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As Debt Limit Reached, Agreement Still Far Off .

A majority of Democrats voted against the tax cuts to the rich while a majority of republican voted for them

we know

that's why we were sent to washington (and lansing and madison and harrisburg and st paul and talahassee...) in record numbers

we also remember that president barack the slasher hussein---whose senate has STILL failed to produce a budget and according to finance chair baucus will probably NOT be able to write up anything this year either---pusillanimously PUNTED the bush/obama/clinton/mcconnell/boehner tax cuts until new years eve

Commentary: Congress punts on Bush tax cuts, middle class | McClatchy

leadership, anyone?
 
What is the difference between what will happen in August if we don't raise the debt ceiling, and what will happen a few years from now if we don't cut spending?
 
According to a CNBC report, debt ceiling negotiations may be focused on a smaller increase aimed at avoiding a possible 8/2 default, but sufficient only until about February 2012. As per my thoughts in #167, if this report is accurate, it may suggest very deep divisions that currently present a barrier for a larger debt ceiling increase.
 
This is not the time for political ideologues and a "my way or the highway" approach. The economic health of the United States of America is at stake here, and while the US scrambles in a battle to avoid default on the debt, a battle which is uncertain, I consider whoever fiddles while our economy burns to be traitors.

Right now, this has turned into a battle between Wall Street and the crazies who have hijacked the Republican Party. The way I see it, if Republicans want to destroy their own party, they are on the right track to do it. But destroying America's economy, because they are not getting what they want at this time, is a morally reprehensible act, which will have dire consequences. Time to be responsible. If you (and I am talking to the jihad wing of the GOP here) want to act like babies and brats, you should do it on your own dime, and not that of your country. Just agree to raise the debt limit, and then feel free to engage in your ideological war later, during the 2012 election campaign. This is neither the time nor the place for it.

Article is here.

The virus of HIV Socialism is the root cause of our rot, and the only way to get on track is to reign in government. Slash, gash and cut the pig. Wrest power from the feds and return it to the states where it belongs. Of course those who paid into the Ponzi Schemes need have their contributions honored... and then phase out the idiocy.

Libs are the ones that need to bend. The country has been prodded enough by these loons. The R's should stand, educate and fight. If they go down... so be it. Let the Lib morons take the final step and destroy the country. My bet is people won't allow it... and 2010 illustrated it fairly clearly.

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My bet is people won't allow it... .

IMO, the public is far behind the curve when it comes to understanding the nation's long-term fiscal challenges. The prevalent attitude is 'do something about the debt, but don't touch Social Security, Medicare, and Medicaid.' The idea that the nation's fiscal challenges can be addressed without reforming the programs most responsible for the long-term imbalances is akin to a belief that a magician can make the debt simply disappear.

Medicare accounts for the largest share of the nation's long-term imbalances. Paul Ryan has offered one approach. The recent health care law offered another. Unfortunately, neither approach actually addresses the underlying problem that Medicare's rapidly rising costs result not only from its own structural shortcomings, but from a system that has a chronic excessive cost growth problem. The industry, specifically the hospital system, is highly uncompetitive in a financial sense and, arguably in a outcomes per cost sense, too. The hospital sector is an inflation generator.

Since the beginning of 2000 (through the April 2011 CPI report), the average annual increase in key inflation indices was:

CPI: 2.6%
Core CPI (excludes food and energy prices): 2.0%
CPI excluding Medical Care: 2.5%
Medical Care: 4.1%
Medical Care Commodities: 2.9%
Medical Care Professional Services: 3.3%
Medical Care Hospital and Related Services: 6.7%

Put another way, overall Medical Care prices rose 1.56 times faster than overall consumer prices and 1.62 times faster than all consumer prices excluding medical care. Hospital and related services rose 2.58 times the rate of overall consumer prices and 2.67 times the rate of all consumer prices excluding medical care. In short, fundamental health care reform that dramatically restructures the nation's hospital system will be essential to addressing the chronic excessive cost growth problem. The present cost trajectory is not sustainable. It will push the U.S. toward a long-term fiscal crisis. That crisis could be amplified on account of a combination of excessive government debt and excessive household debt (household deleveraging appears to be ending or have ended recently).

Whether Medicare services are rationed via a Board (as set forth in the health care law) or via vouchers that rapidly lose purchasing power, won't necessarily address that problem given the relative inelasticity of demand for such services. Indeed, given Congress' inability to implement extremely small cost savings that are already part of existing law, it is highly unlikely that Congress would accept either rationing approach. Instead, the Board's decision would be waived as happens regularly concerning phsyician fees payments or the vouchers would be increased in size beyond what had been envisioned. If so, the nation's long-term fiscal challenges would continue to mount.
 
debt ceiling negotiations may be focused on a smaller increase aimed at avoiding a possible 8/2 default, but sufficient only until about February 2012.

Raising the National debt to cover the deficit is all automatic. Congress has nothing to do with it. The extra capital is provided by the Fed Reserve, has been that way for over seventy years. This year certain Senators is trying to make political points with it and seem to be succeeding.

I can't believe other Senators are that disconnected.


ricksfolly
 
yesterday:

The budget proposal released by the White House back in February didn’t win a single vote in the Senate on Wednesday— the final tally was 0-97. Senate Republicans pushed for the vote as a counterpoint to the defeat of Rep. Paul Ryan’s budget plan.

POLITICO’s David Rogers reports: “The vote on the president’s plan turned into a rout, with neither Republicans nor Democrats voting in favor of taking it up. At one level, the 97-0 vote showed how out-of-date the February requests can seem after so much has changed in the spending debate already this year. But for Democrats, it also proved a convenient way to mask their substantial internal differences over how to proceed” on addressing the government’s fiscal problems.

Unanimous rejection | POLITICO 44

leadership, anyone?
 
In its warning about not reaching a timely debt ceiling agreement, Moody's stated that it believes that an agreement with a lack of credible fiscal consolidation approach is the most likely outcome. Moody's declared:

Moody's had previously indicated that its stable outlook on the Aaa rating was based on the assumption that meaningful progress would be made within the next eighteen months in adopting measures to reverse the country's upward debt trajectory. The debt limit negotiations represent a real near-term opportunity for agreement on a plan for fiscal consolidation. If this current opportunity passes, Moody's believes that the likelihood of anything significant being accomplished before the next presidential election is reduced, in part because the two parties each hopes to capture both a congressional majority and the presidency in the 2012 election, after which the winning party could achieve its own agenda. Therefore, failure to reach an agreement as part of the current negotiations would increase the likelihood of a negative outlook in the near term, because the upward debt trajectory would still be in place. At present, this appears the most likely outcome, in Moody's opinion.

Moody's also described a credible debt reduction agreement as follows, "Such reduction would imply stabilization within a few years and ultimately a decline in the government's debt ratios, including the ratio of debt to GDP."

Moody's Updates on Rating Implications of US Debt Limit, Long-Term Budget Negotiations
 
yup.

that better be one doozy of a bill.
 
From Bloomberg.com:

President Barack Obama and Republicans are narrowing the debate on a deficit-cutting plan to a reduction of $1 trillion to $2 trillion, though whether that would settle the issue through the 2012 presidential election remains in doubt, according to budget and debt experts...

The backbone of a debt deal includes discretionary spending cuts, which the Bipartisan Policy Center in Washington estimates could total $600 billion over 10 years, including spending on foreign aid. Cutting so-called mandatory spending outside of health care, such as agricultural subsidies, could save an additional $100 billion over 10 years, according to estimates by the center, a policy research group founded by former Senate majority leaders from both parties.

Obama, Republicans Focus on Narrower Deal on U.S. Debt as Deadline Nears - Bloomberg
 
any lifting of the ceiling that is not high enough and long enough to get the president and the party in power thru clean until november, 2012, is to be avoided, from their perspective, at just about any cost

fyi
 
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