$14,289,000,000,000.00 not enough credit . . .

[Balta1701]

the do nothing option works on raising the debt ceiling too.

So you're in favor of defaulting on the debt and stopping funding the military entirely?

 

(For once I'm not exaggerating. The military is paid for out of discretionary funds. Soldiers in the field stop getting checks when you default. Not to mention the resumption of financial panic).

[mr_genius]

So you're in favor of defaulting on the debt and stopping funding the military entirely?

 

 

yes i am. but willing to compromise. end all US military operations, send troops home, cut all spending. maybe a temporary debt ceiling increase with around 3 trillion in cuts. i'll even close a bunch of tax loopholes.

Edited May 22, 2011 by mr_genius

[Balta1701]

yes i am. but willing to compromise. end all US military operations, send troops home, cut all spending. maybe a temporary debt ceiling increase with around 3 trillion in cuts. i'll even close a bunch of tax loopholes.

President Obama's budget included $4 trillion in cuts over 10 years.

[mr_genius]

President Obama's budget included $4 trillion in cuts over 10 years.

 

[Balta1701]

Exactly. My math brings out a laugh. The only cuts that count are the ones your side likes.

 

That is of course where we diverge.

 

That doesn't even include the Medicare cuts from the Affordable care act, of course.

[mr_genius]

Exactly. My math brings out a laugh. The only cuts that count are the ones your side likes.

 

That is of course where we diverge.

 

That doesn't even include the Medicare cuts from the Affordable care act, of course.

 

ok ok. i take back the lols

 

but i want more cuts than Obama has offered. Basically, less spending, not more. i'm willing to cut just about all spending. not just the easy stuff.

[Balta1701]

ok ok. i take back the lols

 

but i want more cuts than Obama has offered. Basically, less spending, not more. i'm willing to cut just about all spending. not just the easy stuff.

This is where the real difference is between our 2 sides.

 

For your side...on principle, we're always spending too much, there's always too much waste. It doesn't matter what the program is, whether its effective or not, we should spend less on it. It's a matter of faith that spending = bad.

 

For me, I can pick things I'd cut happily. Military spending. Farm subsidies. Health Care (if you cut the growth rate). But more important for me is the question...is it effective? I think we need to spend a ton more on infrastructure, a lot more on enforcement of laws/regulations (pick your industry, mining/resources, wall street, food safety, etc.), a lot more on education. It's not an article of faith for me that we need to cut spending, it's an article of faith for me that we need to make it effective.

[mr_genius]

This is where the real difference is between our 2 sides.

 

For your side...on principle, we're always spending too much, there's always too much waste. It doesn't matter what the program is, whether its effective or not, we should spend less on it. It's a matter of faith that spending = bad.

 

there just isn't the funds for this spending. these interest payments on this debt is too much. these massive deficits will have very bad consequences. it's a question of return on price. i don't think the return on most of this spending justifies the cost.

 

what it boils down to is this: the excess spending is doing more harm than good.

Edited May 22, 2011 by mr_genius

[Balta1701]

there just isn't the funds for this spending. these interest payments on this debt is too much. these massive deficits will have very bad consequences. it's a question of return on price. i don't think the return on most of this spending justifies the cost.

First...a huge chunk of our debt is actually held by the Federal Reserve...which takes the profits from those interest payments and sends it back into the treasury. Last year, the Fed returned nearly $80 billion in profit to the Treasury. Although, a good chunk of that came from the other things they purchased during their buying binge.

 

Secondly...the long term interest rates are at rock bottom. They have been for years. They've been trending straight downwards for 30 years. Interest payments on the debt in 2010 were actually less than they were in 2007 despite the debt having grown by something like 25% in 2 years. That's one basic, easy reason why you're not supposed to run deficits when the economy is strong and near full employment and why you do when the economy is shrinking and well below full employment.

[mr_genius]

First...a huge chunk of our debt is actually held by the Federal Reserve...which takes the profits from those interest payments and sends it back into the treasury. Last year, the Fed returned nearly $80 billion in profit to the Treasury. Although, a good chunk of that came from the other things they purchased during their buying binge.

 

if the fed is flush with cash, don't raise the debt limit. problem solved. we both know that is not the case.

 

Secondly...the long term interest rates are at rock bottom. They have been for years. They've been trending straight downwards for 30 years. Interest payments on the debt in 2010 were actually less than they were in 2007 despite the debt having grown by something like 25% in 2 years. That's one basic, easy reason why you're not supposed to run deficits when the economy is strong and near full employment and why you do when the economy is shrinking and well below full employment.

 

by 2020 interest payments on the debt will be greater than the budget deficit. This is a real problem. In 2010 for every $1 of discretionary spending we spend $0.15 on interest. By 2020, for every $1 of discretionary spending we will be spending $0.50 on net interest payments.

 

In 2020 the CBO estimates net interest payments of $778 billion. They estimate the deficit to be $685 billion. Our whole deficit will be a result of the interest on accumulated debt. Net Interest paid is $202 billion in 2010 and $778 billion in 2020.

Edited May 22, 2011 by mr_genius