What, no thread on health care yet?

Hmmm. Then Buffet's a complete dumbass. If you make $10K a year and spend $20K, borrowing the other $10K, you are in deep doo doo very quickly.

But what the hell do I know... I'm just a stupid liberservative (libertarian/conservative).

ignorant wrote:

Jensenman wrote: Toyman and I agree. Deficit spending will be the death of this nation, the grandest experiment in freedom ever.

Buffet worries not about the spending deficit.. It's the trade deficit that bothers him.. I think he's right. I'm not worried about our deficit.. I'm worried about our will and resolve to actually create value in this country. But.. What the hell do I know.. I'm only a stupid liberal...

Buffet isn't worried because according to him he pays less taxes than his secretary. He has no ordinary income and pays no income taxes. He's apparently not the guy that's going to be coughing up the money to pay the bill. He might be the smartest guy in the world, but there are a lot of other smart guys who disagree with him. When your debit gets high enough that the interest payment is so high you can't make any head way on paying down the debit, you are bankrupt. It's that simple. Raising taxes to cover it pulls money out of the economy. Economy goes down, tax revenue also goes down. Raise taxes, economy goes down. It's a vicious circle. I reasonably certain the people direction this circle jerk don't really have a clue or care past getting re-elected. Plain and simple, I don't trust them any farther than I can throw the Washington Monument. That includes all of them, not just the Democrats.

Jensenman wrote: Hmmm. Then Buffet's a complete dumbass. If you make $10K a year and spend $20K, borrowing the other $10K, you are in deep doo doo very quickly. But what the hell do I know... I'm just a stupid liberservative (libertarian/conservative).

The rules in macroecomonics don't follow the same rules as your household budget.

While it's more responsible to actually spend less and not run a deficit at all, it's actually better for the economy to carry a deficit than to raise taxes significantly to pay it off....

Bill

wcelliot wrote:

Jensenman wrote: Hmmm. Then Buffet's a complete dumbass. If you make $10K a year and spend $20K, borrowing the other $10K, you are in deep doo doo very quickly. But what the hell do I know... I'm just a stupid liberservative (libertarian/conservative).

The rules in macroecomonics don't follow the same rules as your household budget. While it's more responsible to actually spend less and not run a deficit at all, it's actually better for the economy to carry a deficit than to raise taxes significantly to pay it off.... Bill

ding! Bill is the Winnar...

Toyman01 wrote:

ignorant wrote:

Jensenman wrote: Toyman and I agree. Deficit spending will be the death of this nation, the grandest experiment in freedom ever.

Buffet worries not about the spending deficit.. It's the trade deficit that bothers him.. I think he's right. I'm not worried about our deficit.. I'm worried about our will and resolve to actually create value in this country. But.. What the hell do I know.. I'm only a stupid liberal...

Buffet isn't worried because according to him he pays less taxes than his secretary. He has no ordinary income and pays no income taxes.

Buffet is talking in national terms when he speaks about the deficit. He isn't concerned about himself, cause he has enough money to buy off whole countries..

Micro and macro econ are different things..

wcelliot wrote:

Jensenman wrote: Hmmm. Then Buffet's a complete dumbass. If you make $10K a year and spend $20K, borrowing the other $10K, you are in deep doo doo very quickly. But what the hell do I know... I'm just a stupid liberservative (libertarian/conservative).

The rules in macroecomonics don't follow the same rules as your household budget. While it's more responsible to actually spend less and not run a deficit at all, it's actually better for the economy to carry a deficit than to raise taxes significantly to pay it off.... Bill

That is correct....

...BUT it is an unfair understatement on our current economic picture.

Microeconomics BECOME macroeconomics when practiced for decades.

It is NOT better for the economy to carry an excessive deficit for year after year while raising taxes every year (masked as fees, unfunded mandates, etc.) with NO plan to reduce the deficit nor the debt, and it makes NO difference whether you call that microeconomics or macroeconomics. It's dumb.

Methinks a train wreck approacheth.

It is NOT better for the economy to carry an excessive deficit for year after year while raising taxes every year (masked as fees, unfunded mandates, etc.) with NO plan to reduce the deficit nor the debt

We're in full agreement here... the only worse scenerio than significantly raising taxes to pay of the debt is signifcantly raising taxes and NOT paying off the debt.

The spending is the #1 problem, taxes/regulations (which are just another form of tax) are the #2 problem. If you can get those under control, the debt will take care of itself... as we saw in the 1990's.

Bill

The '90's were an interesting time, and I kind of agree with you, but I don't know how to process the '90's.

There were interesting events in both national debt and the national budget during the '90's.

The budget had a surplus, but Social Security expenditures were moved offline (a bit of slight of hand). Meanwhile, the internet came into existence, which created one of the biggest economic booms in history. I tend to think that was a product of business and capitalism, not a particular administration, though I could be wrong. Maybe Al Gore invented it.

The same business boom that created the gains of the '90's created the bust of the 2000's (dot.com bust).

That's pretty normal. A new industry created new opportunities, then a lot of companies blew it. Same thing happened in the industrial revolution. In the early 1900's, there were hundreds of different auto manufacturers. Almost all are gone.

But I agree with your priorities. Deal with spending, then taxes/ regulation, then see what can be done about the debt.

We are currently spending looser than a trailer trash whore, taxing like a communist, regulating like a fascist, and sticking our fingers in our ears yelling, "I can't hear you, I can't hear you" when it comes time to talk about the debt. Ain't gonna work.

Most of the info available on national debt begins around 1942. That's an interesting moment, because it was the worst moment of our history. ANYTHING compared to that would be an improvement. It was coming out of the great depression, when we borrowed significantly more than 100% of our GNP to try to fix the economy.

It was also the moment when we became a country dependent on handouts, and our entire government was re-shaped to be something it never was before that.

Here is a graph that inclludes the history from 1792:

Note, prior to 1942 we had never had debt exceeding 40% of GDP. SINCE then, we have never been UNDER 40%.

Note also that the graph near the right end currently looks dangerously close to what it looked like heading INTO the Great Depression. It's just as steep, maybe worse. And it's max is potentially WAAY higher.

Debt is important to understand.

We are currently spending looser than a trailer trash whore, taxing like a communist, regulating like a fascist, and sticking our fingers in our ears yelling, "I can't hear you, I can't hear you" when it comes time to talk about the debt. Ain't gonna work.

I doubt truer words have even been written... extremely well said.

Micro/macro, it's all the same. Spending way more than you take in is a recipe for disaster. I don't care what Warren Buffet says. He's already shaken down the economy for more than enough $ to take care of him in perpetuity no matter what happens to the rest of us and that can't help but skew his vision.

No one wants taxes raised. But no one wants entitlements cut either. All is well as long as some other schmuck is paying the bills.

Unfortunately, when guys like this one are senators...

http://www.youtube.com/watch?v=zNZczIgVXjg&feature=player_embedded

SVreX wrote: It was also the moment when we became a country dependent on handouts, and our entire government was re-shaped to be something it never was before that.

it was also the period when the fed really began central monetary planning based on keynesian economics and the big move away from the gold standard allowing bureaucrats to decide how to inflate/deflate the currency artificially. sure makes it easy to pay for a war or irresponsible political promises when you just print more money to cover it.

Since we seem to have switched to debt, here are a couple of interesting articles:

http://www.cbsnews.com/8301-503544_162-4872310-503544.html

http://transcripts.cnn.com/TRANSCRIPTS/0903/20/sitroom.03.html

WilberM3 wrote:

SVreX wrote: It was also the moment when we became a country dependent on handouts, and our entire government was re-shaped to be something it never was before that.

it was also the period when the fed really began central monetary planning based on keynesian economics and the big move away from the gold standard allowing bureaucrats to decide how to inflate/deflate the currency artificially. sure makes it easy to pay for a war or irresponsible political promises when you just print more money to cover it.

Nixon was the Prez who actually signed the legislation ending the gold standard.

Re: switching to debt from health care. Since the bill being rammed through Congress will definitely increase the national debt, the two are intertwined to the oint where one becomes the other and vice versa. They cannot be separated.

WilberM3 wrote:

Jensenman wrote:

WilberM3 wrote:

SVreX wrote: It was also the moment when we became a country dependent on handouts, and our entire government was re-shaped to be something it never was before that.

it was also the period when the fed really began central monetary planning based on keynesian economics and the big move away from the gold standard allowing bureaucrats to decide how to inflate/deflate the currency artificially. sure makes it easy to pay for a war or irresponsible political promises when you just print more money to cover it.

Nixon was the Prez who actually signed the legislation ending the gold standard. Re: switching to debt from health care. Since the bill being rammed through Congress will definitely increase the national debt, the two are intertwined to the oint where one becomes the other and vice versa. They cannot be separated.

yea but thats why i said began then; you're right, nixon officially ended it.

In reply to SVreX:

it appears you are pissing on our feet and telling us its raining.

i can clearly see that the % of debt to GDP crosses back below 40% right around 1968-70, and stays below until the 80's, when there was another economic downturn.

i would also argue that the reduction of debt to GDP after 1940 was due to increase in the GDP rather than any reduction in spending, and the spike again in the early 80's probably had a similar cause.

The economy boomed under Clinton I think mainly due to the dot.com boom. It drug almost all aspects of the economy with it. In doing so, the Clinton Admin also pushed for housing buy-ins among those that couldn't afford it like never before. When everything was booming, it wasn't that big of a problem.

When it all crashed like it was bound to do (many predicted it even then), then the housing market followed some time later. It started to unravel during the last year of so of Clinton, but it really didn't hit until Bush. Couple that with 911 and it was a difficult time. Like it or not, personal tax cuts did have an effect as well as easing business taxes.

During difficult times you ease the purchasing burden among tax payers to stimulate the economy, not saddle them with unneeded debt and high taxes. You also don't start attacking entire industries and taking them over. All you do is instill fear and stunt growth. This really isn't rocket science,but it's amazing how few people grasp this simple concept.

Bush slipped up towards the end of his term and started leaning left with handouts and bailouts. None worked. He also shot himself in the foot with the Iraq war, and poor policies like "no child left behind", but that's another story.

Funny thing is, Bush was the most liberal republican president ever, but the most hated on the left. Why? My feeling is the press made him out to be that way and the left just believe it without checking. He should be more hated by the right than the left. His administration were choir boys compared to Obama's, and he did more to further clean energy and aid to Africa and other third world countries.

Adding a massive tax and penalizing everyone that lives in a country does not further development. Bush subsidized development of alternative fuels, not punished people for using them and getting money because of it. There is a huge difference between the philosophies. Cap and Tax is nothing but a punishment bill. Like the old saying goes, follow the money.

I'm not a Bush fan by any stretch of the imagination, but he did far less harm to the country than Obama is doing. Every time a liberal Democrat gets in office, it takes years to recover. Clinton lucked out because he had the dot.com boom to mask his failings, and because he had a republican congress to keep him in check after he tried to lean to far to the left.

Clinton definitely lucked out. But that's the saying: it's better to be lucky than skillful. 'Course the libbies eat it up, say he was teh best EVAR regardless of how he lit the fuse which turned into the subprime mortgage explosion.

Jensenman wrote: Clinton definitely lucked out. But that's the saying: it's better to be lucky than skillful. 'Course the libbies eat it up, say he was teh best EVAR regardless of how he lit the fuse which turned into the subprime mortgage explosion.

Truth, between Clinton GWB and Obama we have possibly the three biggest presidential failures of modern times. Add Carter, maybe? The economy didn't line up nicely with any of their administrations, and yet the successes during that time get trumpeted and the failures get excused (or the opposite, depending on the political affiliation of the media).

Strizzo wrote: In reply to SVreX: it appears you are pissing on our feet and telling us its raining. i can clearly see that the % of debt to GDP crosses back below 40% right around 1968-70, and stays below until the 80's, when there was another economic downturn. i would also argue that the reduction of debt to GDP after 1940 was due to increase in the GDP rather than any reduction in spending, and the spike again in the early 80's probably had a similar cause.

I was expecting someone to piss on that one.

Fine. You are right. I should have said NEAR 40%.

Geez.

The point is there is any INCREDIBLY CLEAR delineation right in the middle of the graph. Split hairs if you want to.

Of course there was an increase in spending after 1940 and the early 80's. They were the 2 biggest downturns in GDP in our history. Doesn't change the ratio one bit. Its a percentage.

If you spend more than you make, the graph goes up. If you make less than you spend, the graph goes up. Glass half empty, glass half full. Doesn't make any difference whatsoever- the principle is don't spend more than you make. If you have to, make sure it is for a reason, and get back to basics as quick as you can.

We aren't even trying to get things in balance, and have not been for a long time. That's not a hard concept.

It was 139 years before the ratio ever crossed 22%.

It has never again been below 33%.

Out of the 218 recorded years, there are only 9 years in US history that the ratio exceeded 80%. 2 of them were 2009 and 2010.

There were only 7 years (3%) that exceeded 90%. 1 is (budgeted to be) 2010.

ALL of the other bad years were after the Great Depression.

GWB (who was terrible) left 69%. 2009 was 83.29%. 2010 is (budgeted to be) 94.27%. Health care costs don't begin until 2014.

Don't kid yourself. It's a problem.

No it's not. Remember, Warren Buffet says it's OK.

Jensenman wrote: No it's not. Remember, Warren Buffet says it's OK.

He's not perfect, but the dude has been pretty dead on for many many years. He's rich for a reason..

tuna55 wrote:

Jensenman wrote: Clinton definitely lucked out. But that's the saying: it's better to be lucky than skillful. 'Course the libbies eat it up, say he was teh best EVAR regardless of how he lit the fuse which turned into the subprime mortgage explosion.

Truth, between Clinton GWB and Obama we have possibly the three biggest presidential failures of modern times. Add Carter, maybe? The economy didn't line up nicely with any of their administrations, and yet the successes during that time get trumpeted and the failures get excused (or the opposite, depending on the political affiliation of the media).

hey dont forget superspendy reagan.. Per svrex's graph he kicked off this 3 decade long spending binge.