Why liberals should care about a balanced budget.
- Thread starter ♪alt13
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I thought Hey Hey said he wanted to learn something.
Immediate global economic collapse.
Immediate global economic collapse.
framer
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Yep, agree with Franklin here.
♪alt13
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cool we agree on something it's a start
There is a big difference between being open minded and gullible.
You can't just make **** up. You said for instance that budget deficits have grown recently when they have gone down. You also said that the National debt has gone down when it has gone up. It makes me wonder if you know the difference.
deficits
https://www.davemanuel.com/history-of-deficits-and-surpluses-in-the-united-states.php
national debt
https://www.usdebtclock.org/
Instead of simply asserting that you are full of **** I provided links with actual #'s to prove you are full of ****.
LogGrad98
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So if we stopped paying a penny on our debt, tomorrow I couldn't buy a big mac at mcd's with the 5 bucks I have in my pocket right now? Seems a bit extreme.
What that says to me is you really don't know what would happen, or might happen.
Or... and just bear with me for a second...
Your vision of a collapse differs from someone elses.
♪alt13
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Are you saying we don't pay a single penny or we pay everything except one penny?
The former would have very bad consequences the latter seems kind of silly.
LogGrad98
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I am saying if we just stopped paying anything. Like starting tomorrow we just didn't mail any more checks out. What realistically would be the outcome? Franklin said "immediate" collapse of the world economy. What does "immediate" mean? Dickhead...uh I mean Eldickhead rightly (for once) pointed out that the definition of "immediately" might not be the same as I and Webster's assume it is. I am just curious if we sent China and all of our creditors a picture of a middle finger and stopped paying any and all interest (and principle) tomorrow what is a likely outcome? You say "bad consequences", can you provide some detail as to what those would be and the economic mechanism driving said bad outcome? I am not saying it won't, I am saying I don't really know exactly what that would do and I am curious.
Let me be frank, HeyHey. I'm a condescending prick with this subject because I understand where those [generally] in your camp are coming from and see where you are wrong (you all say the exact same things). Your camp [generally] does not understand WTF I'm talking about but BELIEVE I'm wrong anyway. It gets tiring trying to have the patience with people who don't understand the first thing about this stuff, don't want to learn about it, but preach all cocksure like they're some expert. I refuse to debate this with someone who is preaching dogma. You are preaching dogma. If you want to learn about the subject then I'm more than happy to teach a bit. Then, if you show a bit of proficiency, I would be willing to debate the weaknesses that have actual merit.
Your inability to grasp what I stated regarding the debt going down, not up, and also about the CBO projected interest payments years in the future (not to mention you didn't say a peep about the unrealistic ballooning interest rates in 2 short years that are plugged into their projections for some bizarre reason), demonstrate your poor grasp of the subject.
I don't mean any offense, just trying to shoot honest wichoo.
You might be able to buy a big mac tomorrow, but cash would become so scarce in a few short days that this would no longer be possible. No, log, it's not even questionable what would happen. We would try to save it with a bank holiday, but that would have little chance of stopping the irreparable damage. If you want to understand the mechanisms of the spiral then google the effects on pension funds, breaking the buck, credit markets of all kinds, balance of trade accounting, foreign bond markets ...... If we let our banking system collapse then we are nothing short of ****ed. Good luck bartering your drywall, because that's about the only thing of value most of us hold of value in such an apocalyptic world.
LogGrad98
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Thanks for the response frank. The only problem with googling this kind of thing is you get as much or more opinion as you do informed reasoned arguments, and plenty of hyperbole and blaming instead of explanations of the issues involved.
I wouldn't be surprised if this is the one where a lot of the hyperbole actually has foundation though.
Basically what happens is the way our credit rating system stacks up is we force banks, pensions and other funds, etc. to sell the downgraded debt. There isn't anywhere near enough so called "cash on the sidelines" in deep pockets to stop the bleeding and we enter an unstoppable downward spiral. This is essentially what happened when Lehman collapsed, only on a scale that is nowhere near comparable to what a US default would do (we've thrown trillions at it and still haven't fully recovered; that's not an option when your currency is dead).
Outside the credit system, we are so large that we would affect the interest rates on bonds worldwide, and everyone would dump debt trying to seek asylum somewhere but there wouldn't be one since we are it, interest rates on every nation's borrowing costs would skyrocket thus sending their economies into shambles, precious metals prices would go through the roof, every bank would fail and it would be impossible to finance anything (that's the majority of our mediums of exchange creation), businesses would go bankrupt as there is no way for customers to purchase their goods and services...
It's a spiral because of the fractional reserve nature of every medium of exchange. This is the reason every gold standard ever failed. So, we invented a printing press to stop this otherwise inevitable bleeding. It worked pretty damn well following the 2008 financial crisis (or oil if you ask me).
Does that help a little?
I didn't read this link but I'm confident it will be a good explanation of break the buck for you: https://www.investopedia.com/terms/b/breaking-the-buck.asp
♪alt13
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What camp are you putting me into? I assure you that I have no problem grasping what you say. If there is a miscommunication it is because you failed to say what you mean.
Again you are framing me rather than engaging the subject. You have decided in your mind that everyone that thinks our debt is excessive is a nut job conspiracy theorist. This is a misrepresentation of myself and a great many people. What dogma have I preached here? I've simply pointed out numbers that
The debt in dollars has not gone down. The debt inflation adjusted has not gone down. The debt relative to GDP has yet to go down but is expected to for a few years if congress does not cut taxes and does not increase spending. I'm going to assume(because of you not clarifying I have to) that you are referring to debt to GDP over the next 4-5 years.
The biggest problem with projections of our debt to gdp going down(it is projected to go up again after that) is that variable, Congress. Without any pressure I find it unlikely that congress won't cut taxes, increase spending, or both.
If I have still not guessed correctly as to your meaning please clarify but don't fault me for my inability to read your mind.
What camp are you putting me into? I assure you that I have no problem grasping what you say. If there is a miscommunication it is because you failed to say what you mean.
Again you are framing me rather than engaging the subject. You have decided in your mind that everyone that thinks our debt is excessive is a nut job conspiracy theorist. This is a misrepresentation of myself and a great many people. What dogma have I preached here? I've simply pointed out numbers that
The debt in dollars has not gone down. The debt inflation adjusted has not gone down. The debt relative to GDP has yet to go down but is expected to for a few years if congress does not cut taxes and does not increase spending. I'm going to assume(because of you not clarifying I have to) that you are referring to debt to GDP over the next 4-5 years.
The biggest problem with projections of our debt to gdp going down(it is projected to go up again after that) is that variable, Congress. Without any pressure I find it unlikely that congress won't cut taxes, increase spending, or both.
If I have still not guessed correctly as to your meaning please clarify but don't fault me for my inability to read your mind.
Heyhey, we have not created any new debt in several years. We have printed money to pay for "deficits" that are only called deficits for accounting purposes. We are buying more than 100% of our current "deficit". The interest payments on our debt have gone down relative to GDP and in absolute terms.
For the fourth time, you need to figure out how much of these interest payments need to be backed out from the T-F loop. You will find that real payments back in 2000 or 2001 IIRC were somewhere near $100,000,000,000 more per year on our debt than they are now.
As far as explaining myself in a way that you would understand goes, I'm not writing you a novel.
The Thriller
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Franklin, you got your *** kicked. Now go away
♪alt13
Well-Known Member
Tell it to the Federal Reserve you obnoxious ****
This is just wrong.
From the federal Reserve
also from the Fed
As far as I can tell as of wedneday that number was 13.6%. But again as you can read for yourself above just because the Fed owns it doesn't mean it's not real debt. The fact that you said "backed out of the T-F loop" makes me think you already know this.
Further even if we disregard all the debt owned by the fed we still have to deal with more than 85% of the problem, $750,000,000,000. <that's billion (See I can make a number look super impressive by writing out all the zeros too)
No, you are including payments to the Social security trust fund. This does not include those. If social security was included the numbers would be much higher. Even if what you are saying was true(it's not) that is still more than half a trillion dollars less than the CBOs projection before paying a dime to the Social Security Trust Fund.
You can't explain yourself because your position is inconsistent and ill informed.
This is just wrong.
From the federal Reserve
https://www.federalreserve.gov/faqs/money_12853.htm
also from the Fed
https://research.stlouisfed.org/publications/es/article/9644
As far as I can tell as of wedneday that number was 13.6%. But again as you can read for yourself above just because the Fed owns it doesn't mean it's not real debt. The fact that you said "backed out of the T-F loop" makes me think you already know this.
Further even if we disregard all the debt owned by the fed we still have to deal with more than 85% of the problem, $750,000,000,000. <that's billion (See I can make a number look super impressive by writing out all the zeros too)
No, you are including payments to the Social security trust fund. This does not include those. If social security was included the numbers would be much higher. Even if what you are saying was true(it's not) that is still more than half a trillion dollars less than the CBOs projection before paying a dime to the Social Security Trust Fund.
You can't explain yourself because your position is inconsistent and ill informed.
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Your quote says "permanent". Where did I mention otherwise?
Correct. I already said as much. See the FoF comment.
As to the bolded part, ex-Fed Chairman Bernanke and your previous comment were absolutely correct that the govt should step in and spend on investments to make the debt more sustainable, and payable.
Your initial premise was that social welfare cuts would be the result of increasing debt loads. The opposite is true: the debt will increase because of increasing social welfare loads.
Also, I didn't do the math but back of the napkin calculations say it's much less than 13.6%. We are paying out $200 somethin billion and getting what, $90 billion back???
My numbers came from the White House official publication. $200 some odd billion back in 2000 or 2001, and about the same now except we are getting billions more back from the Federal Reserve each year.
If you are including payments to the Trust Fund then you are contradicting your claim that debt service will require social welfare cuts.