So you say that the tax-cut will increase debt?

CADsortaGUY

Lifer
Oct 19, 2001
25,162
1
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www.ShawCAD.com
While I could maybe agree with the notion that this tax-cut (or any other tax-cut) may aid in increasing short-term(2-3year) budget deficits because of front loading; you can't say that tax-cuts are a "cost" or directly create debt, which I hear spewed by every Tom, Dick, and Howard(creative, no?:p ). Think I'm full of Shiz when I say that Gov't spending is the reason for "debt" instead of "tax-cuts"? Sit down, buckle-up;), and please remove all tinfoil hats as I lay things out for you.:)

Gov't spending in:
Year // Total Outlay (**=projected)
2000 // 1,788,773,000,000
2001 // 1,863,895,000,000
2002 // 2,010,975,000,000
2003 // 2,140,377,000,000**
2004 // 2,229,425,000,000**
2005 // 2,343,399,000,000**
2006 // 2,463,663,000,000**
2007 // 2,576,203,000,000**
2008 // 2,710,517,000,000**

Taken from http://w3.access.gpo.gov/usbudget/fy2004/sheets/hist01z1.xls

So the "tax-cut" was ~$350 billion over 10 years right? With ~226billion coming in the first two years.

So since we only have the next 6 years estimates we'll use them as it will prove my point just as well.

2008 spending = 2.7trillion**
2002 spending = 2.0trillion
-----------------------------
. . . . . . . = 700billion in spending increases. Which equates to roughly 115 billion in spending increases per year.

Tax Cut break down
350billion - 226billion (first 2 years) = ~124billion/year for the first 2 years

124billion / 8 years= 15.5billion/year for the last 8 years of the tax cut

So lets put this all in perspective.

Spending increase 2003 = 130 billion (-124billion taxcut "cost")
spending increase 2004 = 90 billion (-124billion taxcut "cost")
spending increase 2005 = 110 bilion (-15.5billion taxcut "cost")
.....
....
...

You can fill in the rest.

first 6 years of the tax-cut "cost" = 310 billion
next 6 years projected budget spending increases = 700 billion

Now I ask you, What causes the gov't to "borrow" money?

Hmmm...couldn't be the increase in spending now could it?;)


The above does not take into consideration the possibility that this "tax-cut" could also increase revenue which would
then start negating it's "cost" :D

CkG
 

CADsortaGUY

Lifer
Oct 19, 2001
25,162
1
76
www.ShawCAD.com
Originally posted by: Hayabusarider
Of course you are going to volunteer to freeze your pay for 6 years too ;)

No, I'm sure my employer would cut the wasteful spending from his budget;)

CkG

Edit - oh and actually it'd really only be 2-3 even if what you imply is what would happen ;)
 

LunarRay

Diamond Member
Mar 2, 2003
9,993
1
76
Might be an interesting read.

Archer then invokes the hallowed name of Alan Greenspan, who has noted that tax cuts are less bad than spending increases. But Archer fails to note that Greenspan, like most responsible observers, believes that paying down the public debt is the best use of the surplus. Greenspan also just engineered an interest rate increase to slow down a booming economy. The stimulative effects of a tax cut on consumer spending could well be offset by further Fed action.

Brookings inst

But this was in '99 and booming is no longer real..
 

Bowfinger

Lifer
Nov 17, 2002
15,776
392
126
Originally posted by: CADkindaGUY
While I could maybe agree with the notion that this tax-cut (or any other tax-cut) may aid in increasing short-term(2-3year) budget deficits because of front loading; you can't say that tax-cuts are a "cost" or directly create debt, which I hear spewed by every Tom, Dick, and Howard(creative, no?:p ). Think I'm full of Shiz when I say that Gov't spending is the reason for "debt" instead of "tax-cuts"? Sit down, buckle-up;), and please remove all tinfoil hats as I lay things out for you.:)
I'm not sure why you are so determined to spin this, but the simple, obvious, inarguable truth is that when the feds pass a $350 billion tax "cut" without making matching spending cuts, the deficit gets about $350 billion larger. This is Intro to Accounting stuff.

Congress did pass a $350+ billion tax "cut". Congress did NOT make matching spending reductions. Therefore, the effect of this specific "cut" is a $350+ billion increase in the federal deficit that we will have to repay with interest. It is therefore not really a tax cut at all -- it is a loan.

This tax "cut" increases the deficit. That is a fact.
 

CADsortaGUY

Lifer
Oct 19, 2001
25,162
1
76
www.ShawCAD.com
Originally posted by: HJD1
Might be an interesting read.

Archer then invokes the hallowed name of Alan Greenspan, who has noted that tax cuts are less bad than spending increases. But Archer fails to note that Greenspan, like most responsible observers, believes that paying down the public debt is the best use of the surplus. Greenspan also just engineered an interest rate increase to slow down a booming economy. The stimulative effects of a tax cut on consumer spending could well be offset by further Fed action.

Brookings inst

But this was in '99 and booming is no longer real..

A bit off the topic but I'll respond since it has to do with taxes.

So if we enjoy good time (like in 99:p) it isn't "responsible" to have a tax-cut because we should use it all to pay off the debt(which is a bit of a misnomer) but then during "bad times" like the present it isn't "responsible" to give a tax-cut "because we can't afford it"?

Maybe I'm just confused but when do we ever get tax-cuts if we don't have them in good time or bad? Or, maybe we could stop overspending, which would then allow us to fit "paying off the debt" into our budget, and then when out debt is at a more managable level we could start with the tax-cuts;) But until they start budgeting "debt payments" and stop increasing wasteful spending, I would like to keep more of my money.

Now back to my topic. What does greenspan and the ficticious(uhh I mean projected;) ) surplus have to do with the overspending of our gov't?

CkG
 

CADsortaGUY

Lifer
Oct 19, 2001
25,162
1
76
www.ShawCAD.com
Originally posted by: Bowfinger
Originally posted by: CADkindaGUY
While I could maybe agree with the notion that this tax-cut (or any other tax-cut) may aid in increasing short-term(2-3year) budget deficits because of front loading; you can't say that tax-cuts are a "cost" or directly create debt, which I hear spewed by every Tom, Dick, and Howard(creative, no?:p ). Think I'm full of Shiz when I say that Gov't spending is the reason for "debt" instead of "tax-cuts"? Sit down, buckle-up;), and please remove all tinfoil hats as I lay things out for you.:)
I'm not sure why you are so determined to spin this, but the simple, obvious, inarguable truth is that when the feds pass a $350 billion tax "cut" without making matching spending cuts, the deficit gets about $350 billion larger. This is Intro to Accounting stuff.

Congress did pass a $350+ billion tax "cut". Congress did NOT make matching spending reductions. Therefore, the effect of this specific "cut" is a $350+ billion increase in the federal deficit that we will have to repay with interest. It is therefore not really a tax cut at all -- it is a loan.

This tax "cut" increases the deficit. That is a fact.

So current increased spending doesn't cause an increased deficit?:confused:

CkG
 

etech

Lifer
Oct 9, 1999
10,597
0
0
Originally posted by: Bowfinger
Originally posted by: CADkindaGUY
While I could maybe agree with the notion that this tax-cut (or any other tax-cut) may aid in increasing short-term(2-3year) budget deficits because of front loading; you can't say that tax-cuts are a "cost" or directly create debt, which I hear spewed by every Tom, Dick, and Howard(creative, no?:p ). Think I'm full of Shiz when I say that Gov't spending is the reason for "debt" instead of "tax-cuts"? Sit down, buckle-up;), and please remove all tinfoil hats as I lay things out for you.:)
I'm not sure why you are so determined to spin this, but the simple, obvious, inarguable truth is that when the feds pass a $350 billion tax "cut" without making matching spending cuts, the deficit gets about $350 billion larger. This is Intro to Accounting stuff.

Congress did pass a $350+ billion tax "cut". Congress did NOT make matching spending reductions. Therefore, the effect of this specific "cut" is a $350+ billion increase in the federal deficit that we will have to repay with interest. It is therefore not really a tax cut at all -- it is a loan.

This tax "cut" increases the deficit. That is a fact.


It looks like you skipped basic economics. You ignore the effects of the tax cut on the economy. More money moving through the system can also mean more taxes collected.
You may wish to study the Laffer curve for a more indepth explanation.
 

Bowfinger

Lifer
Nov 17, 2002
15,776
392
126
Originally posted by: CADkindaGUY
Originally posted by: Bowfinger
Originally posted by: CADkindaGUY
While I could maybe agree with the notion that this tax-cut (or any other tax-cut) may aid in increasing short-term(2-3year) budget deficits because of front loading; you can't say that tax-cuts are a "cost" or directly create debt, which I hear spewed by every Tom, Dick, and Howard(creative, no?:p ). Think I'm full of Shiz when I say that Gov't spending is the reason for "debt" instead of "tax-cuts"? Sit down, buckle-up;), and please remove all tinfoil hats as I lay things out for you.:)
I'm not sure why you are so determined to spin this, but the simple, obvious, inarguable truth is that when the feds pass a $350 billion tax "cut" without making matching spending cuts, the deficit gets about $350 billion larger. This is Intro to Accounting stuff.

Congress did pass a $350+ billion tax "cut". Congress did NOT make matching spending reductions. Therefore, the effect of this specific "cut" is a $350+ billion increase in the federal deficit that we will have to repay with interest. It is therefore not really a tax cut at all -- it is a loan.

This tax "cut" increases the deficit. That is a fact.

So current increased spending doesn't cause an increased deficit?:confused:

CkG

rolleye.gif
This is like talking to my kids.

Yes, both factors increase the deficit. Both.

When you increase spending without a matching tax increase, you increase the deficit. Similarly, when you reduce taxes without a matching spending reduction, you increase the deficit. When you increase spending and reduce taxes, you increase the deficit even more, by the amount of the spending increase plus the amount of the tax reduction. The deficit is headed towards a trillion dollars. This tax "cut" is only about $350 billion of it. It is $350 billion more that we will have to repay with interest; therefore, it is a loan, not a cut.
 

LunarRay

Diamond Member
Mar 2, 2003
9,993
1
76
Two issues,

First; A 350b tax cut with a high enough multiplier would result in a net zero deficit increase if it realized its multiplier and we won't know this until we can measure it. Current thinking at my house is: The tax package on top of the last one will not realize more than .5 multiplier... that was Joey's vote and he's a smart Silkie.

Second; In '99 with a booming economy the right was not too interested to cut tax despite the highest tax revenues since WW2. Now we are in the low end of things and I don't think anything but massive tax relief can turn it around. But, directed and that which has both a high multiplier and not to the rich... because of the picture it paints to the very folks expected to help stimulate.. I just don't agree the tax cut is well directed. Not that one is not needed... and I don't want the Debt to go bonkers and create the international issues that that will start.

I gotta take another pill so if the above is cryptic I'll read it again and correct.
 

Bowfinger

Lifer
Nov 17, 2002
15,776
392
126
Originally posted by: etech
Originally posted by: Bowfinger
I'm not sure why you are so determined to spin this, but the simple, obvious, inarguable truth is that when the feds pass a $350 billion tax "cut" without making matching spending cuts, the deficit gets about $350 billion larger. This is Intro to Accounting stuff.

Congress did pass a $350+ billion tax "cut". Congress did NOT make matching spending reductions. Therefore, the effect of this specific "cut" is a $350+ billion increase in the federal deficit that we will have to repay with interest. It is therefore not really a tax cut at all -- it is a loan.

This tax "cut" increases the deficit. That is a fact.


It looks like you skipped basic economics. You ignore the effects of the tax cut on the economy. More money moving through the system can also mean more taxes collected.
You may wish to study the Laffer curve for a more indepth explanation.
Bzzzzt! Sorry, thanks for playing.

Yes, there is some return on tax revenue due to slightly increased spending. It is a small return, however. That's why I said "the deficit gets about $350 billion larger".

You should also note that this is offset by the near-certainty that this tax reduction will cost much more than $350 billion. In order to keep the cost at their $350 billion target, Congress included expiration dates for the reductions. Most everyone in Congress seems to agree that these expiration dates are phony; they all expect the cuts to be extended. Thus, the actual deficit increase will probably be $600 to $800 billion more over the next ten years.

 

etech

Lifer
Oct 9, 1999
10,597
0
0
Originally posted by: HJD1
Two issues,

First; A 350b tax cut with a high enough multiplier would result in a net zero deficit increase if it realized its multiplier and we won't know this until we can measure it. Current thinking at my house is: The tax package on top of the last one will not realize more than .5 multiplier... that was Joey's vote and he's a smart Silkie.

Second; In '99 with a booming economy the right was not too interested to cut tax despite the highest tax revenues since WW2. Now we are in the low end of things and I don't think anything but massive tax relief can turn it around. But, directed and that which has both a high multiplier and not to the rich... because of the picture it paints to the very folks expected to help stimulate.. I just don't agree the tax cut is well directed. Not that one is not needed... and I don't want the Debt to go bonkers and create the international issues that that will start.

I gotta take another pill so if the above is cryptic I'll read it again and correct.

Actually HJD1, that post of yours actually made some sense. When the economy is booming you don't cut taxes and inflate it even higher, you pay down the debt. When the economy is down, you cut taxes to boost it back up.
The only thing we may disagree on is how much this tax cut will boost the economy. I will have to admit that I cannot judge the full effect of it, of course the "experts" also disagree which means that no one can really judge till it happens. One thing to not forget is that it can be changed if it does not have the desired effect.

bowfinger, neither you nor any of the experts know the effect it will have on the economy or how much more money in taxes it will bring in.
 

CADsortaGUY

Lifer
Oct 19, 2001
25,162
1
76
www.ShawCAD.com
Originally posted by: Bowfinger
Originally posted by: CADkindaGUY
Originally posted by: Bowfinger
Originally posted by: CADkindaGUY
While I could maybe agree with the notion that this tax-cut (or any other tax-cut) may aid in increasing short-term(2-3year) budget deficits because of front loading; you can't say that tax-cuts are a "cost" or directly create debt, which I hear spewed by every Tom, Dick, and Howard(creative, no?:p ). Think I'm full of Shiz when I say that Gov't spending is the reason for "debt" instead of "tax-cuts"? Sit down, buckle-up;), and please remove all tinfoil hats as I lay things out for you.:)
I'm not sure why you are so determined to spin this, but the simple, obvious, inarguable truth is that when the feds pass a $350 billion tax "cut" without making matching spending cuts, the deficit gets about $350 billion larger. This is Intro to Accounting stuff.

Congress did pass a $350+ billion tax "cut". Congress did NOT make matching spending reductions. Therefore, the effect of this specific "cut" is a $350+ billion increase in the federal deficit that we will have to repay with interest. It is therefore not really a tax cut at all -- it is a loan.

This tax "cut" increases the deficit. That is a fact.

So current increased spending doesn't cause an increased deficit?:confused:

CkG

rolleye.gif
This is like talking to my kids.

Yes, both factors increase the deficit. Both.

When you increase spending without a matching tax increase, you increase the deficit. Similarly, when you reduce taxes without a matching spending reduction, you increase the deficit. When you increase spending and reduce taxes, you increase the deficit even more, by the amount of the spending increase plus the amount of the tax reduction. The deficit is headed towards a trillion dollars. This tax "cut" is only about $350 billion of it. It is $350 billion more that we will have to repay with interest; therefore, it is a loan, not a cut.

Ding..Ding..Ding Step right up folks we have a winner! :D
My whole first post was about increased spending and how it compares to this tax-cut. It wouldn't take "spending cuts" to "pay" for this tax-cut, but rather a stop to increased spending. THAT sir was my point. Democrats (and some Republicans) who are blaming this tax-cut for the deficit spending aren't being truthful in their analysis and had everychance to stop the increased deficit spending. If they were as "fiscally responsible" as they are claiming to be by dissing this tax-cut then they should realize that they need to curb spending too. You call 700billion increase in 6years responsible? I sure as hell don't. They need to stop wasting my money NOW!!!

CkG
 

Ferocious

Diamond Member
Feb 16, 2000
4,584
2
71
The answer is yes.

Unless the Republicans (and Democrats too) can ease their spending sprees.
 

LunarRay

Diamond Member
Mar 2, 2003
9,993
1
76
Cadguy,

Ding..Ding..Ding Step right up folks we have a winner! :D
My whole first post was about increased spending and how it compares to this tax-cut. It wouldn't take "spending cuts" to "pay" for this tax-cut, but rather a stop to increased spending. THAT sir was my point. Democrats (and some Republicans) who are blaming this tax-cut for the deficit spending aren't being truthful in their analysis and had everychance to stop the increased deficit spending. If they were as "fiscally responsible" as they are claiming to be by dissing this tax-cut then they should realize that they need to curb spending too. You call 700billion increase in 6years responsible? I sure as hell don't. They need to stop wasting my money NOW!!!

CkG[/quote]

Cad, the spending is in line with the needs.... its the revenue that is missing... well lower and so as in all things the difference goes to the big pot of debt. Spending beyond the required social needs is not much really. But, the revenue in relation to it makes for the problem. Ya cant cut spending more than a few billion... (not to mention congressional reelection wants) all ya can do is force everything into debt and hope the economy will respond to the tax relief. Everyone on earth would agree with that I think.
What is really sad is and this is the hard truth... Although I have the same title today as twenty five years ago my function is totaly differn't. Then I had to know what affect govt. action had on my industry... my customer and the world. Today, I only need to know if a raster program or version 14 of CAD is really needed. I've lost the insight. I only care about how it will affect me the person. I think I understand the subject well I really should but, have learned I use to only guess real well... I was a guru of guess. Never a solid feeling about anything Economic wise...Just a Good Guesser. I've talked with Laffer on occasion about how he was gonna advise Reagan on this and that... He was certain (during a conversation at a pub in Amsterdam in 1980) That his way was gospel and would flow from his lips into law... well he was right... but, I asked him.. I said "Art what about the debt.. what effect will all this have on the debt?" He responded with... "who cares. The debt is not significant when it comes to ridding the nation of 20% inflation, not significant at all" I've tried to proove that statement wrong many times but, never could. It may be right... Ya fix the economy and where it flows it flows... tomorrow we'll deal with the debt today we deal with the other issues.

Edit: sorry the first conversation in '80 was at UCSD the one at the pub was in '85
 

Tripleshot

Elite Member
Jan 29, 2000
7,218
1
0
Originally posted by: CADkindaGUY
Originally posted by: Bowfinger
Originally posted by: CADkindaGUY
Originally posted by: Bowfinger
Originally posted by: CADkindaGUY
While I could maybe agree with the notion that this tax-cut (or any other tax-cut) may aid in increasing short-term(2-3year) budget deficits because of front loading; you can't say that tax-cuts are a "cost" or directly create debt, which I hear spewed by every Tom, Dick, and Howard(creative, no?:p ). Think I'm full of Shiz when I say that Gov't spending is the reason for "debt" instead of "tax-cuts"? Sit down, buckle-up;), and please remove all tinfoil hats as I lay things out for you.:)
I'm not sure why you are so determined to spin this, but the simple, obvious, inarguable truth is that when the feds pass a $350 billion tax "cut" without making matching spending cuts, the deficit gets about $350 billion larger. This is Intro to Accounting stuff.

Congress did pass a $350+ billion tax "cut". Congress did NOT make matching spending reductions. Therefore, the effect of this specific "cut" is a $350+ billion increase in the federal deficit that we will have to repay with interest. It is therefore not really a tax cut at all -- it is a loan.

This tax "cut" increases the deficit. That is a fact.

So current increased spending doesn't cause an increased deficit?:confused:

CkG

rolleye.gif
This is like talking to my kids.

Yes, both factors increase the deficit. Both.

When you increase spending without a matching tax increase, you increase the deficit. Similarly, when you reduce taxes without a matching spending reduction, you increase the deficit. When you increase spending and reduce taxes, you increase the deficit even more, by the amount of the spending increase plus the amount of the tax reduction. The deficit is headed towards a trillion dollars. This tax "cut" is only about $350 billion of it. It is $350 billion more that we will have to repay with interest; therefore, it is a loan, not a cut.

Ding..Ding..Ding Step right up folks we have a winner! :D
My whole first post was about increased spending and how it compares to this tax-cut. It wouldn't take "spending cuts" to "pay" for this tax-cut, but rather a stop to increased spending. THAT sir was my point. Democrats (and some Republicans) who are blaming this tax-cut for the deficit spending aren't being truthful in their analysis and had everychance to stop the increased deficit spending. If they were as "fiscally responsible" as they are claiming to be by dissing this tax-cut then they should realize that they need to curb spending too. You call 700billion increase in 6years responsible? I sure as hell don't. They need to stop wasting my money NOW!!!

CkG

It is obvious to most that republicans are just as big spenders at the government trough as any democrat. It was almost defeated, until Cheney broke the tie and passed the tax cut.

This was done once before, wasn't it? Isn't one of the definitions of insanity doing the same thing twice, expecting different results?

Last time GW swore up and down giving every taxpayer $300 would "save" the economy. I guess that wasn't enough, so, in light of an upcoming election, and his pathetic fiscal performance so far, he will now give "family" people $1000. But when Dems cried foul, and declared his tax giveaway only helped the rich and not the real taxpayers (middleclass), BOOM, lets give the middleclass MORE money this go around, and maybe they won't see the real benifit here is a major decrease in upper tax burdens and -------elmination of the tax on dividends. Damn, I don't think any of the majority of middleclass EVER see a dividend check they have to pay taxes on, but the RICH? You guessed it. They get a winfall, and dividend checks get sent to them on a regular basis, now tax free!

Lets see the trickle down come from that. (Don't hold your breath waiting). ;) This tax bondoggle just gave the rich woodies again. They will dump tons of extra cash to GW's re election. For me, I do not want to be governed by big business. I will vote democrat even if they run a poddle. GW does not deserve re election because he has neglected the country while performing very questionable foreign policy. I only mention his re elction here because that is what this taxcut is all about. Not helping the people, just helping himself, buying votes.

Let us all know how you are going to help the economy with your government handout check. :D

 

CADsortaGUY

Lifer
Oct 19, 2001
25,162
1
76
www.ShawCAD.com
Originally posted by: Tripleshot
Let us all know how you are going to help the economy with your government handout check. :D

You mean, what are we going to do with the money the gov't isn't taking away from us? ;)

Anyone who doesn't think this tax-cut is "right" or "won't help the economy" can kindly not cash any refund checks they get from the gov't.:D I surely wouldn't want you to feel compelled to take part in the destruction of our country
rolleye.gif


CkG
 

SuperTool

Lifer
Jan 25, 2000
14,000
2
0
Originally posted by: CADkindaGUY
Originally posted by: Tripleshot
Let us all know how you are going to help the economy with your government handout check. :D

You mean, what are we going to do with the money the gov't isn't taking away from us? ;)

Anyone who doesn't think this tax-cut is "right" or "won't help the economy" can kindly not cash any refund checks they get from the gov't.:D I surely wouldn't want you to feel compelled to take part in the destruction of our country
rolleye.gif


CkG

Who is going to be rolling their eyes when this country goes bankrupt?
 

CADsortaGUY

Lifer
Oct 19, 2001
25,162
1
76
www.ShawCAD.com
Originally posted by: SuperTool
Originally posted by: CADkindaGUY
Originally posted by: Tripleshot
Let us all know how you are going to help the economy with your government handout check. :D

You mean, what are we going to do with the money the gov't isn't taking away from us? ;)

Anyone who doesn't think this tax-cut is "right" or "won't help the economy" can kindly not cash any refund checks they get from the gov't.:D I surely wouldn't want you to feel compelled to take part in the destruction of our country
rolleye.gif


CkG

Who is going to be rolling their eyes when this country goes bankrupt?

Do you know how long this country has "survived" with deficit spending? I'm not saying it is right for the gov't to spend more than it takes in, but rather that it SHOULD only spend what it takes in. Neither side of the isle without blame in regards to fiscal responsibility, but those that are screaming bloody murder at the moment sure aren't suggesting any better options;) You see doom and gloom, I see opportunity to fix what is wrong with gov't.;)

Whatever though - think partisan...heck it's worked for this long, why change now?
rolleye.gif


CkG
 

LunarRay

Diamond Member
Mar 2, 2003
9,993
1
76
Supertool quote

Who is going to be rolling their eyes when this country goes bankrupt?
**********************

Depends on your age... not me...

But how can the nation go bankrupt? We could declare a debt holiday and make it zero. Then what? Americans holding debt write it off. Others outside just have junk bonds and a bad investment. We start over at zero. Who say's we can't?
 

SuperTool

Lifer
Jan 25, 2000
14,000
2
0
Originally posted by: HJD1
Supertool quote

Who is going to be rolling their eyes when this country goes bankrupt?
**********************

Depends on your age... not me...

But how can the nation go bankrupt? We could declare a debt holiday and make it zero. Then what? Americans holding debt write it off. Others outside just have junk bonds and a bad investment. We start over at zero. Who say's we can't?

If it's so easy, why not go bankrupt now?
 

Tom

Lifer
Oct 9, 1999
13,293
1
76
There is a lot of talk about increased spending in this thread, but not much about why there is increased spending. The largest factor is just spending increases associated with population increases.

There are very few ways to actually dramatically cut spending, the best way would be to reduce the debt so that we don't have to pay 1/4-1/3 of the budget paying interest on the debt. The only other one is to cut military spending, I'm not in favor of it and I doubt if many people are.

So if you are going to talk about cutting spending, stand up and say what you would cut. No simple across the board cut either unless you are willing to explain how across the board cuts affect costs associated with per person charges, like veterans benefits.

As an example, there are more disabled veterans now than last year, how are you going to take care of more veterans with less money ?

The problem with both of Bush's tax cuts is they squandered the small opportunity that existed to actually reduce government spending by reducing the debt and reducing interest payments on it. And it was completely unwarranted and unnecessary, we don't have a big problem in this country with rich people not having enough money.

 

LunarRay

Diamond Member
Mar 2, 2003
9,993
1
76
Originally posted by: SuperTool
Originally posted by: HJD1
Supertool quote

Who is going to be rolling their eyes when this country goes bankrupt?
**********************

Depends on your age... not me...

But how can the nation go bankrupt? We could declare a debt holiday and make it zero. Then what? Americans holding debt write it off. Others outside just have junk bonds and a bad investment. We start over at zero. Who say's we can't?

If it's so easy, why not go bankrupt now?

Well ... we don't need to... Full Faith and Credit and all. The Debt is only a problem when the service on it in times of high alternate returns at or near the beta of T. can cause a "disgourgement" of T instruments.

What is more alarming is currently occuring. (I am a fiscal conservative)
the dollar is losing against all major currencies... 1.19 vs the Euro, there is only so much good in this condition.. exports ok... but, if it gets much worse... say 1.25 vs the euro there will be major shift out of US stock and the market will drop big time which will stifel the effect of the current economic stimuli.... (which is politically low by about $400b and mis directed at that...should not have been a stock divident element or partial at best) because of the attitude it will develope toward the economic health.. then the threat of commodity denominated in dollars moving to Euro may occur... more than bad news!

The dems have played their trump... keep the tax cut low and to the rich... "its the economy stupid" again... watch... you'll see. at the expense of us dummies.
Speaking of which... I ramble... most of the middle class hold dividend paying stock in 401k or other tax deferred or free vehicles.... what good does a no tax stock dividend do them? My research indicates that no matter what or how the $ got to the 401k when drawn out it is fully taxed even the non tax dividends........ Now I've been on the "web" since late feburary of this year and this means that I tried to find info on my last statement but found nothing to negate what I said and would welcome any info to the contrary............. so all of these folks get no tax benefit. Economists consider saved tax cuts as deferred spending... so in what century will the benefit of that portion hit the economy?

My hands need a rest... I need one of those talking to the computer gizmos.. ;)
 

Bowfinger

Lifer
Nov 17, 2002
15,776
392
126
Originally posted by: Dead Parrot Sketch
There is a lot of talk about increased spending in this thread, but not much about why there is increased spending. The largest factor is just spending increases associated with population increases.

There are very few ways to actually dramatically cut spending, the best way would be to reduce the debt so that we don't have to pay 1/4-1/3 of the budget paying interest on the debt. The only other one is to cut military spending, I'm not in favor of it and I doubt if many people are.

So if you are going to talk about cutting spending, stand up and say what you would cut. No simple across the board cut either unless you are willing to explain how across the board cuts affect costs associated with per person charges, like veterans benefits.

As an example, there are more disabled veterans now than last year, how are you going to take care of more veterans with less money ?

The problem with both of Bush's tax cuts is they squandered the small opportunity that existed to actually reduce government spending by reducing the debt and reducing interest payments on it. And it was completely unwarranted and unnecessary, we don't have a big problem in this country with rich people not having enough money.
Well said.
 

CADsortaGUY

Lifer
Oct 19, 2001
25,162
1
76
www.ShawCAD.com
Originally posted by: Dead Parrot Sketch
There is a lot of talk about increased spending in this thread, but not much about why there is increased spending. The largest factor is just spending increases associated with population increases.

There are very few ways to actually dramatically cut spending, the best way would be to reduce the debt so that we don't have to pay 1/4-1/3 of the budget paying interest on the debt. The only other one is to cut military spending, I'm not in favor of it and I doubt if many people are.

So if you are going to talk about cutting spending, stand up and say what you would cut. No simple across the board cut either unless you are willing to explain how across the board cuts affect costs associated with per person charges, like veterans benefits.

As an example, there are more disabled veterans now than last year, how are you going to take care of more veterans with less money ?

The problem with both of Bush's tax cuts is they squandered the small opportunity that existed to actually reduce government spending by reducing the debt and reducing interest payments on it. And it was completely unwarranted and unnecessary, we don't have a big problem in this country with rich people not having enough money.

First off, Interest Expense on the Debt Outstanding fiscal 2002 was $332,536,958,599.42 with a budget of $2,010,975,000,000 which would be approx 16.6%. Which looks HUGE doesn't it? Ah, but that is only half of the story;) Actually the total Net interest was $170,951,000,000 due to gov't investments (trust funds, etc), so that puts it at ~8.5%. But there is an "on / off budget" mess you run into also so actual the budgeted number is about 250billion or about 12%. Does anyone care to enlighten me/us as to the why/how/what for's regarding "on/off budget"?

But regardless of how much we pay in interest, I will agree that we should also budget in some actual "debt" principle, which would help lower the interest;) I could go find a thread in which I posted how much and long it would take for us to "pay it off" if we would only budget principle payments too.
Secondly, as to across the board cuts in budget increases, I think one could reasonably work around instances like veterans benifits where there is an increase in the number of people affected. Not everything needs to have an increase in budget allowances because everything doesn't carry an increased burden year to year like the vet benifits may. It would take considerable time to weed out individual budget items that could be "cut" or atleast cut the spending increase.

If I had the time and patience:p I'd go dig into each category's spending and see if I could weed out the "bad" but alas, I am neither an accting guru, nor able to make time stop so I could spend the time neccesary to research it, so I will leave it up to the people seem to think they can do it best - the elected officials. But at the end of the day I'd still like to see them curb spending. Wishful thinking?;):p

Oh wait:D I found 1 billion dollars to cut:D Homeland Security ;)

I've said it once and I'll say it again. Until the day comes when the gov't show signs of wise spending, I will keep pushing to keep as much of MY money as possible.:D

CkG