Americans oppose raising debt ceiling

Hm, you know this thread with just the Americans alone as the posts confuses me greatly.

Fixing America's economic problems doesn't require anything extreme. The problem isn't really that bad. It's the trend we're all worried about. Bush's trillion dollar bail out, followed by Obama's trillion dollar bail out, is a transient issue. Eventually the recession will end and economic growth comes back.

But the budget still needs to be balanced. Still why do the arguments turn into

• Ideological stances on Social Security. Shit doesn't matter to your budget.

• Why ignore the lack of tax revenue and tax evasion. There's 100 billion in lost corporate taxes (for instance, GE paying zero tax on 12 billion in profit). There's possibly 200-300 billion in lost taxes because of the rules on the rich allowing them to get out on everything. Middle class individuals in California would pay a combined (state+federal) tax rate of like 25-28%, and the rich get off paying almost the same rate? That makes no sense. We can all take theoretical statements about dividend tax, capital gains tax, but the fact of the matter is that those should be raised... massively to count as normal income because frankly, only the rich get that stuff.

• Ideological stances on the military. I don't care what you talk about of "oh noes, cutting and running, then the magical Terrorism monster will get me". It doesn't matter. Being in Iraq will probably get you a whole new Al Qaeda terror group against the USA in 20 years time, and we'll all be stuck wondering "What did we do to deserve this" and have totally forgotten the war. Everything needs cutting, including the military and as far as I can see, the US military can cut a vast majority of equipment purchases, R&D and so on and still have money to give soldiers salary increases and more training. I mean jeez, base grunts earn so little, I have no idea why anybody wants to be in the military and risk death. Plus the fact, US soldiers sometimes buy their own upgrades or put their own armour on vehicles.

• Stop whining about the RMB exchange rate. Want to know why it's so damn low? Because China keeps buying up American debt with RMB. How do you think they keep the exchange rate low in the first place? Magic? You want the value of RMB higher, stop selling them debt!

Those fools who (still!) believe that they can find middle ground with ideologues bear a lot of the responsibility, for they could have stopped all this, and did not.

Ivy: Um I think not. I blame folks who are aligned with corporate interests putting that into place.

deboss: On the first one not the second one.

Who watches the watchmen?

Well, I actually mean "destroy" as in "render obsolete through technological development" as opposed to "ship them over seas". The first is "destroying" the second is "outsourcing" and just moves it around.

Fight smart, not fair.

Actually, if there were no possible deductions on this whatsoever it'd be perfect.

Share it so that people can get into this conversation, 'cause we're not the only ones who think like this.

Of course. Allowing deductions on it would defeat the purpose.

Democracy is the process in which we determine the government that we deserve

Anyone willing to take a bet that Obama gives the Republicans everything they ask for, or close to it?

edited 16th May '11 7:03:06 AM by EnglishIvy

And I'm willing to bet that they complain all the way about it being an act of tyranny and oppression to give them all of that.

Sounds like the debt limit's been reached. Time to start listening to the ticking time bomb.

Sadly he will, and the Republicans will still make him out as some uncompromising monster.

Interesting news tidbit I just heard: the U.S. government won't default on the debt if the debt limit is reached and nothing is done. Why? the Treasury Depatment has said they will pay interest on the debt first with remaining non - debt income. They're also bending the rules (It's a bit unclear to me how this is happening) so the government won't (strictly speaking) be breaking the law with current spending until perhaps as late as mid - August.

I don't have figures off the top of my head right now (I'll try and look up some straightforward examples,) but the impact of income tax on the gigantic amounts of money wealthy people make is VASTLY overstated. Since it's done as a percentage rather than a flat penalty, it's not like you just stop making money when you get enough to move from one bracket to another, even at very high rates, that's not how progressive taxation is designed. You always make more money, a LOT more money, just that the government gets a bigger share of it too.

Deboss can be a bit of a Darker Me Single-Issue Wonk, so on certain topics (art endowments, academic humanities, society…) he goes into Troll mode. You can safely write off the contents of these outbursts, since they have nothing to do with anything else he says, nor with anything anyone else said.

That depends on what you mean by “the Republicans ask for.” He's probably going to cave on huge spending cuts to programs that don't need them, and may even give into more tax cuts for the wealthy, but he's indicated in no uncertain terms that they're delusional if they think he'll let them use budget shenanigans to bully him into undoing his first two years' work.

Eric,

edited 16th May '11 3:29:02 PM by EricDVH

To be fair, I think that Deboss is kinda right, it's just that we're going to go there probably kicking and screaming and entirely unprepared. Productivity is going to keep on rising, we're going to need less labor, and we need to think of some way to deal with this.

BTW. As I've said before, to keep it on-topic, I think much of the current debt is related to stagnant wages due to productivity gains outstripping demand.

Democracy is the process in which we determine the government that we deserve

No, Deboss has no idea what he's talking about. No matter what demand is, consumption relies on a certain amount of production, which—regardless of how heavily automated—means people doing work.

Productivity is measured in monetary value, which means that if low demand causes prices to fall, it will consequently cause productivity to fall as well, since those prices are what productivity is measured in to begin with. If lower demand causes consumption to fall below production instead, it has no effect on productivity, since the only goods with measurable value are the ones sold, not the surplus.

Let's say there's two workers, A and B. A relies heavily on automation, while B does not. In one hour's labor, A generates $100 in value for their employer, valued as such because consumers buy it for that much, while B generates $20 in value. A is extremely productive, B is not. Unfortunately for A, his boss is a greedy jerk, so A and B are both payed $10/hour, which means that while B keeps 50% of his earnings, the more productive A only keeps 10%.

No matter how productive you are, if management doesn't share, it doesn't matter. Productivity gains don't just vanish, somebody keeps it, or else it wouldn't appear in the consumer price, and thus wouldn't count as productivity.

Since workers are also consumers, the major practical implication of this is that even if goods and services become cheaper (whether through offshoring or automation,) if pay drops faster, the affordability of goods and services actually goes down, which is exactly what happened. The figures in that chart are CPI-corrected, which means they're inflation-corrected relative to the price of consumer goods.

Eric,

edited 16th May '11 3:58:31 PM by EricDVH

I don't know of any places that aren't incredibly small businesses or places where they pay outright commission that operate that way, as nice as it would be.

I heard on my local news that the US will default on its debt on August 2nd if nothing is done, which is sooner than I thought.

And the argument is which wires do we cut to extend that timer. This can only end well

My troper wall

If the only thing keeping demand up is workers that can be replaced, then demand is being artificially inflated. This includes management, which are unnecessary jobs for the most part. The faster we wipe them out, the better.

Fight smart, not fair.

If it were so, but in actuality what keeps demand up is that people have to eat, drink, and be merry. That's at a fixed level for any given population.

Eric,

So...what happens when we default on our loan?

China comes in and breaks our kneecaps?

Them and what Army?

The People's Liberation Army, you say?

Ok, them and what navy?

Um...let me get back to you.

It'd be unpleasant for everybody. There's a point where you can't afford to not keep getting paid, even if you have to re-negotiate to less favorable terms.

edited 16th May '11 8:25:08 PM by blueharp

China's army is defensively oriented and has little Force Projection capability right now. They're trying to change that, but the US could still order it's carriers to ram every Chinese carrier under construction and still have the force projection to wipe out the country. Nukes are still a threat though.

edited 16th May '11 8:48:05 PM by Deboss

Fight smart, not fair.

Nukes are like challenging somebody to a duel with flamethrowers at 5 paces.

While in the middle of a drought-killed brush field.

Ha!

That's great.

Look, you can't make me speak in a logical, coherent, intelligent bananna.

The world economy goes downhill due to higher interest rates, jittery investors, etc. It won't be pretty

edited 16th May '11 11:04:08 PM by Acebrock

My troper wall

Two brackets.

Fight smart, not fair.