The 112th Congress: Debt ceiling edition

[Priceless]

Re: The 112th Congress: Debt ceiling edition

What specific spending cuts are the Dems offering?

Let's not forget that the Democrats already cut $38 billion the last time the GOP held the economy hostage.

A hard-earned compromise that Congress is expected to pass this week to fund the remainder of the fiscal year and cut $38.5 billion from current spending levels contains billions of dollars in cuts to mandatory spending, including $6.8 billion from labor, health, and education programs.

Flood Control and Coastal Emergencies -$30M
· Energy Efficiency and Renewable Energy -$899M
· Electricity Delivery and Energy Reliability -$49M
· Nuclear Energy -$169M
· Fossil Energy Research -$31M
· Clean Coal Technology -$18M
· Strategic Petroleum Reserve -$15M
· Energy Information Administration -$34M
· Office of Science -$1.1B
· Power Marketing Administrations -$52M
· Department of Treasury -$268M
· Internal Revenue Service -$593M
· Treasury Forfeiture Fund -$338M
· GSA Federal Buildings Fund -$1.7B
· ONDCP -$69M
· International Trade Administration -$93M
· Economic Development Assistance -$16M
· Minority Business Development Agency -$2M
· National Institute of Standards and Technology -$186M
· NOAA -$336M
· National Drug Intelligence Center -$11M
· Law Enforcement Wireless Communications -$52M
· US Marshals Service -$10M
· FBI -$74M
· State and Local Law Enforcement Assistance -$256M
· Juvenile Justice -$2.3M
· COPS -$600M
· NASA -$379M
· NSF -$139M
· Legal Services Corporation -$75M
· EPA -$1.6B
· Food Safety and Inspection Services -$53M
· Farm Service Agency -$201M
· Agriculture Research -$246M
· Natural Resource Conservation Service -$46M
· Rural Development Programs -$237M
· WIC -$758M
· International Food Aid grants -$544M
· FDA -$220M
· Land and Water Conservation Fund -$348M
· National Archives and Record Service -$20M
· DOE Loan Guarantee Authority -$1.4B
· EPA ENERGY STAR -$7.4M
· EPA GHG Reporting Registry -$9M
· USGS -$27M
· EPA Cap and Trade Technical Assistance -$5M
· EPA State and Local Air Quality Management -$25M
· Fish and Wildlife Service -$72M
· Smithsonian -$7.3M
· National Park Service -$51M
· Clean Water State Revolving Fund -$700M
· Drinking Water State Revolving Fund -$250M
· EPA Brownfields -$48M
· Forest Service -$38M
· National Endowment for the Arts -$6M
· National Endowment for the Humanities -$6M
· Job Training Programs -$2B
· Community Health Centers -$1.3B
· Maternal and Child Health Block Grants -$210M
· Family Planning -$327M
· Poison Control Centers -$27M
· CDC -$755M
· NIH -$1B
· Substance Abuse and Mental Health Services -$96M
· LIHEAP Contingency fund -$400M
· Community Services Block Grant -$405M
· High Speed Rail -$1B
· FAA Next Gen -$234M
· Amtrak -$224M
· HUD Community Development Fund -$530M

President Obama rolled out a $3.7 trillion budget blueprint that would trim or terminate more than 200 federal programs next year and make key investments in education, transportation and research. The plan is aimed at boosting the nation's economy while reducing record budget deficits.

As we discussed in the Budget Thread, it's going to take a balance of spending cuts and a rollback of the Bush tax cuts. We managed to balance the budget and get the country back to solvency (no debt at all) around 2030. Unfortunately, we don't run the country, and a letter to Olympia Snowe got a response that no one was able to figure out. Kent Conrad had a plan that got $2T from spending cuts and $2T from rolling back the tax cuts and (I'm shocked!) he gave it up after getting 0 support from either side.

 

[Priceless]

Re: The 112th Congress: Debt ceiling edition

Twitter:

GOP voted to raise the Debt Ceiling 7 times under Bush. But that record debt was ok, as it was Freedom Debt.

 

[Bill]

Re: The 112th Congress: Debt ceiling edition

Let's not forget that the Democrats already cut $38 billion the last time the GOP held the economy hostage.







As we discussed in the Budget Thread, it's going to take a balance of spending cuts and a rollback of the Bush tax cuts. We managed to balance the budget and get the country back to solvency (no debt at all) around 2030. Unfortunately, we don't run the country, and a letter to Olympia Snowe got a response that no one was able to figure out. Kent Conrad had a plan that got $2T from spending cuts and $2T from rolling back the tax cuts and (I'm shocked!) he gave it up after getting 0 support from either side.

$38 billion is a lot to you or me, but its trivial when addressing the annual deficits/total debt. If either side is serious about tackling the deficit/debt, the big ticket items (Entitlement Programs Reform and Defense) need to be on the chopping block. The Dems want tax increases, the Reps don't. So what of significance are the Dems offering?

 

[Priceless]

Re: The 112th Congress: Debt ceiling edition

$38 billion is a lot to you or me, but its trivial when addressing the annual deficits/total debt. If either side is serious about tackling the deficit/debt, the big ticket items (Entitlement Programs Reform and Defense) need to be on the chopping block. The Dems want tax increases, the Reps don't. So what of significance are the Dems offering?

President Obama rolled out a $3.7 trillion budget blueprint that would trim or terminate more than 200 federal programs next year

Want specifics? Go read.

From the Washington Post

President Obama will respond to a Republican push for a drastic reduction in government spending by proposing sharp cuts of his own in a fiscal 2012 budget blueprint that aims to trim record federal deficits by $1.1 trillion over the next decade.

Obama would reach his target in part by raising taxes, an idea that Republicans refuse to consider. But two-thirds of the savings would come from spending cuts that are draconian by Democratic standards and take aim at liberal priorities, such as a popular low-income heating assistance program and community development block grants.

Obama also targets the Pentagon, traditionally considered untouchable by both parties, by adopting $78 billion in savings proposed by Defense Secretary Robert M. Gates.

 

[Bill]

Re: The 112th Congress: Debt ceiling edition

Want specifics? Go read.

From the Washington Post

I'll take that as either the Dems are offering nothing in terms of big ticket items, or you don't know.

 

[ScoobyDoo]

Re: The 112th Congress: Debt ceiling edition

$38 billion is a lot to you or me, but its trivial when addressing the annual deficits/total debt. If either side is serious about tackling the deficit/debt, the big ticket items (Entitlement Programs Reform and Defense) need to be on the chopping block. The Dems want tax increases, the Reps don't. So what of significance are the Dems offering?

They offered the Bush Tax Cuts in December. It didn't work. The right said over and over again that finally those tax cuts would stimulate the economy and give a 100% return to the treasury. They were wrong. Those tax cuts are big ticket items.

 

[Priceless]

Re: The 112th Congress: Debt ceiling edition

I'll take that as either the Dems are offering nothing in terms of big ticket items, or you don't know.

Take it for whatever you want. Do you want me to do your research for you?

Tell you what...try to balance the budget without rolling back the Bush tax cuts. Good luck.

Edit: And no, you can't raise other taxes, either. Tax increases are off the table!

 

[Bill]

Re: The 112th Congress: Debt ceiling edition

We're so far in the hole that any tax increases won't even begin to put a significant dent in the problem. The (really) big ticket items have to be brought under control, and that means Entitlement programs for the Dems and Defense for the Reps. The Dems need to be offering up Entitlement Reform and the Reps need to be offering up Defense. Anything else is just posturing and rhetoric.

 

[ScoobyDoo]

Re: The 112th Congress: Debt ceiling edition

We're so far in the hole that any tax increases won't even begin to put a significant dent in the problem. The (really) big ticket items have to be brought under control, and that means Entitlement programs for the Dems and Defense for the Reps. The Dems need to be offering up Entitlement Reform and the Reps need to be offering up Defense. Anything else is just posturing and rhetoric.

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[Almington]

Re: The 112th Congress: Debt ceiling edition

We're so far in the hole that any tax increases won't even begin to put a significant dent in the problem. The (really) big ticket items have to be brought under control, and that means Entitlement programs for the Dems and Defense for the Reps. The Dems need to be offering up Entitlement Reform and the Reps need to be offering up Defense. Anything else is just posturing and rhetoric.

While long term (post 2020) medicare and SS need to be reformed, in the short term they are not the problem. The deficits the US faces over the next decade reflect a fundamental imbalance between spending and revenue, one that goes beyond entitlements. Today, federal tax revenues are only ~14% of the economy as compared to the historical average of ~19%, that 5% difference account for about a decrease in federal revenue of about $750B per year, or about 3/4 of the projected budget deficit for the year.

You can have any 2 of: A functioning government as we know it, low taxes, or a balanced budget. If you don't choose the functioning government as we know it, you had better be able to accept the resulting societal fallout.

 

[5mn_Major]

Re: The 112th Congress: Debt ceiling edition

We're so far in the hole that any tax increases won't even begin to put a significant dent in the problem. The (really) big ticket items have to be brought under control, and that means Entitlement programs for the Dems and Defense for the Reps. The Dems need to be offering up Entitlement Reform and the Reps need to be offering up Defense. Anything else is just posturing and rhetoric.

Frankly tax revenue is a big part of why the deficits up. Frankly, I'd like to see how much of the increase in the deficit is increased spending vs. interest on the existing debt vs. a huge drop in tax revenue. Here's one piece of the pie:

http://www.sequenceinc.com/fraudfiles/wp-content/uploads/2009/08/fedtax.jpg

 

[Priceless]

Re: The 112th Congress: Debt ceiling edition

We're so far in the hole that any tax increases won't even begin to put a significant dent in the problem. The (really) big ticket items have to be brought under control, and that means Entitlement programs for the Dems and Defense for the Reps. The Dems need to be offering up Entitlement Reform and the Reps need to be offering up Defense. Anything else is just posturing and rhetoric.

We already solved the deficit in the budget thread. Almington summed it up nicely. No one (who is serious) is saying rolling back the Bush tax cuts alone will solve the problem, but they're a necessary step in the process. Tax policy can be returned to where it was in '90's, not the 50's. It doesn't help when your side considers any taxation "theft" and a return to the 1990's bracket (as was supposed to happen anyway, BTW) "Socialism".

 

[Bill]

Re: The 112th Congress: Debt ceiling edition

We already solved the deficit in the budget thread. Almington summed it up nicely. No one (who is serious) is saying rolling back the Bush tax cuts alone will solve the problem, but they're a necessary step in the process. Tax policy can be returned to where it was in '90's, not the 50's. It doesn't help when your side considers any taxation "theft" and a return to the 1990's bracket (as was supposed to happen anyway, BTW) "Socialism".

We're not in charge, so what counts is what the Dems in Washington are offering up to the Reps in exchange for tax increases. That's why I asked the question to begin with. Both sides need to give, but it has to be on the big spending items or it won't help the deficit/debt at all. We can talk taxes all we want but the reality is that Washington has to get spending under control because that's the heart of the problem.

 

[5mn_Major]

Re: The 112th Congress: Debt ceiling edition

We're not in charge, so what counts is what the Dems in Washington are offering up to the Reps in exchange for tax increases. That's why I asked the question to begin with. Both sides need to give, but it has to be on the big spending items or it won't help the deficit/debt at all. We can talk taxes all we want but the reality is that Washington has to get spending under control because that's the heart of the problem.

Youve got all the talking points down...but your still not addressing the whole picture. There are two parts...income and spending. You have to work both sides.

The economy sucks. And no its not because of high taxes...its because businesses, which many of which are experiencing excellent profits and record productivity, are not spending or hiring. The theory is that at times of bad economy, govt forces spending to happen by powering money through the system. Again, there is evidence based on company success and Dow 12,500 at the end of the stimulus that it was successful. But the problem is business didn't do its share.

So in the end, you can cut spending...and if business doesn't pick up the slack...we're toast. But we will need to find a way to increase govt income whether its due to significantly more business activity or higher taxes.

 

[Priceless]

Re: The 112th Congress: Debt ceiling edition

We're not in charge, so what counts is what the Dems in Washington are offering up to the Reps in exchange for tax increases. That's why I asked the question to begin with. Both sides need to give, but it has to be on the big spending items or it won't help the deficit/debt at all. We can talk taxes all we want but the reality is that Washington has to get spending under control because that's the heart of the problem.

Actually, it is possible to leave spending alone and tax our way out of the problem. It isn't feasible to cut spending enough on its own to resolve the deficit. However, I would rather not have VATs, carbon taxes and more payroll taxes.

Sen. Mark Warner seems to get it.

“I hear from some senators, ‘Well, maybe things have to get worse before they get better,’” Warner said. “How many more millions of lives do you have to put in jeopardy — people pushed out of their homes, losing their jobs or can’t buy a home because interest rates spiked.”

“I think people think this is just one more Washington squabble,” he said.

A moderate Democrat, Warner has called for a blend of spending cuts and closing some tax breaks as a way to rein federal debt that is now growing by trillions of dollars annually.

 

[Bakunin]

Re: The 112th Congress: Debt ceiling edition

Before we start dropping a deuce on businesses for not hiring, perhaps there aren't enough qualified applicants available for the positions?

I read a finance article the other day on msn money's site where the writer (Jim Jubak if you wish to search for it) claimed that somewhere around 1/4 of our unemployment is structural (meaning job openings are posted and go unfilled for lengthy periods of time because nobody is sufficiently qualified). Now, you could argue that businesses should hire people *and* train them to bring them up to speed, but that costs a significant amount of money and time - and also requires the businesses to be very confident that things are getting better and will continue to improve over the coming months/years to justify the type of investment required.

 

[Almington]

Re: The 112th Congress: Debt ceiling edition

Youve got all the talking points down...but your still not addressing the whole picture. There are two parts...income and spending. You have to work both sides.

The economy sucks. And no its not because of high taxes...its because businesses, which many of which are experiencing excellent profits and record productivity, are not spending or hiring. The theory is that at times of bad economy, govt forces spending to happen by powering money through the system. Again, there is evidence based on company success and Dow 12,500 at the end of the stimulus that it was successful. But the problem is business didn't do its share.

So in the end, you can cut spending...and if business doesn't pick up the slack...we're toast. But we will need to find a way to increase govt income whether its due to significantly more business activity or higher taxes.

Under capitalism as it exists in the US today, consumer demand drives supply. Which is why supply side economics are never going to be as effective as demand side economics to influence the trajectory of the overall US economy.

The problem is demand not supply. Businesses are not going to increase production as long as the demand does not require it. Demand isn't going to increase until businesses hire and the job situation improves. The only way that government can increase demand is though spending directly on goods and services (not tax cuts because that money may or may not be spent). The defict wouldn't be anywhere as large as it currently is if we as a nation had been smart enough to run a slight surplus during the boom years to pay down the debts that are incured during the down years.

Economic growth is essentially a function of productivity – output per man-hour which is a function of physical capital (factories, roads, machines/equipments), human capital (education, training, and experience), natural resources, and society knowledge (scientific and technological understanding). Thus, to increase long term growth, the key isn't tax cuts but increases in saving and investment (by running a balanced budget so that capital isn't consumed by the public sector and is available for the private sector), public spending on education (both K-12 and post-secondary) and basic infrastructure (roads, ports, airports, etc), and promotion of scientific research and technological advancement (though spending on the NSF, NIH, etc). It isn't a quick solution, but it's what we need to do to reverse the direction that the nation is headed, and the first step isn't cutting spending on education, infrastructure, and research in the name of balancing the budget, but raising taxes to fund those areas while balancing the budget.

 

[Priceless]

Re: The 112th Congress: Debt ceiling edition

Under capitalism as it exists in the US today, consumer demand drives supply. Which is why supply side economics are never going to be as effective as demand side economics to influence the trajectory of the overall US economy.

The problem is demand not supply. Businesses are not going to increase production as long as the demand does not require it. Demand isn't going to increase until businesses hire and the job situation improves. The only way that government can increase demand is though spending directly on goods and services (not tax cuts because that money may or may not be spent). The defict wouldn't be anywhere as large as it currently is if we as a nation had been smart enough to run a slight surplus during the boom years to pay down the debts that are incured during the down years.

Economic growth is essentially a function of productivity – output per man-hour which is a function of physical capital (factories, roads, machines/equipments), human capital (education, training, and experience), natural resources, and society knowledge (scientific and technological understanding). Thus, to increase long term growth, the key isn't tax cuts but increases in saving and investment (by running a balanced budget so that capital isn't consumed by the public sector and is available for the private sector), public spending on education (both K-12 and post-secondary) and basic infrastructure (roads, ports, airports, etc), and promotion of scientific research and technological advancement (though spending on the NSF, NIH, etc). It isn't a quick solution, but it's what we need to do to reverse the direction that the nation is headed, and the first step isn't cutting spending on education, infrastructure, and research in the name of balancing the budget, but raising taxes to fund those areas while balancing the budget.

Socialist!

 

[Slap Shot]

Re: The 112th Congress: Debt ceiling edition

Before we start dropping a deuce on businesses for not hiring, perhaps there aren't enough qualified applicants available for the positions?

I read a finance article the other day on msn money's site where the writer (Jim Jubak if you wish to search for it) claimed that somewhere around 1/4 of our unemployment is structural (meaning job openings are posted and go unfilled for lengthy periods of time because nobody is sufficiently qualified).

While a contributor, 1/4 is not only not majorly significant but it's difficult to know how accurate he is with the estimate. fwiw I'm not blaming businesses for not hiring - I have to believe they're hiring what they need.

 

[5mn_Major]

Re: The 112th Congress: Debt ceiling edition

Under capitalism as it exists in the US today, consumer demand drives supply. Which is why supply side economics are never going to be as effective as demand side economics to influence the trajectory of the overall US economy.

The problem is demand not supply. Businesses are not going to increase production as long as the demand does not require it. Demand isn't going to increase until businesses hire and the job situation improves. The only way that government can increase demand is though spending directly on goods and services (not tax cuts because that money may or may not be spent). The defict wouldn't be anywhere as large as it currently is if we as a nation had been smart enough to run a slight surplus during the boom years to pay down the debts that are incured during the down years.

Economic growth is essentially a function of productivity – output per man-hour which is a function of physical capital (factories, roads, machines/equipments), human capital (education, training, and experience), natural resources, and society knowledge (scientific and technological understanding). Thus, to increase long term growth, the key isn't tax cuts but increases in saving and investment (by running a balanced budget so that capital isn't consumed by the public sector and is available for the private sector), public spending on education (both K-12 and post-secondary) and basic infrastructure (roads, ports, airports, etc), and promotion of scientific research and technological advancement (though spending on the NSF, NIH, etc). It isn't a quick solution, but it's what we need to do to reverse the direction that the nation is headed, and the first step isn't cutting spending on education, infrastructure, and research in the name of balancing the budget, but raising taxes to fund those areas while balancing the budget.

Yup, pretty much agree. Education is the key to winning in the battlefields of tomorrow.

And I hope it didn't appear that I felt that businesses were making bad decisions. In a normally functioning marketplace, businesses invest to sieze marketshare...ie they aggressively grow to satisfy demand. This demand has existed as again profits have been healthy. But business by its nature is selfish, which normally helps the consumer. The problem is its kind of leaving the country out to dry as there has been limited hiring and investment relative to other periods of healthy profits. Again, hiring is not the govts fault.

Before we start dropping a deuce on businesses for not hiring, perhaps there aren't enough qualified applicants available for the positions?

Largely true. But so is your argument about high requirements. I am almost uniquely qualified in a specific business field for which I'm consulting. Well just for kicks I threw a resume at that unique position within a biomed firm. We talked but they were looking for someone with my exact background from someone with a decade in the biomedical field. Believe me...pretty much no chance of that. Their posting was up for about 6 months in market with millions of workers available and likely taken down without a qualified candidate.