The Debt Ceiling

ace--i am not interested in your ridiculous less-than-short-term view of the tea party. the tea party is the main reason given for the downgrade. people like you **are** the dysfunctionality of the present political context. you perform it. your ridiculous worldview---which is really nothing other than self-regard transposed into some pseudo-systemic viewpoint---is in itself a demonstration of that dysfunction. your viewpoint is the direct result of the ideological uniformity that the united states has imposed upon itself---a uniformity that provides no way to even think coherently about, must less address, system crisis caused by the viewpoint that you espouse.

you seem to imagine that your boys in the tea party, by playing the part of sociopaths, have managed some victory. what those actions are in fact doing is (1) exposing the obvious institutional problems of the international financial system and (2) exposing the political problems of continued american domination at a period when the americans cannot get their shit together politically.

in a rational world, there's no victory here at all---only unnecessary damage.
you should look up pyhrric victory.

 

I support either a true single payer system or a true private free market system for people other than the elderly/children/disabled (I am not suggesting a system without rules and regulation when I say free market system).
--- merged: Aug 8, 2011 9:42 PM ---

I know I can be hard to follow sometimes, but it is all there for people who do follow my positions. On this point, I acknowledge that there are different systems that can be successful other than an American style form of capitalism. Different economies can and are serving their people very well. I support what I know. I support what I am comfortable with. I have a cultural bias towards a socio-economic system and biases against others. I believe some consider it a "religion" or being a "slave" to an ideology. I acknowledge and have acknowledged that. I don't compare the Canadian economy to the US economy in terms of one being better or worse than the other, or performing better or worse than the other. They are simply different. What I want for the US is a return to a more traditional focus on individualism, personal growth and responsibility - that for example has never been China and will never be China but China has a socio-economic system serving their people to the satisfaction of it's people.
--- merged: Aug 8, 2011 9:52 PM ---

I will try to be specific and focus and where we may agree.

I think our tax code is unfair.
I think those who have the most real wealth in this country can unfairly avoid paying taxes.
I do not think, my ideal of a flat consumption type tax system, is a realistic possibility in my lifetime.

Most Tea Party people hold similar views. With that, I would assume it pretty easy to get 100% buy-in from Tea Party people on a government revenue "compromise" assuming the other-side actually wanted "compromise".

 

ya, the tea party is somehow responsible even though they make up a small minority of the congress and population. the people who run the deficits up are the ones responsible. why do people still not understand that it's a spending problem not a tax problem? the math to end this with taxation just isn't there. i know the left loves their taxes but it wont solve this problem.

they wont even agree to cap spending at the insane amount that it's at now, let alone cutting. this is getting absurd and shows the left is trying to point blame at the tea party instead of this failed presidency and congress.

bring spending to controllable levels then we can bring tax talk back on the table. until then it's just empty words.

this credit rating drop could just of easily come under bush administration or the next president after Obama. however, it's inevitable when governments engage in blatant printing of currency. there is no other outcome besides defaulting, lowered credit ratings, and severe inflation.

the tea party has been around for what 3 years? and now a very few tea party members of congress are in power. there's plenty of blame to go around but blaming it on the tea party is just foolish.

ps: someone delete my previous post please

 

I think their role was to shift the nations thinking back to the problem of continual deficit spending and the inevitable finanancial problems it will cause.

we are talking about a group who has been in congress less that a year and isn't even close to the majority. exactly what do you think they are responsible for? defaults, hyperinflation, and credit problems are the fruits of this type of spending. was this debate a catalyst for the credit rating dropping? maybe, however these things are just a matter of when not if in our current system.

 

As for the S&P downgrade: once again, treating it as justified or a concrete example that the US needs to cut spending right now is just a joke. Just the CRAs repaying the republicans for letting them off the hook. If there was any credibility to what the CRA said, bond rates wouldn't have dropped this morning.

As for Ace: I am not arguing about different "systems" or anything of the sort. I am saying that your view that the current recession is caused by "anti business climate" or any other supply side excuse is simply, absolutely, 100% false. If it was a matter of investors not investing out of fear of taxes, or regulation, or any of that, we wouldn't have plunging inflation. We wouldn't have plunging interest rates. There is no two ways about it. If it was investors staying away because they don't trust what the government wants to do, production would fall and prices would go up.

 

Maybe. Aren't taxes' irregularity & people's unwillingness to pay them not part of the owner's problem with collecting their revenues? There will probably become more wars over what only resemble issues, without any hope of taking anyone alive. Taxing me to death has the same effect as charging that it's too interesting. Where's our realistic focus? We ain't got one.

 

Is that "maybe" directed at me?

Because no, there is no "maybe" about it. If it was lack of confidence in the government going forward, if it was an "anti business climate" that was behind this recession, you'd have inflation and increasing interest rates (and we are talking about interest rates at which people are willing to lend to the government).

 

And all government tax policy is bad tax policy. That's the tea party position, isn't it, an infinite loop of: "We're taxed too much!"

Right, but taxes don't affect your profit margin. Your profits may be taxed as part of your individual income, but you must have made those profits first for them to be taxed. So the individual tax rate doesn't affect your profit margins, just what you get to keep.

I'm not going to argue with you about the difference between a fact and an opinion here.

And I could give examples of people clearly acting against their best interests even when it was obvious they were doing so. There are entire industries whose existence proves that large amounts of people frequently don't care about acting in their own best interests. Really, the idea of the rational economic actor only works as a really shitty approximation of reality.

Let's stick to what we were chatting about.

Way to miss the point. The point was that large companies, and the wealthy folks who run them and make money from them, don't pass their prosperity on to the general public, and it's ridiculous to expect them to. Income disparity has gone up for the last 30 years while real wages have gone down.

"may" being the key term here. Raising taxes or prices also may lead to greater revenues and profits too. The economy is too complex to rely on bromides about the cure-all that is tax reduction.

 

The Tea Party people actually supported and help pass the Ryan budget. Nothing specific in return from the WH or the Senate that could be voted on.
The Tea Party people actually supported and help pass Cut/Cap/Balance. Nothing specific in return from the WH or the Senate.
Obama not the Tea Party people lied about default after 8/2/11.
Obama not the Tea Party presented the scenario as "Armageddon".
Obama has yet to present a budget with any support in Congress.
Congress, dating back before the 2010 elections has failed to pass a budget.
Obama, put together a bi-partisan committee to address the deficit, and ignored the recommendations.
Obama failed to use his power as President to address the debt limit issue in a timely manner.
Democrats had a super-majority before anyone in the Tea Party officially got elected to office, and they failed to act on their agenda.
Obama, signed legislation extending the Bush tax cuts.
Obama signed the "compromise" debt ceiling deal, that was supposed to help avoid the S&P downgrade.

I am getting bored with typing this, do I need to continue?
--- merged: Aug 9, 2011 9:58 PM ---

I could live with perhaps 10% false, but not 100%. And, to be clear - recessions happen, there is a normal business cycle. that cycle has very little to do with the folks in Washington. the folks in Washington in this recession have made things worse and they have prolonged it.

Come now, you are not being fair. There are different factions in our economy that play different roles and do different things. And as us econo-nerds say - the magic happens on the margins. Inflation plunges for one reason. Investors invest for their reasons. What drives economic growth are what I call real wealth creators. The largest group in this category are small businesses. When things are against small business, the engine of economic growth slows. Again that does not mean small business is everything to all facets of the economy. But we play our role. Large mature corporations generally do not fuel economic growth. Government generally does not fuel economic growth. The super-rich generally do not fuel economic growth. It is usually the guy with a dream, willing to take a risk, who may start with himself as one employee and grows a business that employs scores of people, hundreds, thousands. We should do everything we can to encourage these people, not treat them like dirt!

 

The dishonesty in this discussion and, more importantly, among the Tea Partymembers and other Republicans in COngress is the continued insistence to take tax increases off the table.

The S&P statement made that clear and most economist across the political spectrum agree. Anything less than serious discussion of the necessity of added revenue is nothing less than an ongoing roadblock to long term debt reduction that falls entirely on the hands of the Republicans.

The American people overwhelmingly want to see a more "shared sacrifice" and Obama and the Democrats in Congress have put most popular programs (with the exception of Medicare, which must be included) on the cutting block, with a significant impact on, and w/o the support of, core constituencies, and yet the Republicans, particularly the Tea Part members, will not budge on tax increases.

 

I think many would put it this way: taxes are a necessary evil.

Just what I keep? Yes, I want to keep more of what I work for.

If I was not clear, it is my fault. Normally I am specific and say people do what they perceive to be in their best interest. I agree that their perception can be wrong.

Income disparity is due to the "ownership" disparity. People with an "ownership" mentality accumulate real wealth over time. We live in a country where every person has an opportunity to accumulate wealth, if they don't it is because it is by choice or they simply don't know.

Detailed modeling can be done. If Obama and his economic team actually made a fact based case for raising taxes, I have not seen it.

 

I repeat. I do not believe the people in Washington are serious about getting spending under control. I do not trust them. I will not "compromise" on the tax question until I am satisfied that the spending side is being addressed. I think most Tea Party people see this as I do.

That as a given, the other side (you) can ignore my concerns or we can address them. I have made it clear that I can and would support tax reform, including the elimination of tax loop-holes. O.k., there is your opening, what is your response?
--- merged: Aug 9, 2011 10:45 PM ---

I was going through a list of reasons how I absolve the Tea Party of any responsibility in this disaster. Nothing more.

 

The CBO did its modeling earlier this year and reported that the Bush tax cuts were responsible for nearly a third (.$2+ billion) of the debt increase of $6+ billion between 2001-2011 or four times as much as the Recovery Act.

http://www.cbo.gov/ftpdocs/121xx/doc12187/ChangesBaselineProjections.pdf

The tax cuts are now due to expire at the end of 2012 and, as S&P noted, they based their new rating on the likelihood that the Republicans will block any attempt to end the "temporary" tax cuts at that time and revert back to the pre-Bush rates, which was hardly a deterrent to economic growth and job creation:

 

We know the Bush Tax cuts, extended by Obama, are going to expire unless there is new legislation to extend them that would have to be signed by Obama before becoming the law of the land. We also know that there are not enough Tea Party people in Congress to over-ride a veto. So, I have not read the S&P report on the down-grade and have no intent on reading it, but if what you say is true, the S&P down-grade has less credibility than I originally gave them credit for if they down-graded the US for something that is of no consequence.

When you actually think about it, what has Obama wanted that he is not going to get or has gotten? He is going to get a tax increase when the Bush tax cuts expire. He got the debt limit increase done. There has been not cuts in the major entitlement programs. He got a stimulus bill passed (that was supposed to create jobs last summer). He has people thinking the Tea Party is responsible for the S&P downgrade. The Wall St. fat cats have lost a ton of money (I actually know better, there are two sides to every trade). The price of oil, although it has dropped is still relatively high, to support alternative energy. Drilling for oil has arguably declined on our shores. He got Obama Care. What is missing? What am I missing?
--- merged: Aug 9, 2011 11:34 PM ---

That is not what I said. I don't think they are responsible for the down-grade.

I guess, I should also say, the down-grade is not a concern to me. I suppose no one here will re-visit what Obama said prior to the down-grade regarding the consequences of a down-grade. So, I will do it. He was wrong. If borrowing costs across the economy are correlated to the S&P rating it is only one of many factors, where most of those other factors are more important.

I am keeping count. On two occasions in the past two days, I offered an opportunity for a poster to present a case that could lead to compromise based on the concerns I have and of the Tea Party. I have clearly stated the primary concern creating an obstacle and and what I could support on the other side of that obstacle. So far, no response. People well versed in the art of compromise should easily be able to get things moving and reach a solution, if a solution is what they wanted.

 

wait are you really saying 6 billion from 2001-2011 was caused by the bush tax cuts? am i reading this correctly? if that's true it just illustrates the point that taxing our weight out of this crisis is totally impossible. you are talking about 6 billion when we have a 14.5 TRILLION dollar deficit.

please someone tell me these numbers are wrong, even i didn't think the tax argument was this upside down. we budget in the trillions every year and you are talking about a couple billion? it's a joke
--- merged: Aug 9, 2011 11:41 PM ---

it usually happens once or twice a year but i agree with michael moore, arrest the s and p criminals.