Why isn't government debt more of a problem in people's minds?

[ttwtt78640]

Agree about having an educated populace, so I have to wonder why you're in favor of government-subsidized schools when private schools historically have provided a much higher educational quality. Studies have pinpointed how students who were educated in the private sector are much more likely than public school students to complete a bachelor's degree or higher by their mid-20s.

Here's an interesting article from someone who works in the public school system as a teacher but sends his kids to a private school. https://www.theatlantic.com/educati...l-teacher-but-a-private-school-parent/386797/

Anyone who is in the middle-class bracket or higher can afford private school. All it takes is some sacrifice and prudence on the parent's part. Kids don't need to have xbox games on their home computers, smart phones, or all the other expensive non-essential luxuries. What is more important?

You say you lean libertarian, but doesn't that mean you advocate less government and less spending in all areas including local and state? Education takes a huge chunk out of state and local budgets and burdens property owners with a high amount of taxation. That's not libertarian.

There is a happy medium to this public/private debate once we accept that having an educated public is good deal for all - use vouchers and let the parents decide whether to choose homeschooling, public or private. You have still failed to address what happens to those below the "middle" class that are unequipped to homeschool their kids - no education for their kids at all?

 

[Former GOP]

There is a happy medium to this public/private debate once we accept that having an educated public is good deal for all - use vouchers and let the parents decide whether to choose homeschooling, public or private. You have still failed to address what happens to those below the "middle" class that are unequipped to homeschool their kids - no education for their kids at all?

Very simple. Don't have kids! Anyone who is unable to afford such an expense for 18 or more years or take on such a huge responsibility has no business in the baby-making business. I don't care if it's cold-hearted but I don't give a damn about those people who breed and have no sense of fiscal or moral responsibility. They made their own mess, they need to find a way to clean it up without burdening the taxpayers!

 

[ttwtt78640]

Very simple. Don't have kids! Anyone who is unable to afford such an expense for 18 or more years or take on such a huge responsibility has no business in the baby-making business. I don't care if it's cold-hearted but I don't give a damn about those people who breed and have no sense of fiscal or moral responsibility. They made their own mess, they need to find a way to clean it up without burdening the taxpayers!

That sounds wonderful except for those that lose a job, have an accident/illness, get divorced/widowed or were initially denied an education because of "choosing" to be born to poor parents.

 

[Stinger]

First, the was no cherry-picking -- at least on my part. Second, I find it ironic that those who claim that cutting taxes under Bush was causal to revenue increases, conveniently use nominal data which excludes the fact that inflation and population growth increase revenues regardless of tax policy while also hopping over the deficits that reappeared immediately following those tax cuts. The nation had a surplus for four years, ending in 2000. 2001 was the year the first tax-cuts went into effect and deficits skyrocketed. The next tax-cut was 2003 and deficits rose again. Deficits started to come down in 2005, as a result of the beginning of the housing bubble.

We had a surplus ending in 2000 because of Republican policies of lower tax rates and spending restraint. That ended with the recession, the dot.com bust and 911. The Bush tax rates cuts were passed to phase in through 2006 and were barely in place at all in 2001 - 2003. The one thing they did try and failed at was the demand-side tax prebate stimulus. They should have just put the new tax rates into place from the getgo. In 2004 they accelerated the cuts and fully implemented them and revenues and the economy took off. And again housing is only 3-5% of GDP and there is not much capital gains in residential housing because much is not even subject to capital gains. It was an across the board expansion putting every one to work and paying taxes.

Third, blaming the post 2000 deficits on the dot-com bubble is more cherry-picking. Those deficits continued long after those tech stocks rebounded.

And the recession and 911 and there was only one year of a $400B peak deficit which then rapidly fell to the last Republican deficit of a paltry $161B. Then the Democrats took control of the budget and fiscal policy and in 2008 spending went up 9% and then in 2009 spending went up 18% and the deficit soared to $1,400B, they then kept it over $1,000B for the next four years. They never even came close to the WORST Republican deficit and it only came down because of the Republican sequester.

So, those who claim that cutting taxes is a key to decrease debt, have no leg to stand on.

We got both you have neither.

Clinton raised overall taxes and deficits moved into surplus;

Clinton came into office on a strong recovery and increasing tax revenues hitting 9%. His tax rate increase bent that curve down to 7%. It went back up and hit double digits after Gingrich and Kasich forced him to sign tax rate cuts and welfare reform and they refused his spending request.

Bush cut taxes twice and each time deficits increased

Wrong again, once fully implemented revenues soared to record increases and the deficits quickly receded down to that measly $161B heading to surplus again.

(VP Cheney famously stated, "deficits didn't matter" -- acknowledging responsibility for increased deficits.) Obama raised taxes in 2013, and deficits shrank.

Alleged to have said and that would have been acknowledging that the deficits were being driven by 911 and the war in Afghanistan against the Taliban and we were heading into a recovery and the deficits would fall once the tax cuts were fully implemented and the economy was back on track and he was right if that is what he said.

 

[MTAtech]

The post above is at odds with facts. While Stinger claimed that spending was "restrained" in the 1990s, spending increased each year.
Stinger also gives credit to the Republicans, for "policies of lower tax rates," which is a fallacy. Regular income taxes on top earners were raised 8.6%, from 31% to 39.6%. While taxes on capital gains did decrease, the bulk of tax revenue is ordinary income not capital gains, which accounts for only 9.2%, on average of income taxes in the 1990s.

The zombie theory that cutting taxes increases revenue is repeatedly killed but manages to get up and be claimed again.

During the 1990s, more revenue was generated because overall tax-rates were higher. During the 2000s, we had rates that were lower and lower revenue. It is really that simple.

 

[Critter7r]

#3 does not work since, by definition, a deficit adds to the national debt. That leaves you with (some combination?) of #1 and/or #2.

Deficit spending also adds to GDP, so it's a wash when figuring deficit spending as a % of GDP.

 

[ttwtt78640]

Deficit spending also adds to GDP, so it's a wash when figuring deficit spending as a % of GDP.

Great, then we can just borrow and spend our way to prosperity!

 

[Critter7r]

Great, then we can just borrow and spend our way to prosperity!

I was just pointing out why your rejection of #3 (".. keep deficits to below GDP growth as a % of GDP.") was incorrect. Because deficit spending adds to both sides of the equation, you can indeed reduce the debt by doing so.

 

[MTAtech]

Great, then we can just borrow and spend our way to prosperity!

Under certain circumstances, that's true. That was true in 2008-2011, when demand had tried up and so many people lost their jobs that tax revenue fell drastically. Deficit spending, e.g. demand of last resort, created private demand that spurred companies to put workers back to work, providing them taxable income that raised revenues again.

 

[ttwtt78640]

Under certain circumstances, that's true. That was true in 2008-2011, when demand had tried up and so many people lost their jobs that tax revenue fell drastically. Deficit spending, e.g. demand of last resort, created private demand that spurred companies to put workers back to work, providing them taxable income that raised revenues again.

Yep, and from 2012 thru 2017 no more deficit spending was required.

 

[joG]

As I've said many times, the federal government, in terms of spending, is an insurance company with an army. That's where the vast amount of federal spending resides, in five areas: Social Security, Medicare, Medicaid, defense and interest on the debt. So, if someone is talking about reducing federal spending to lower debt, they are either talking about cutting the big five or they have no idea what they are talking about.

Most insurance services are fundamentally private goods. Military is not. You sell the first to private companies and maintain the latter. That seems quite simple. What is more difficult is to educate the voters on this and to develop a viable transfer of the business.

 

[MTAtech]

Most insurance services are fundamentally private goods. Military is not. You sell the first to private companies and maintain the latter. That seems quite simple. What is more difficult is to educate the voters on this and to develop a viable transfer of the business.

What are you advocating, disbanding Social Security, Medicare and Medicaid?

The reason why Medicare was created was because private insurance companies wouldn't insure the health for seniors, because they are a poor risk. Medicare was created to provide health insurance for the poor, who couldn't buy private health insurance. Those two programs were created because the market system didn't work for those two groups.

 

[MTAtech]

Yep, and from 2012 thru 2017 no more deficit spending was required.

Not entirely but the deficit did fall dramatically.

 

[Lafayette]

The problem is not so much the debt, but the ever growing interest on it crowding out other spending.

Your right. And look what's "crowding out other spending"! See here:

What would you rather happen:
*That we cut the massive DoD-budget in half and spend the money on Free Tertiary Education so that your kids can find a damn-good-job because they have the educational qualifications, or
*That we don't cut the DoD-budget and the status-quo is maintained, meaning that about 45% of our kids don't make it into a post-secondary education.
*So, they end-up spending their lives either under-employed or unemployed or employed-but-earning-the-Minimum-Wage (about $15K a year)?

And we keep hiring, for instance, educated/talented IT-people from India/Korea/Wherever who come to the US to work (at a damn-fine wage) and it is THEIR KIDS that go to an American university ... !?!

PS: Bernie and Hillary saw clearly the challenge of educating our youth. Hillary borrowed Bernie's idea (that he borrowed from Europe) to allow free Tertiary Education (vocational, 2- & 4-year) to all children of a family earning below $100K a year. Which, is the "average salary" of a family with two parents earning the average US salary of $54K a year.
PPS: I am a Yank living in France, and I sent my children to university here at at total cost (per child) of $900/year - not including room 'n board because they were living at home. Because in most of Europe, a Post-secondary Education is free, gratis and almost for nothing at state-run schools!
PPPS: We can't do that in America? Or, is it that we dont wanna do that in America?
PPPS: So their option is to join a military service that promises them - if they don't come home in a body-bag - a free post-secondary schooling? (Wow, what a joke!)

 

[MTAtech]

chuckiechan]
The problem is not so much the debt, but the ever growing interest on it crowding out other spending.

Look at the graph below. Notice the growing interest? Me neither.

 

[ttwtt78640]

Look at the graph below. Notice the growing interest? Me neither.

Yep, it is simply amazing that one can borrow (thus owe) twice as much and pay less interest. Of course, that was done by lowering the interest rate that you charge (yourself?) in half - a luxury (accounting trick?) that is no longer possible.

 

[Kushinator]

Yep, it is simply amazing that one can borrow (thus owe) twice as much and pay less interest. Of course, that was done by lowering the interest rate that you charge (yourself?) in half - a luxury (accounting trick?) that is no longer possible.

More than 100 basis points in Fed Funds increases, and the 10 year Treasury is still @ 2%. Can you explain to the rest of us how this can be possible?

 

[MTAtech]

...
And the recession and 911 and there was only one year of a $400B peak deficit which then rapidly fell to the last Republican deficit of a paltry $161B. Then the Democrats took control of the budget and fiscal policy and in 2008 spending went up 9% and then in 2009 spending went up 18% and the deficit soared to $1,400B, they then kept it over $1,000B for the next four years. They never even came close to the WORST Republican deficit and it only came down because of the Republican sequester.

Wrong again, once fully implemented revenues soared to record increases and the deficits quickly receded down to that measly $161B heading to surplus again.

That's merely lowering the bar. Prior to the tax-cuts, the country ran four years of surpluses and the CBO projected in January 2001, a cumulative surplus of $5.6 trillion for the 2002–2011 period. That means that CBO was projecting surpluses under the Clinton tax policies -- not "only" a $166 billion deficit and a peak $400 bil deficit.

In a way you have to wonder what point there even is in trying to argue here. But anyway, look: it’s been a long time since Morning in America. We’ve now been through four two-term administrations, two of which raised taxes, the other of which cut them. Which looks like it presided over a more vibrant economy?

.....

There is no evidence that cutting taxes from levels that are not confiscatory increases economic growth or increases revenue. None.

 

[MTAtech]

Yep, it is simply amazing that one can borrow (thus owe) twice as much and pay less interest. Of course, that was done by lowering the interest rate that you charge (yourself?) in half - a luxury (accounting trick?) that is no longer possible.

What's happened is that the 10 year and 30 year notes (under Reagan, Treasury bills were lent at 13%) and replaced by low interest notes.

 

[Southern Dad]

What would you rather happen:
*That we cut the massive DoD-budget in half and spend the money on Free Tertiary Education so that your kids can find a damn-good-job because they have the educational qualifications, or
*That we don't cut the DoD-budget and the status-quo is maintained, meaning that about 45% of our kids don't make it into a post-secondary education.
*So, they end-up spending their lives either under-employed or unemployed or employed-but-earning-the-Minimum-Wage (about $15K a year)?

And we keep hiring, for instance, educated/talented IT-people from India/Korea/Wherever who come to the US to work (at a damn-fine wage) and it is THEIR KIDS that go to an American university ... !?!

PS: Bernie and Hillary saw clearly the challenge of educating our youth. Hillary borrowed Bernie's idea (that he borrowed from Europe) to allow free Tertiary Education (vocational, 2- & 4-year) to all children of a family earning below $100K a year. Which, is the "average salary" of a family with two parents earning the average US salary of $54K a year.
PPS: I am a Yank living in France, and I sent my children to university here at at total cost (per child) of $900/year - not including room 'n board because they were living at home. Because in most of Europe, a Post-secondary Education is free, gratis and almost for nothing at state-run schools!
PPPS: We can't do that in America? Or, is it that we dont wanna do that in America?
PPPS: So their option is to join a military service that promises them - if they don't come home in a body-bag - a free post-secondary schooling? (Wow, what a joke!)

Cutting the DoD budget in half really sounds like a good idea, doesn't it? Of course, that means that there will be a lot of unemployed soldiers, sailors, airmen, and marines. I am sure that you know that we are already cannibalizing aircraft and ships just to keep them in service. Eliminating all those service members really sounds like a good idea. Of course, we have to bring them back from wherever they are stationed, muster them out, then if something happens we can always use a draft to fill the ranks again. It's worked well in the past.

 

[Lafayette]

Cutting the DoD budget in half really sounds like a good idea, doesn't it? Of course, that means that there will be a lot of unemployed soldiers, sailors, airmen, and marines. I am sure that you know that we are already cannibalizing aircraft and ships just to keep them in service. Eliminating all those service members really sounds like a good idea. Of course, we have to bring them back from wherever they are stationed, muster them out, then if something happens we can always use a draft to fill the ranks again. It's worked well in the past.

No, it would simply mean that the world would have to wake-up and start protecting itself.

Half the military complex that exists today is enough to protect our nation. More than enough given the war-technology now out there that replaces soldiers.

Besides, where's the threat The biggest calamity to have hit the US since the Vietnam War was perpetrated by a dozen jihadists who crashed two planes into the NYC World Trade Center ...

 

[Southern Dad]

No, it would simply mean that the world would have to wake-up and start protecting itself.

Half the military complex that exists today is enough to protect our nation. More than enough given the war-technology now out there that replaces soldiers.

Besides, where's the threat The biggest calamity to have hit the US since the Vietnam War was perpetrated by a dozen jihadists who crashed two planes into the NYC World Trade Center ...

I agree that we should not be the world's police force. But cutting the DoD budget significantly will result in a lot of service members becoming unemployed. It will also leave us with a shortage of active duty troops in the event that North Korea decides to get a little stupid or Iraq decides to close of a strait. I just wonder if it will cost us even more transitioning all those service members back to civilian life, mothballing all those military bases, and getting rid of all that equipment.

 

[Lafayette]

I agree that we should not be the world's police force. But cutting the DoD budget significantly will result in a lot of service members becoming unemployed. It will also leave us with a shortage of active duty troops in the event that North Korea decides to get a little stupid or Iraq decides to close of a strait. I just wonder if it will cost us even more transitioning all those service members back to civilian life, mothballing all those military bases, and getting rid of all that equipment.

There is no reason to Throw Troops into a conflict just because a PotUS wants to show the TV-world that they are "doing something". We did that in Afghanistan and Iraq and it cost us a bit less than 7000 American lives.

Was it worth it? For what? The conflict in both countries still continues.

We are NOT the world's police. Period.

Cutting the Defense budget will allow us to do more good where it NEEDS to be done. Educating our children into a good job, when only post-secondary (vocational, 2- & 4-year) will accomplish that goal nowadays.

Enough of our kids have died already in senseless conflicts beyond our borders - and far too many are dying within the confines of the US where we have the highest gun-death of any developed country. For gun-related death, the US is running at 10.5 (per 100K of population), whilst here in France it is 2.5. In Germany it is 1.0. In Canada it is 1.97.

It's crazy, just plain crazy - as if the country went berserk and has lost all sense of value for life ...

 

[Southern Dad]

There is no reason to Throw Troops into a conflict just because a PotUS wants to show the TV-world that they are "doing something". We did that in Afghanistan and Iraq and it cost us a bit less than 7000 American lives.

Was it worth it? For what? The conflict in both countries still continues.

We are NOT the world's police. Period.

Cutting the Defense budget will allow us to do more good where it NEEDS to be done. Educating our children into a good job, when only post-secondary (vocational, 2- & 4-year) will accomplish that goal nowadays.

Enough of our kids have died already in senseless conflicts beyond our borders - and far too many are dying within the confines of the US where we have the highest gun-death of any developed country. For gun-related death, the US is running at 10.5 (per 100K of population), whilst here in France it is 2.5. In Germany it is 1.0. In Canada it is 1.97.

It's crazy, just plain crazy - as if the country went berserk and has lost all sense of value for life ...

I am an isolationist. I believe that we bring every soldier, sailor, airman, and marine back to North America then tell the world to kiss our ass. So you are preaching to the choir on that part. What I disagree with is cutting the DoD budget by half. I know how that would play out.

 

[Critter7r]

10.5 (per 100K of population)[/B], whilst here in France it is 2.5. In Germany it is 1.0. In Canada it is 1.97.

It's crazy, just plain crazy - as if the country went berserk and has lost all sense of value for life ...

Sidebar : 2/3 of those gun deaths were suicides.

Take suicides out of the equation, and we're down to about 4 per 100k.