is a 2009 number)
Private derivative debt (off books) is said to be in the hundreds (https://en.wikipedia.org/wiki/Financial_position_of_the_United_States)of $Ts.

Points:
- no structural reform that doesn't include defaults can possibly ever pay off all of this back- and lots of it is pure fraud, and tax dollars should not be used to pay it off.
- we can never raise taxes or increase the economy (and tax it enough) to pay off a fraction of this debt.

I think that there will be an economic crash. It will either be controlled, somewhat controlled, or uncontrolled. Either way, once that is over there will certainly be structural reforms- even if it takes decades.

Some odd ends:

I think that private unions do a lot of good. They however should be banned from participating in politics. They are supposed to be fighting for their workers (and hopefully making their corporations stronger), not laundering money for the DNC.

Public unions should be very limited. They should not be allowed to buy their future bosses.

Government spending has to be realistic. We can't use debt spending to buy votes. We need to shift from a debt based system to an equity based system. That means we need more economic freedom.









We DO have a debt problem in this country (the United States), as do many countries in today's world. The question here is how that can best be addressed.

Here's my view:

The typical solutions one hears from both the political right and the political left (make poor people pay it off with cuts in social spending or make rich people pay it off with income tax hikes respectively) are rather mechanistic solutions that fail to get at the heart of the problem. The real fiscal problem we have is structural and therefore requires a structural solution. The structural problem is that we have great big recessions today. Recessions put large numbers of people out of work and reduce the general income levels, thus forcing more people onto government assistance. The government then must spend more money than usual keeping the enlarged ranks of the poor alive at the very same time that it finds itself taking in less revenue than usual as a result of people generally being poorer and thus more tax-exempt. More spending plus less revenue equals more debt. When a recession is especially severe like the one we had in the early 1980s and the most recent one, for example, major debt growth results. It can gradually be gotten back under control through deliberate deficit reduction (e.g. the 1990s), but unless and until the fundamental problem is addressed, we'll just keep having more of these economic disasters and corresponding phases of massive debt growth until eventually we go bankrupt as a nation. What we really need to do is find of way to stop having these really bad recessions. But how, you ask? Let's talk about that.

All recessions are caused by the financial industry. The better regulated and under control the financial industry is, the smaller recessions tend to be. For example, take a look at how small our recessions were between the 1930s and the 1970s. Now consider that before financial regulation came about in the early 1930s, the typical recession in this country was specifically a depression. And likewise consider that since we began rescinding moderating regulations on the financial sector in the late 1970s, we've had two great big recessions: one in the early '80s and another very recently. And now look at budgets over the same periods of time respectively: even with a substantial array of social welfare programs in place, our budgets were still basically balanced for as long as we regulated the financial industry with reasonable strictness. Now they're rarely anywhere near balanced. I'm sure you can see my point. The bottom line is that the structural solution to our debt problem is to regulate the financial industry in, at minimum, the same kind of ways we used to. That way we won't have these disastrous extra-large recessions anymore. But how do we get from here to there? Let me propose that the answer begins with re-unionizing the workforce. How do I figure? Because it was the de-unionizing of the workforce that got us to a position of dependence on debt to maintain a modern standard of living in the first place. Once workers lost their job security and started making less money (after you take inflation into account) and fewer benefits, they started having to rely on debt more and more. This increased Wall Street's grip on the economy, thus giving them increasing political muscle with which to get the regulations on their business overturned. A unionized workforce would be more economically independent of Wall Street, thus weakening their grip on the economy and therefore on the nation's politics.

So that's my idea of how to initiate a real solution. Anyone concur?

[Matty]

Give it up DEE, you look stupid bringing your road show to yet another thread....


What? What he said is true all except for the part that it's right wing think tanks.

[Peter1469]

You might have to rethink those numbers. Hint, they used static accounting models- meaning they did not consider if the tax cuts would have a positive or negative impact on economic growth. See the attached chart below.



According to CTJ (http://www.ctj.org/pdf/bushtaxcutsvshealthcare.pdf), the Bush tax cuts that were passed up through 2006 (the 2001 and 2003 cuts as well as other smaller cuts in 2004, 2005 and 2006) ended up costing the Treasury approximately $2.1 trillion in foregone revenue from 2001 to 2010.

If you add interest payments, that number goes up to around $2.5 trillion.

[zelmo1234]

According to CTJ (http://www.ctj.org/pdf/bushtaxcutsvshealthcare.pdf), the Bush tax cuts that were passed up through 2006 (the 2001 and 2003 cuts as well as other smaller cuts in 2004, 2005 and 2006) ended up costing the Treasury approximately $2.1 trillion in foregone revenue from 2001 to 2010.

If you add interest payments, that number goes up to around $2.5 trillion.

That is assuming that all of the investment would have happened without the tax cuts.

Here is reality the actual figures?

http://www.usgovernmentrevenue.com/revenue_chart_2000_2017USb_11s1li111mcn_F0f

Now remember in September of 2001 we lost a huge part of the revenue in the 911 attack?

The cuts took effect in 2002 and by 2003 we had the beginning of massive increases in revenue?

So with a loss of one about 100 billion for on year and 50 billion for another? and then massive increases because of a growing economy?

The left will tell you that business would have invested anyway?

I do not find that to be true. because unless there is the opportunity for gain, you will not invest

[Bob]

http://thepoliticalforums.com/images/misc/quote_icon.png Originally Posted by Bob http://thepoliticalforums.com/images/buttons/viewpost-right.png (http://thepoliticalforums.com/showthread.php?p=664260#post664260)
I knew this would happen. Everybody has a solution but when one is shoved at them, they reject it.

I know of no magic, other than slight population increase, to account for nearly double the 2000 budget on the part of Obama. He is getting super close to double it.

Cuts won't happen unless the brave step forward and actually mean it.

Taxing the rich works if the deficit is small. But this deficit is like dynamite.

If the Feds can't cut spending, nothing else works. They refuse. No budget by Obama amounts to a budget cut other than sequestration. You suggest all cuts would harm a unique group. Called the "not that well off"

Those of us now collecting, do drain the cash stocks of the Feds. The onslaught is starting. This is going to get far worse and not better with no action. We are living with rules made in the past.

When those doing the voting, steadily build more and more spending, then refuse to cut back short of the law of sequestration, somebody needs to look over the entire package.


Well actually she has a point, So what if we had the same budget per capita as 200 it would still be about 3/4 of a trillion less than today?

This would mean that we would have the exact dollars per person to spend?

What would be wrong with that?

I like her idea of getting things repaired.

And sure, population increase is a factor and has to be accounted for.

But this present budget, despite sequester, is nuts.

She sees the use of government, per other remarks, as socialists see government. Supposedly this pie in the sky approach fixes things.

I submit it is that very policy by socialists that got us where we are.

They can pull the Bush blame game but when facts are looked at, it is clear the real problem is Obama, right now and his doing. zelmo1234

[zelmo1234]

First, I want to put the issue in perceptive. The US has lots of debt:

Official gov't debt: ~$17.5T (http://www.usdebtclock.org/#)
Unofficial gov't debt (future entitlement spending out to 2075): ~$211T (http://www.bloombergview.com/articles/2011-06-29/stop-the-fiscal-war-against-our-children-now-laurence-kotlikoff)
Private debt (not including the toxic derivatives that are off the books): $52T (https://en.wikipedia.org/wiki/Financial_position_of_the_United_States)+ (that is a 2009 number)
Private derivative debt (off books) is said to be in the hundreds (https://en.wikipedia.org/wiki/Financial_position_of_the_United_States)of $Ts.

Points:
- no structural reform that doesn't include defaults can possibly ever pay off all of this back- and lots of it is pure fraud, and tax dollars should not be used to pay it off.
- we can never raise taxes or increase the economy (and tax it enough) to pay off a fraction of this debt.

I think that there will be an economic crash. It will either be controlled, somewhat controlled, or uncontrolled. Either way, once that is over there will certainly be structural reforms- even if it takes decades.

Some odd ends:

I think that private unions do a lot of good. They however should be banned from participating in politics. They are supposed to be fighting for their workers (and hopefully making their corporations stronger), not laundering money for the DNC.

Public unions should be very limited. They should not be allowed to buy their future bosses.

Government spending has to be realistic. We can't use debt spending to buy votes. We need to shift from a debt based system to an equity based system. That means we need more economic freedom.

I have to say that I totally disagree that the debt could never be paid off?

Now we can't put it on a 30 year mortgage but it did not happen in 30 years either.

If the government were to operate on a balanced budget, and use last year revenue for the budget, the debt would begin to very slowly drop!

As the debt starts to drop the dollar and the economy will start to improve and thus produce more revenue!

By operating on last years revenue? you will have many years with surplus, and that should work on a 50/50 plan. 50% to rainy day fund and 50% to principal reduction

Now it is likely to be our great grand children that will be able to scream we are debt free, but the crisis would be diverted.

Getting the current SS system reformed would go a long way

[Bob]

That is assuming that all of the investment would have happened without the tax cuts.

Here is reality the actual figures?

http://www.usgovernmentrevenue.com/revenue_chart_2000_2017USb_11s1li111mcn_F0f

Now remember in September of 2001 we lost a huge part of the revenue in the 911 attack?

The cuts took effect in 2002 and by 2003 we had the beginning of massive increases in revenue?

So with a loss of one about 100 billion for on year and 50 billion for another? and then massive increases because of a growing economy?

The left will tell you that business would have invested anyway?

I do not find that to be true. because unless there is the opportunity for gain, you will not invest

Despite the enormous hit the economy took on 911 and following, the cuts did a lot to revive the economy.

Few recall that when Bush took office, we were enduring the Clinton era dot.com crash. This shot the economy way down. Something had to be done or the economy might have collapsed. Democrats wanted no part of that discussion. They wanted to put 100 percent of the blame on Bush. Today they ended that habit by not blaming Obama for anything.

[Bob]

If I was to give you 47k to invest? would you put in in the SS system or the market? over the life time of a minimum wage worker the difference would be the difference between about 1200 a month and 12000 a month in income

Very few people move there money to foreign banks however when the government becomes oppressive they will take drastic measures

Keep this in mind during the debate.

[Mainecoons]

The original premise is flawed as this government has been running deficits in boom times. The problem is spending, which has gone up far faster than population and has required more and more tax hikes which still don't cover the deficits.

Polly, government is the problem here, not the solution. Too much of it, paid too much money for bad or counterproductive burdens on the private sector where the real wealth comes from.

Just since Obama took office, the EPA alone has issued 25,000 pages of new regulations. It costs money to deal with that government burden and that money is diverted from paying people and from growing businesses. It costs money to deal with this ObamaCare mess and that money is coming out of the pockets of working people in the form of loss of job quality and hourly pay.

No matter how many times it plays out in front of their faces, liberals will never grasp that government solves very little and costs everyone dearly. We've compounded that with unionized government, the toxic combination of two forms of virtually unstoppable monopoly acting in its own interests and against the interests of working people.

[Bob]

I have to say that I totally disagree that the debt could never be paid off?

Now we can't put it on a 30 year mortgage but it did not happen in 30 years either.

If the government were to operate on a balanced budget, and use last year revenue for the budget, the debt would begin to very slowly drop!

As the debt starts to drop the dollar and the economy will start to improve and thus produce more revenue!

By operating on last years revenue? you will have many years with surplus, and that should work on a 50/50 plan. 50% to rainy day fund and 50% to principal reduction

Now it is likely to be our great grand children that will be able to scream we are debt free, but the crisis would be diverted.

Getting the current SS system reformed would go a long way

By the Federal measurements, and completely ignoring food costs, fuel costs and some others, there has almost been zero inflation.

A perfect time have stopped spending and pay the debt. While today the USA borrows on the cheap, sooner rather than much later, we face the chance of a complete super long lasting depression. We have to fix it or bear the blame for the next time.

[Bob]

The original premise is flawed as this government has been running deficits in boom times. The problem is spending, which has gone up far faster than population and has required more and more tax hikes which still don't cover the deficits.

Polly, government is the problem here, not the solution. Too much of it, paid too much money for bad or counterproductive burdens on the private sector where the real wealth comes from.

Just since Obama took office, the EPA alone has issued 25,000 pages of new regulations. It costs money to deal with that government burden and that money is diverted from paying people and from growing businesses. It costs money to deal with this ObamaCare mess and that money is coming out of the pockets of working people in the form of loss of job quality and hourly pay.

No matter how many times it plays out in front of their faces, liberals will never grasp that government solves very little and costs everyone dearly. We've compounded that with unionized government, the toxic combination of two forms of virtually unstoppable monopoly acting in its own interests and against the interests of working people.

Well stated.

[Bob]

Yes you are correct and that is why, you would put a system in place that moved money to safety as a person aged.

But for example I lost abut 1.8 in 2008, but I did not move any of that money out of the mutual funds because that was what I had allowed for that part of my portfolio!

I was 42 at the time with plenty of time to recover. Thus you would do the same for someone in the retirement program. WHY?

Because while I had a lot less money? I had about a third more shares

Now when the market came back to about 11,000 I had all of my money back and at 15,500 I had nearly double my money?

Now in 2 years when I am 50, about 1/3 of my portfolio will move into securities were there is no chance of loss

At 57 I will take an additional 1/3 out of the market, and at 62 I will take another 1/3 out that will leave me with about 67% of investment portfolio will be safe, and 33% will still e in a growth market.


For a person following this program and historical market gains, the lifetime minimum wage earner is going to have a yearly income of our 100K and about 1.5 million in savings If we are smart in educating our children and people have long term care insurance and they purchase a decent health insurance And they live to be 85

They still are going to have about 600K to pass on to there children! so say they have 3 kids the kids would be in there 50's and get a nice 200k to help them pay off things before they retire

I would love for the forum to read this over and over and over.

Suppose we had learned this in high school?

Why won't the left wing push for this in high school?

They run the schools. When we try to improve things, they shoot us down.

[Peter1469]

Add up the numbers I put up there. It is impossible to pay off, unless we just take the total that you add up and enter it into a printer and hit print. But then you would collapse the dollar.

And address the fraudulent portion of the debt, why should tax payers even entertain the idea of paying that off? I say go Iceland on them.

Regarding the various derivatives off the books (but which could be placed back on the books with regulatory action) could be as high as $600T- there is no paying that off. Once that figure was made public, the entire system would collapse.


I have to say that I totally disagree that the debt could never be paid off?

Now we can't put it on a 30 year mortgage but it did not happen in 30 years either.

If the government were to operate on a balanced budget, and use last year revenue for the budget, the debt would begin to very slowly drop!

As the debt starts to drop the dollar and the economy will start to improve and thus produce more revenue!

By operating on last years revenue? you will have many years with surplus, and that should work on a 50/50 plan. 50% to rainy day fund and 50% to principal reduction

Now it is likely to be our great grand children that will be able to scream we are debt free, but the crisis would be diverted.

Getting the current SS system reformed would go a long way

[Bob]

Peter is right about the complete debt. I don't see how that can be paid for. Bankrupt the country?????

It can happen. Just because a person says it can't be done, does not mean it can't be done. A lot of things declared unable to do have happened.

1913. Who the hell saw tax law so complex by this date?

Who predicted the super high rate of taxes.

I mean all taxes.

Add up local
County or Parish or??
State
Fed direct
Fed indirect

Man o man o man.

Who the hell thought these words would produce these shocking results?





U.S. Constitution (http://www.law.cornell.edu/constitution/overview)› 16th Amendment


16TH AMENDMENTAMENDMENT XVIThe Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several states, and without regard to any census or enumeration.

That was an open invitation to rob we the people.

[zelmo1234]

I would love for the forum to read this over and over and over.

Suppose we had learned this in high school?

Why won't the left wing push for this in high school?

They run the schools. When we try to improve things, they shoot us down.

The left does not want people to be dependent on themselves?

What would they have to offer.

The left and particularly those liberals that lean toward socialism, will adamantly oppose that !

You have to remember that it is about power and control of others. Not compassion

[zelmo1234]

Despite the enormous hit the economy took on 911 and following, the cuts did a lot to revive the economy.

Few recall that when Bush took office, we were enduring the Clinton era dot.com crash. This shot the economy way down. Something had to be done or the economy might have collapsed. Democrats wanted no part of that discussion. They wanted to put 100 percent of the blame on Bush. Today they ended that habit by not blaming Obama for anything.

yes but future liabilities come along with future revenues as well!

so you have to take what is real today!

If a family is making 150K per year and they did not manage money well and are 787,500 dollars in debt? cold they pay off there debt?

There payment would be 4228.00 a month and they would have about 7K in net income? that is 5% interest and a 30 year term

So it would certainly change there life, but it could be done

We take in about 3.3 trillion on a 17+ trillion dollar debt, it is the same income to debt ratio!

Now there are policies that liabilities that need to be changed, people would have to go back to work. we have to stop spending money all over the world

The tax code needs to be changed. But the everyone would gladly pay a little more if DC would stop the waist.

And the government does not have to pay it off in 30 years it might take 100?

But to say it is impossible? that means that you can't cut spending and change the future. if that is the case it is gone!

[zelmo1234]

Peter is right about the complete debt. I don't see how that can be paid for. Bankrupt the country?????

It can happen. Just because a person says it can't be done, does not mean it can't be done. A lot of things declared unable to do have happened.

1913. Who the hell saw tax law so complex by this date?

Who predicted the super high rate of taxes.

I mean all taxes.

Add up local
County or Parish or??
State
Fed direct
Fed indirect

Man o man o man.

Who the hell thought these words would produce these shocking results?





U.S. Constitution (http://www.law.cornell.edu/constitution/overview)› 16th Amendment


16TH AMENDMENT

AMENDMENT XVI

The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several states, and without regard to any census or enumeration.

That was an open invitation to rob we the people.

It only can't be done if everything stays the same

For example the top 5% of income earners don't need SS and Medicare that might be a place to start!

[Chris]

The original premise is flawed as this government has been running deficits in boom times. The problem is spending, which has gone up far faster than population and has required more and more tax hikes which still don't cover the deficits.

Polly, government is the problem here, not the solution. Too much of it, paid too much money for bad or counterproductive burdens on the private sector where the real wealth comes from.

Just since Obama took office, the EPA alone has issued 25,000 pages of new regulations. It costs money to deal with that government burden and that money is diverted from paying people and from growing businesses. It costs money to deal with this ObamaCare mess and that money is coming out of the pockets of working people in the form of loss of job quality and hourly pay.

No matter how many times it plays out in front of their faces, liberals will never grasp that government solves very little and costs everyone dearly. We've compounded that with unionized government, the toxic combination of two forms of virtually unstoppable monopoly acting in its own interests and against the interests of working people.


And for you all liberals, even Keynes advised against what the government is doing: How Obama got Keynes wrong (http://money.cnn.com/2010/02/04/news/economy/meltzer_keynes.fortune/):


If Keynes were alive today, what would he think of President Obama's fiscal policies?

He would roll over in his grave if he could see the things being done in his name. Keynes was opposed to large structural deficits. He thought that they chilled rather than stimulated the economy. It's true that we're stuck with large deficits now. The goal should be to reduce them, not to take on new spending that makes them worse.

Today, deficits are getting bigger and bigger with no plan to significantly lower them. Keynes understood what the current administration doesn't understand that the proper policy in a democracy recognizes that today's increase in debt must be paid in the future.

We paid down wartime deficits. Now we have continuous deficits. We used to have a rule people believed in, balanced budgets. And now that's gone.

Didn't Keynes advocate temporary deficit spending in a recession?

Keynes wanted deficits to be cyclical and temporary. He wouldn't have been in favor of efforts to raise tax rates in a recession to eliminate deficits. He viewed that as suicidal. He was opposed to the idea that governments should balance the budget during a downturn, and advocated running short-term deficits to spur the economy.

The type of stimulus he advocated was very specific. He said it should be geared towards increasing private investment. He viewed private investment, as opposed to big government spending, as the source of durable job creation. He also said that the deficits should be self-liquidating, so that the increased economic activity caused by the stimulus inevitably generated a combination of extra tax revenues and lower unemployment payments. With higher revenues and lower outlays, the deficit would disappear.

The Obama administration's main objective, in the name of Keynes, is boosting consumption. That sounds very different from the focus on investment that you say Keynes advocated.

Keynes didn't favor at any time that I know spending to increase consumption. He didn't want that, and in fact he believed that was taken care of by the marketplace.

Keynes wanted to increase employment by smoothing the amount of investment through the up and down parts of the business cycle. He knew that recessions cause a decline in investment, and that the fall in investment caused unemployment to rise. So he wanted the government to stabilize investment through a recession.


Hard to believe Obama can't even get Keynes right!

[Peter1469]

Keynes never believed in what we call Keynesianism.