Are you better off than you were 4 years ago? (Page 3)

Why do so many people think that NOW is the time to try paying down the debt?!  The economy had tanked and unemployment is over 8%.  Yes, I'll say it...  Now is the time to stimulate, get the economy back on it's feet and GO INTO MORE DEBT!  We need to get people back to work and spending money first.  Once things stabilize, then worry about paying it off.  For example...

Let's say you have a $20,000 credit card bill.  (Don't get started on why it's not smart to have a credit card balance of that much.  That would be correct for individuals, but NOT for the government.)  AND YOU LOSE YOUR JOB.  So you have little to no income.  Is NOW the time to try and pay off that cc balance with money you don't have?  Or would it be better to work as hard as you can to find a job, start making income again, even if it means you cc balance goes up to $30,000 to pay for rent, food and gas?  After you get a new job, THEN you start paying it off.

The government isn't an individual and it's not designed or meant to make a "profit".  $16 trillion in debt is too much.  EVERYONE can agree on that.  But not having any debt isn't good fiscal policy either (for a government).  Now isn't the right time to be having the debt argument.  I believe in cutting spending, just not while the unemployment numbers are where they are.

The markets reflect this.  Talk of government stimulus makes the market go up.  Look at the reaction to the market from yesterday's EU CB announcement.  Gov't cut talks make the market fall and investors sell, Gov't spend talks make the market rise and investors buy.  It's a s simple as that.  When the economy improves and the gov't talks of deficit reduction in a GOOD economy, that will spur on markets as well.  The only way Clinton was able to turn a deficit into a surplus was because there was a good economy to support it at the time.

Now is not the time.  IMHO.

Becasue Japan tried this approach and got a lost decade for it.  They are continuing this fiscal experiment and are getting more of the same.

We have tried this experiment and have gotten more of the same.

So yes by all means lets continue the insanity.  It's like an alcoholic.  If you keep pouring the booze they will keep drinking.  The beginning of getting better is painful and rough but you don't get better while Uncle Sammy keeps pouring the booze. You just get deeper and deeper in the hole.  Sooner or later you will crash and burn and the damage will be much, much worse when that time comes.

Why do so many people think that NOW is the time to try paying down the debt?!  The economy had tanked and unemployment is over 8%.  Yes, I'll say it...  Now is the time to stimulate, get the economy back on it's feet and GO INTO MORE DEBT!  We need to get people back to work and spending money first.  Once things stabilize, then worry about paying it off.  For example...

Let's say you have a $20,000 credit card bill.  (Don't get started on why it's not smart to have a credit card balance of that much.  That would be correct for individuals, but NOT for the government.)  AND YOU LOSE YOUR JOB.  So you have little to no income.  Is NOW the time to try and pay off that cc balance with money you don't have?  Or would it be better to work as hard as you can to find a job, start making income again, even if it means you cc balance goes up to $30,000 to pay for rent, food and gas?  After you get a new job, THEN you start paying it off.

The government isn't an individual and it's not designed or meant to make a "profit".  $16 trillion in debt is too much.  EVERYONE can agree on that.  But not having any debt isn't good fiscal policy either (for a government).  Now isn't the right time to be having the debt argument.  I believe in cutting spending, just not while the unemployment numbers are where they are.

The markets reflect this.  Talk of government stimulus makes the market go up.  Look at the reaction to the market from yesterday's EU CB announcement.  Gov't cut talks make the market fall and investors sell, Gov't spend talks make the market rise and investors buy.  It's a s simple as that.  When the economy improves and the gov't talks of deficit reduction in a GOOD economy, that will spur on markets as well.  The only way Clinton was able to turn a deficit into a surplus was because there was a good economy to support it at the time.

Now is not the time.  IMHO.

2009: $11 trillion in debt

2012: $16 trillion in debt. 

End of story.

Because I'm really busy at work and absolutely have nothing better to do, I decided to play with some numbers.

Assumptions: 15 Trillion GDP to start, 16 Trillion debt, constant 3.0% GDP growth every year, no exceptions

I plugged in the numbers of Ryan's road map to prosperity Table A-II-1 to see how it would project. All numbers are in trillions.

Link to this table?

In theory I agree, but to a small extent.  A near 50% increase in debt with little to no effect is not a smart move.  Each job the stimulus created cost about $135-185k (depends on your source).  A lot of the money was also used to give teachers and police and firefighters raises.  That's not smart job creation.

So I'm not suggesting that we raise taxes and use this to pay off the debt.  However you HAVE to control debt.

In your CC example above eventually the debt will become so large that even if you do get that job you'll never be able to pay off the credit cards as the interest mounts.  Or it'll end up taking yo the rest of your life to pay for it all.

Link to this table?

Oh I whole-heartedly agree.  It's not an "all-or-nothing", "one-way-or-the-other" approach.  We should be cutting spending now and slowing the bleeding.  When your cc bill is high and you lose your job, you cut back on the frivolous spending and stick to the basics.  My belief:

• Combine spending cuts with an increase in taxes on those that can afford to pay more.  Zero revenue increases are ridiculous IMHO.  I know a few multi-millionaires when asked if they could afford to pay $250 thousand more in taxes replied, "Sure.  I don't think anyone likes paying more in taxes.  But it wouldn't change my lifestyle or hurt my bottom line in the long-run."
• Defense shouldn't be a sacred "don't cut a single penny" political battle.  Massive cuts can and should be made in areas where even the Pentagon doesn't want to waste money on systems they don't need or want.  Increase funding for troops, families, services, job/transition training for them when they come home and especially mental health for them.  And BTW - Revamp the military away from, it's current Cold War docterine of a strategic war against the Soviet Union to a leaner, more mobile, more regional, fast-reposne military strategy.
• Close tax loopholes for corporations and get them to start paying more.
• Cut wasteful spending, but don't make the people who need help the most suffer.  Lets face it, not everyone in this country can "make it" if they simply try harder.  The mentally ill need help.
• Seriously reconsider US government ideology anout trying to make the rest of the world "more like us".  We pay out billions to other countries to influence their political and societal structure (a holdover from anti-Communist days).  Is that our goal?  To try and make everyone think and act our way?  And to do so by paying them for it?
• Accept the fact that this is a global economy and some jobs just aren't coming back to the US.  All the government can do is offer incentives to companies for keeping jobs here and invest in new industries that create jobs here.  We can try and keep manufacturing jobs in the US, but it's never going to be like it was in 1950.  Get over it.
• Something has to be done with Medicare, Medicaid and Social Security.  But those are gigantic hurdles.  I believe they need reform in a phased approach over many years to soften the blow on these "big ticket" areas.
• Don't sacrifice education and the future to save a couple of shekels now.  If our University engineering departments are filled with foreign Chinese and Indian students who then take their degree back home with them, what have we gained as a country as a whole?  And make it frickin' AFFORDABLE!  At this rate, only a priveledged few will have the financial opportunity to get higher educations.  Working hard will mean abosolutely nothing.
• Run with The Affordable Healthcare Law.  Refine it over time.  Get the ball rolling on lower medical costs.  It has to start somewhere.  Stop being so political about making it an ideological battle-point.  Even people against it, support many tenants in it.

I guess my main point is to at least be open to discussing the options.  The "we won't budge a single inch on this."  "I signed a pledge that I won't raise any taxes on anyone."  This black or white, all or nothing" attitude needs to stop.  While everyone can agree that the debt needs to come down, at least have a debate and be pragmatic on how.  Make some deals.  Give and take.  Be a politician!

Oh I whole-heartedly agree.  It's not an "all-or-nothing", "one-way-or-the-other" approach.  We should be cutting spending now and slowing the bleeding.  When your cc bill is high and you lose your job, you cut back on the frivolous spending and stick to the basics.  My belief:

• Combine spending cuts with an increase in taxes on those that can afford to pay more.  Zero revenue increases are ridiculous IMHO.  I know a few multi-millionaires when asked if they could afford to pay $250 thousand more in taxes replied, "Sure.  I don't think anyone likes paying more in taxes.  But it wouldn't change my lifestyle or hurt my bottom line in the long-run."
• Defense shouldn't be a sacred "don't cut a single penny" political battle.  Massive cuts can and should be made in areas where even the Pentagon doesn't want to waste money on systems they don't need or want.  Increase funding for troops, families, services, job/transition training for them when they come home and especially mental health for them.  And BTW - Revamp the military away from, it's current Cold War docterine of a strategic war against the Soviet Union to a leaner, more mobile, more regional, fast-reposne military strategy.
• Close tax loopholes for corporations and get them to start paying more.
• Cut wasteful spending, but don't make the people who need help the most suffer.  Lets face it, not everyone in this country can "make it" if they simply try harder.  The mentally ill need help.
• Seriously reconsider US government ideology anout trying to make the rest of the world "more like us".  We pay out billions to other countries to influence their political and societal structure (a holdover from anti-Communist days).  Is that our goal?  To try and make everyone think and act our way?  And to do so by paying them for it?
• Accept the fact that this is a global economy and some jobs just aren't coming back to the US.  All the government can do is offer incentives to companies for keeping jobs here and invest in new industries that create jobs here.  We can try and keep manufacturing jobs in the US, but it's never going to be like it was in 1950.  Get over it.
• Something has to be done with Medicare, Medicaid and Social Security.  But those are gigantic hurdles.  I believe they need reform in a phased approach over many years to soften the blow on these "big ticket" areas.
• Don't sacrifice education and the future to save a couple of shekels now.  If our University engineering departments are filled with foreign Chinese and Indian students who then take their degree back home with them, what have we gained as a country as a whole?  And make it frickin' AFFORDABLE!  At this rate, only a priveledged few will have the financial opportunity to get higher educations.  Working hard will mean abosolutely nothing.
• Run with The Affordable Healthcare Law.  Refine it over time.  Get the ball rolling on lower medical costs.  It has to start somewhere.  Stop being so political about making it an ideological battle-point.  Even people against it, support many tenants in it.

I guess my main point is to at least be open to discussing the options.  The "we won't budge a single inch on this."  "I signed a pledge that I won't raise any taxes on anyone."  This black or white, all or nothing" attitude needs to stop.  While everyone can agree that the debt needs to come down, at least have a debate and be pragmatic on how.  Make some deals.  Give and take.  Be a politician!

The reason I did that is to further emphasize my point, that there is very little difference and neither candidate is going to help us out. Even with my rosy assumptions, the numbers are horrible. There is also no way that you can project out 70 years.

Oh I whole-heartedly agree.  It's not an "all-or-nothing", "one-way-or-the-other" approach.  We should be cutting spending now and slowing the bleeding.  When your cc bill is high and you lose your job, you cut back on the frivolous spending and stick to the basics.  My belief:

• Combine spending cuts with an increase in taxes on those that can afford to pay more.  Zero revenue increases are ridiculous IMHO.  I know a few multi-millionaires when asked if they could afford to pay $250 thousand more in taxes replied, "Sure.  I don't think anyone likes paying more in taxes.  But it wouldn't change my lifestyle or hurt my bottom line in the long-run." The extra income from these taxes are a drop in the bucket compared to defense spending.  You could cut defense and make up for the tax hikes in a heartbeat.
• Defense shouldn't be a sacred "don't cut a single penny" political battle.  Massive cuts can and should be made in areas where even the Pentagon doesn't want to waste money on systems they don't need or want.  Increase funding for troops, families, services, job/transition training for them when they come home and especially mental health for them.  And BTW - Revamp the military away from, it's current Cold War docterine of a strategic war against the Soviet Union to a leaner, more mobile, more regional, fast-reposne military strategy. Agreed, defense could be cut 30-40% easily.  However I'd ask Mr. Obama if he's so gung-ho on cutting defense (as he said in his speech last night) why didn't he do this in his first 2 years?
• Close tax loopholes for corporations and get them to start paying more. Agreed.
• Cut wasteful spending, but don't make the people who need help the most suffer.  Lets face it, not everyone in this country can "make it" if they simply try harder.  The mentally ill need help. One person's waste is another's pet project.  But I agree it needs to be trimmed.
• Seriously reconsider US government ideology anout trying to make the rest of the world "more like us".  We pay out billions to other countries to influence their political and societal structure (a holdover from anti-Communist days).  Is that our goal?  To try and make everyone think and act our way?  And to do so by paying them for it? Foreign aid should be cut by 50% each year. Wean them all off.
• Accept the fact that this is a global economy and some jobs just aren't coming back to the US.  All the government can do is offer incentives to companies for keeping jobs here and invest in new industries that create jobs here.  We can try and keep manufacturing jobs in the US, but it's never going to be like it was in 1950.  Get over it. Yep.  Which means we need to educate our population more.
• Something has to be done with Medicare, Medicaid and Social Security.  But those are gigantic hurdles.  I believe they need reform in a phased approach over many years to soften the blow on these "big ticket" areas.
• Don't sacrifice education and the future to save a couple of shekels now.  If our University engineering departments are filled with foreign Chinese and Indian students who then take their degree back home with them, what have we gained as a country as a whole?  And make it frickin' AFFORDABLE!  At this rate, only a priveledged few will have the financial opportunity to get higher educations.  Working hard will mean abosolutely nothing.  We have in-state and out-of-state tuition rates.  We need to have international rates that are MUCH more expensive.
• Run with The Affordable Healthcare Law.  Refine it over time.  Get the ball rolling on lower medical costs.  It has to start somewhere.  Stop being so political about making it an ideological battle-point.  Even people against it, support many tenants in it. Hmmm, a debate for another time.

Did anyone else get the impression from Obama;s speech last night he was basically listing things he promised to do 4 years ago and then promising to get them done if reelected?  His 2012 speech sounded an awful lot like his 2008 speech.

So what then?  Give up and let them run it into the ground?

See replies above in (non sarcastic) pink.

Did anyone else get the impression from Obama;s speech last night he was basically listing things he promised to do 4 years ago and then promising to get them done if reelected?  His 2012 speech sounded an awful lot like his 2008 speech.

Did anyone else get the impression from Obama;s speech last night he was basically listing things he promised to do 4 years ago and then promising to get them done if reelected?  His 2012 speech sounded an awful lot like his 2008 speech.