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Thread: U.S. Deficit Decline to 2.8% of GDP Is Unprecedented Turn

  1. #61
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    Re: U.S. Deficit Decline to 2.8% of GDP Is Unprecedented Turn

    Quote Originally Posted by jmotivator View Post
    Here, let me help!

    2009 US Budget: $3.1 Trillion
    2013 US Budget: $3.8 Trillion

    Difference: $700 billion
    So if Our budget remained at the level we had at the height of the stimulus we would be running a surplus now.
    Fallacy of composition.

    You cannot say that total receipts would be at their record levels if we held spending constant. Does this make sense?
    It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.
    "Wealth of Nations," Book V, Chapter II, Part II, Article I, pg.911

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    Re: U.S. Deficit Decline to 2.8% of GDP Is Unprecedented Turn

    Quote Originally Posted by Kushinator View Post
    Of course!



    A partisan foot stomp!



    The debt total is irrelevant. What is important is that deficit growth < output growth.
    No, what matters is the debt service on that debt which is now the fourth largest budget item and soon to be first or second as interest rates rise. You cannot seem to comprehend that reality. Debt today exceeds our yearly GDP and you don't seem to think that is a problem, why? When was the last time that debt exceeded yearly GDP?

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    Re: U.S. Deficit Decline to 2.8% of GDP Is Unprecedented Turn

    Quote Originally Posted by CanadaJohn View Post
    Obama's spending obsession has effectively been controlled since shortly following the 2010 mid-term elections when the Republicans took control of the House and the initiation of spending bills.
    Spending was a byproduct of a financial crisis. As expected, automatic stabilization outlays declined with a much improved economy.

    That would be President Obama who has traveled the country claiming obstructionist Republicans have kept him from his plans to improve the economy and yet you, and others, are now touting how wonderful the American economy is. Imagine that!!
    It could be much better. Too bad the partisan right salivates at the idea of financial collapse on the watch of this administration. There is absolutely no reason to credit Republicans in Congress for anything.
    It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.
    "Wealth of Nations," Book V, Chapter II, Part II, Article I, pg.911

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    Re: U.S. Deficit Decline to 2.8% of GDP Is Unprecedented Turn

    Quote Originally Posted by Visbek View Post
    sigh

    No, it was actually Cheney who insisted that "deficits don't matter," when Bush 43-era policies erased the Clinton-era surplus.
    sigh

    No, it has been countless liberals on this site.

    The typical Keynesian claim is: During a recession, it is more important to spend on stimulus with high multipliers (like infrastructure spending, or unemployment benefits) to kick-start the economy, than to worry about short-term deficits. The stimulus will get the economy back on track faster, which means you're limiting the amount of government revenues lost to the recession. In turn, the deficit will go down as the economy gets back on track.

    In addition, a fair amount of the government spending cuts would harm the economy. Cutting military will have some negative effects; but firing teachers and cops, or allowing infrastructure to continue to deteriorate, or putting off needed bridges, will all hurt the economy.

    So: In 2008 and 2009, it would have been a great idea to spend on infrastructure projects, rather than do tax cuts.
    1) We need to fix up bridges and roads anyway.
    2) That kind of work would rely heavily on the underutilized construction workers and resources, idled by the recession / real estate bubble burst.
    3) In the long run, you'll make up more by getting the economy back on track sooner, than you would if you tried to cut spending during the recession.

    Further, the right-leaning economists claimed that a debt-to-GDP ratio above 100% would harm an economy. It turns out this is not the case, as the paper in question used a flawed interpretation of the data. (Reinhart-Rogoff Economic Paper Draws Fire - WSJ)

    Despite the conservative caricature that the left just wants to tax and spend, the results we're seeing now are entirely consistent with what leftists and Keynesian-influenced economists have been saying for years.
    Except that it is actually FED stimulus that has floated the economy, not Obamas spending spree in 2009-2010. If you are going to credit someone, be honest and credit Bernanke, not Obama. But then again, the repercussions of that FED policy aren't yet known.

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    Re: U.S. Deficit Decline to 2.8% of GDP Is Unprecedented Turn

    Quote Originally Posted by Kushinator View Post
    Fallacy of composition.

    You cannot say that total receipts would be at their record levels if we held spending constant. Does this make sense?
    What doesn't make sense is why we need a 3.8 trillion dollar budget? We have 50 states that have their budget as well and Congress has a tendency to run for the next election and buy votes with social spending which is a state responsibility all to keep their jobs. There is no false comparison here as it is right on. A growth of 700 billion in the budget to generate the results we have today is gross misuse of taxpayer money.

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    Re: U.S. Deficit Decline to 2.8% of GDP Is Unprecedented Turn

    Quote Originally Posted by Kushinator View Post
    Fallacy of composition.

    You cannot say that total receipts would be at their record levels if we held spending constant. Does this make sense?
    Government spending exceeds government receipts so it makes no sense to claim that government spending is a tax multiplier.
    Give a man a fish and he eats for a day. Teach a man to fish and he stops voting for the Free Fish party.

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    Re: U.S. Deficit Decline to 2.8% of GDP Is Unprecedented Turn

    Quote Originally Posted by Conservative View Post
    first or second as interest rates rise.
    Do you understand how debt works?

    You cannot seem to comprehend that reality.
    On the contrary, it is you that is severely lacking in the understanding department. Debt service is only an issue insofar as deficit growth > output growth. When this relationship reverses, the present value of debt necessarily decreases! Do you understand why or even what i am saying?

    Debt today exceeds our yearly GDP and you don't seem to think that is a problem, why?
    It is decreasing! You see, we just emerged from a once in a century financial crisis.


    When was the last time that debt exceeded yearly GDP?
    When the country emerged from both a world war and a once in a generation financial crisis.
    It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.
    "Wealth of Nations," Book V, Chapter II, Part II, Article I, pg.911

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    Re: U.S. Deficit Decline to 2.8% of GDP Is Unprecedented Turn

    Quote Originally Posted by Kushinator View Post
    Spending was a byproduct of a financial crisis. As expected, automatic stabilization outlays declined with a much improved economy.



    It could be much better. Too bad the partisan right salivates at the idea of financial collapse on the watch of this administration. There is absolutely no reason to credit Republicans in Congress for anything.
    Talk about partisanship, you have yet to give the opposite party any credit while trying to find something to credit Obama for. You have yet to acknowledge the Obama 3.9 trillion dollar budget proposal, the Obama debt of over 7 trillion dollars, the high unemployment/under employment/discouraged workers, and the partisan arrogant leadership he displays. Wonder what it is about liberalism that creates this kind of loyalty. True results matter and cutting the deficit to still record highs should never be touted as a success.

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    Re: U.S. Deficit Decline to 2.8% of GDP Is Unprecedented Turn

    Quote Originally Posted by jmotivator View Post
    Government spending exceeds government receipts so it makes no sense to claim that government spending is a tax multiplier.
    It makes absolutely no sense to believe that the economy would be where it is if government spending was curtailed for the past 5 years. Remember, government expenditure is a part of total output.
    It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.
    "Wealth of Nations," Book V, Chapter II, Part II, Article I, pg.911

  10. #70
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    Re: U.S. Deficit Decline to 2.8% of GDP Is Unprecedented Turn

    Quote Originally Posted by Kushinator View Post
    Do you understand how debt works?



    On the contrary, it is you that is severely lacking in the understanding department. Debt service is only an issue insofar as deficit growth > output growth. When this relationship reverses, the present value of debt necessarily decreases! Do you understand why or even what i am saying?



    It is decreasing! You see, we just emerged from a once in a century financial crisis.




    When the country emerged from both a world war and a once in a generation financial crisis.
    Yep, sure do understand how debt works and how that debt is paid for, do you?

    Debt service is far from your definition, it is paid to the bond holders many of who are outside this country and foreign sources. That is an outflow that we could use in taxpayers pockets especially in a consumer driven economy.

    Sorry but deficits being reduced that are still records and that still grow the debt aren't something to be touted. You don't really seem to have a grasp of reality.

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