House passes debt-limit increase: Tell us your thoughts

by NW Spotlight

Did House Republicans strike a hard bargain considering Democrats control the Senate and the White House, or did they cave in the Federal budget game of chicken?

The Hill is reporting that the US House has “approved bipartisan legislation to raise the $14.3 trillion debt ceiling and reduce long-term budget deficits, endorsing the agreement President Obama struck with Republican leaders.”

The vote was 269-161 in the Republican-controlled House.

174 Republicans voted YES
66 Republicans voted NO
95 Democrats voted YES
95 Democrats voted NO

Republican leaders in the House see the debt-limit bill as imperfect, but one that begins to change the culture of spending in Washington. The bill enables increasing the debt ceiling by $2.1 trillion through 2012, while reducing the deficit by $1 trillion over ten years.

Nancy Pelosi, who was not happy with the bill but voted for it, said that Democrats succeeded in preventing benefit cuts to the core safety-net programs of Medicare, Medicaid and Social Security.

House liberals feel the bill is a surrender to Republicans – one House liberal compared the bill to a “sugar-coated satan sandwich.”

House conservatives don’t like a provision that would result in sweeping defense cuts if the committee’s recommendations are not approved by the end of the year, and even though the package would call for a vote on a balanced-budget amendment, the debt ceiling could be increased even if the balanced-budget amendment is not approved.

The debt-ceiling compromise is expected to pass the Democrat-controlled Senate tomorrow at Noon.

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Posted by at 07:08 | Posted in Federal Budget | 102 Comments |Email This Post Email This Post |Print This Post Print This Post
  • Devin

    I think I agree with Rand Paul here: “The current deal to raise the debt ceiling doesn’t stop us from going over the fiscal cliff,” Paul charged. “At best, it slows us from going over it at 80 mph to going over it at 60 mph.”
     
    But at the same time, I think it is probably the best deal we are going to get while we only control the house, unless we are willing to live without increasing the debt limit at all, which wouldn’t be easy.
     
    I find it very ironic though how everyone on both the right and the left, including Krauthammer and the NYT’s says this is a victory for the tea party.  Everyone except the tea party none of which says it’s a great deal, and a few coming out opposing it.

    • David Appell

      This is probably right. $1 trillion over 10 yrs? That’s $100 B/yr. That’s peanuts these days, when deficits are over $1 T/yr. Doesn’t this show that (1) you can’t make meaningful cuts to the deficit without more revenue, (2) without cutting defense, and (3) without more revenue?

      • Devin

        No, its just “you can’t make meaningful cuts to the deficit without more revenue”, while obama is in office.  Fix that second half and everything will work itself out.

  • David Appell

    I hope those in favor of this austerity plan will tell us how it is supposed to bring the economy out the ditch. What should we expect a year from now, or three? For extra credit, compare and contrast to Britain’s austerity plan and their continuing lack of economic growth, and the US 1937 recession.

    • Rupert in Springfield

      >I hope those in favor of this austerity plan will tell us how it is supposed to bring the economy out the ditch.

      It’s not supposed to, what it is supposed to do is keep us going further into the ditch.

      >What should we expect a year from now, or three?

      Hopefully deficits a little smaller than what Obama is racking up.

      >For extra credit, compare and contrast to Britain’s austerity plan

      Why bother? Most of Europe is cutting back and generally you guys laud Europe.

      • Founding Fathers

         “It’s not supposed to, what it is supposed to do is keep us going further into the ditch.”

        Thank you for your honesty Rupert. The G.O.P. wants the country to fail, and at least you have the guts to admit it.

        • Devin

          How do you say that “keeping us going further into the ditch” is “wanting the country to fail”?  He is saying he wants the country to succeed! That he wants us to stop going further into debt that our children and our grandchildren will be paying off.  That we may be in a better situation in the future.

  • Rupert in Springfield

    The big lesson here is we have done nothing, zero, to advance our way out of this mess. To the contrary, we have in all likelihood set our economy back.

    The single thing that will get us out of this mess is economic growth. You aren’t going to get there by raising taxes, there isn’t enough money if you confiscated it all. You aren’t going to get there by zeroing out defense.

    That leaves two choices – One, cut entitlement spending, probably the right choice morally. Simple means testing would right our fiscal ship in short order. Two, grow the economy. On the latter we have shot ourselves in the foot with a Howitzer. A business climate in this country that ranges from uncertain to outright hostile fosters nothing but interest in shipping jobs overseas. With the massive drag on the economy called Obama Care coming online in just short order, employee costs are uncertain to say they least.

    This recent gambit in Washington, with Obama only paying attention to the debt ceiling debate in its final five or six weeks was a nightmare. If you can’t lead, get out of the way. Don’t step in late in the game and start yammering about veto this and veto that unless you get some dopey tax increase. This whole event did absolutely nothing but introduce a greater sense of market uncertainty. Can we get our act together as a country?

    What we saw was endless attempts to con us. The effort to relabel tax increase as “ending loopholes” or “additional revenue” is especially damaging. Nobody is falling for that anymore, and it makes the person attempting such a ploy look like a fool. When the president two time in a row went on about ending tax breaks for corporate jets – all that accomplished was to make him look silly. Few business owners watched that and quaked in their boots that their corporate jet would be taxed differently. All looked at that and saw a man, Obama, who had not the slightest clue of what he was talking about. In short they saw future uncertainty in the form of revelatory incompetence.

    From a business perspective that’s disaster. That’s exactly what what was accomplished over the past two weeks or so. What business saw was the same failed effort by government – if you give me more money, I will spend less of it. Who believes that? No one.

    • David Appell

      The single thing that will get us out of this mess is economic growth. You aren’t going to get there by raising taxes
      Says who? Like all spending, government spending is well-known to be a short-term stimulus. And monetary policy has been exhausted. 

      No one is talking “confiscating it all.” They’re talking about raising tax rates back to what they were before Bush tanked the economy, and using that to increase demand at a time when it isn’t coming from anywhere else. That’s what will lead to economic growth. I don’t even see a theory about how austerity is supposed to do that, except by increasing ‘confidence’ — and that already hasn’t happened.

      • Devin

        Government spending is always bad for the economy, but a slightly worse economy is the price people are willing to pay for the services that government provides that cannot be provided in the private sector. Having one government job digging a hole and a second one filling it back in doesn’t help the economy. The money those government employees are paid comes from taxing (and harming the economy by at least the price of their wage) or inflating the dollar (a tax on everyone holding a dollar), or borrowing. Even Keynsian don’t believe that increasing taxes helps the economy. Having the government borrow more money in the short term “crowds out” borrowing in the private sector, and in the long term forces our children and grandchildren with paying back our debts, neither of which is a good thing. Every dollar that purchases government treasury bonds could instead be used to buy an American small business bonds or stock and increase the number of jobs and the wages of those jobs.
         
        Most government services should all be handled at the local government closest to the people they are providing the serve to, where they can decide how much, which kinds, and what to teach. The things the federal government should do are expressly enumerated in the constitution, the things that no individual state can do by itself, such as provide for the national defense. We as a society needs to determine how much damage to our national economy we are willing to have for how strong of a national defense we will have, along with how much for all the other national expenses. But we should pay those costs now, unless there are exceptionally unusual/temporary disasters or wars rather than push those costs off on our children.
         
        Every person in America knows that sometimes you need to take out a loan in the short term to pay for something that you need a lot of money for immediately (such as buying a home or car). But long term, the effort should be to pay back those debts, increase our net worth, and make this country better for our children. The problem is our government has been borrowing larger and larger amounts every single year. Putting everything on its credit card that keeps getting maxed out and asking for a higher credit limit
         

        • David Appell

          And govt does not employ people to dig a hole and another to fill it. 

          Nor is there any evidence that government borrowing is crowding out private sector borrowing. Interest rates are very low. Anyone already could buy business bonds or stock, but they often prefer the safety of govt bonds.

          Many govt services are best handled at the local level, but some are not. The federal govt can save money via economies of scale, particularly where the free market fails, such as the health insurance market.

          Govt spending on programs is not always wasteful–it can *save* money and improve lives, as people who live in a single-payer health system know. Their health costs are lower, they have fewer problems obtaining the care they need, and they have better health as a result. Likewise with govt spending on crime protection, fire protection, defense, etc.

          The Constitution also calls for the federal government to provide for the “general welfare,” not just the “common defense.”

          • Devin

            I’m sorry I believe the words of James Madison and Thomas Jefferson on what the constitution means over what you say.

            James Madison: “With respect to the words general welfare, I have always regarded them as qualified by the detail of powers connected with them. To take them in a literal and unlimited sense would be a metamorphosis of the Constitution into a character which there is a host of proofs was not contemplated by its creators.”Thomas Jefferson: “Congress has not unlimited powers to provide for the general welfare, but only those specifically enumerated.”As to “single payer”, yea that’s great if you want to wait more than a year to get a hip replacement or more than a month to get surgery (which is what happens in Canada).  For me, I would rather be able to get medical care when I need it rather then have it rationed out to me by the government.

          • Wbrady

            You have an incorrect interpretation of the “general welfare” referred to by the founders.  They would never support government welfare, government manage health care, or any of the rest of the stuff the left wants.

            If you like single payer so much, move to Canada or England.  Don’t mess up the best medical care system in the world.

          • David Appell

            Who cares what the founder’s interpretation of “general welfare” was? We live now, not then. It’s a general term that each generation can interpret as they see fit.

            Obviously the US doesn’t have the best medical care in the world. In 2010 the Commonwealth Fund ranked the US health care system 7th out of 7 industrialized countries. A 2007 Commonwealth Fund ranked the US 6th out of 6. A 2000 WHO study ranked the US 37th in the world. Canada and the UK came in higher than the US in all of these studies.

          • Devin

            See, you cannot have it both ways: that is, the character and nature of the constitution changes over time, but the force holding those who voluntary entered the union never changes. The constitution provides both the meaning of government limitations and the terms of union. If the meaning can change, then so can the union. If you argue otherwise, please explain how a party to a compact (i.e. constitution) who entered the union upon certain guarantees, promises, protections and limitations is forever bound to that union (by force) when those guarantees, promises, protections and limitations are removed and replaced with meanings and applications contrary and different from those originally promised to be true. This is called “bait and switch” which is considered criminal and illegal in any contract scenario throughout the states in America. Do you think this principle applies less to the most fundamental law in society: that is, in constitutions? George Washington did not think so:

            “The Constitution which at any time exists, till changed by an explicit and authentic act of the whole people, is sacredly obligatory upon all.”

          • Have you never bothered to read the Constitution? The only place where the term “general welfare” appears is the Preamble. The Preamble is NOT part of the Constitution, rather it is DESCRIBING the Constitution. It is the Constitution ITSELF, not the government structure defined in the Constitution, that accomplishes all of the purposes listed in the Preamble. The Constitution improved the Union by better allocation of powers and responsibilities than the first attempt under the Articles of Confederation. The Constitution establishes justice, ensures domestic tranquility, provides for the common defense, promotes our general welfare, and secures the blessings of liberty by strictly delineating and limiting the reach of the central government so as to prevent government’s natural tendency to take on more than it should and encroaching on our liberty.

            The Constitution does NOT say that the government is supposed to promote “the ‘general welfare’, nor does it call for the government to provide for common defense. It DOES say that those are two reasons why the people of the United States ordained and established the CONSTITUTION.

            Please read the document before making such ludicrous claims.

          • the real valley person

            Gee, then the last 200 plus years have been a terrible mistake haven’t they? 

          • Devin

            No just after the Judicial Procedures Reform Bill of 1937, (“IE the court packing bill”), forced the court (or more specifically Owen Roberts) into the 1937 decision in Helvering v. Davis, misinterpreting the constitution.

          • the real valley person

            Oh I see. Only the last 74 years have been a terrible mistake. Thanks for clarifying.

          • Devin

            It took 99 years for Shaffer v. Heitner to overturn Pennoyer v. Neff.  And 96 years for Erie R.R. Co. v. Tompkins, to overturn Swift v. Tyson.  Mistakes of the past can be corrected.

        • the real valley person

          “Government spending is always bad for the economy…”

          Whoa there Nellie. That is categorically wrong. Government spending is and has been about 20% plus or minus of the national economy for many decades. 40% of that “spending” sustains old people and keeps them out of poverty and in reasonable health. This is bad for the economy?  How exactly? The economy would be somehow better off with lots of poor old people, like back in the 1930s?

          Education is bad for the economy? Basic research is bad for the economy? Roads and bridges are bad for the economy? Clean air and water are bad for the economy? What economy are you talking about?

          The economy is not “harmed” by taxation. It’s partly redirected towards public goods and services. That is not harm. You may think you would be better off keeping 100% of your income and having no public roads to travel on, but you would be wrong about that.

          • Devin

            How about you finish that sentence rather then taking it out of context? “Government spending is always bad for the economy, but a slightly worse economy is the price people are willing to pay for the services that government provides that cannot be provided in the private sector”.
             
            You say ”It’s partly redirected towards public goods and services. That is not harm.”  And I say yes that is.  Redirecting money away from creating more and better jobs is harm to the economy.  Sometimes a small amount of harm to the economy is ok, for the benefit the government service provides is large enough to large number of people.
             
            Yes there can be a point at which too much education can be bad.  Yes there is a point at which bridges are too expensive for the benefits they provide.  Yes there is a point at which we don’t need 99.9999% purity in water and air when 99.9% is good enough.  All of these things have a cost and are not absolutely always good.  The only question is the damage to the economy from the taxes in the short term worth the long term benefits.

          • the real valley person

            The 2nd part of your sentence did not negate the premise of the first part, which is what I took issue with.

            The money redirected by our democratic government, acting on our behalf, arguably creates more and better jobs than that same spending left in a private sector, especially one that lacks public infrastructure, education, and research among other things. Some government spending is wasteful, unnecessary, or even undesirable. But the same is true for some private sector spending, unless you think the Beanie Baby craze and Bernie Madoff were economic pluses simply because they were private sector.

            Well, if we have too much education, I hadn’t noticed. And if our bridges, which rate a D- by actual engineers are too expensive for us, I guess we should let a few more crumble into dust. And if our air is too clean, well that is a nice problem to have.

            Why do you believe that clean air has a cost, but dirty air does not? You have never heard of asthma? You think we would save money by sending truckers 100 miles out of their way because we let a few bridges go? Penny wise and pound foolish.      

            Using your accounting system, if we eliminate x dollars in taxes we spend on police services, and spend that same x dollars on private sector security, and assuming perfect equality of service delivered, did we go from an economic minus to an economic plus?

          • Devin

            “The money redirected by our democratic government, acting on our behalf, arguably creates more and better jobs than that same spending left in a private sector”.  I disagree, the only question is how much is that job worth to the people paying for it.  A job created by a free choice to spend their money to buy something creating a job creating that good, is far better than one where money is taken from you by force and given where the politician thinks is best rather than the person who’s money was taken.
             
            Bernie Madoff cheated, lied and swindled, that is not the private free market at work.  Government does have a responsibility to investigate accusations of people committing fraud and throw those that commit fraud in jail.
             
            Do you not see the costs of government spending?  Yes sometimes government is needed, but that government should be closest to the people receiving the benefits.
             
            Those government police officers salaries are paid by forcing the population to give money to pay for them.  Some police is absolutely needed (again how much should be decided in the government closest to the people receiving the benefit as possible).  But those private security people are paid from an individual or a group who freely choose to spend their money on that security guard/security company.  If he does a bad job, they can find someone else with their money.  Or if they decide they don’t need one, they just don’t have to hire one and can spend it on other things.  Maybe they just need a good lock.  Then you have your protection, AND you buy something else with that money.  Letting people choose how to spend their own money, leads to massive benefits to the economy.

          • the real valley person

            Taxes are not taken from the great majority of us us by force. In a democracy we elect politicians or engage in referendums that establish public policy, including the level of taxation and what services this covers. We then voluntarily pay our assigned legal share. A handful of people break the law by not paying their legal obligations, and after a long period of trying to get them to pay up, the government may force them to pay.  Saying we are all paying because we are forced to assumes we are all scofflaws or free riders.

            Bernie Madoff was the private market at work. I could have used Enron or Countrywide Financial or any number of other examples. The private market unfortunately includes a lot of swindlers and cheaters and thieves, not a majority by any means, but far more proportionally than those who work for the government. If you don’t believe me do some research on prison populations and see what percent came out of the private sector and what percent were public when they were busted.

            Do I see the costs of government spending?  Sure. I also see the costs of not having the services we spend money on. If I hire someone to mow my field, that is a cost in return for which I get a mowed field. If I pay taxes for my local fire department, that is a cost for which I get lower insurance rates and emergency help if and when I need it. What is the difference? That one was “voluntary” and the other “forced?” I say BS.  Nobody forced me to buy a farm in this particular fire district. It was a voluntary action on my part, and if I did my homework and cared about taxes I could choose the cheapest (and probably worse trained and equipped) fire district in the region.

            Some government services can’t be provided locally. National defense, old age security, air traffic control, national parks, and a lot else the federal government does cannot be done locally. Localities provided old age pensions and welfare long before the federal government ever got into that business and they could not manage it. The majority of old people died poor in those days. The feds solved the problem, and yes it costs us a lot of money, but federal old age insurance is a service that 80% of the American people strongly support.

            This stuff about paying private security versus public police is a libertarian  fantasy world. If you want to see a nation where private security is the norm and public security is almost non existant, I suggest you fly to Mogadishu and see how far you get from the airport before you are forced to contribute to private security forces. Its a veritable libertarian utopia with hardly any government at all.

          • Devin

            All taxes are by force of law.  To say that most of us pay voluntarily is an illusion in that if you don’t pay, it is taken from you by force.  They can and will garnish your pay check or bank account legally taking the money from you.  The fact that you give them the money before they do, does not mean it is not by force.  A man puts a gun to your head and says “give me all your money”, and then you do, would you call that voluntarily giving him money?  Yes it is voluntary to enter into a political region, but that doesn’t make the taken of taxes in that region any less forced.  Its like a gangster network in an area saying if you want to live here, you got to pay “protection money”, I think everyone can agree that is still taking your money and forced to pay it or else, even if you could have moved to a difference area and chose to move into that area even knowing the gangsters are there.  (Clearly the gangster network is illegal, while taxes are legal and a good thing sometimes, but that doesn’t change the fact that the money is taken by force).
             
            All groups of human beings include swindlers, cheaters and thieves, private sector or public sector. William Jefferson, Rod Blagojevich, Tom DeLay, ect. I could go on forever (and these are just the big well known politicians, all the smaller public sector crime you don’t hear about as much).  Are there more then the private sector then in the public sector absolutely, but that’s just because there are more people in the private sector.  Government, as I have said, does have a responsibility to investigate accusations of fraud/theft, and put the people who commit those crimes away in jail.  But that is NOT the free market system at work.  The free market system works when there is an even playing field.  Enron for instance lied to the public about what was going on, had people known the truth, they wouldn’t have invested, and it is because of those LIES, that they deserved to go to jail, but that in no way disparages the free market system.
             
            I think everyone agrees national defense cannot be done locally.  And I believe you could make a strong argument for air traffic control.  But parks clearly don’t NEED to be done locally.  In Oregon 53% of the land is owned by the federal government.  Why couldn’t Oregon state government manage most of that?  I could see a case for a few “national treasures” like Yosemite, being federally protected, but other than that why does the federal government need to do it?  As to old age security, I disagree that it needs to be done at the federal level.  There are plenty of states that have programs to help seniors.  Let me give you one example in Oregon: http://www.oregon.gov/DHS/spwpd/sua/info-aaa.shtml “There are 17 Area Agencies on Aging across Oregon that administer and support community-based care services. AAAs advocate for older adults living in their area, develop community-based long term care services to meet the needs of those adults and administer funds to implement services.”  So why does the federal government need to do it?
             
            I am not saying that public security should be “nearly nonexistent”.  I am merely saying that there is a cost for the public security that we provide.  And that deciding how much to spend on public security should be done as close to the people that are receiving the benefits (the local communities), as is possible.  That way if you don’t like it, you can move.

          • the real valley person

            Taxes are based on law, and every law has enforcement mechanisms. We voluntarily comply with the law, and if we don’t,  then there are enforcement mechanisms that could be used against us. That makes tax law exactly like every other law in the nation, so if you think tax law is oppressive then you must feel the same about speed limits or breaking and entering. I mean, why should jackbooted state troopers be able to arrest me for helping myself to your car? Why can’t they just leave that matter between us to settle?

            “…but that doesn’t change the fact that the money is taken by force”.

            Again, it is only “taken by force” if one chooses to not comply with the law. And it can only be taken by registered agents of the government, not by any yahoo with a gun.

            We don’t elect the local mob boss. We do elect people to set tax policy. Its representative democracy, augmented in Oregon by the referendum.   We choose to tax ourselves to have the government provide a range of services that we choose to fund, or we choose user fees in many cases . If I want to camp in a state park, the rules say I have to pay a fee. and if I refuse to pay I get enforced on. Is that wrong or oppressive?

            ”Are there more then the private sector then in the public sector
            absolutely, but that’s just because there are more people in the private
            sector.”

            Proportionally, there are far more private sector actors in prison than there are public sector actors. When was the last time you heard of a public official in Oregon being sent to prison? Its very rare, and when it happens it is in the media. Yet our prisons are pretty full.

            “The free market system works when there is an even playing field.”

            Well then by your own words our free market system does not work because the playing field is not even, never has been, and never will be since those with money can game the system in their favor. And don’t hand me any libertarian utopia about how it is supposed to work if only this or that. We both live in the real world, not an if only world.

            “In Oregon 53% of the land is owned by the federal government.  Why couldn’t Oregon state government manage most of that?”

            It could if the American people decided to hand their land over to our state. But as a former US Forest Service employee, I can assure you most of that land costs more to manage than can be gained in revenue, so be prepared to have your taxes raised to have the privilege of  local management.

            “I could see a case for a few “national treasures” like Yosemite, being
            federally protected, but other than that why does the federal government
            need to do it?”

            Its a choice that dates back to an era when state governments out west were just getting their feet under them and had no capacity to mange tens of millions of acres of forested mountains. I don’t know if you get out much, but there are a lot of national treasures outside of national parks. Start with Mount Hood and work your way south along the Cascades through the 3 Sisters. Then throw in Hells Canyon, Steens mountain, the Columbia Gorge, and a lot else.

            “There are plenty of states that have programs to help seniors. ”

            Sure. But most of the income for most of our seniors, and nearly all of their medical expenses, are paid for by the federal government from taxes on working people. I don’t know of any state that wants that level of responsibility for 25% of its population. But I’d like to see Rick Perry step up and suggest opting out just to see what his over 65 population says about it.

            “I am merely saying that there is a cost for the public security that we provide. ”

            And I am merely answering that for that cost you get security. Its a quid pro quo. You don’t just hand the government money and get nothing for it. You may be able to get along with less security. Great. Then vote in people who agree with you. But most government is not a shopping mall where you can pick from here and never mind what they have over there. And, the money you hand over gets used to pay people and buy equipment for them, and all of that is part of the economy. The money does not simply disappear. You can argue some of it gets wasted, and I would agree, but a lot of money spent in the private sector also gets wasted.

            Most day to day security IS provided locally. Last I looked around we had municipal police departments, and when you dial 911 they are the ones who respond, not the Feds or even the State, so I’m not sure what your complaint is.

             

      • Rupert in Springfield

        >Says who?

        Because “the mess” is slow to zero economic growth. The only thing that alleviates that is economic growth. No one says it, its basically a truism.

        >Like all spending, government spending is well-known to be a short-term stimulus.

        Not true. Government spending first of all has the problem that it is a very slow way to get money into the economy. This is what Obama found out when there were no “shovel ready jobs”.

        Government spending is known for the exact opposite of what you have mistaken it for. It is not a short term method, it is long term as it takes quite a while for government money to get out there, unlike tax cuts in which the money is essentially out there instantaneously.

        >No one is talking “confiscating it all.” They’re talking about raising
        tax rates back to what they were before Bush tanked the economy

        Actually the Bush tax cuts spurred quite a sustained growth in the economy. Our economy under Bush grew at an annual 3% rate, the highest in the industrialized world. Due to this, revenues increased. Sorry, you are just wrong on this one.

        >and using that to increase demand at a time when it isn’t coming from anywhere else.

        Sorry, we already tried that with the stimulus. All we really got for our trillion was Obama chuckling about how there were no shovel ready jobs, and a one word zinger line for late night comedians – “Stimulus”

        >That’s what will lead to economic growth.

        Well, it never has before but there is always a first time. You, and possibly Dean, are probably the only people on the planet who would seriously advocate a second stimulus with a straight face.

        >I don’t even see a theory about how austerity is supposed to do that

        And I dont see a reason why you still are making this false connection after you have been schooled several times on it. It’s ridiculous.

        Austerity is about keeping a countries economy, whether is be Germany, France, the USA, from turing into a Wiemar Republic (look it up, I am not talking about the recently resigned congressman). Economic growth is a secondary concern when talking about cutting back excessive spending. 

        >except by increasing ‘confidence’ — and that already hasn’t happened.

        You dont get confidence overnight. Obama’s damage will take quite a while to work through, and some of it hasn’t even occured yet. We still have the hurdle of Obama care. Business is scared of that. They have no idea how it will be enforced other than on a corny government basis (look up health care waivers). That doesn’t bode well for the near term.

        • the real valley person

          “Our economy under Bush grew at an annual 3% rate, the highest in the industrialized world.”

          Rupert fact alert. Economic growth under George W Bush averaged 1.6% over his 2 terms, not the 3% you seem to claim. And even that gets him off the hook for the huge decline during Obama’s first year, attributable to Bush.

          http://economix.blogs.nytimes.com/2011/07/29/ranking-the-presidents-by-g-d-p/

          “You, and possibly Dean, are probably the only people on the planet who
          would seriously advocate a second stimulus with a straight face.”

          You can include Nobel prize winning economist Paul Krugman and mildly successful investor Warren Buffet to that list.

          “Austerity is about keeping a countries economy, whether is be Germany, France, the USA, from turing into a Wiemar Republic”

          We have been spending between 18-23% of GDP consistently for over 4 decades, and inflation is near zero, and interest rates are near zero. Weimar Republic? Do you really believe your own rhetoric? 

          • Devin

            When Bush took Office the economy (GDP) had been growing at about 1%.  He added the tax cuts in 2001 and 2003.  Between 2001 and 2005, GDP growth was 2.8% and the number of number of jobs grew by 6.5% on average.  Overall the GDP grew by 2.5% during Bush’s term.

            In 2003, the Bush Administration attempted to create an agency to oversee Fannie Mae and Freddie Mac, the primary cause of the eventual collapse of the housing market. The bill never made progress in Congress, facing sharp opposition by Democrats.

            Mind you, I think everyone agrees Bush screwed up the last 2 years in office.  But that is primarily for stupid stuff like TARP. 

          • the real valley person

            I don’t know what you mean by “overall the GDP grew by 2.5% during Bush’s term.” He had 2 terms. GDP growth averaged 1.6%. This is less than half the growth rate under Clinton by the way, who RAISED taxes. Its about 1/2 the growth rate under Jimmy Carter.  It is the worst growth rate of any president since Hoover.

            Bush attempted to oversee Fannie. The mean democrats, who were the minority, somehow stopped him. Therefore the financial crisis was not his fault. Is that your point? He tried something that didn’t work so his responsibility ended in 2003? Four years before the housing bubble burst?

            Stupid stuff like TARP? It was the one thing Bush did that actually worked. It saved the financial system from collapse and has ended up costing almost nothing.

          • David Appell

            Not only this, it’s simplistic to claim that the F&F were the primary causes of the collapse of the housing market. There were many factors and they were in place for several years before the bubble burst. A lack of proper regulation seems to be behind most of these factors, which was a reflection of the Randian philosophy of the core economic regulators under Bush, from Greenspan down. (The same Greenspan who later admitted his worldview was flawed.)

          • Devin

            See, you cannot have it both ways: that is, the character and nature of the constitution changes over time, but the force holding those who voluntary entered the union never changes. The constitution provides both the meaning of government limitations and the terms of union. If the meaning can change, then so can the union. If you argue otherwise, please explain how a party to a compact (i.e. constitution) who entered the union upon certain guarantees, promises, protections and limitations is forever bound to that union (by force) when those guarantees, promises, protections and limitations are removed and replaced with meanings and applications contrary and different from those originally promised to be true. This is called “bait and switch” which is considered criminal and illegal in any contract scenario throughout the states in America. Do you think this principle applies less to the most fundamental law in society: that is, in constitutions? George Washington did not think so:

            “The Constitution which at any time exists, till changed by an explicit and authentic act of the whole people, is sacredly obligatory upon all.”

          • Devin

            blah replied to the wrong thead, ignore this one ill add it below.

          • Devin

            Fannie Mae and Freddie Mac are HUGE parts of the problem with the housing market as in 2008 they owned $5.1 trillion in residential mortgages, about half the total U.S. mortgage market while only having $0.1 trillion in net worth (I wish I could borrow 50 times my net worth).  Underwriting people that couldn’t afford homes on their own to get more people into homes combined with allowing those underwritten mortgages to be silly sub-prime balloon mortgages.  But they were far from the only culprit that is true.  FHA and HUD own a lot of the blame as well by pressuring banks into giving more loans to minorities especially in down town urban areas.  But they weren’t the only ones doing this.  Various organizations have been suing banks that weren’t giving what they thought was enough loans to minorities.  Obama as a part of ACRON sued Citibank to try to force it to give more loans, making himself personally a small part of the problem.  http://www.clearinghouse.net/detail.php?id=10112

          • Rupert in Springfield

            Correct. Fmac and Fmae not only were huge players, strictly in terms of the amount of mortgages the taxpayers guaranteed through them.

            They were also huge drivers of lax regulation (Fmae head Johnson was singularly responsible for having HUD oversee Fmae for example)

            In addition Johnson almost single-handedly  was responsible for taking the Boston Fed study of lending practices to minorities, completely misinterpreting its results according to the author, and then using it as a cudgel to engage in wildly risky lending practices.

            Those two things alone are enough to establish Fmae and Fmac as the central core of the collapse. Yes, there were other factors, but few would argue Fmae and Fmac were not central to the scandal.

          • Rupert in Springfield

            You really haven’t read much on this subject have you?

          • Devin

            Whatever believe me or not, I get my data from the U.S. Bureau of Economic Analysis.  Under Bush Inflation Adjusted Real Average GDP growth 2.0375% (without adjusting for inflation it is higher which I think were the numbers that I got from a different source).  Meanwhile under Obama Inflation Adjusted Real Average GDP growth we have had a -0.5% economy has gotten worse under Obama then when bush left office.

          • Rupert in Springfield

            Yep, just double checked, growth under Bush outperformed other industrialized countries at least for the first term.

          • the real valley person

            Which other industrialized countries. All or some? And who cares? His record stunk by US standards. 

          • the real valley person

            You are looking at old data. The latest revised data shows that the average Bush growth rate was 1.6% over his 8 years. I sent you a source. But even at 2%, he would be the lowest on record since Hoover, about tied with his dad and Geral Ford, two other Republicans. Obama’s current average is 1.2%. Also very bad, but his first year was digging out from a negative 6% rate left by Bush. If you measured Reagan over his first 2 years only he would have looked even worse.

          • Rupert in Springfield

            >Rupert fact alert. Economic growth under George W Bush averaged 1.6% over his 2 terms, not the 3% you seem to claim.

            You were the one who claimed it nitwit. Several months ago when you were trying to make the case Obamas  2% and change growth was a good rate.

            Don’t make me go back through the logs to dope slap ya. Call it good and move on.

          • the real valley person

            You can’t be serious. So you are citing me as your source for Bush’s growth rate? Sorry dude. You are all mixed up once again. Bush had a 3% growth rate maybe 1 or 2 years out of his 8. Even a broken clock is right twice a day. But you can’t seem to reach that low standard.

        • David Appell

          I’m just curious Rupert: when you write down things like ‘3% growth under Bush,’ do you check them first, or just throw them out there hoping they will stick?

          You might find this interesting: WSJ, 1/9/09, “Bush on Jobs: The Worst Track Record on Record”
          http://blogs.wsj.com/economics/2009/01/09/bush-on-jobs-the-worst-track-record-on-record/

          • Rupert in Springfield

            I’m curious David – Do you write your “scientific” articles in such a slipshod manner as you do here? I spoke to economic growth under Bush and you try and refute it with an editorial about job creation? Something I never spoke to?

            Anyhoooooo – I am loving this, you will see why in a moment.

            No, I did not check out the 3% figure.

            At least originally. Dean checked it out several months ago because he was the one who originally posted the 3% figure. Which is correct by the way.

            The problem is, he stepped in it, just like you did here. 3% growth is nothing to crow about, but isn’t all that bad either when an economy is muddling along. Coming out of a recession, yes, 3% is bad. but when you are talking about average over 8 years, most not being recession, 3% is ok.

            But

            And wit for it

            But……

            Turns out 3% growth under Bush was actually remarkable in one way – it beat most other industrialized economies growth rate for the same period.

            Sha Zaaaaaammmmmmmm

            Damn, thats a double smack down off the same mistake. First Dean a few months back, claiming 3% was small, and now you, doing the exact same thing.

            And your WSJ cite? Who cares? I was talking the growth rate under Bush, I never said thing one about job creation.

          • the real valley person

            Do you actually live in an alternative universe in which George Bush averaged 3% GDP growth over his 2 terms? Because in the real universe, he averaged only 1.6%. Shazzam, or whatever. 

        • 3H

          What lesson are you taking from the Weimar Republic?  I’m assuming you’re talking about the hyperinflation.  What conditions do you see today that would replicate the hyperinflation? 

          Just one note of irony, talking about the Weimar Republic, was that it came out of the box hobbled.   The Kaiser refused to increase taxation to pay for the First World War, and instead borrowed money.  Hmmm… makes ya kinda wonder doesn’t it? 

        • David Appell

          > unlike tax cuts in which the money is essentially out there instantaneously

          Tax cuts aren’t an option now, so there is no stimulus to be found there.

          • Rupert in Springfield

            >Tax cuts aren’t an option now, so there is no stimulus to be found there.

            Well, they are a more viable option than tax increases. Let’s face it, they have a better track record of success than your recommendations.

        • 3H

          Where did you learn your history?  Self-taught?  High School?  Some College classes but not much past 100 and 200 level?

          • the real valley person

            “Where did you learn your history?”

            Clearly, he didn’t. Being self taught would be fine if he actually did that. Its more like being self ignorant.

          • Devin

            They don’t agree with you so they must be ignorant eh? How about you talk about the issue rather then name call? Or is your argument just that weak?

          • 3H

            It’s not a simple matter of disagreement.  After all, professional historians do that all the time.  Rupert, however, seems to have some gaps and interesting ideas about history. I’m just curious about his background.  We are all ignorant about many things – it’s different than being called stupid.  LOL..   you might want to keep in mind that Rupert is much more prone to name calling than most.  Although of late he seems to have muted his propensities a little.

          • the real valley person

            No Devin, ignorance is demonstrated  by being wrong on facts and insisting on being right. In Rupert’s case, he keeps repeating a wrong figure for GDP growth under Bush, then tries to cover by blaming that figure on me. That is willful ignorance, the worse kind.  If he insists that the moon is really made of green cheese, what would you call it? Just an opinion that one can agree or disagree with?

  • the real valley person

    Well, that was certainly a weird experience. The Republican/tea party basically pointed a loaded gun at the national economy and acted crazy enough to pull the trigger unless they got everything they wanted,  then at the end said “just kidding” and settled for less than half of what they had demanded, and even that in the out years, which is a maybe.

    40% of US government “spending” is basically compulsory old age insurance. We all pay while working and get back later so some of us don’t die on the poor farm.  In other words, the government is not really spending that money at all. It is just a middle man that hands it from younger people to older people, the deal being that when the presently younger people get older there will be other younger people doing the same for them. This drives the Republican/tea party nuts because it feels bad to have government have to mommy and daddy our personal finances, but experience shows that most young people do not plan decades ahead and won’t ever save enough to avoid the slow moving disaster that is old age poverty. The great majority of the American people, including most Republicans, do not want SSI or Medicare cut. So much for that 40%.

    About 20% of federal spending is on current national defense (leaving out the long term costs of war and veteran care). Republicans love defense spending, the more the better. Democrats grudgingly go along so as to not appear weak (which is in and of itself weak, but never mind that). So defense can’t be cut much. That takes about 60% off the table. And it equals thte amount we pay in taxes. We pay 60 cents on teh dollar for government.

    The next around 20% is all the services government actually does domestically, from managing national parks to highway and bridge construction to air traffic control. That bit has already been squeezed to 1950s era spending levels.

    Leaving debt and farm support payments. We have to pay the debt, and there are like 30 farm state senators, so do that math. Bottom line? You can make threats, hold your breath, yell, stomp, and pretend to initiate mass sepiku up until your bluff is called.  But if you want to balance the federal budget, you will have to raise taxes.

    • Devin

      I’m sorry you may believe that going back to Clinton era spending levels for a little while would kill the economy, but that doesn’t mean the rest of us believe that.  No one was dying in the streets and the economy looked like it was running just fine to me during that time (with surpluses too!).  Sorry the scare tactics and fear mongering of the past is over, people don’t believe you anymore.
       
      I’ll say it right here, right now, I think people should be able opt-out and decide how to best invest in their own retirement.  You want to force people to invest in retirement, fine, but let them choose how to invest it and let them keep the money in a bank account in their name (that they can’t withdraw from until the conditions are met).  Having all the new people entering the system paying off the people that have been in the system for a while is what we call a Ponzi scheme and like all Ponzi scheme it works at first, and then it falls apart, and it’s only a matter of time.
       
      National defense is needed, it is one of the only things our federal government is actually authorized and required to do.  But even I see the tens of thousands of troops in Germany, and think “really Germany is going to come kill us any time soon?”
       
      “less than half of what they had demanded”?  Boehner has always been clear that the republicans were ready to vote for anything that raised that cut spending by more than the amount the debt limit was raised and that didn’t increase taxes.  I think everyone agrees this deal does that, and that it is the first real deal put on the table by the democrats that did.
       
      As to farm subsidies, they should be ended, along with all subsidies and bailouts for everyone.  No sector of the economy should be given an advantage against any other.  No choosing winners and losers by government.

      • the real valley person

        I’m ok with Clinton era spending levels AND Clinton era tax levels adjusted for inflation, winding down 2 wars, the Republican passed Medicare Part D, and the reality of a rapidly expanding group of senior citizens.  That comes to about 21% of GDP, which is in the ballpark of federal spending over the past 40 years. About half the current deficit would be gone by going back to Clinton era tax levels by the way.

        But Clinton era spending levels without the rest is pure fantasy. Its not going to happen. Seniors vote. The defense and medical industries lobby.

        You can say whatever you like about opting out of SSI and Medicare. Its not politically feasible, and even Paul Ryan has not proposed this. With 30 farm state senators, I would not hold my breath on that one, but you go right ahead.

        Boehner settled for less than half the cuts needed to “balance” the increase in the debt ceiling, with those “cuts” not even happening until years down the road, and much of it from defense, which he initially said should not happen. He also got a 50/50 committee that will negotiate something that for reasons stated, is going to either include raised taxes or serious further defense cuts or both. SSI, Medicare, and even Medicaid are off the table for cuts. He signed a time bomb that bought him a few months to remain as speaker.  As the implications become clear, he will have a lot of explaining to do. You will see.

      • David Appell

        Opting-out doesn’t work–history has shown that. People say they’re going to save, and think they’re going to save, but too many don’t. And things come up in life: illnesses and accidents that affect income levels, job losses, people have too many kids, they get divorced, expenses rise, stock markets crash. With opt-out you will have some people left in shacks like before SS, except now not as many die before 65. We aren’t that kind of country. Yet. 

        • 3H

          Your place of employment convinces you, despite all the advice to the contrary, to put your retirement money into the company – and they turn out to be crooks.

          • Devin

            So make the retirement accounts in FDIC insured accounts that you can’t withdraw from until you are over 65 (and then only a % of that amount per year).

          • 3H

            What happens if you live too long?  What if you work at jobs that don’t pay that great – you’re a good worker, you work hard, just don’t get high paying jobs.   Keep working until you drop because you don’t have enough in your account to retire on?  Even for basics.

          • Devin

            Well the way that the Chile system works that works so well is that the government licenses some private pension funds to administer this (keeping the government out as much as possible, but still making sure it is reasonable and not risky investments that are taken).  And then the government does make some guarantees to protect the people from problems outside of their control:
            1.All citizens who have contributed to a fund for at least 20 years are guaranteed a minimum pension. The difference between the minimum pension and the pension entitlement from the investment fund is paid by government.
            2.If a pension fund is unable to perform a defined minimum profit, it will be liquidated and the collected assets will be transferred to another fund. In this case, the government solves the assets gap.
            3.In case of bankruptcy of a pension fund the government pays out the pensions on public expenses.

        • Devin

          Look I have no problems with restrictions on when you can take out the money, if needed you cant take it out at all until you reach the right age, and then only a specific %.  But I would rather have some flexibility where they can in an emergency situation (at least some % of it), such as an illness or they need surgery or other disaster, that they could take it out.  Over 30 countries have made personal retirement account plans available to their citizens rather then government run retirement including Chile, Sweden, the United Kingdom, Switzerland, Denmark, the Netherlands, Argentina, Colombia, Peru, Bolivia, Mexico, Uruguay, Australia, Poland, Hong Kong and El Salvador.

  • Anonymous

    When I got my first credit card, my “debt ceiling” was $5000; then they rose to $7000 then $10,000the up to $19000 at the same time I sent and spent above my means. I was making $22.00 an hour. This job was going to go permanent, so I can always pay it back. When I got laid off and found a 17.00 temp job then more layoffs. My debt is in default now I have $22,000 in debt. I had to cut back and stop spending more I made. I am going the Dave Ramey route and slow recovering my life.  
    The moral of the story is if deficit spending was not good for me, how in the hell it is good for or nation?

    • David Appell

      Because a nation is not a person. Governments have lots of powers that individuals (or businesses) do not. They have many ways of raising revenues that an individual does not, and they have spending powers that an individual does not. They have a central bank, which an individual does not. They are huge. They have clout.

      Look, no one is saying that deficit spending can go on forever. They’re saying that NOW, especially, is a very bad time to cut government spending. The time to have done it was when the government had a surplus, but instead Bush spent that on tax cuts for the wealthy. 

      Cutting govt spending removes a large buyer from the marketplace. Now hundreds of billions of dollars a year will not be spent on paper and tanks, or used to employ people who buy soap and cars. 

      This reduces demand for products. That reduces jobs. That reduces tax revenue and increases unemployment benefits, etc. It’s a negative feedback.

      Govt spending in a bad economy can be a positive feedback. This is well known. It’s also well known that reducing govt spending at a time like this has lead to problems in the past — the US recession of 1937, for example, or the UK right now. Economists have done lots of studies of this. 

      Here is a readable op-ed in the WSJ:
      http://online.wsj.com/article/SB10001424052702303635604576392023187860688.html

    • Rupert in Springfield

      Good story, and probably one a lot can relate to. I think the central thing that is hard for the left to overcome is deficit spending is at such a colossal level right now that it becomes real hard to argue more of it would be an economic godsend.

      The moral here is – once you are spending over a trillion dollars on anything, it gets real hard to convince people the reason why it isn’t working is lack of funds. Most with common sense begin to conclude if a trillion dollars a year wont do it, maybe you have a bad plan.

      • the real valley person

        The amount of Federal government “spending” is only relevant to the size of the economy as a whole, not as a number taken in isolation.  We have a $15 trillion economy, so $3.5 trillion in federal spending only amounts to 23% of GDP. It averaged above 22% under Reagan, and he did not have 2 wars, Medicare Part D, a much larger percent of people over 65, and an economic emergency. He did manage to run unprecedented deficits, and “conservatives” said nothing about this.

        A temporary increase in spending, along with a temporary increase in the deficit, is exactly what we and our economy need. Its easy to make the argument. But its hard to get people who insist on seeing macro economics through their personal household budget experience, and that includes you.

        • Rupert in Springfield

          >The amount of Federal government “spending” is only relevant to the size
          of the economy as a whole, not as a number taken in isolation.

          Wrong – Spending is relevant to quite a few things, not “only the economy as a whole”.

          Revenue is pretty relevant in there, and when you are borrowing 40% of what you are spending, people get real concerned real quick.

          >But its hard to get people who insist on seeing macro economics through
          their personal household budget experience, and that includes you.

          It’s also apparently hard to get others, such as Moody’s and Fitch ratings to agree with this nonsense either. They have warned pretty clearly of a downgrade unless the deficit is brought under control. Not increased as you would have us do.

          Look – Let’s face it you aren’t going to convince many people that we need to run higher deficits. You can call names all you wan’t but you aren’t going to get anywhere with it for one simple reason:

          Obama has spent like a madman and not many people think things have improved due to it.

          In other words, you know and I know that there ain’t no way in hell your “let’s spend more” plan will get any further than making people laugh at you in a bar. 

          • the real valley person

            They warned of a downgrade if the Republicans were crazy enough to shoot the economy in the head by refusing to honor the obligations of the US government for the first time in history. Now that the madness has temporarily passed, no downgrade.

            I called you a name?

            If Warren Buffet said spend more, would he be laughed at too? Because that is what he said. I would pay money to see you laugh at Warren Buffett. 

          • Devin

            Here is what Moodys said:”the government bond rating would very likely be changed to negative at the conclusion of the review unless substantial and credible agreement is achieved on a budget that includes long-term deficit reduction. To retain a stable outlook, such an agreement should include a deficit trajectory that leads to stabilization and then decline in the ratios of federal government debt to GDP and debt to revenue beginning within the next few years.”

            And S&P: “If an agreement is reached to raise the debt ceiling but nothing meaningful is done in terms of deficit reduction, the U.S. would likely have its rating cut to the AA category. While banks and broker-dealers wouldn’t likely suffer any immediate ratings downgrades, we would downgrade the debt of Fannie Mae, Freddie Mac, the ‘AAA’ rated Federal Home Loan Banks, and the ‘AAA’ rated Federal Farm Credit System Banks to correspond with the U.S. sovereign rating,”

            As to Warren Buffett, What you mean a Democratic wants to spend more money?  Who would have thought!

          • the real valley person

            Well I guess we flunked that test then didn’t we. Nevertheless Moody’s did not downgrade, despite the fact that the “cuts” they made were far below the projected increase in spending.

            Who cares if Warren Buffet is a Democrat? He is a pragmatic investor who knows a bit about economics.  

            Devin, if all economic wisdom rests with Republicans how do you explain the fact that economic growth under Democratic presidents has substantially exceeded that under Republican presidents since the days of Roosevelt?

          • Devin

            I believe this article explains the differences so I wont repeat it:
            http://online.wsj.com/article/SB122117691244025843.html
             
            Needless to say I wouldn’t support the price and wage controls that Nixon did even if he is a republican.  He did not do a very good job.  While I actualy like a lot of the stuff JFK did even if he is a democrat.  Even bush, although not bad in his first half where he cut taxes and did great, in his second term, he did very poorly.  No I stand by the policies of Reagan which did wonderful things for this country.

          • 3H

            You mean cut taxes and increase spending?

          • Devin

            16% Spending to GDP ratio under JFK, and he cut taxes, what isnt there to like about JFK?
            “It is a paradoxical truth that tax rates are too high and tax revenues are too low and the soundest way to raise the revenues in the long run is to cut the rates now … Cutting taxes now is not to incur a budget deficit, but to achieve the more prosperous, expanding economy which can bring a budget surplus.”
            – John F. Kennedy, Nov. 20, 1962

            “Lower rates of taxation will stimulate economic activity and so raise the levels of personal and corporate income as to yield within a few years an increased – not a reduced – flow of revenues to the federal government.” – John F. Kennedy, Jan. 17, 1963″It is no contradiction – the most important single thing we can do to stimulate investment in today’s economy is to raise consumption by major reduction of individual income tax rates.” – John F. Kennedy, Jan. 21, 1963

          • the real valley person

            The WSJ article is rationalizing, its not analysis. The likely reason (and this has been analyzed) the economy grows better, quite consistently, under Dem presidents is that Dem policies are more inflationary. And that is also why Reagan broke the mold of Republican presidents. After initially slamming inflation by raising interest rates (a Carter-Volker policy that Reagan continued) he quickly reversed, lowered interest rates, expanded spending, and cut taxes, all of which are basically inflationary policies that fuel growth. 

            And in fact the one area where Republican presidents beat Dems on the economy is that the inflation rates are lower under them. The macro economic lesson should be, but is never learned, that if you want a growing economy you have to follow inflationary policies, but not too inflationary. Its  a lesson we should be applying right now, but instead we are captured by gold bugs who think money is a shiny metal. Roosevelt ran deficits equal to half of GDP to get us out of the depression. That is near the level we ought to be at today.

          • Devin

            Inflation rates are usualy higher under Dems.  Thats why you got to look at inflation adjusted GDP and other growth indicators.  Having $1 mean as much as 50c and doubling your GDP means nothing really changed (definatly didnt improve at least).

          • the real valley person

            Only the inflation rates under Dems were just slightly higher, not to the extent of halving the currency value. A little inflation is necessary to have full employment.  

      • the real valley person

        The amount of Federal government “spending” is only relevant to the size of the economy as a whole, not as a number taken in isolation.  We have a $15 trillion economy, so $3.5 trillion in federal spending only amounts to 23% of GDP. It averaged above 22% under Reagan, and he did not have 2 wars, Medicare Part D, a much larger percent of people over 65, and an economic emergency. He did manage to run unprecedented deficits, and “conservatives” said nothing about this.

        A temporary increase in spending, along with a temporary increase in the deficit, is exactly what we and our economy need. Its easy to make the argument. But its hard to get people who insist on seeing macro economics through their personal household budget experience, and that includes you.

  • Wbrady

    The House should have stuck with Cut, Cap, and Balance.  They could have refused to go beyond that.  It was a good bill and Obama would have probably caved if there were no other option. 

  • Publius

    Whoopee, what a crock of bovine scat.  Wow we reduced the projected deficit increase over the next 10 years from $10+TRILLION to $9+TRILLION.  Why I just can’t express in words you will print on how happy that makes me feel.  Some one needs to take a flame thrower to the swamp called DC, That’s Washington D. (don’t) C. (care).

    This is comparable to cleaning up the Gulf oil spill with ONE eyedropper. 

    Give me a break.  This bill has insured the continued enslavement of my children and grandchildren.  I can only pray they don’t damn us every day of thier upcoming miserable lives to be under the socialist who have defacto won the debate, the battle and the country.

    Every body say “So long America, it was nice to know ya.”

    Publius

  • Bob Clark

    I think it’s the best politically practical bill what with Bama controlling the White House and the Dems controlling the Senate.  The protracted negotiations probably put a dent in the near term economy because businesses and people started pulling back on spending and investing not knowing if government payment flows weren’t going to get cut off because of lack of debt issuing capability.

    We’ll see if politicians can really cut medicare payments to doctors and hospitals next year.  So far each year they’ve threaten such cuts, they’ve only ended up reversing the cuts and keeping medicare budgets increasing.

    It’s hard to continue Keynesian fiscal stimulus when the country is facing a bond downgrade.  The only ways to maybe stimulate the economy at this point are to approve more private projects needing federal permiting (ANWR and Keystone Pipeline, for instance), and for the Federal Reserve to keep money suppy easy.

  • Devin

    So “the real valley person” and “David Appell”, you seem like “Tax the rich” liberals.  Maybe you can explain how the percentage of the income taxes paid by people earning over $200k increased after the bush tax cuts?
     
    http://libertyworks.com/wp-content/uploads/2010/07/fraction-paid-by-rich1.jpg

    • the real valley person

      The percent went up because the rich earned more than everyone else. Next question?

      • Devin

        Its not just the rich earned more, but that they earned SO MUCH MORE, that the revenue that the government got from them increased from the tax cut.  So taxes are cut, and revenues go up because of it.  So why does Obama want to increase taxes on the wealthy to reduce the deficit?  (other then “For Purposes of Fairness”, as obama claimed in the democrat debate http://www.youtube.com/watch?v=WpSDBu35K-8)

        • the real valley person

          The revenue did not increase from the tax cut. The revenue increased due to economic growth, only a bit of which was related to the tax cut.  Every honest and math literate economist including Bush’s own economists will tell you that you don’t increase revenues by cutting taxes. You decrease revenues about 70 cents on the dollar.

          Obama wants to increase taxes to help reduce the deficit because the government is only taking in 60 cents for every dollar it spends. Buy a functional calculator.

  • Feelgood

    These fools are so out to lunch it isn’t even funny.

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