Explaining Why Federal Deficits Are Needed[W:5330]

[JohnfrmClevelan]

Here are the Obama deficits, tell me how they added to the net addition of financial assets?

OK. Government deficit = private sector surplus. The bigger the deficit, the greater the private sector gain.

Your assumption is that there was a return on that so called investment and that it was a net addition.

No, I'm not even looking at the return on investment, I'm simply looking at the net addition of financial assets to the private sector. If you want to discuss return on investment, that's fine too. Deficit spending elicits production that would not otherwise have happened. That means more commerce and more jobs. And if you had bothered to read the rest of the thread, you would have learned that deficit spending is normally necessary in our economy to offset demand leakages from savings and trade deficits. Without deficit spending, we would need some spectacular growth in order for normal credit growth to outweigh those demand leakages year after year.

You definitely have a socialist mentality and no understanding of the private sector, the value of money, and what deficit spending that Obama has done generated

And you definitely have a conservative mentality, because you eschew education and understanding of the subject in favor of just repeating the same uninformed garbage over and over, with no proof and very little reasoning.

Debt Debt
Fiscal Yr Oct. 1 Sept. 30 Deficit
2009 10.1 11.9 1.8
2010 11.9 13.6 1.7
2011 13.6 14.8 1.2
2012 14.8 16.1 1.3
2913 16.1 16.7 0.6
2014 16.7 17.8 1.1
2015 17.8 18.2 0.4
16-Jul
2016 18.2 19.4 1.2

More numbers with zero context. Keep on putting them out there, and maybe someday they will be meaningful. :roll:

You do not seem to understand that it isn't the government's role to add to its own asset base, that is the role of the private investor. Govt. spending doesn't increase net worth, it increases debt

The government, with its own central bank, is in the unique position of being able to create currency and elicit production in the private sector, thereby increasing overall wealth. The government's role is to benefit its citizens, and this benefits the citizens.

 

[JohnfrmClevelan]

Look, you don't get it and probably never will. You claimed this is the greatest economy in the world which is true and it is an economy that is based about 20% on govt. spending among the lowest in the world. it is an economy that benefits from the private sector and individual wealth creation, not govt. increasing spending and value.

Yes, deficit spending is money spent over and above the taxation, exactly, it has to be paid for, you have no concept or understanding of that reality. When the govt. runs a surplus it should go back to the people who helped create it. The time for deficit spending is during a recession and that should be to prime the private sector pump not create more entitlement, dependence, or bail out non Federal Responsibility issues. Reagan did it right, his stimulus was all tax cuts and the revenue generated was spent in the private sector. Obama's stimulus was targeted tax cuts and spending for shovel ready jobs. Targeted tax cuts like cash for clunkers etc was a failure because the people only got a tax cut if they spent money, money they didn't have. Shovel ready jobs took employment fro 142 million(BLS) in January 2009 to 139 million in January 2011, that is a failure of stimulus spending

Until you understand that debt caused by deficits has to be funded, this discussion is a waste of time and when you fund the debt service today that is 250 billion that would be better spent elsewhere in the private sector or given back to the consumers but that couldn't be done because it had to be funded. Please take a finance course and stop making a fool of yourself.

Well, this begs the question, conservative - what is your educational background? Where did you pick up all of your massive expertise in economics and government finance? Because so far, I'm the only one coming up with real answers here, while you can only repeat that I don't understand. So why don't you lay out your shining CV for us all?

 

[Conservative]

Well, this begs the question, conservative - what is your educational background? Where did you pick up all of your massive expertise in economics and government finance? Because so far, I'm the only one coming up with real answers here, while you can only repeat that I don't understand. So why don't you lay out your shining CV for us all?

You and I are done, a total waste of time, someone that doesn't understand the value of money, the indirect costs to the govt. for debt, the affects the printing of money has on the value of the dollar isn't worth any more time. for some reason you believe what you are told and that the deficit spending goes back to the economy but you don't understand the budget at all. how does the debt service get back into the economy when over 40% of it goes overseas? How does deficit spending that goes to create more entitlements that do nothing to lower costs benefit the economy? What a naïve view you have of the economy and human behavior

 

[Conservative]

OK. Government deficit = private sector surplus. The bigger the deficit, the greater the private sector gain.



No, I'm not even looking at the return on investment, I'm simply looking at the net addition of financial assets to the private sector. If you want to discuss return on investment, that's fine too. Deficit spending elicits production that would not otherwise have happened. That means more commerce and more jobs. And if you had bothered to read the rest of the thread, you would have learned that deficit spending is normally necessary in our economy to offset demand leakages from savings and trade deficits. Without deficit spending, we would need some spectacular growth in order for normal credit growth to outweigh those demand leakages year after year.



And you definitely have a conservative mentality, because you eschew education and understanding of the subject in favor of just repeating the same uninformed garbage over and over, with no proof and very little reasoning.



More numbers with zero context. Keep on putting them out there, and maybe someday they will be meaningful. :roll:




The government, with its own central bank, is in the unique position of being able to create currency and elicit production in the private sector, thereby increasing overall wealth. The government's role is to benefit its citizens, and this benefits the citizens.

Oh by the way those numbers out of context as you call it are the Obama deficits by year and total 9 trillion dollars added to the debt. What exactly have the taxpayers gotten for that so called investment you want to tout

 

[JohnfrmClevelan]

You and I are done, a total waste of time, someone that doesn't understand the value of money, the indirect costs to the govt. for debt, the affects the printing of money has on the value of the dollar isn't worth any more time. for some reason you believe what you are told and that the deficit spending goes back to the economy but you don't understand the budget at all. how does the debt service get back into the economy when over 40% of it goes overseas? How does deficit spending that goes to create more entitlements that do nothing to lower costs benefit the economy? What a naïve view you have of the economy and human behavior

Not so eager to compare educations anymore, are you? Probably a good call on your part.

I don't believe what I am told, I study the subject. I read a lot of material, mostly academic papers, about this stuff outside of debate boards. Can you say the same?

 

[Conservative]

Not so eager to compare educations anymore, are you? Probably a good call on your part.

I don't believe what I am told, I study the subject. I read a lot of material, mostly academic papers, about this stuff outside of debate boards. Can you say the same?

What I see is a book smart street stupid comments about deficit spending never understanding the consequences. the value of money, the true role of the federal govt, the affects on the private sector do not matter to someone like you. You are definitely a liberal, someone who ignores reality and human nature that somehow believes govt. is the answer and govt. spending always generates positive results. Debt doesn't matter because you can always print your way out of it ignores who that hurts and how much. How unliberal of you not caring about how it affects someone else.

 

[JohnfrmClevelan]

What I see is a book smart street stupid comments about deficit spending never understanding the consequences. the value of money, the true role of the federal govt, the affects on the private sector do not matter to someone like you. You are definitely a liberal, someone who ignores reality and human nature that somehow believes govt. is the answer and govt. spending always generates positive results. Debt doesn't matter because you can always print your way out of it ignores who that hurts and how much. How unliberal of you not caring about how it affects someone else.

I accept your surrender.

 

[Moderate Right]

Here are the Obama deficits, tell me how they added to the net addition of financial assets? Your assumption is that there was a return on that so called investment and that it was a net addition. You definitely have a socialist mentality and no understanding of the private sector, the value of money, and what deficit spending that Obama has done generated
Debt Debt
Fiscal Yr Oct. 1 Sept. 30 Deficit
2009 10.1 11.9 1.8
2010 11.9 13.6 1.7
2011 13.6 14.8 1.2
2012 14.8 16.1 1.3
2913 16.1 16.7 0.6
2014 16.7 17.8 1.1
2015 17.8 18.2 0.4
16-Jul
2016 18.2 19.4 1.2


You do not seem to understand that it isn't the government's role to add to its own asset base, that is the role of the private investor. Govt. spending doesn't increase net worth, it increases debt

It's kind of like when a private person runs up a credit card debt of $20,000 and then when you look at their assets you can't find squat. The money just vanished into thin air with nothing to show for it but the bill for $20,000 still comes in the mail.

 

[JohnfrmClevelan]

It's kind of like when a private person runs up a credit card debt of $20,000 and then when you look at their assets you can't find squat. The money just vanished into thin air with nothing to show for it but the bill for $20,000 still comes in the mail.

It's nothing like that. First of all, we should all know by now that comparing a person's credit card bill with a government sovereign in its own currency is invalid. Second, the benefit has accrued as increased wealth. Things have been produced, people have eaten and been sheltered, houses have been built, etc. That's commerce. Not all of it results in durable goods - that doesn't mean it's not worthwhile.

Besides - government money exists until it is taxed away.

 

[Moderate Right]

OK. Government deficit = private sector surplus. The bigger the deficit, the greater the private sector gain.



No, I'm not even looking at the return on investment, I'm simply looking at the net addition of financial assets to the private sector. If you want to discuss return on investment, that's fine too. Deficit spending elicits production that would not otherwise have happened. That means more commerce and more jobs. And if you had bothered to read the rest of the thread, you would have learned that deficit spending is normally necessary in our economy to offset demand leakages from savings and trade deficits. Without deficit spending, we would need some spectacular growth in order for normal credit growth to outweigh those demand leakages year after year.



And you definitely have a conservative mentality, because you eschew education and understanding of the subject in favor of just repeating the same uninformed garbage over and over, with no proof and very little reasoning.



More numbers with zero context. Keep on putting them out there, and maybe someday they will be meaningful. :roll:




The government, with its own central bank, is in the unique position of being able to create currency and elicit production in the private sector, thereby increasing overall wealth. The government's role is to benefit its citizens, and this benefits the citizens.

But you said that the increasing overall wealth is going to the rich. So, maybe we should quit the deficit spending because it is winding up in the hands of the rich. I still don't understand, if what you say is true, why the government can't just print up a million dollars for each and every one of the 99% - because we can and we don't even have to worry about the increased debt by doing it and, it goes to the 99% and not the rich, ending income inequality.

 

[JohnfrmClevelan]

But you said that the increasing overall wealth is going to the rich.

I said that an outsized share of income is going to the rich, which is true. But that is a separate problem.

So, maybe we should quit the deficit spending because it is winding up in the hands of the rich.

That's like going on a diet by starving your chickens and cows.

I still don't understand, if what you say is true, why the government can't just print up a million dollars for each and every one of the 99% - because we can and we don't even have to worry about the increased debt by doing it and, it goes to the 99% and not the rich, ending income inequality.

Because too much demand would outstrip our economy's ability to meet demand, which would drive up prices.

If you really have a problem understanding this, then there is little hope for you. I truly hope, for your sake, that you are just raising this argument (yet again) to be a P.I.T.A.

 

[Conservative]

I accept your surrender.

And I accept your lean along with the reality that in the liberal world, big govt. and govt. spending creates that utopia liberals like you think exists.

 

[James972]

It's nothing like that. First of all, we should all know by now that comparing a person's credit card bill with a government sovereign in its own currency is invalid.

actually identical, both a person and govt look back and wonder where the money went and why problems are worse not better. We're $20 trillion in debt, spending has just gone from 2 to 3 to $4 trillion and all Bernie/Hillary want to do is spend more without realizing that their crippling welfare spending is causing a greater need for more spending, not lessor need. 1+1=2

 

[James972]

The government, with its own central bank, is in the unique position of being able to create currency and elicit production in the private sector, thereby increasing overall wealth.

one country in the Stone Age tries to get ahead by printing money while another tries to get ahead by encouraging the capitalist supply of new inventions. Which one gets ahead and which one is totally stupid???????????????

 

[Moderate Right]

Because too much demand would outstrip our economy's ability to meet demand, which would drive up prices.

And yet you want to deficit spend considerably more than we do now. How is that any different?

 

[SailaWay]

What I see is a book smart street stupid comments about deficit spending never understanding the consequences. the value of money, the true role of the federal govt, the affects on the private sector do not matter to someone like you. You are definitely a liberal, someone who ignores reality and human nature that somehow believes govt. is the answer and govt. spending always generates positive results. Debt doesn't matter because you can always print your way out of it ignores who that hurts and how much. How unliberal of you not caring about how it affects someone else.

this poster understands what TRUE wisdom is..

 

[JohnfrmClevelan]

And yet you want to deficit spend considerably more than we do now. How is that any different?

Do you think that American industry is producing all that it is capable of producing? What is preventing Ford from producing more cars, for instance?

 

[Moderate Right]

Do you think that American industry is producing all that it is capable of producing? What is preventing Ford from producing more cars, for instance?

Again I ask, what difference does it make if we deficit spend your way or we just give the lower classes each a bunch of money to spend as they please? No need to take from the rich when we can just print money and give it away. Either way you want to increase deficit spending so what's the difference?

 

[JohnfrmClevelan]

Again I ask, what difference does it make if we deficit spend your way or we just give the lower classes each a bunch of money to spend as they please? No need to take from the rich when we can just print money and give it away. Either way you want to increase deficit spending so what's the difference?

The difference is largely political. You could pay the unemployed to do stuff, or you could just give them the money, but one way is politically more palatable than the other. The economically important thing is getting money in their hands so they can spend it, eat, live, etc.

Why take from the rich? Because rich people having too much money leads to political problems. They buy influence, which often means they are influencing how much money comes their way. Why do you think the Koch brothers play this game? They are buying influence in order to make their businesses more profitable, lower their own taxes, eliminate potential competition, etc. The more you tax the rich, the less debt you have to amass, and much of that interest flows to the rich anyway.

If you have a problem with taxing more money from the rich, I'd sure like to hear a reason that outweighs my point about them buying political influence.

 

[Moderate Right]

The difference is largely political. You could pay the unemployed to do stuff, or you could just give them the money, but one way is politically more palatable than the other. The economically important thing is getting money in their hands so they can spend it, eat, live, etc.

Why take from the rich? Because rich people having too much money leads to political problems. They buy influence, which often means they are influencing how much money comes their way. Why do you think the Koch brothers play this game? They are buying influence in order to make their businesses more profitable, lower their own taxes, eliminate potential competition, etc. The more you tax the rich, the less debt you have to amass, and much of that interest flows to the rich anyway.

If you have a problem with taxing more money from the rich, I'd sure like to hear a reason that outweighs my point about them buying political influence.

One could argue that the poorer buy political influence and they are even much more effective and economical at it than the rich, which redistributes wealth all by itself. Look at how many people clamor about income inequality, including politicians, and then tell me that the poor have not bought political influence. The fact that the rich spend millions or even billions to buy political influence while the poor do not is a form of wealth Redistribution. The fact that you resist a plan making the poor richer without taking from the rich in order to do it just confirms there is a jealousy factor. Making the poor richer is not good enough for you guys. You also have to make the rich poorer.

 

[mmi]

Making the poor richer is not good enough for you guys. You also have to make the rich poorer.

Well, a little bit poorer, and we can use the money to make the poor a little bit richer.

 

[SailaWay]

Well, a little bit poorer, and we can use the money to make the poor a little bit richer.

who is working the system to make the poor richer?? and richer coming from taking from the producer rich?

its the MEDIA and ENTERTAINMENT industry.. the media is now trying to bring in womens very worst nightmare MUSLIMS because of them being 1 billion population MORE to drug out on entertainment and the news

 

[Critter7r]

You are wrong still. Look at your chart. 1986 was $189B, 1993 $169B.

You are cherry-picking.

From the trough in 1970 to the trough in 1993, there was an increase. 1986 was a crest.

You are also talking about $75B over 20 years which accounts to $3.2B a year which was less then interest payments on Federal debt. You are looking at Net National Savings the wrong way. You see a number like $169b in 1993 and freak out because it rose. But did it actually rise per person in real meaningful way? Meaning did it just match GDP PPP, wage increases or inflation/deflation?
So let's look at it in terms of population..

So $94b/203m (US population at the time). That's $543.

Now $169B/248m (US population in 1990).. That's $681.

That's not a big difference.

But it's still a long-term, sustained increase. It doesn't have to be "a big difference" to be an increasing trend. And, you just showed that it increased in nominal dollars AND per capita.

These aren't huge jumps, rather falling behind GDP PPP, wage increase and inflation/deflation over those periods. In fact the Net National Savings is much lower then it should be, especially if you are looking towards GDP PPP. PPP was just over $5000 in 1970 and in 2014 $54,000. So you should expect the Net National Savings to have grown at that rate as well to mean that per person the Net National Savings should be close to $5,000 per person or $1.5T.

So this Net National Savings is nonsense when you take a closer look at the numbers and don't rely on ideology.

Net savings generally increases over time. We nearly always have more in savings one year than we did the previous year. How is that nonsense? You may disagree the underlying meanings of our ever-increasing net savings, but to deny that it's happening is truly dumb.

 

[Moderate Right]

Well, a little bit poorer, and we can use the money to make the poor a little bit richer.

Did you not understand my post? I said that since deficits and the national debt are no big deal then we can just print up some money and give it to the poor without taxing the rich more at all. Then I said that that is not good enough for you guys because you aren't happy with just making the poor richer, you also have to take money away from the rich as well because you are jealous of them. Making the poor richer by just printing up some money and giving it to them does decrease income inequality because it raises them up so there is no need to tear the rich down.

 

[Moderate Right]

You are cherry-picking.

From the trough in 1970 to the trough in 1993, there was an increase. 1986 was a crest.



But it's still a long-term, sustained increase. It doesn't have to be "a big difference" to be an increasing trend. And, you just showed that it increased in nominal dollars AND per capita.



Net savings generally increases over time. We nearly always have more in savings one year than we did the previous year. How is that nonsense? You may disagree the underlying meanings of our ever-increasing net savings, but to deny that it's happening is truly dumb.

So you guys never cherry pick, only the right does. Got it.