• This is a political forum that is non-biased/non-partisan and treats every person's position on topics equally. This debate forum is not aligned to any political party. In today's politics, many ideas are split between and even within all the political parties. Often we find ourselves agreeing on one platform but some topics break our mold. We are here to discuss them in a civil political debate. If this is your first visit to our political forums, be sure to check out the RULES. Registering for debate politics is necessary before posting. Register today to participate - it's free!

IMF chief says U.S. needs blend of spending cuts, revenue raising

donsutherland1

DP Veteran
Joined
Oct 17, 2007
Messages
11,862
Reaction score
10,300
Location
New York
Gender
Male
Political Leaning
Centrist
From Reuters:

The United States needs a balanced, comprehensive approach to tackle its fiscal woes that should include a mix of spending cuts and revenue increases, the head of the International Monetary Fund said on Sunday.
"My view, personally, is that the best way to go forward is to have a balanced approach that takes into account both increasing the revenue, which means, you know, either raising taxes or creating new sources of revenue, and cutting spending," IMF Managing Director Christine Lagarde said in a pre-taped interview on CNN's "State of the Union," which aired on Sunday.

IMF chief says U.S. needs blend of spending cuts, revenue raising | Reuters

Hopefully, the IMF Director-General's perspective will carry some weight in Washington. If the fiscal cliff situation is to be resolved in an effective manner and, more importantly, if the U.S. is to develop a credible and effective fiscal consolidation strategy, Washington's policy makers will need to focus on pragmatic realities. They will need to do so even if it requires them to give greater weight to best practices (and there are examples of successful fiscal consolidation efforts available in the international experience) than entrenched ideology or ideologically-driven assumptions.
 
I think both sides need to compromise. I think the best plan would be to eliminate the tax loopholes on some businesses that can get away with paying very little taxes and on some very wealthy individuals that can work the financial system to do the same thing. On the flip side I think we also need to reform and cut entitlement/welfare spending.
 
Shouldn't we first state what our interest payments to banks will be this year, then decide if those interest payments could be reduced. Next, even though it would be advantageous to the Military/Industrial/Corporate complex, let's not attack anybody in the coming year, and lower the Military OFFENSE budget accordingly. Absolutely get rid of the 'welfare queens" starting with Nuclear Power and Fossil Power subsidies, and not to forget many of the Military/Industrial welfare queens. Raise taxes to pre-Bush ( Ruth Marcus: The shifting line on tax cuts - The Washington Post ), Social Security Retirement is not an entitlement, but a prepaid retirement. Initiate a referendum to see if the citizens of the USA want to starve the poor and remove their medical care because those costs are unjustifiable. These suggestions are just starting points.
 
I think both sides need to compromise. I think the best plan would be to eliminate the tax loopholes on some businesses that can get away with paying very little taxes and on some very wealthy individuals that can work the financial system to do the same thing. On the flip side I think we also need to reform and cut entitlement/welfare spending.

I believe a measure of entitlement reform is essential. The easiest approach would be to agree on an increase in the age of eligibility. By easiest, I mean the approach that has the least adverse immediate macroeconomic impact. Other parameters i.e., copayments, means-testing, etc. should be in the mix.

In terms of tax revenue, I'm flexible as to the approaches taken to raise the agreed revenue. Tax reform that increases efficiency might be a good starting point, but some measure of rate changes might also be necessary. In general, though, the broader the tax base, the less the rate changes would need to be.
 
Shouldn't we first state what our interest payments to banks will be this year, then decide if those interest payments could be reduced.

There are limits to how much the interest payments can be reduced. The U.S. could try to shift more of its payments to the shorter-end of the yield curve, but that could lead to vulnerability once rates begin to rise from the currently historically low levels. However, even if the U.S. were to shift dramatically toward that end of the yield curve, demand might not be sufficient to avoid a rise in those interest rates. I don't believe such an approach is prudent, especially when one considers that interest rates are probably at or near their bottom. Numerous indebted countries have tried to shorten their average maturity only to be hit hard once interest rates began to rise. At that point, they wound up in a liquidity crisis that would have been avoidable had they maintained longer maturities that they did not need to roll over as quickly.

Next, even though it would be advantageous to the Military/Industrial/Corporate complex, let's not attack anybody in the coming year, and lower the Military OFFENSE budget accordingly.

I don't believe the U.S. needs to go to war in the coming year. It certainly should avoid commitments in civil conflicts e.g, the ongoing civil war in Syria. However, this isn't a fully controllable matter, so there is always a degree of risk.

Social Security Retirement is not an entitlement, but a prepaid retirement. Initiate a referendum to see if the citizens of the USA want to starve the poor and remove their medical care because those costs are unjustifiable.

Very few responsible political leaders would want to eliminate Social Security. Today, the program is underfunded. Moreover, there is no prefunded "trust fund" in terms of concrete assets so to speak. Payroll taxes have been used to acquire a special class of Treasury Securities and those securities will need to be cashed in to maintain the program's obligations. The program has also been expanded beyond its original parameters and that expansion has also entailed additional net costs. Fortunately, unlike with Medicare, the actuarial changes required to sustain Social Security are relatively modest (benefits indexed to inflation, gradually increased age limit, increased payroll tax ceiling indexed for inflation, modest payroll tax hike to fund the difference, etc.)
 
From Reuters:



IMF chief says U.S. needs blend of spending cuts, revenue raising | Reuters

Hopefully, the IMF Director-General's perspective will carry some weight in Washington. If the fiscal cliff situation is to be resolved in an effective manner and, more importantly, if the U.S. is to develop a credible and effective fiscal consolidation strategy, Washington's policy makers will need to focus on pragmatic realities. They will need to do so even if it requires them to give greater weight to best practices (and there are examples of successful fiscal consolidation efforts available in the international experience) than entrenched ideology or ideologically-driven assumptions.

While I agree with the premise of the solution needed, did Bowles-Simpson carry any weight ? While the GOP would be wise to embrace it fully at this point, it still gets lip-service at best. It was Obama's project, and when they came in with lowered rates for all (including the millionaires and billionaires), while cutting loopholes, creating a net revenue increase, almost exactly as the GOP has advocated, Obama and the spineless Dems made the two chrome-domes (both Simpson and Bowles are hair-challenged) as bushy red-headed stepchilds !

I would hope that the GOP lets Obama take us off the cliff until Obama embraces such as a Simpson-Bowles approach. But they won't.
 
Shouldn't we first state what our interest payments to banks will be this year, then decide if those interest payments could be reduced. Next, even though it would be advantageous to the Military/Industrial/Corporate complex, let's not attack anybody in the coming year, and lower the Military OFFENSE budget accordingly. Absolutely get rid of the 'welfare queens" starting with Nuclear Power and Fossil Power subsidies, and not to forget many of the Military/Industrial welfare queens. Raise taxes to pre-Bush ( Ruth Marcus: The shifting line on tax cuts - The Washington Post ), Social Security Retirement is not an entitlement, but a prepaid retirement. Initiate a referendum to see if the citizens of the USA want to starve the poor and remove their medical care because those costs are unjustifiable. These suggestions are just starting points.

I have to agree with you on everything you said. I also have no clue why some people call SS an entitlement. Cutting social security will do nothing to lower the debt. It is a seperate issue from the fiscal cliff. Cutting social welfare programs will only hurt the economy rather than help it and will cause needless suffering.
I'm with you on cutting the real welare queens, the corporations that cost the tax payers money but will not help the economy by providing jobs in the US. The CEOs paying themselves million dollar bonuses and laying workers off. Wall Street that played fast and lose with the economy and got bailed out. Lets do some common sense cutting on the budget.
 
From Reuters:



IMF chief says U.S. needs blend of spending cuts, revenue raising | Reuters

Hopefully, the IMF Director-General's perspective will carry some weight in Washington. If the fiscal cliff situation is to be resolved in an effective manner and, more importantly, if the U.S. is to develop a credible and effective fiscal consolidation strategy, Washington's policy makers will need to focus on pragmatic realities. They will need to do so even if it requires them to give greater weight to best practices (and there are examples of successful fiscal consolidation efforts available in the international experience) than entrenched ideology or ideologically-driven assumptions.

Lets see...

IMF = UN in certain people's minds.
Legard = French
Both = foreigners cant tell us anything useful because we are superior to everyone else.

So... chances are 0% to 0%....
 
Lets see...

IMF = UN in certain people's minds.
Legard = French
Both = foreigners cant tell us anything useful because we are superior to everyone else.

So... chances are 0% to 0%....
You are sadly right that many will perceive it this way. I do have to say I have a very bad knee jerk reaction in a negative way to anything the IMF says though because in my mind IMF = austerity and privatization things i do not like.
 
You are sadly right that many will perceive it this way. I do have to say I have a very bad knee jerk reaction in a negative way to anything the IMF says though because in my mind IMF = austerity and privatization things i do not like.

Which is ironic because that is exactly what the most negative towards the IMF and foreigners among the American political elite want...
 
From Reuters:



IMF chief says U.S. needs blend of spending cuts, revenue raising | Reuters

Hopefully, the IMF Director-General's perspective will carry some weight in Washington. If the fiscal cliff situation is to be resolved in an effective manner and, more importantly, if the U.S. is to develop a credible and effective fiscal consolidation strategy, Washington's policy makers will need to focus on pragmatic realities. They will need to do so even if it requires them to give greater weight to best practices (and there are examples of successful fiscal consolidation efforts available in the international experience) than entrenched ideology or ideologically-driven assumptions.

And let's cut out the subsidized oil company welfare checks, the corporate farmers subsidized welfare checks, Israels weaponry subsidized welfare check, Congress' subsidized health care, Congressional pay raises and return their wages to the average income in the US, and all the pork barrel spending the republicans do....
 
From Reuters:



IMF chief says U.S. needs blend of spending cuts, revenue raising | Reuters

Hopefully, the IMF Director-General's perspective will carry some weight in Washington. If the fiscal cliff situation is to be resolved in an effective manner and, more importantly, if the U.S. is to develop a credible and effective fiscal consolidation strategy, Washington's policy makers will need to focus on pragmatic realities. They will need to do so even if it requires them to give greater weight to best practices (and there are examples of successful fiscal consolidation efforts available in the international experience) than entrenched ideology or ideologically-driven assumptions.

Spending cuts first.
 
I have to agree with you on everything you said. I also have no clue why some people call SS an entitlement. Cutting social security will do nothing to lower the debt. It is a seperate issue from the fiscal cliff. Cutting social welfare programs will only hurt the economy rather than help it and will cause needless suffering.
I'm with you on cutting the real welare queens, the corporations that cost the tax payers money but will not help the economy by providing jobs in the US. The CEOs paying themselves million dollar bonuses and laying workers off. Wall Street that played fast and lose with the economy and got bailed out. Lets do some common sense cutting on the budget.

Are you kidding me? The SS/Medicare programs were designed to work when many more workers existed to support each retiree and each (surviving) retiree collected benefits for only a few years; the number of workers per retiree is dropping and many more are now living up to (and well past) the retirement age. Other social programs for "the poor", including welfare in its many forms, are now costing over $1 trillion per year, and much of that is simply gov't administrative overhead "needed" to dole out those funds. It has been said that these "welfare" funds are sufficient to give each "poor person" in the US about $61,000 per year.
 
Are you kidding me? The SS/Medicare programs were designed to work when many more workers existed to support each retiree and each (surviving) retiree collected benefits for only a few years; the number of workers per retiree is dropping and many more are now living up to (and well past) the retirement age. Other social programs for "the poor", including welfare in its many forms, are now costing over $1 trillion per year, and much of that is simply gov't administrative overhead "needed" to dole out those funds. It has been said that these "welfare" funds are sufficient to give each "poor person" in the US about $61,000 per year.

Actually, social security wasn't designed the way it is running now. Many years ago congress took money from the social security funds and it nearly brankrupted the program. It is designed as an insurance, you pay in with the promise to get retirement money and medical care when you reach retirement age. People who work physically hard jobs take a beating for 30 or 40 years and they earned the retirement and need the medical care. Those who work physically easy jobs might be able to retire later than others, but they paid into the program with the promise of retirement at age 65. When the US government makes a promise to the people, the people should expect that promise to be honored. As for programs for the poor, that money gets spent. There is a study that shows for every dollar spent on food stamps, the return on that back to the government is $1.40. Ending SNAP would cause needless suffering and harm the economy. Do we really want to be a nation that allows our poor, disabled and children to starve? Do we want to be the kind of nation that allows people to be in poor health and die without medical care simply because they can't afford to pay for it? That is not the way I want American to be. I think it is important to invest in our citizens and in the long run we will have a stronger healthier workforce.
 
Social Security has long-term fiscal imbalances. Reforms would reduce or eliminate those imbalances.

The latest information on Social Security's imbalances can be found on pp.148, 165-169 (pp.171, 188-192 on the .pdf) at http://www.gao.gov/financial/fy2011/11frusg.pdf

I agree that we need to reform it, but we don't need to cut it or end it. We should start reforming social security by putting the money back into the SS fun that congress has taken out over the years. Once that is done, SS will be fixed and good to go. Obamacare reduced the amount of medical costs medicare spends, so that is a good start as well.
 
When the US government makes a promise to the people, the people should expect that promise to be honored.
If we had a penny for every broken promise, we wouldn't be talking about fiscal cliffs and IMF chiefs.
 
I agree that we need to reform it, but we don't need to cut it or end it.
It's not really a question of whether or not we need to cut it... it's a question of when and how. Current benefit levels are unsustainable.
 
I agree that we need to reform it, but we don't need to cut it or end it. We should start reforming social security by putting the money back into the SS fun that congress has taken out over the years. Once that is done, SS will be fixed and good to go. Obamacare reduced the amount of medical costs medicare spends, so that is a good start as well.

I don't believe any serious political leader would eliminate Social Security. For all its challenges, the Program has made an important contribution in reducing the incidence of poverty among older Americans.

The Program faces big challenges on account of the nation's demographics (increasing share of the population comprised by people eligible for Social Security coupled with a lengthening life span of people eligible for Social Security meaning more people receive Social Security for a longer period). Determining how to fully fund the Program's anticipated payouts is a relatively straightforward actuarial exercise. Modest reforms can address Social Security's actuarial imbalances.

The health-related programs continue to drive the largest part of the nation's imbalances. Perhaps the leading challenge involved is finding an effective approach to slow the growth in medical expenditures, something that was largely outside the scope of the Affordable Care Act for which the primary goal was expanded health coverage, though CBO estimates some measure of savings albeit far short of what would be needed to eliminate the nation's long-term health-related imbalances. Medical expenditures cannot continue to grow at a multiple of the economy indefinitely, as foreign creditors won't be willing to pick up a growing share of those costs via financing U.S. deficits without the nation's debt stabilizing and then falling as a share of GDP over the longer-term. Numerous factors including debt-related risks, the need to tap savings countries such as Japan (aging + own debt challenges), and opportunities to earn attractive returns from growing economies outside the U.S., among other factors, could temper the flow of such funds to the U.S. in medium- and longer-term.

Until the issue concerning rapid growth in medical expenditures in the U.S. is resolved--and it's highly complex--public and private health care policies will either become more expensive (premiums/other costs rising faster than incomes grow), offer less coverage (procedures, pharmaceutical products, and/or technologies), and/or run imbalances. The challenge involved extends beyond Medicare/Medicaid Program design. A disproportionate share of medical cost increases also arise from hospital care, not physician appointments or medical supplies. The growing utilization and high cost of long-term care (e.g., at nursing homes) is also an emerging factor and has implications for Medicaid. These challenges need to be addressed comprehensively and objectively.
 
I think both sides need to compromise. I think the best plan would be to eliminate the tax loopholes on some businesses that can get away with paying very little taxes and on some very wealthy individuals that can work the financial system to do the same thing. On the flip side I think we also need to reform and cut entitlement/welfare spending.

Loopholes were designed by congress, then when they figured out they screwed up on some loopholes, so they came up the the AMT. Which was designed to effect the wealthy but now it almost effects everyone.
 
and on some very wealthy individuals that can work the financial system to do the same thing.
What about the 50% or so who work the political system to accomplish the same thing?

If we're going back to Clinton tax rates on the rich, why not couple it with Clinton tax rates on everyone else and Clinton spending levels?
 
I don't believe any serious political leader would eliminate Social Security. For all its challenges, the Program has made an important contribution in reducing the incidence of poverty among older Americans.

The Program faces big challenges on account of the nation's demographics (increasing share of the population comprised by people eligible for Social Security coupled with a lengthening life span of people eligible for Social Security meaning more people receive Social Security for a longer period). Determining how to fully fund the Program's anticipated payouts is a relatively straightforward actuarial exercise. Modest reforms can address Social Security's actuarial imbalances.

The health-related programs continue to drive the largest part of the nation's imbalances. Perhaps the leading challenge involved is finding an effective approach to slow the growth in medical expenditures, something that was largely outside the scope of the Affordable Care Act for which the primary goal was expanded health coverage, though CBO estimates some measure of savings albeit far short of what would be needed to eliminate the nation's long-term health-related imbalances. Medical expenditures cannot continue to grow at a multiple of the economy indefinitely, as foreign creditors won't be willing to pick up a growing share of those costs via financing U.S. deficits without the nation's debt stabilizing and then falling as a share of GDP over the longer-term. Numerous factors including debt-related risks, the need to tap savings countries such as Japan (aging + own debt challenges), and opportunities to earn attractive returns from growing economies outside the U.S., among other factors, could temper the flow of such funds to the U.S. in medium- and longer-term.

Until the issue concerning rapid growth in medical expenditures in the U.S. is resolved--and it's highly complex--public and private health care policies will either become more expensive (premiums/other costs rising faster than incomes grow), offer less coverage (procedures, pharmaceutical products, and/or technologies), and/or run imbalances. The challenge involved extends beyond Medicare/Medicaid Program design. A disproportionate share of medical cost increases also arise from hospital care, not physician appointments or medical supplies. The growing utilization and high cost of long-term care (e.g., at nursing homes) is also an emerging factor and has implications for Medicaid. These challenges need to be addressed comprehensively and objectively.

The healthcare issue grabs my attention. I drive persons to Medical appointments about 100 mile away. Lots of discussions about problems, costs, paperwork, professionalism or lack thereof, etc. For the most part, all the medical care is excellent. Now the billing is another matter. It is not uncommon for a surgeon to charge $8000.00 for an outpatient surgery and then when the Insurance pays the bill and only covers $5600.00, then the surgeon says to forget the portion of the bill not covered. Soounds like a good guy. This is both Medicare and bought insurances. The surgeon sounds like the good guy until you figure out he bills "really high" to make sure he gets the maximum that the insurance will pay. There seems to be no set list of fees and this is how they make sure they get paid the "max." That is why they forgive the amount not covered. Although if the patient is wealthy it might not be forgiven. This seems like some kind of hole/flaw in the system which is about money of course. Or, it is a typical example of gov't involvement. Anybody else experienced this?
 
Actually, social security wasn't designed the way it is running now. Many years ago congress took money from the social security funds and it nearly brankrupted the program. It is designed as an insurance, you pay in with the promise to get retirement money and medical care when you reach retirement age. People who work physically hard jobs take a beating for 30 or 40 years and they earned the retirement and need the medical care. Those who work physically easy jobs might be able to retire later than others, but they paid into the program with the promise of retirement at age 65. When the US government makes a promise to the people, the people should expect that promise to be honored. As for programs for the poor, that money gets spent. There is a study that shows for every dollar spent on food stamps, the return on that back to the government is $1.40. Ending SNAP would cause needless suffering and harm the economy. Do we really want to be a nation that allows our poor, disabled and children to starve? Do we want to be the kind of nation that allows people to be in poor health and die without medical care simply because they can't afford to pay for it? That is not the way I want American to be. I think it is important to invest in our citizens and in the long run we will have a stronger healthier workforce.

That is all well and good but you must be willing to pay taxes for this. The absurd idea now being advanced by the left is that only "the rich" will be taxed "a bit more" to fund this mess. If your food stamp "investment" nonsense were true then why not give them to everyone? Taking a dollar from citizen A to give it to citizen B does not create $1.40 in gov't revenue.
 
It's not really a question of whether or not we need to cut it... it's a question of when and how. Current benefit levels are unsustainable.

They are sustainable until 2033. If we get busy now shoring up SS, it is fixable. The question is, how do we fix it. I like means testing for a start. There are a lot of options, but we need to take action now.
 
Back
Top Bottom