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Chris
12-23-2017, 04:28 PM
If all Republicans do is cut taxes they've left their job half done.

Tax Reform Was Easy, Spending Cuts Are Un-possible (http://reason.com/blog/2017/12/22/tax-reform-was-easy-spending-cuts-are-im)


...So here's the thing: What are Republicans going to do on spending? Cutting taxes is the frosting, not the cake, when it comes to actually making America great again. Our $20 trillion national debt (this figure includes both debt with investors and what various parts of the government owe each other and is the most accurate measure) is undoubtedly retarding economic growth for a variety of reasons:

https://www.youtube.com/watch?v=fpEocyWcNZ8

Balancing budgets and reducing the size, scope, and spending of the federal government is not simply a puritanical accounting fetish. Economists on every point of the political spectrum agree that debt-to-GDP ratios of ov—er 100 percent are a drag on the economy because everyone knows that a major restructuring is coming eventually. Taxes will need to go up, services will need to be cut, and inflation will rise—or most likely, some combination of all three.

...Earlier in December and almost certainly as a way to disarm budget hawks, Speaker Paul Ryan pledged that right after tax cuts, the GOP would start work on cutting spending, especially on entitlements.

...While signing the tax bill into law, Trump himself eschewed talk about cutting spending, choosing instead to talk excitedly about getting back to infrastructure spending, which kept calling an "easy" sell. Suddenly, we've gone from headlines either trumpeting or darkly warning that tax cuts pave the way for spending cuts to ones like this Fox Business beaut:

Trump's tax reform win paves way for infrastructure spending and higher stock prices

The most-common number bandied about is "$1 trillion," though it's anyone's guess what that means or how many years it's spread over. But assuming the 10-year budget figures that are typical, that's still $100 billion a year, or a pledge to spend more than even Norquist at his most excited calculated annual savings from welfare cuts (that again, are off the table anyway).

https://i.snag.gy/4ip8tP.jpg

...But because history presents itself first as tragedy and then as farce, we've gotten a Benny Hill version of the old shakedown: Republicans have promised to cut taxes now and reduce spending later. And have already reneged on that, before the ink on President Trump's signature dried. Or, if we're being strictly accurate, before the legislation even landed on his desk.

...

Peter1469
12-23-2017, 04:31 PM
We need to focus on reducing the deficit. That $20T in debt will never get paid off.

Chris
12-23-2017, 04:40 PM
We need to focus on reducing the deficit. That $20T in debt will never get paid off.

With spending cuts.

Peter1469
12-23-2017, 05:02 PM
With spending cuts.

Yes, currently we need cuts of $666B to end the deficit. The most draconian proposals during the last couple of election cycles was around ~240B.

We haven't even gotten to the debt yet.

pragmatic
12-23-2017, 05:09 PM
Yes, currently we need cuts of $666B to end the deficit. The most draconian proposals during the last couple of election cycles was around ~240B.

We haven't even gotten to the debt yet.


The only place we could possibly make meaningful (percentage wise) spending cuts is in Entitlements and to a lesser extent the military.

But those would have both political and economic ramifications.


There are no easy answers.

pragmatic
12-23-2017, 05:11 PM
Yes, currently we need cuts of $666B to end the deficit. The most draconian proposals during the last couple of election cycles was around ~240B.
We haven't even gotten to the debt yet.


The annual deficit really is a staggering number....

Chris
12-23-2017, 05:12 PM
The only place we could possibly make meaningful (percentage wise) spending cuts is in Entitlements and to a lesser extent the military.

But those would have both political and economic ramifications.


There are no easy answers.

Oh, the answers are easy, they're just not, let us say, politically correct.

Peter1469
12-23-2017, 07:42 PM
The only place we could possibly make meaningful (percentage wise) spending cuts is in Entitlements and to a lesser extent the military.

But those would have both political and economic ramifications.


There are no easy answers.
I don't believe any such cuts could ever be passed under our budget creation process.

Peter1469
12-23-2017, 07:42 PM
The annual deficit really is a staggering number....
And that is down from most of O's 8 years.

Kacper
12-23-2017, 09:28 PM
We need to focus on reducing the deficit.


Why? We can borrow money with effectively nothing interest right now. The US has no problem moving bonds, so there is zero real pressure to lower the debt.

Peter1469
12-23-2017, 10:19 PM
Why? We can borrow money with effectively nothing interest right now. The US has no problem moving bonds, so there is zero real pressure to lower the debt.


That is a big gamble. If interest rates return to their historic average we will use up our discretionary budget to service the debt.

Unless we tell our creditors to pound sand. If that will be our plan we need a massive investment in defense and rack up twice the debt. Then tell our creditors to f-off.

Chris
12-23-2017, 10:28 PM
Why? We can borrow money with effectively nothing interest right now. The US has no problem moving bonds, so there is zero real pressure to lower the debt.

We can just print it too but all both do is inflate the dollar and deflate its purchasing power much like a tax.

Kacper
12-23-2017, 11:11 PM
That is a big gamble. If interest rates return to their historic average we will use up our discretionary budget to service the debt.

Unless we tell our creditors to pound sand. If that will be our plan we need a massive investment in defense and rack up twice the debt. Then tell our creditors to f-off.

Our defenses are fine. It isn't like Japan can do much against us these days.

Kacper
12-23-2017, 11:12 PM
We can just print it too but all both do is inflate the dollar and deflate its purchasing power much like a tax.

That will happen anyway. We monetized debt to save us from Great Depression II just a few years ago and we are fine.

Peter1469
12-23-2017, 11:27 PM
Our defenses are fine. It isn't like Japan can do much against us these days.


If nations stopped using the USD and the world reserve currency it would be game over for our economy.

As long as they continue to do so we are in uncharted territory.

Peter1469
12-23-2017, 11:31 PM
That will happen anyway. We monetized debt to save us from Great Depression II just a few years ago and we are fine.

No we were not. We had the most flaccid economic recovery in history. We did not fix the structural problems in our banking sector- we allowed them to get worse. And we restarted the programs that lead to the housing crisis.

Because politicians didn't have the courage to do what is right we set ourselves up for a larger collapse. Are you prepared?

Chris
12-23-2017, 11:31 PM
That will happen anyway. We monetized debt to save us from Great Depression II just a few years ago and we are fine.

Uh, now we're not.

Kacper
12-24-2017, 11:07 AM
If nations stopped using the USD and the world reserve currency it would be game over for our economy.

As long as they continue to do so we are in uncharted territory.
Since they will continue to do so, no big deal

Kacper
12-24-2017, 11:08 AM
Uh, now we're not.

Evidence that we are not is?

Ethereal
12-24-2017, 11:09 AM
The only place we could possibly make meaningful (percentage wise) spending cuts is in Entitlements and to a lesser extent the military.

But those would have both political and economic ramifications.


There are no easy answers.

The most sensible place to make cuts are the US drug war and the US empire. Both are unnecessary and extremely expensive. Americans will never tolerate cuts to entitlements while the US government wastes trillions of dollars on stupid wars and foreign meddling, nor should they.

Kacper
12-24-2017, 11:24 AM
No we were not. We had the most flaccid economic recovery in history. We did not fix the structural problems in our banking sector- we allowed them to get worse. And we restarted the programs that lead to the housing crisis.
A recovery is a recovery, you expectations not withstanding.

Because politicians didn't have the courage to do what is right we set ourselves up for a larger collapse. Are you prepared?

Yep.

Chris
12-24-2017, 11:30 AM
A recovery is a recovery, you expectations not withstanding.


Yep.


A recovery in the market is not a recovery in the government. Economic recovery could drive higher revenue, even with lower taxes, and help pay off deficit but...

Peter1469
12-24-2017, 11:33 AM
Since they will continue to do so, no big dealThe world is slowly moving away from it now- they are adding other currencies into world reserve status.

Peter1469
12-24-2017, 11:36 AM
A recovery is a recovery, you expectations not withstanding.


Yep.A flaccid recovery is a flaccid recovery. Not a robust recovery.

At least you are prepared for the coming self-imposed crash.

Kacper
12-24-2017, 11:42 AM
A recovery in the market is not a recovery in the government. Economic recovery could drive higher revenue, even with lower taxes, and help pay off deficit but...

National debt is not a horrible thing. If the money weren't going to interest, it would be going to something just as pointless, like militarization on the government side. On the market side, it would just lead to inflation and unnecessary consumption of natural resources. I still find no compelling argument that our debt is horrible or that debt is horrible.

Ethereal
12-24-2017, 11:46 AM
National debt is not a horrible thing. If the money weren't going to interest, it would be going to something just as pointless, like militarization on the government side. On the market side, it would just lead to inflation and unnecessary consumption of natural resources. I still find no compelling argument that our debt is horrible or that debt is horrible.

The national debt is the biggest reason why the political class needs us to remain their tax slaves. Without our taxes, the political class has no way to pay back their masters.

Chris
12-24-2017, 12:17 PM
National debt is not a horrible thing. If the money weren't going to interest, it would be going to something just as pointless, like militarization on the government side. On the market side, it would just lead to inflation and unnecessary consumption of natural resources. I still find no compelling argument that our debt is horrible or that debt is horrible.

So you think being in debt is a good thing? It reduces your credit score and ability to obtain loans.

The way out of debt is to first stop increasing it with more and more spending on pointless and unconstitutional things.

It is paying off debt with fiat money that causes inflation.

Peter1469
12-24-2017, 12:19 PM
National debt is not a horrible thing. If the money weren't going to interest, it would be going to something just as pointless, like militarization on the government side. On the market side, it would just lead to inflation and unnecessary consumption of natural resources. I still find no compelling argument that our debt is horrible or that debt is horrible.
Some debt isn't bad, especially if you are using the money productively.

1. $20T is way too much debt.

2. The US government squandered most of those borrowed dollars.

Peter1469
12-24-2017, 12:21 PM
The national debt is the biggest reason why the political class needs us to remain their tax slaves. Without our taxes, the political class has no way to pay back their masters.

They aren't really paying anyone back. They are rolling the debt over.

We can't pay back on the debt when we have deficits running between $.5T and $1T. It is just a shell game.

Chris
12-24-2017, 12:32 PM
Some debt isn't bad, especially if you are using the money productively.

1. $20T is way too much debt.

2. The US government squandered most of those borrowed dollars.

Right, if you borrow at an interest rate that ends up lower than the inflation rate, then you actually pay back less, and you got to use it to invest in something that hopefully also earned wealth.

Kacper
12-24-2017, 03:01 PM
Some debt isn't bad, especially if you are using the money productively.

1. $20T is way too much debt.

2. The US government squandered most of those borrowed dollars.

Take away the intergovernmental holdings and you are down to around $16T. A lot of that debt represents roads and buildings already built, etc where the opportunity cost of paying it off thirty plus years later mitigates the opportunity cost of paying cash up front.

Kacper
12-24-2017, 03:02 PM
So you think being in debt is a good thing? It reduces your credit score and ability to obtain loans.

The way out of debt is to first stop increasing it with more and more spending on pointless and unconstitutional things.

It is paying off debt with fiat money that causes inflation.

Personal debt and public debt are not in the same solar system economically.

Kacper
12-24-2017, 03:06 PM
The national debt is the biggest reason why the political class needs us to remain their tax slaves. Without our taxes, the political class has no way to pay back their masters.

Ok tha is certainly one perspective.

Kacper
12-24-2017, 03:07 PM
A flaccid recovery is a flaccid recovery. Not a robust recovery.

At least you are prepared for the coming self-imposed crash.
As I have stated here before, I live well below by means. I have some rusty but semi-useful skills. I am fine either way.

Kacper
12-24-2017, 03:10 PM
The world is slowly moving away from it now- they are adding other currencies into world reserve status.
A natural by product of a global economy. Doesn't change that America occupies such a large part of global market that not being in on the dollar as some political statement is largely self-defeating. The BRICS nations also plan to set up their own internet outside of US control.

Chris
12-24-2017, 03:11 PM
Personal debt and public debt are not in the same solar system economically.

Actually they are.

Question, if deficits and depts are good, then why bother taxing the people, the government can just print money.

Peter1469
12-24-2017, 08:34 PM
Right, if you borrow at an interest rate that ends up lower than the inflation rate, then you actually pay back less, and you got to use it to invest in something that hopefully also earned wealth.

Correct but interest rates are being held artificially low via the government / fed.

Kacper
12-24-2017, 10:06 PM
Actually they are.

Actually no they are not.


Question, if deficits and depts are good, then why bother taxing the people, the government can just print money.

Because then the value of currency would not be backed by debt.

Chris
12-24-2017, 10:39 PM
Actually no they are not.



Because then the value of currency would not be backed by debt.



Currency backed by debt. That has seriously got to be the strangest thing I've ever heard. Well, next to liberals arguing that government control frees them.

Kacper
12-24-2017, 10:51 PM
Currency backed by debt. That has seriously got to be the strangest thing I've ever heard. Well, next to liberals arguing that government control frees them.

The dollar is backed by debt. If you consider that something strange that you have never heard before, then I am not sure you understand how fiat currency works.

Peter1469
12-24-2017, 11:57 PM
A currency is not backed by debt- that is off the hook silly. It is backed by a commodity.

The USD is considered to be backed by the full faith and credit of the US- a solid commodity for a century. That faith is beginning to fall. There is a zero percent chance that we will pay off our debt. The chances of convincing our creditors to buy more debt based on what they think we can repay is an unanswered question. So long as they buy USDs we can spend into oblivion. Someday they will wake up and stop buying.

Then the Establishment will be laid low. The people will rise up and destroy the government that crashed our economy. Molon Labe. (Greek (https://en.wikipedia.org/wiki/Greek_language): μολὼν λαβέ molṑn labé

Prepare for the crash. Once it happens it will be too late.

Chris
12-25-2017, 11:06 AM
The US, so long as GDP rises, will be a commodity as a producer of goods and services. One might also argue it is a commodity in maintaining world order, for now--though there's room for debate on fighting wars for democracy (Bush) or humanty (Obama). So long as the world, and we the people, see that as true what Peter says is true.

Green Arrow
12-25-2017, 11:24 AM
The only place we could possibly make meaningful (percentage wise) spending cuts is in Entitlements and to a lesser extent the military.

But those would have both political and economic ramifications.


There are no easy answers.

The military to a lesser extent? Why is military adventurism more important than the neediest Americans?

Captdon
12-25-2017, 12:23 PM
If interest rates return to any kind of normal rates the budget will be unsustainable without tax increases. There won't be enough money to pay for defense (the prime duty of government),Social Security and Medicare(both paid for by people using it) or anything else. The debt does matter then unless the government prints enough money to let inflation pay the debt down.

Peter1469
12-25-2017, 02:48 PM
If interest rates return to any kind of normal rates the budget will be unsustainable without tax increases. There won't be enough money to pay for defense (the prime duty of government),Social Security and Medicare(both paid for by people using it) or anything else. The debt does matter then unless the government prints enough money to let inflation pay the debt down.
Printing more money will make it cheaper to pay the debt (never mind the deficit for this point), but it is effectively a partial default. I bought $1M in US debt, and when the US pays me back the $1M is worth 10% less.

Captdon
12-25-2017, 04:42 PM
The dollar is backed by debt. If you consider that something strange that you have never heard before, then I am not sure you understand how fiat currency works.

The dollar is backed by the faith and credit of the US government( as stated already). That's all it is. All you get for a dollar is what someone thinks it is worth.

Captdon
12-25-2017, 04:46 PM
The military to a lesser extent? Why is military adventurism more important than the neediest Americans?

Defense. It's the basic job of government.

Captdon
12-25-2017, 04:52 PM
Printing more money will make it cheaper to pay the debt (never mind the deficit for this point), but it is effectively a partial default. I bought $1M in US debt, and when the US pays me back the $1M is worth 10% less.

No, you are misreading my post. Inflation is a killer of economies. I've been through the 1969-1985 inflation bullshit. I can't even tell my grandchildren about prices and wages then because they look at me as if I'm from another planet.

I was making 2 dollars an hour when i got married. I was middle of middle class. I lived okay. My grandkids think that's impossible.

No, inflation would be bad for us but the debt would be paid with cheaper dollars. It's what we would do if China wanted to cash in their treasury notes. It's also why they wouldn't dump them all at one time.

Green Arrow
12-25-2017, 05:25 PM
Defense. It's the basic job of government.
Military adventurism is not defense.

Kacper
12-25-2017, 08:22 PM
The dollar is backed by the faith and credit of the US government( as stated already). That's all it is. All you get for a dollar is what someone thinks it is worth.

Credit is debt

Captdon
12-25-2017, 08:31 PM
Military adventurism is not defense.

You don't get to define what our military is doing.

Green Arrow
12-25-2017, 08:42 PM
You don't get to define what our military is doing.

Sure I do. America is still a free country, thankfully.

Captdon
12-26-2017, 02:31 PM
Sure I do. America is still a free country, thankfully.

You still don't have a vote in Congress.

Green Arrow
12-26-2017, 02:34 PM
You still don't have a vote in Congress.

Sure I do. Technically, I have three. Two senators and a Representative.

Common
12-26-2017, 03:28 PM
Sure I do. Technically, I have three. Two senators and a Representative.
Be that true what real impact do any of us have as individuals, I think the best example of that if the peoples word truly had meaning would we still be fighting in the middle east after 17yrs.

There are so many things that the majority is against and it doesnt matter, its been that way all my adult political life.

Ethereal
12-26-2017, 03:30 PM
Ok tha is certainly one perspective.


No Treason by Lysander Spooner (http://praxeology.net/LS-NT-6.htm#no.6)

...Among savages, mere physical strength, on the part of one man, may enable him to rob, enslave, or kill another man. Among barbarians, mere physical strength, on the part of a body of men, disciplined, and acting in concert, though with very little money or other wealth, may, under some circumstances, enable them to rob, enslave, or kill another body of men, as numerous, or perhaps even more numerous, than themselves. And among both savages and barbarians, mere want may sometimes compel one man to sell himself as a slave to another. But with (so-called) civilized peoples, among whom knowledge, wealth, and the means of acting in concert, have become diffused; and who have invented such weapons and other means of defense as to render mere physical strength of less importance; and by whom soldiers in any requisite number, and other instrumentalities of war in any requisite amount, can always be had for money, the question of war, and consequently the question of power, is little else than a mere question of money. As a necessary consequence, those who stand ready to furnish this money, are the real rulers. It is so in Europe, and it is so in this country.

In Europe, the nominal rulers, the emperors and kings and parliaments, are anything but the real rulers of their respective countries. They are little or nothing else than mere tools, employed by the wealthy to rob, enslave, and (if need be) murder those who have less wealth, or none at all.

The Rothschilds, and that class of money-lenders of whom they are the representatives and agents – men who never think of lending a shilling to their next-door neighbors, for purposes of honest industry, unless upon the most ample security, and at the highest rate of interest – stand ready, at all times, to lend money in unlimited amounts to those robbers and murderers, who call themselves governments, to be expended in shooting down those who do not submit quietly to being robbed and enslaved.

They lend their money in this manner, knowing that it is to be expended in murdering their fellow men, for simply seeking their liberty and their rights; knowing also that neither the interest nor the principal will ever be paid, except as it will be extorted under terror of the repetition of such murders as those for which the money lent is to be expended...

Ethereal
12-26-2017, 03:34 PM
The dollar is backed by debt.

That is perhaps the proximate backing, but the higher-level distal backing of the USD (and all FIAT monies) are the police powers of the state.

Ethereal
12-26-2017, 03:36 PM
Defense. It's the basic job of government.
Expenditures on the military have gone FAR beyond mere defensive purposes.

Kacper
12-26-2017, 04:18 PM
That is perhaps the proximate backing, but the higher-level distal backing of the USD (and all FIAT monies) are the police powers of the state.

I am a big fan of police powers when they are directed at someone other than me for my benefit.