Baraka_Guru

I don't see your analogy working properly. I think instead it would be like shifting the bell curve after an important mid-term test to prevent most of the students from dropping out and having the class get cancelled. Of course, the prof would then need to find ways to handle the class more fairly to prevent similar problems down the road, because she does, after all, have accountability to her department and institution. And let's say this class is an important prerequisite for future classes at higher levels too. There are rather dire consequences of having this class fail, and so something is done to prevent it from happening. Something went wrong---it could have been from both inside and outside forces---and so something was done to prevent widespread failure, and for the benefit of those not just in the class, but outside as well.

Well, we could call them the Obama tax cuts, but it would be disingenuous of him to do so. Because down the road he could say that, hey, even as a Democrat look at these nice hefty tax cuts I put together for you guys. Well, all good things come to an end, but at least we can say I'm reasonable. We call them the Bush tax cuts because that's who put them together, not Obama.

Neither saving nor spending have any inherent value on their own. What matters is the balance between the two and their effects on the wider economy. Governments tend to want to influence this balance based on the current economic situation and the current business cycle. A particularly poor time to encourage saving is during a trough and subsequent recovery.

There are three reasons for this: first, you don't even have to encourage saving during a recession/trough/recovery; people are already in that mode because of fear. Second, without encouraging spending over saving, you get a logjam. You get companies who aren't performing well enough to build back their business to previous levels before the recession. Third, there are many companies who aren't even seeking more investments or loans because they don't even need them. Look at how many companies are sitting on a shitload of cash right now. They're doing this because they're uncertain about future performance, i.e., sales/revenues.

So, no, saving isn't a bad thing, but we don't need to encourage saving right now; we need to encourage spending.

You're thinking about one-trick solutions? No single thing will be enough, which is why you have to look at multiple things. I'm not suggesting the Bush tax cuts are going to be enough to solve the budget problems, but it's one piece of the puzzle, and it's measured with a significant number of zeros.

It's nothing more than an acknowledgement that cuts to health care are essentially cuts to the economy. The government as customer shouldn't be overlooked in a fragile economic recovery. Are cuts to Medicare not essentially the government reducing its spending as a customer of health care? Do you think it's a good thing for customers to cut their spending during a recovery?

While there are many Americans who aren't affected by Medicare, those who use it will likely shift their spending to make up for any cuts. It's basically the government forcing Americans to spend less on non-health-care-related products and services and more on health care. If your business isn't a part of the health care industry, this means you are potentially going to lose out on revenue. It's a shift in the economy and it will potentially result in a reduction of spending overall, and so it will mean taking money out of the economy, which is a bad move during a recovery.

This is why I compared it to the Bush tax cuts. You can say that the cuts are good because the value of the cuts will be invested into the economy, but my point is that it won't necessarily be as efficient as using the money for something else. For all we know, the money from these cuts will go overseas or to Canada, into stronger economies.

I understand that spending cuts are necessary, but if you want to reduce the deficit, you should also be looking at how to boost tax receipts. It's about balance. The U.S. has competitive tax rates regardless of whether the tax cuts expire or not. The decisions made over the next few years should be about maintaining stability among all Americans with regard to jobs, health care, etc., while at the same time encouraging spending. Without a front-loaded spending increase, the economy cannot hope to recover at a high enough rate that would spur companies to finally seek more investments and loans.

If they're sitting on so much cash, give them a reason to spend it. Encourage Americans to do business with them. This has little to do with whether the tax cuts expire.

I don't know. These are political questions for which I have few ideas. I think Obama capitulated far too much to the Republicans. If the Democrats had maintained control of both the senate and the house, I think it would have had a different outcome with regard to many of these issues. Obamacare was a compromise, but it's something that can be retooled over time. Canada's health care system didn't start out as a nationwide system paid for by both the feds and the provinces. It took years to get it to what it is today. If Obama is guilty of anything, it's trying to cater to indifferent or obstructive Republicans when it comes to health care.

As above, this is about Obama capitulating to the Republicans. I hope it was a political move that will somehow pay off down the road. I hope he borrows from Clinton's playbook at starts appropriating Republican wants and making them Democrat wants. He needs to pull the government back towards the centre.

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Knowing that death is certain and that the time of death is uncertain, what's the most important thing?
—Bhikkhuni Pema Chödrön

Humankind cannot bear very much reality.
—From "Burnt Norton," Four Quartets (1936), T. S. Eliot