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DesideriScuri -> RE: US Deficits / Debt (11/12/2013 8:18:01 PM)
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quote:
ORIGINAL: joether
quote:
ORIGINAL: Phydeaux
Tax revenues are the highest they've ever been. Federal expenditures as % of GDP are the highest they've ever been.
Ben Bernanke says spending has to come down.
I like the bold part there Phydeaux. You know why? Because that is conservative media conditioning the stupid, idiot and foolish conservatives to babbling stuff they don't know what they are talking about. Its a talking point, but only works if someone doesn't challenge you over it. If the tax revenue was the highest it has ever been, then how was the budget balanced before former G. W. Bush took office, five or six tax reductions taken place, and a deficit of nearly $800 Billion in existence? Since a 'balanced budget' means Revenue = Expenses, it would therefore be logical to assume had those tax cuts NOT been put in place there would not only be no deficit but revenues would be MUCH higher. Go ahead, challenge it.....
The conservative media includes the OMB now? Joether, look here: http://www.whitehouse.gov/sites/default/files/omb/budget/fy2014/assets/hist01z1.xls
2012 Tax Revenues were $2.45T, the third highest ever (2007 saw $2.57T and 2008 saw $2.52T), and 2013 revenue is estimated at $2.71T, the highest annual revenue. You can blame conservative media all you want, but you'll have to admit that revenue dollars are way the fuck up there.
quote:
Here is the credible reasoning from Macro Economics (college level): (simplified version)
During any recession in US History, wages and jobs have decreased at a faster rate than they were increasing. The result has been observed to be less consumer spending than in bullish times. Less consumer spending often leads companies to make further cut backs on wages and jobs. Most people can understand how this downward spiral does not correct itself on its own. There is a 'bottom' much like a metaphorical stock price: $0.00 of worth. The US Government in times past has artificially created demand by pouring money into the economy through increased government spending. And it has often worked. 'Fiscal' folks that are dumb rage about this funding, while wise folks realize the spending does create much more good than bad over time.
You are making the assumption that our levels of consumption was a good level of consumption. Perhaps, it was not, and maintaining that consumption level only ends up extending the recession/depression. The downward spiral would stop on it's own, as people still need to buy stuff, even if it's only food. The USA would have looked terrible and the lives of millions and millions would have fallen apart. It would have been painful. I don't doubt my ex and I would have still split. I don't doubt we'd have lost the house. I don't doubt I'd have lost my job (which happened anyway). People would have become more self-reliant, and there would have been a broader sense of community, too.
Mitch Daniels in Indiana started making sacrificial cuts and re-organizing things to reduce spending and liabilities once the Federal Stimulus hit. When Stimulus waned, Indiana didn't have as large a budget problem. Ted Strickland kept on spending in Ohio. When Stimulus waned, Ohio's budget was trashed, which was a big part of why John Kasich is now Ohio's Governor. The Federal Stimulus can work like you wrote, but it could also, very easily, simply gloss over things that should have changed, like it did.
We could still see the horrors of a complete economic meltdown. If this meltdown was because of improper investments and those investments haven't been dealt with, our foundation is still as shaky as it was pre-Recession.
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