National Debt: Year 2000 Increase= $18 billion, 2008 Increase= $700 Billion

[host]

When you get your government stimulus rebate check, in a few months, consider the impact of the government rebating at least $150 billion in tax revenue, back to taxpayers and corporations.

This "stimulus package", is intended, somehow, to replace the effect on the economy, of the $800 billion in "MEW", mortgage equity withdrawal, take out of rising home equity, just in 2005 alone. That withdrawal amount, this year, will be down to $100 billion, if it is even that much.

Without the rebate, the increase in "national debt", or US treasury debt, in 2008, would be at least $550 billion, where it has been "stuck", annually, for the last four years, up from just $18 billion, in the friscal year ended 09/30/00:

Background:

http://www.whitehouse.gov/news/relea.../20010228.html
For Immediate Release
Office of the Press Secretary
February 27, 2001

Address of the President to the Joint Session of Congress


..t is reasonable, and it is responsible. It meets our obligations, and funds our growing needs. We increase spending next year for Social Security and Medicare, and other entitlement programs, by $81 billion. We've increased spending for discretionary programs by a very responsible 4 percent, above the rate of inflation. My plan pays down an unprecedented amount of our national debt. And then, when money is still left over, my plan returns it to the people who earned it in the first place. (Applause.)...

....Many of you have talked about the need to pay down our national debt. I listened, and I agree. (Applause.) We owe it to our children and grandchildren to act now, and I hope you will join me to pay down $2 trillion in debt during the next 10 years. (Applause.) At the end of those 10 years, we will have paid down all the debt that is available to retire. (Applause.) <h3>That is more debt, repaid more quickly than has ever been repaid by any nation at any time in history.</h3> (Applause.)....

http://www.gop.com/News/NewsRead.asp...c-9532ba33cf3d
Wednesday, February 02, 2005
Fact Check: Democrat State Of The Union Response

The Democrat Duo Of Obstruction Responds To
State Of The Union Address With Misstatements And Inaccuracies

4. Reid Implied President Bush Is Not Concerned With National Debt. “[A]fter we worked so hard to eliminate the deficit, his policies have added trillions to the debt – in effect, a ‘birth tax’ of $36,000 on every child that is born.” (Sen. Reid and Rep. Pelosi, “Democratic Response To State Of The Union Address,” Press Release, 2/2/05)

*
But In State Of The Union, President Bush Promised To Cut Deficit In Half By 2009, Cut Wasteful Programs, And Keep Spending Increases Under Rate Of Inflation. “[N]ext week I will send you a budget that holds the growth of discretionary spending below inflation, makes tax relief permanent, and stays on track to cut the deficit in half by 2009. My budget substantially reduces or eliminates more than 150 government programs that are not getting results, or duplicate current efforts, or do not fulfill essential priorities. The principle here is clear: a taxpayer dollar must be spent wisely, or not at all.” (President George W. Bush, State Of The Union Address, As Prepared For Delivery, Washington, DC, 2/2/05)

Debt to the penny...you enter the time span:
http://www.treasurydirect.gov/NP/BPD...application=np

Historical Debt Outstanding – Annual:
http://www.treasurydirect.gov/govt/r...t/histdebt.htm

http://ap.google.com/article/ALeqM5h...F0_UAD8UCAGKO0
Deal Reached on Tax Rebates for Stimulus

5 hours ago

WASHINGTON (AP) — Democrats running Congress and the Bush administration reached a tentative deal Thursday on $300-$1,200 tax rebates and business tax cuts to jolt the slumping economy.

THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP's earlier story is below.

WASHINGTON (AP) — House Democratic and Republican leaders are looking for imminent agreement with the White House on an emergency package to jolt the economy out of its slump after negotiators on all sides made significant concessions at a late-night bargaining session.

"They're hoping to near a conclusion very soon," presidential spokeswoman Dana Perino said Thursday.

House Speaker Nancy Pelosi agreed to drop increases in food stamp and unemployment benefits during the Wednesday meeting in exchange for gaining rebates of at least $300 for almost everyone earning a paycheck, including low-income earners who make too little to pay income taxes.

Families with children would receive an additional $300 per child, subject to an overall cap of perhaps $1,200, according to a senior House aide who outlined the deal on condition of anonymity in advance of formal adoption of the whole package. Rebates would go to people earning below a certain income cap, likely individuals earning $75,000 or less and couples with incomes of $150,000 or less.

Pelosi, D-Calif., and House Minority Leader John Boehner, R-Ohio, had yet to reach agreement on a package of tax breaks for businesses after estimates showed a tentative business tax agreement could exceed $70 billion, far more than had been expected, the aide and a Democratic lobbyist said.

Pelosi and Boehner appeared optimistic as they left their third extended negotiating session of the day with Treasury Secretary Henry Paulson. "We'll have more to say tomorrow," Boehner said. "We're hopeful...."

Do we need the stimulus, more than we need to control the debt increase. Doesn't the bulk of the rebate go to those in least need of it, and least likely to spend it all, to stimulate economiuc activity?

Is this period, since the end of 2000, the worst period of out of control spending in US history? The debt was $5.65 trillion in Oct., 2000, and it is $9.18 trillion, as of today.

Enjoy your rebate check, it comes on the backs of your grandchildren!

[aceventura3]

Looks like we agree on something, I bet it is for different reasons but we have come to the same conclusion.

Even the economist Keynes (his name is almost synonymous with the use of government spending to stimulate the economy) came to the conclusion that government spending does not have a lasting impact on economic stimulus.

Increased production of real goods and services is the only thing that will generate real economic growth. The folks in Washington can play shell games all day long with moving money around, but unless people produce more the shifting of money was a waste in terms of economic stimulus.

So you are correct. Either we pay for this today with increased taxes, nullifying the package or we pay (or our children) in the future with increased taxes - hurting future economic growth.

If the government really wants to stimulate the economy, we need tax cuts targeted to the production of goods and services. Oops, thats some supply side stuff again. I know how much you dislike that concept. But when a family takes their $1,200.00 to pay-off a credit card debt, that won't create one new job. On the other hand if you give a tax break to a small business trying to grow you may get an entity that hires people to produce valued goods and services. So you have real people making real income from producing real goods and services that other real people want to consume.

The basis is investing in the infrastructure for increasing production leads to lasting economic growth.

[ASU2003]

I agree that this won't do anything to solve our economic mess that Bush and his theories created. Everything was going great under Clinton, our national debt should have been at record low levels right now. Especially under a republican (whose party is supposed to be for fiscal restraint and smaller government...)

This $600 that is coming from nowhere, and will go to buy Chinese goods at Wal-Mart will do nothing. Well, actually I already spent mine on a Projector from Japan. So, different country, same effect.

It doesn't do anything to fix the economic mess that has happened in the past 7 years. Too many people with 'free' money in their homes, spending wildly on things they couldn't afford at the time, demand for homes going up because investors could get them cheap and with little money, companies kept trying to make more profits, and if one supplier raised prices, then the next company has to raise prices. And the whole problem of materials/resources (like oil) being auctioned off as commondities in the market. I wonder how much oil/gold/copper/ whatever is just sitting in someones portfolio, causing demand to skyrocket, yet actual use is constant.

Oh yeah, and this will do nothing to help the value of the dollar against foreign currencies.

But who cares, it's not like we will be able to tax the retirees in 20 years when the country is broke...

[rlbond86]

What do you expect from an administration that believes in "supply-side economics." Instead of listening to real economists, they decide that they know better, and that they should give money to the super rich.

There is a video of Peter Peterson on Charlie Rose about how this type of thinking is a problem for this country: http://youtube.com/watch?v=kCpzs45vrRsThe point is, that $600 rebate will not be spent by many people, anyone who has a lot of money will just save it... and the poor people who would spend it won't be getting a rebate. But what do you expect from an administration that asserts how factual information is inferior to the hunch.

[aceventura3]

Originally Posted by ASU2003

... Everything was going great under Clinton...

Perhaps not everything, what about that Dot-com bubble bursting thingy?

Do you blame Clinton for that, like you would blame the sub-prime mortgage melt down on Bush?

Keep in mind that during the rise of the Dot-com bubble, government was the benefactor of abnormal tax receipts from speculators and day traders profiting from stocks with no economic value.

[Cynthetiq]

Originally Posted by rlbond86

The point is, that $600 rebate will not be spent by many people, anyone who has a lot of money will just save it... and the poor people who would spend it won't be getting a rebate. But what do you expect from an administration that asserts how factual information is inferior to the hunch.

That's right, I'll just put mine right into my bank account.

[Ustwo]

Originally Posted by rlbond86

What do you expect from an administration that believes in "supply-side economics." Instead of listening to real economists, they decide that they know better, and that they should give money to the super rich.

There is a video of Peter Peterson on Charlie Rose about how this type of thinking is a problem for this country: http://youtube.com/watch?v=kCpzs45vrRs
The point is, that $600 rebate will not be spent by many people, anyone who has a lot of money will just save it... and the poor people who would spend it won't be getting a rebate. But what do you expect from an administration that asserts how factual information is inferior to the hunch.

How do people who don't pay that much in federal taxes get a 'rebate' that would be called a 'gift'.

Its an economic stimulus package, and I guess you don't know anyone who makes 50k or more if you think they will all put that into savings.

I personally think it won't do much, but it was MY GOD DAMN money in the first place they TOOK from me. So just who should be getting it?

Using my very scientific method (this was sarcasam, some people have very bad sarcasm detectors) I think any recession will be minor at this point. People are still spending a money, lots of it, I was driving all over, put 100 miles on my car yesterday looking for supplies for my new office. I had to fight for parking spots everywhere and the stores were packed. It looked more like the week before xmas than a nothing weekend in January. I noted the same behavior the last two recessions. So you can call this a hunch, it is, but so far hunches seem to have as good a chance of being true as expert opinion on such matters.

Being that this 'rich' man spent six hundred thousand dollars he didn't have this year and created several jobs I could use a bit of my labor they took from me last labor. It would be most welcome, as I'm taking a pay cut along with this risk.

I'm now working this Sunday on this project, so I bid you good day.

Edit: Too many typos to bother fixing it, had to stop writing it several times taking care of the kids and it shows, but you get the gist.

[ASU2003]

Originally Posted by aceventura3

Perhaps not everything, what about that Dot-com bubble bursting thingy?

Do you blame Clinton for that, like you would blame the sub-prime mortgage melt down on Bush?

Keep in mind that during the rise of the Dot-com bubble, government was the benefactor of abnormal tax receipts from speculators and day traders profiting from stocks with no economic value.

Well, maybe not everything. But I was talking about the direction the national debt was headed.

I would blame investors, hedge fund/401k managers and speculators for a lot of the problems in the economy. They unnaturally inflate things by reducing the supply that they won't use (or had no part in producing). I'm not saying that they don't have a role in an economy and making it run. But it seems like they are the ones that pump things up to as high as they can go, and then get out at the top, while everyone else gets burnned.

[dc_dux]

Originally Posted by aceventura3

Perhaps not everything, what about that Dot-com bubble bursting thingy?

Do you blame Clinton for that, like you would blame the sub-prime mortgage melt down on Bush?

Keep in mind that during the rise of the Dot-com bubble, government was the benefactor of abnormal tax receipts from speculators and day traders profiting from stocks with no economic value.

Lets compare the Clinton/Bush years:

REAL GDP GROWTH
4.09% during Clinton's 8 Years
2.65% over Bush's first 7 years

NATIONAL DEBT
$5.7 trillion at end of Clinton term
$9.2 trillion at the start of Bush's last year

BUDGET DEFICIT/SURPLUS
$431 billion surplus in Clinton's last 3 budget years
$734 billion deficit over Bush's last 3 budget years

NEW PRIVATE SECTOR JOBS CREATED
1.76 million jobs/year during Clinton 8 years
369,000 jobs/year over Bush 7 years

MEDIAN HOUSEHOLD INCOME & CHANGE IN MEDIAN INCOME
$49,163 at end of Clinton's term, with a $6,000 Increase in 8 Years
$48,023 at start of Bush's last year, with $1,100 decrease in 6 Years

U.S. TRADE DEFICIT
$380 billion at end of Clinton's term
$759 billion at start of Bush's last year

STRENGTH OF U.S. DOLLAR
1.07 Euros per Dollar at end of Clinton's term
0.68 Euros Per Dollar at start of Bush's last year

Are we better off as a nation than we were 8 years ago?

[aceventura3]

DC,

There are a couple of fundamental issue to be addressed regarding your comparison of the Bush/Clinton years.

To what degree does a President influence the economy?

How do you factor in the timing of political policies on the economy?

I don't dispute the fact that the economy is worse today than it was 8 years ago, even realizing some segments of the economy are improved and the fact that there are always trade offs, i.e. GDP growth during war v. low inflation, or household income v. household net worth.

If you believe that on day one of a Presidency the trends and issues affecting our economy are the result of the new President, I see your point. Otherwise you would have to have a very complex economic model to address your point with any degree of objectivity.

Just like I believe that the Nixon administration had an impact on the economic conditions during the Carter administration so would the Clinton administration have had an impact on economic conditions during the Bush administration. This does not even take into account the impact of laws and regulations resulting from acts of Congress or even the actions taken by other nations in our world economy.

[Cynthetiq]

Originally Posted by dc_dux

Lets compare the Clinton/Bush years:

REAL GDP GROWTH
4.09% during Clinton's 8 Years
2.65% over Bush's first 7 years

NATIONAL DEBT
$5.7 trillion at end of Clinton term
$9.2 trillion at the start of Bush's last year

BUDGET DEFICIT/SURPLUS
$431 billion surplus in Clinton's last 3 budget years
$734 billion deficit over Bush's last 3 budget years

NEW PRIVATE SECTOR JOBS CREATED
1.76 million jobs/year during Clinton 8 years
369,000 jobs/year over Bush 7 years

MEDIAN HOUSEHOLD INCOME & CHANGE IN MEDIAN INCOME
$49,163 at end of Clinton's term, with a $6,000 Increase in 8 Years
$48,023 at start of Bush's last year, with $1,100 decrease in 6 Years

U.S. TRADE DEFICIT
$380 billion at end of Clinton's term
$759 billion at start of Bush's last year

STRENGTH OF U.S. DOLLAR
1.07 Euros per Dollar at end of Clinton's term
0.68 Euros Per Dollar at start of Bush's last year

Are we better off as a nation than we were 8 years ago?

I don't know about as a nation, but I can say as an individual/married couple. We're much better off now than 8 years ago. I'm much better off than I was almost 2 decades ago. All my friends lost their money and savings in the dot com investment and decline, and now the housing overpurchasing. I made modest investments in the 90s and only bought as much house as I could comfortably afford in the 00s.

I also agree with the idea of how much does the president influence the economy, I have since '91 increased my net worth steadily with disipline and constant work and vigilance.

I also think that the previous president has much more influence on the current president economy. Thus, Reagan/Bush I affected Clinton more than Clinton did anything for himself. Clinton impacted Bush II.

[dc_dux]

I would agree with you both that there is a transitional affect.....at least for the first 2-3 years of the succeeding President's term.

But, you cannot ignore the policies of Clinton to cut the growth of spending in his last three years, and Bush, who proposed massive tax cuts on two separate occasions, accompanied by annual budgets with uncontrolled growth for seven years, a war and occupation funded outside the budget process but added to the national debt and passed on to future generations, an unwillingness to take any action on trade policy for seven years (particularly regarding China) contributing to the trade deficit, huge tax breaks to multi-national energy companies making record profits at the same time as rising energy prices......

[aceventura3]

DC,

I agree spending during the Bush administration has been historically high by most measures with the exception of deficit spending as a percentage of GDP. However, given the ratio of discretionary to non discretionary spending it seem to me no matter who sits in the Oval office the general spending trend is out of control. On the other side of the equation we have taxes collected. Taxes collected by the federal government has gone up even after the "Bush Tax cuts". No matter how you look at it, either taxes collected and spent by the government or money that stayed in the hands of citizens the money did not disappear and the money is still some where doing something affecting the economy. And that money can be taken away from citizens anytime the government wants it, I can argue that the tax cuts are not material to the long-term underlying trends in the deficit and debt. Spending is the key factor in my opinion. But, I assume we disagree on the impact of the tax cuts, however, do you think a Democratic President and a Democratic controlled Congress will bring spending under control?

I actually want Democrats to have control of the oval office and Congress, I am interested in knowing what they really want to do. I wonder if they will address Social Security and Medicare, and I wonder if they will fix those problems before nationalizing health care, which will be another massive non-discretionary budget item for future generations.

[dc_dux]

I would hope the Democrats would restore the pay-as-you-go (PAYGO) rules they have been campaigning on:

If you want more tax cuts you have to pay for them. If you want new mandatory spending you have to pay for it. If you do not pay for it, you have to muster a supermajority vote on the floor of the House/Senate for more tax cuts or new mandatory spending.

We'll see if that happens.

[Cynthetiq]

I'd have to say that sometimes there's more than just a transitional.

401(k) creations in the 80's under Reagan allowed for many investors to have the monies to move around during the 90's dot com.

Advertising changes under Reagan which allowed for infomercials created billions of dollars in sales over the past decades.

Airline deregulation under Carter allowed for many more airlines to compete in the market place creating a wealth of jobs in the marketplace in the 90's.

There are many more examples.

The paygo wasn't that part of the Promise to America with Mr. Gingrich spearheading it?

[dc_dux]

The Republican "Contract with America" called for a constitutional amendment requiring a balanced budget and/or line item veto. It was more show than anything, particularly since few in either party really want that...and Gingrich took it off the table as soon as he became Speaker.

The Democrats running for President and many of those running for Congress have adopted the PAYGO budgetary rules I cited above....thats not to say, they wont do the same as Gingrich.

[Cynthetiq]

my point was that Republicans have touted that "responsibilty" as well, but seem to have not followed through on it.

[dc_dux]

But the last Democratic president did follow through with cuts in the growth of spending in his last three budgets.

[Elphaba]

Originally Posted by aceventura3

Looks like we agree on something, I bet it is for different reasons but we have come to the same conclusion.

Even the economist Keynes (his name is almost synonymous with the use of government spending to stimulate the economy) came to the conclusion that government spending does not have a lasting impact on economic stimulus.

Increased production of real goods and services is the only thing that will generate real economic growth. The folks in Washington can play shell games all day long with moving money around, but unless people produce more the shifting of money was a waste in terms of economic stimulus.

So you are correct. Either we pay for this today with increased taxes, nullifying the package or we pay (or our children) in the future with increased taxes - hurting future economic growth.

If the government really wants to stimulate the economy, we need tax cuts targeted to the production of goods and services. Oops, thats some supply side stuff again. I know how much you dislike that concept. But when a family takes their $1,200.00 to pay-off a credit card debt, that won't create one new job. On the other hand if you give a tax break to a small business trying to grow you may get an entity that hires people to produce valued goods and services. So you have real people making real income from producing real goods and services that other real people want to consume.

The basis is investing in the infrastructure for increasing production leads to lasting economic growth.

Ace, I can't agree with you more in most of what you have posted here. Unfortunately, I don't think there is enough time to revitalize the economy through investment in rebuilding the infrastructure, before a serious recession sets in. It angers me that both political parties are willing to go along with nothing more than a temporary placebo. I believe that Bush would have been remembered as a great president if he had followed Eisenhower's infrastructure initiatives, rather that ignoring his warning that has led to our war economy.