The National Debt

[Nathan]

Hi. Since this is my first post, i'd like to take a few sentences to introduce myself. If you don't care, skip to the part past the marker.

Well... i'll have to admit i'm kindof a liberal... most forums i find though are pretty liberal also, and theres no challenge there. i feel like i have nothing to debate with those people. So i have come here, in search of honest, thought provoking debate with my fellow people.

I'll try to keep it simple to start, and not post anything too mind boggling. I'm sure you would welcome the opportunity to squeeze the liberal media out of me. so, here' goes.



on the topic of the national debt and the deficit.... How does bush justify spending more money than he has?

Yes, he has promised to cut the deficit in half over the next 5 years. The problem is that he doubled it last year, and the year before, and brought it into the red from a surplus to a deficit the year before that. So even halved, thats still a lot of debt to explain. And we all know bush's estimates arn't terribly accurate.

The national debt has just passed the 7 trillion dollar. i'm not a mathematitian... but won't that be about 9 trillion by the time he leaves office in 2008 , by his own estimates?

The serious question... as in 2000 we had a big surplus, but instead of using it to pay off our debts, we cut taxes, which seems to be the more popular thing to do. But, if that strategy keeps on, and nobody pays down the debt, will the United States ever get out of debt?

After all our extra money had been spent on a tax cut, 9/11 hit and so did all of its obligations, pushing us further into debt. However, bush decided that the U.S. citizen of today shouldn't carry any of that burden, borrowing more money, and cutting taxes for a second time.

One thing, doesn't borrowing money now mean we'll have to raise taxes later? possibly at a more critical time? Considering that the main working force in our economy, the baby boomers, is about to retire starting in 2010, maybe we shouldn't go so far into debt?

Does Bush ever plan to pay back all of this money he is borrowing?

I guess it won't be his call to make, because he'll be out of office by then.

[MO]

I'm a little bit confused about whether you are trying to talk about the deficit or the national debt. You seem to be using them interchangeably.

First of all, there was no "surplus," as they never materialized. Did you think it was in a "lock box?" They were projections based on the numbers at the height of the fake dot com boom and the world wide tech boom. By the time Clinton left office, we were already in recession so the projections were way off. This in not even disputed by economists. The definition of a recession is two or more consecutive quarters of negative growth. Bush inherited a stalled economy.

When the dot com bubble burst and profits began to slide, it exposed quite a bit of corporate fuzzy accounting in the large companies that have since been exposed. Much of the rosy outlook was money that only existed in false accounting schemes. Then came the worst terrorist attack on our nations history. The events of 9-11 had an enormous impact on the economy. Unfortunately, neither the liberals or the "compassionate" conservatives have the testicular fortitude to do what needs to be done--- cut social spending and entitlement programs.

Tax cuts get the economy moving and wind up creating more money for the national treasury. We are seeing that economic boom now, as we did with the Reagan and Kennedy tax cuts. Problem is keeping congress from doing what they did in the Reagan years- spending more even as more is coming in.

I do agree that congress needs to focus on fiscal restraint. I don't think I should be paying for Johnny Carson's prescriptions just because he is old.

[Nathan]

" I do agree that congress needs to focus on fiscal restraint. I don't think I should be paying for Johnny Carson's prescriptions just because he is old. "

Bush's medicare bill doesn't give too much money to Johnny Carson. It pays for prostitutes for the HMO industry.

( ok, maybe i'm exadurating a little. who is Johnny Carson? )

I suppose, in some roundabout way this is all must be clinton's fault.

Back to the main topic though: When are we going to pay off this debt?

[Nathan]

another thing... if reagan caused the clinton boom, then who caused the bush Sr. bust? carter?

[MO]

Hmmm....how old are you? Do you remember a time before Jay Leno?

The Medicare expansion gives freebies to people just because they're old. When I'm old, I don't want young families paying more in taxes to pay for my medicine, just so my sick old ass can sit in my paid off home. The last thing we need is more entitlements. That's what keeps growing and increasing the debt.

Interesting that you didn't bother to address any of my other points and only tried to put words in my mouth. H. Bush caused his own problems by caving in to the pressure from Democrats to raise taxes.

[Nathan]

How old? 19.

well... here's an economics lesson from a 19 year old. I'm kindof winging it btw, so don't get too touchy.


The U.S. Economy works like this:

Now that we have exceeded the point where the total population has enough ability to produce rescources and services to provide for a number exceeding the population, two things, among others, exist:

Overproduction, and Unemployment.

First, you have overproduction. Overproduction leads to increased competition, which leads to layoffs, which leads to unemployment.

Unemployment means that some segmant of your population is out of work, therefore has little money and can't afford to buy stuff. This decreases demand, which leads to more overproduction, which leads to more unemployment, which leads to more overproduction.

This is a vicious cycle which was most visible during the great depression. As you'll remember, durring the great depression, food was rotting in the fields, because farmers made no profit shipping it, while people starved in the cities, because they had no jobs to afford to buy the food.

The U.S. Economy today counteracts this problem by employing among its people an abhorrant ammount of luxury, thus keeping all of its citizens employed, and able to purchace their share of the production.

This is where entrepenuership comes in. People must discover new industries to fuel the burning demand for jobs. Without these jobs, the economy will crumble. And nice new inventions are a nice side effect.

Aint capitalism grand?




Eitherway, because of this effect, Welfare programs are necessary to supplement the wealth of the lower class so that they may afford to buy stuff that would go to waste anyway.

As long as there is not a large ammount of inflation in the economy ( inflation is what happens when there is too much demand rather than too little ) welfare programs do NOT hurt the economy.

They simply entitle unworking people, for example, the elderly, to the items that they got when they were working, most of which would go to waste anyway.

I'm way off topic arn't I?





Besides, wouldn't you rather have that person unemployed on welfare than telemarketing you, porn spamming your email or selling you cheap plastic junk that doesn't work?

Personally i think this is all a good argument for a strong space program... but thats beside the point....

the point is.... wait... i forget .... ok... medicare? this isn't a post about medicare.

umm...

whatever search through here for whatever gems you may find.

[MO]

umm...

whatever search through here for whatever gems you may find.

I'm trying!

I don't understand the defeatist attitude. "The sky is falling, the sky is falling!" For all the talk from the Dems about "losing jobs," they've neglected to explain why unemployment is reasonably low. There is always some unemployment as people are in flux and change jobs. Full employment is considered to be 4% unemployment. We are at just above 5%, where we were in the third year of the previous administration.

The problem isn't with a safety net. Most people, liberal or conservative, agree that we should have one. The problem is too many people using it as a hammock. Many liberals seem to be urging this nation to go the way of many European nations which is cradle to grave socialism. Social programs that expand every year are causing the bankruptcy of this nation. The "war on poverty" should have taught us all something. That there is no domestic problem that the federal government can't screw up further still. The large federal bureaucracies operating for the benefit of the "poor" such as HUD, spend roughly 75% of their budgets administering their programs. A private charity with those numbers would be run out of town. They're not using resources that would otherwise rot. They are stealing from tax paying Americans. That's a lot of people who don't need to be innovative, because they are fat, dumb and happy off the backs of the real innovators, under the guise of helping the "poor."

[Nathan]

I do admit unemployment isn't that high... yet..

wait for the stock market to crash, then we'll talk.

quote: "The problem isn't with a safety net. Most people, liberal or conservative, agree that we should have one. The problem is too many people using it as a hammock."

When you are 80 years old, you'll want a hammock too.

however it seems for the most part we agree.....

my point is, though, that we are running out of jobs. People search for them, who want to work, and can't find them. The problem isn't big yet, but we should be prepaired when it does get big.

Eitherway we are way off topic.




Back to the national debt:

quote: "I'm a little bit confused about whether you are trying to talk about the deficit or the national debt. You seem to be using them interchangeably. "

umm they are related. when there is a deficit, the government borrows money to make up the difference, which contributes to the national debt.


The situation with the deficit isn't really as bad as it seems. We would be fine if it wasn't for programs like Bush's medicare bill, which isn't a medicare bill, but is infact a sell out to the HMO and Pharmacutical industries, who donated massively to his campaign. Eitherway, this really isn't the right time to overhaul medicare. Expecially not the way bush wants to overhaul it.

And i disagree with the idea that massive tax cuts to rich individuals bought with borrowed money helps the economy.

You arn't infusing money into the economy, because the same ammount of people are purchasing government bonds as are receiving the tax cut. All you are doing is giving money to the richest of americans and selling out our children to higher taxes.

I do agree, as does Senator Kerry, that a Middle class tax cut is a good idea, but i wouldn't agree with it if it is based on borrowed money.

[MO]

The bigger the populous, the more jobs needed and created. People are our best resource.

I won't want government programs when I'm old. I'm planning for my own golden years. You know once upon a time, families felt a responsibility to take care of their elderly family members. Wasn't that long ago. They didn't hand over their children to the government at five years old, either. The Medicare expansion was a sellout to AARP and other liberals.

I believe your entire premise to be flawed and sounding dangerously like communism. Do you think that the money you earn belongs to the government, and they should decide how much of it you need and should therefore be allowed to keep? The tax cuts don't "give" money to anyone as it was their money. Everyone who pays taxes got a tax cut under Bush. The "rich" got a lower percent of the tax cut. It works out to more $ because they pay so much more of the taxes to begin with. Do you honestly believe that only money invested in government bonds helps the government? Every transaction is taxed and keeps people working and paying taxes. It makes no sense to claim that tax cuts create less tax revenue. All the evidence is against you.

[Ted]

The real reason the US is pressed for cash at the moment is the 40 years of liberal spending policies started in the 60s. By the time Bush got into office, virtually all of the massive surpluses from WWI and WWII were gone into nice little governmental programs of no ultimate use. Then Bush tries to do something constructive, and Lo and Behold, the liberals already spent the cash.