Oh boy, you hit my hot spot... the national debt. Unfortunately, you used more than half of the article trying to place blame. Believe me, there is plenty to go around. Agree that there should not be a BBA or a supermajority. Love the CBBP example that "families often borrow". They forget to mention what happens to them if they don't pay…
Oh boy, you hit my hot spot... the national debt. Unfortunately, you used more than half of the article trying to place blame. Believe me, there is plenty to go around. Agree that there should not be a BBA or a supermajority. Love the CBBP example that "families often borrow". They forget to mention what happens to them if they don't pay it back! The EPI "revenue decline' argument is interesting, but in the last 60 years, revenue has declined only 6 times and only once (2009) by more than 3%. We spent $600 billion in interest last year and that's going up $300B+ with every 1% increase in Treasury rates. I wrote a Trib (badly edited) op-ed last year in response to a Professor Bruno piece placing much of the blame for our debt/deficit problems on billionaires. There are 700ish billionaires in the US with a TOTAL net worth of 5 trillion. We added more debt in the past 2 years. Take all their money and we reduce the national debt by 16%. It ain't their fault. Government spending graph is a hockey stick, and every American man, woman and child has over $100,000 in debt and growing.
The national debt is way too high. We DO need to get the federal budget under control. The Republicans (and a few Democrats) who say that are right. The Republicans are hypocrites in only complaining when there is a Democrat signing all those debt laden budgets. The Democrats who insist that deficits don't matter are wrong.
Bill Clinton gets credit for the last time we balanced the federal budget - and he deserves some of that credit. But it was not only his tax raising bill in 1993 but also the the others passed under Reagan and GHW Bush that led to that coming about. In the last 4 years that Clinton was in office the federal government collected an average of 19.4% of GDP in taxes. Because of George W Bush's and Trump's tax cuts that figure fell to 16.3% for the 4 years of Trump's term. The federal budget can be brought into balance if we go back to collecting another 3% of GDP in taxes AND trim $500 billion in spending. How we apportion those tax increases and budget cuts is debatable.
The 2022 revenue as a percent of GDP will be 20% with a record $4.9 trillion in revenue. The deficit will be $1.4 trillion an additional 5.5% of GDP. Seems to me the main issue is spending.
The problem with the "just cut spending!" mantra is that neither party REALLY has an appetite for it. Most government spending is popular and arguably necessary. Not all, of course, but look at what happened when that stubborn ideologue Bruce Rauner was governor... he banged on about cutting spending, but then couldn't find nearly enough popular cuts to make.
Of course. Santa is much more popular than Scrooge. Politicians and the media love the compassionate vs heartless characterizations. The problem is compounded by spending growth that always outpaces revenue growth, which is a result of growth in current programs and adding new programs. There will always be more things to spend on than there is revenue.
In 2019 revenue was $3.5 trillion, and the deficit was $984 billion. So $1.4 trillion more in revenue in 2022, still saw a deficit increase of $400 billion. The $6 trillion in 2022 is a 36% spending increase over the $4.4 Trillion of 2019.
"Santa is much more popular than Scrooge." Love it! Wait until those elves unionize, though.
"Popular cuts" is an oxymoron, EZ. It will take a "stubborn idealogue" (BTW the nicest thing you've ever called Rauner), and support from the swamp (I hate the word, but if the shoe fits...) to ever make any progress. It's hard to manage a budget on a mere $5 trillion in revenue. That's more in revenue than the country's 20 largest companies combined.
"Love the CBBP example that 'families often borrow'. They forget to mention what happens to them if they don't pay it back! "
In what sense does the United States not "pay it back"? The United States has not once defaulted on its loans, which is why everyone is happy to continue to lend it money in the form of bonds at low interest rates. If a family doesn't pay back one of its loans, its credit rating tanks and it can't borrow again or must pay through the nose to do so. If an analogous fate befalls the United States with a first-ever debt default, it will count among the stupidest, most pointless, self-destructive acts in the history of a great nation. (Of course, Trump is all for it, reminding us all afresh what a dangerous dumbass the man is, devoid of any civic conscience or common sense.)
I'll at least say this for that family: it may have borrowed too much, but odds are that it would have paid that loan if it could have. We can pay our debts. Indeed, we can do so quite comfortably. If we don't, it will be because we choose not to, because we're insane.
I have no idea how to respond to this... If a family does not pay their mortgage, they lose their home. They do not have the option of borrowing more and more and more. When the government pays off existing debt by issuing greater and greater amounts of debt, they are not paying off their debt, they are accumulating more. Families do not have the option of printing money. The federal government is leveraging off the credit of the wealthiest nation in history. They have so far accumulated $100,000 of debt for you, me and every other American. We will soon be paying 1 trillion dollars each year to service it. Any Econ 101 book will tell you that "Rising debt increases expectations of higher rates of inflation and erosion of confidence in the country's currency". At some point, probably not in my lifetime, we will have to pay the piper. Here is a site showing countries who have had debt crises. It's a long list and I was surprised to see the US on it from 1790. https://en.wikipedia.org/wiki/List_of_sovereign_debt_crises
Oh boy, you hit my hot spot... the national debt. Unfortunately, you used more than half of the article trying to place blame. Believe me, there is plenty to go around. Agree that there should not be a BBA or a supermajority. Love the CBBP example that "families often borrow". They forget to mention what happens to them if they don't pay it back! The EPI "revenue decline' argument is interesting, but in the last 60 years, revenue has declined only 6 times and only once (2009) by more than 3%. We spent $600 billion in interest last year and that's going up $300B+ with every 1% increase in Treasury rates. I wrote a Trib (badly edited) op-ed last year in response to a Professor Bruno piece placing much of the blame for our debt/deficit problems on billionaires. There are 700ish billionaires in the US with a TOTAL net worth of 5 trillion. We added more debt in the past 2 years. Take all their money and we reduce the national debt by 16%. It ain't their fault. Government spending graph is a hockey stick, and every American man, woman and child has over $100,000 in debt and growing.
The national debt is way too high. We DO need to get the federal budget under control. The Republicans (and a few Democrats) who say that are right. The Republicans are hypocrites in only complaining when there is a Democrat signing all those debt laden budgets. The Democrats who insist that deficits don't matter are wrong.
Bill Clinton gets credit for the last time we balanced the federal budget - and he deserves some of that credit. But it was not only his tax raising bill in 1993 but also the the others passed under Reagan and GHW Bush that led to that coming about. In the last 4 years that Clinton was in office the federal government collected an average of 19.4% of GDP in taxes. Because of George W Bush's and Trump's tax cuts that figure fell to 16.3% for the 4 years of Trump's term. The federal budget can be brought into balance if we go back to collecting another 3% of GDP in taxes AND trim $500 billion in spending. How we apportion those tax increases and budget cuts is debatable.
The 2022 revenue as a percent of GDP will be 20% with a record $4.9 trillion in revenue. The deficit will be $1.4 trillion an additional 5.5% of GDP. Seems to me the main issue is spending.
https://fiscaldata.treasury.gov/americas-finance-guide/government-revenue/#:~:text=Total%20revenue%20has%20increased%20from%20%24%204.05%20T,the%20United%20States%20that%20year%20%24%204.90%20trillion.
https://www.cbo.gov/publication/58592
The problem with the "just cut spending!" mantra is that neither party REALLY has an appetite for it. Most government spending is popular and arguably necessary. Not all, of course, but look at what happened when that stubborn ideologue Bruce Rauner was governor... he banged on about cutting spending, but then couldn't find nearly enough popular cuts to make.
Of course. Santa is much more popular than Scrooge. Politicians and the media love the compassionate vs heartless characterizations. The problem is compounded by spending growth that always outpaces revenue growth, which is a result of growth in current programs and adding new programs. There will always be more things to spend on than there is revenue.
In 2019 revenue was $3.5 trillion, and the deficit was $984 billion. So $1.4 trillion more in revenue in 2022, still saw a deficit increase of $400 billion. The $6 trillion in 2022 is a 36% spending increase over the $4.4 Trillion of 2019.
"Santa is much more popular than Scrooge." Love it! Wait until those elves unionize, though.
"Popular cuts" is an oxymoron, EZ. It will take a "stubborn idealogue" (BTW the nicest thing you've ever called Rauner), and support from the swamp (I hate the word, but if the shoe fits...) to ever make any progress. It's hard to manage a budget on a mere $5 trillion in revenue. That's more in revenue than the country's 20 largest companies combined.
"Love the CBBP example that 'families often borrow'. They forget to mention what happens to them if they don't pay it back! "
In what sense does the United States not "pay it back"? The United States has not once defaulted on its loans, which is why everyone is happy to continue to lend it money in the form of bonds at low interest rates. If a family doesn't pay back one of its loans, its credit rating tanks and it can't borrow again or must pay through the nose to do so. If an analogous fate befalls the United States with a first-ever debt default, it will count among the stupidest, most pointless, self-destructive acts in the history of a great nation. (Of course, Trump is all for it, reminding us all afresh what a dangerous dumbass the man is, devoid of any civic conscience or common sense.)
I'll at least say this for that family: it may have borrowed too much, but odds are that it would have paid that loan if it could have. We can pay our debts. Indeed, we can do so quite comfortably. If we don't, it will be because we choose not to, because we're insane.
I have no idea how to respond to this... If a family does not pay their mortgage, they lose their home. They do not have the option of borrowing more and more and more. When the government pays off existing debt by issuing greater and greater amounts of debt, they are not paying off their debt, they are accumulating more. Families do not have the option of printing money. The federal government is leveraging off the credit of the wealthiest nation in history. They have so far accumulated $100,000 of debt for you, me and every other American. We will soon be paying 1 trillion dollars each year to service it. Any Econ 101 book will tell you that "Rising debt increases expectations of higher rates of inflation and erosion of confidence in the country's currency". At some point, probably not in my lifetime, we will have to pay the piper. Here is a site showing countries who have had debt crises. It's a long list and I was surprised to see the US on it from 1790. https://en.wikipedia.org/wiki/List_of_sovereign_debt_crises