Ultimately it's the democrats

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Yachtie -> Ultimately it's the democrats (1/5/2013 11:57:55 AM)
By EconMatters (see for whole story) Today on CNBC during the coverage of the monthly employment report, Rick Santelli pointed out that there is some absurdity in calling the Republicans “lunatics,” when they are the only responsible voice in Washington right now trying to call attention to the out of control government spending in the overall context of an unsustainable federal deficit, while the Democrats are running the country into the ground with even additional spending programs that the government has to borrow more money to fund. His point is that if anybody should be labeled a lunatic, it should be the Democrats and those that are encouraging these unsound financial spending policies. I was highly disappointed in the Republicans over the weekend. First of all, the Senate and House needed to have one voice on this issue, and the Senate Republicans threw the House Republicans under the bus by going along with the boneheaded tax increases, and ‘no spending cuts’ deal negotiated by the vice president. With regard to the Democrats there is no hope for them, and this is literally their last hurrah, as the country is faced with Greek style tough love once interest rates go up to the normal levels again. Then, the US will be put on a budget by China our major creditor just like Greece was by Germany. Just compare the standard of living, and Greek lifestyle of today versus just five years ago. Greece has essentially lost entire parts of their economy due to the effective sovereign default at the hands of creditors. Streets which once thrived with shoppers and business activity are replaced with plywood and graffiti. A modern day ghost town! Now picture the United States and the size of the hole that the US is digging with these creative money shuffling techniques, and the alarm bells should be sounding off right now all over the world. Because by the time you get to Greece`s level where the bond vigilantes make the government face up to the problem, the problem is too far gone. It is too late; there is nothing that can be done about it. And I am not talking about some tweaks that Washington is addressing now in the dialogue. I am talking a major paradigm shift in budgetary thinking, about 2013 and not having a budget deficit, whatever it takes. And it will take spending cuts. We collect enough tax revenue in this country. It is ridiculous how much tax revenue this country takes in each year. Government programs, no matter how well intentioned (the road to Hell is so paved), cannot be sustained at these levels. Defense could be cut to zero and still not even come close to what is needed in cuts. What is it with these social utopians that gravity be declared to not be so?

tazzygirl -> RE: Ultimately it's the democrats (1/5/2013 12:31:42 PM)
Ahem... another take on the incident... with video... CNBCs Rick Santelli is known for his explosions, but today's scream-fest over a discussion with Kelly Evans, Steve Liesman and three very patient guests was over the top, even for him. Evans was talking about some thoughts a U.K. investor overseas shared with her on the risk of the U.S. having yet another fiscal cliff battle. The investor said he saw the economy recovering and was expecting bond yields to move higher, "aside from an insane technical default brought on by lunatic Republicans." "That's the worry here," Evans continued. "Will we have a self inflicted wound — a gunshot to the head." And Santelli was off. "What about the lunatics that spend 16.4 trillion and want another check," he screamed. "Aren't they the crazies, Kelly?" The next minute or so is a stressful attempt by Evans to get the show back on the road as Santelli interrupts over and over again. The most painful moment comes at the end when Santelli goes into total rage mode, flailing his arms and saying, "You gotta be a man when you look at the debt. If it means uncomfortability, if it means going over the cliff, if it means the government closing, my kids will thank me someday for it." To which one tired guest replied, "I doubt it." "I'd like to see if you run your personal finances that way," Santelli countered. That's when there was basically a collective sigh from the group as Liesman and a guest tried to explain that personal finances and government finances are not the same. Read more: http://www.businessinsider.com/rick-santelli-debt-rant-with-kelly-evans-2013-1#ixzz2H8R1XN2m

DarkSteven -> RE: Ultimately it's the democrats (1/5/2013 12:57:23 PM)
This may sounds ridiculous to a Republican, but we have to actually face reality. Reality is: 1. The Dems won the 2012 election in every way you could imagine. They took the presidency, kept the Senate, and made inroads in the House. 2. The GOP not only lost the recent fiscal cliff fight, they could barely come up with even a negotiating position. If the GOP truly wants to put a lid on spending, the proper time to do that is during appropriations bills. Why make expenditure commitments and then later threaten to not pay the bills? Despite all the yelling and screaming, we've been deficit spending for decades. Cheney even echoed Reagan's statement that "deficits don't matter". The GOP suddenly got religion when Obama was elected, but have been horribly profligate spenders themselves. And even while they're demanding that deficits be reduced, they're also demanding no cuts to defense. The GOP is breaking the machinery that makes the country able to operate. They don't seem to understand that any deal will ultimately be arrived at by working with the Democrats, not by throwing tantrums.

tazzygirl -> RE: Ultimately it's the democrats (1/5/2013 1:01:13 PM)
Thats what got me when I listened to the video and this guy screaming about 16.4 Trillion.... LOL... do some think the Democrats did that alone? And Santelli was off. "What about the lunatics that spend 16.4 trillion and want another check," he screamed. "Aren't they the crazies, Kelly?" Either he needs a reality dose, badly, or he didnt mean just the Democrats. Im betting on the reality dose after listening.

Yachtie -> RE: Ultimately it's the democrats (1/5/2013 1:08:16 PM)
quote: ORIGINAL: tazzygirl LOL... do some think the Democrats did that alone? Of course not. And neither does Santelli. But most social programs are of Democrat origin.

vincentML -> RE: Ultimately it's the democrats (1/5/2013 1:32:39 PM)
quote: ORIGINAL: Yachtie quote: ORIGINAL: tazzygirl LOL... do some think the Democrats did that alone? Of course not. And neither does Santelli. But most social programs are of Democrat origin. Most Americans support those programs; most Republican pols refuse to fund them. They, the R-pols, would rather do war instead. Hence, the on going deficit.

tazzygirl -> RE: Ultimately it's the democrats (1/5/2013 1:33:35 PM)
quote: ORIGINAL: Yachtie quote: ORIGINAL: tazzygirl LOL... do some think the Democrats did that alone? Of course not. And neither does Santelli. But most social programs are of Democrat origin. And you believe its only the social programs that are the problem?

Yachtie -> RE: Ultimately it's the democrats (1/5/2013 2:07:21 PM)
quote: ORIGINAL: tazzygirl quote: ORIGINAL: Yachtie quote: ORIGINAL: tazzygirl LOL... do some think the Democrats did that alone? Of course not. And neither does Santelli. But most social programs are of Democrat origin. And you believe its only the social programs that are the problem? Of course not. But you could stop the wars and bring the troops home and still not have enough. The truth of the math is astounding. As to Vincent, it matters not if most Americans support programs they wish to receive benefit of. What Americans want is irrelevant to what they can have. What matters is whether such is affordable. The deficit is not solely war based simply because if you eliminated defense completely there would still be the ongoing economic problem, albeit at a reduced rate. I've posted on this before. The major problem is sourced in the regulations and corporatism of Medicare, Medicare and the systematic looting of Social Security (though that can be more easily fixed) which at its current rate of increase will eventually require 100% of GDP to fund. Until one removes their political bent from the equation one shall continue to not comprehend the math. I've said this so many times... 2+2=4 and gravity is. Why do people wish to argue it otherwise?

tazzygirl -> RE: Ultimately it's the democrats (1/5/2013 2:09:04 PM)
Because you are assuming only the war is the problem with the military budget. Its not. The whole system is bloated with pork and waste. And THATS what we need to get a handle on.

Yachtie -> RE: Ultimately it's the democrats (1/5/2013 2:12:26 PM)
quote: ORIGINAL: tazzygirl Because you are assuming only the war is the problem with the military budget. Its not. The whole system is bloated with pork and waste. And THATS what we need to get a handle on. DAMN IT !!!!! I fucking said remove 100% of defense. Take your rose colored glasses off.

tazzygirl -> RE: Ultimately it's the democrats (1/5/2013 2:12:52 PM)
Dammit... Im not talking about JUST Defense. [8\|] Btw, this is what you said.... quote: Of course not. But you could stop the wars and bring the troops home and still not have enough. The truth of the math is astounding. You were speaking of the wars.

mvc333 -> RE: Ultimately it's the democrats (1/5/2013 2:16:39 PM)
Medicare and Social Security are not problems in the sense they are being portrayed as. They have dedicated funding sources; ie specific taxes. If you doubt that then how can you possibly predict the future shortfalls and prediction dates. They are all based on proper actuarial analysis of these programs, which is appropriate because they are essentially insurance. Social Security IS insurance against voluntary unemployment. What needs to happen with these social programs is that the actuaries need to be brought back into balance. Benefits need to be paid out with a growth rate consistent with the income not with the needs. If that's not good enough then the income needs to be changed in order to accomodate the needs, not just spending more. These programs are most definitely affordable. Anytime you have income and expenditure it's affordable so long as you make them match.

DomKen -> RE: Ultimately it's the democrats (1/5/2013 2:19:56 PM)
FR The deficit is unsustainable in the long term but is needed in the short term. The fact is that government deficit spending is a vital part of the economy and has been for decades. Undoing that dependency during an economic downturn of this severity is asinine. When the economy improves and unemployment is closer to 4% then we can drastically cut defence spending, resulting in tens of thousands of job losses in the private sector, and increase tax rates till we have a surplus which can be used to pay down the debt over several decades. As to the sudden rage in supposed conservatives about the defecit it has that unmistakable odor of partisanship at best, at worst it appears to be eerily reminiscent of http://en.wikipedia.org/wiki/Council_Wars

Yachtie -> RE: Ultimately it's the democrats (1/5/2013 2:31:32 PM)
quote: ORIGINAL: tazzygirl Dammit... Im not talking about JUST Defense. [8\|] Btw, this is what you said.... quote: Of course not. But you could stop the wars and bring the troops home and still not have enough. The truth of the math is astounding. You were speaking of the wars. Of course not. But you could stop the wars and bring the troops home and still not have enough. The truth of the math is astounding. Is there something there you do not comprehend? The wars are but a subset of defense. I then, further down, no matter it was response to Vincent, said remove defense completely and it would still not be enough. I pointed directly to it; Medicare, Medicade and SS. It goes way further than pork and waste; they're a drop in the bucket. Even if one spelled it out soooo slowly for you, I'm convinced you'd still not get it.

Yachtie -> RE: Ultimately it's the democrats (1/5/2013 2:38:38 PM)
quote: ORIGINAL: DomKen FR The deficit is unsustainable in the long term but is needed in the short term. The fact is that government deficit spending is a vital part of the economy and has been for decades. True as to first part; unsustainable. Short term? More of what got us here. Like drinking more to achieve sobriety. We've been heading towards the brick wall for decades. Problem is, which most deny, is that we have arrived. When the economy improves and unemployment is closer to 4% then we can drastically cut defence spending, resulting in tens of thousands of job losses in the private sector, and increase tax rates till we have a surplus which can be used to pay down the debt over several decades. Maybe ten years ago, when we had some room to still move, before we hit the wall. No matter how you slice the pie, there is not enough to achieve that without destroying what remains. It's just math.

Yachtie -> RE: Ultimately it's the democrats (1/5/2013 2:46:44 PM)
quote: ORIGINAL: mvc333 Medicare and Social Security are not problems in the sense they are being portrayed as. They have dedicated funding sources; ie specific taxes. If you doubt that then how can you possibly predict the future shortfalls and prediction dates. At what % rate is Medicare increasing? Divide 72 (Rule of 72) by that and get the time for doubling. I.e, at 10% it's 7.2 years. Medicare (largest single outlay) is rising faster each year. Apply this across the board of government spending. What do you get? Now, what happens when Bonds start going up? Eventually Bernanke will not be able to contain it. That debt must be serviced. Now add in, for yucks, lowering tax revenues (rising unemployment). You can't tax enough to offset it. Add in the increasing cost of the Neo-Con wars. Hell, it's already been discussed about transference of 401-Ks to government bonds. And lets not forget government pensions. Oh no. Lets not forget about them and the promises made. Fuck politics! Fuck what people want. It's just the damn math. further edit: and I have not even brought up the shadow banking and derivatives mess. We're in a slowly beginning deflationary spiral (credit destruction) which Bernanke, with Congressional approval, is trying to hold back via QEing. The more he hold back the more inflation we shall have. People will spend less, resulting in less revenue to the states and local communities. This will not be a straight line down. But the bottom is where we are headed. The only solution is to stop going there. To continue GDP must rise faster than real inflation (been to the store lately). Is it? Really? Which component of GDP is holding us up currently. We can keep doing what we are doing, which is what I anticipate... but the patient dies.

mvc333 -> RE: Ultimately it's the democrats (1/5/2013 3:23:24 PM)
Medicare is affordable as I've said. The problem is outlays vs income. Obviously changes need to be made to the system, if an insurance company were spending more than it were making they'd adjust rates/benefits. The same needs to happen here. As far as the points of the neo-con wars (Which I am NOT a fan of) they don't enter into these equations. You cannot take government programs with distinct revenue streams and then say they are going to overwhelm the general budget. It's simply not true. That's the entire point of having a specific revenue stream is to be able to constrain the expenditures by the income. Now I agree 100% that is not happening but even if it were not for the wars and other factors, ie a smaller tax base, these problems would still exist because they are systemic to how the programs are being administered. So I agree, it is just math. However the math governing these social programs cannot be lumped in with the general ledger. One comment on your description of inflation. People tend to spend money in inflationary periods not hold on to it. The reason being is your money is worth less tomorrow than it is today. This is why the fed is trying to create mild levels of inflation because the opposite--deflation-- would result in people saving more because their money effectively buys more consumer goods and services in the future. Right now we need spending not saving(Note: right now). Furthermore as far as the fear of the bonds market turning against the US Treasury Inflation Protected Securities (TIPS) were paying NEGATIVE yields. People would rather lose money lending it to the US than they would putting it elsewhere. That's because a minor loss in US funds in real terms is a gain vs other devaluing currencies. However I digress, we are in long term trouble if we don't get our 20-30 year picture straight. The problem is everyone talks about outgrowing out deficit, "If we run our economy at a 3% deficit but grow GDP at 4% we'll outgrow our deficits without paying it down" I often hear (not you) people saying things like this which results in not paying down the deficit in boom time and in recession/depression phases having not enough wiggle room to pass a large enough stimulus to pick up the shortage from the private sector.

Yachtie -> RE: Ultimately it's the democrats (1/5/2013 3:51:18 PM)
quote: ORIGINAL: mvc333 Furthermore as far as the fear of the bonds market turning against the US Treasury Inflation Protected Securities (TIPS) were paying NEGATIVE yields. People would rather lose money lending it to the US than they would putting it elsewhere. That's because a minor loss in US funds in real terms is a gain vs other devaluing currencies. First, as to Medicare, see my response to Tazzy's Post on Federal Spending. Now, ....... ahem..... ARE YOU NUTS??????? If you were correct, China et al would be scrambling to buy our debt. They've been sellers. As such it's becoming the FED as our lender of last resort.

DesideriScuri -> RE: Ultimately it's the democrats (1/5/2013 3:59:40 PM)
quote: ORIGINAL: DomKen FR The deficit is unsustainable in the long term but is needed in the short term. The fact is that government deficit spending is a vital part of the economy and has been for decades. Undoing that dependency during an economic downturn of this severity is asinine. When the economy improves and unemployment is closer to 4% then we can drastically cut defence spending, resulting in tens of thousands of job losses in the private sector, and increase tax rates till we have a surplus which can be used to pay down the debt over several decades. As to the sudden rage in supposed conservatives about the defecit it has that unmistakable odor of partisanship at best, at worst it appears to be eerily reminiscent of http://en.wikipedia.org/wiki/Council_Wars We could have 4% unemployment tomorrow if that's what we want. What would the cost be for that, though? What would the benefit be? The whole point of government isn't to give the majority what they want. The Constitution is the framework and limitations placed on Government. It doesn't matter if the majority want something, nor if that something is "affordable" or not. The first test is whether or not it's Constitutional. Then we can see if it's affordable and/or even desirable. The point of Government is not to protect the habitat of some naked mole rat or to commission a plan to create a safeway for local fauna to cross a highway safely. It's also not about imperialistic military installations and bases strewn across the globe.

mvc333 -> RE: Ultimately it's the democrats (1/5/2013 4:24:32 PM)
Asking if I'm crazy doesn't do much to strengthen your argument. I think you are oversimplifying the situation. China is experiencing LESS growth than it has and had anticipated. One of the reasons China was buying US debt was to take money out of their economy to prevent it from overheating, as well as manipulate their currency. China is now spending more money domestically in an attempt to get their growth rate higher. Basically they are willing to experience some inflation in order to achieve more growth. Furthermore they are being PRESSURED to inflate their currency as compared to the US Dollar. Which means less foreign currency reserves dominated by dollars. http://www.businessweek.com/news/2012-11-27/china-s-u-dot-s-dot-debt-purchases-seen-limited-former-adviser-says Notice "Brazil, Belgium, Luxembourg, Russia, Switzerland, Taiwan and Hong Kong boosted their holdings of U.S. government securities by a collective $264.8 billion since the last debate over the U.S. debt ceiling ended in August 2011, U.S. data show." This is as compared to "China cut its U.S. government debt holdings by $123 billion in September to $1.156 trillion, according to U.S. Treasury Department data released Nov. 16." US debt is still institutionally safe and being bought up. The fed is NOT a lender of last resort. Also note that in general 2/3rds of US debt is owned by the public, not foreign governments. Please look at http://www.marketwatch.com/investing/bond/30_year click on the 3 year or the 5 year view. Long term 30 year T-bills are incredibly low. People want to buy them. The market is not suggesting that the US is fiscally unsustainable. This is what the right is passing off as factual information.

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