Republicans, Democrats See Economic Disaster Ahead

[Bronco_Beerslug]

These are not uninformed people talking about this.
-------------------------------------------

ECONOMIC EXPERTS OUTLINE PRECARIOUS FINANCIAL SITUATION

WASHINGTON -- In this season of political disunity and destructive campaigning, one diverse group of Americans is coming together on a campaign subject that ought to be of greatest importance to us all -- the financial stability of the nation.
Paul Volcker, former chairman of the Federal Reserve Board and a Republican, says we face a 75 percent chance of a financial crisis within five years. Robert Rubin, former economic chief under President Clinton, says we are confronting "a day of serious reckoning" and that "the traditional immunity of advanced countries like America to a Third World-style crisis isn't a birthright."

But perhaps Peter Peterson, former chairman of the Federal Reserve Bank in New York, chairman of The Blackstone Group and a moderate Republican, put it most succinctly. "We are not paying our own way," he says. "As a nation, we are running on empty. If the ultimate test of a moral society is the heritage it leaves to its grandchildren, I would say we are failing that test."

In short, these men -- our best and brightest -- are telling us that, while the nation is fixated on delusions of empire in the Near East and illusions of omnipotence, we are simply going broke.

"There are three realities we must deal with," Peterson said at a recent meeting at the Institute for International Economics here. "First, we are risking our national security to fight two wars: one overseas and one at home. We have seriously underestimated the cost. Our military is stunningly successful, but it is also stunningly expensive. One billion dollars a week for just two divisions in Iraq -- and we have no war budget!

"The second new reality is our huge foreign currency account deficits. Currently we import $4.4 billion of foreign capital a day. Even the International Monetary Fund is giving us hell. Our borrowing is at unprecedented levels for an industrialized power. None of the specialists believe that this is sustainable, and half of the experts say we risk a hard landing. America must consume less and save more, export more and import less."
http://www.uexpress.com/georgieannegeyer/

[watermock]

I have allready talked about the French trying to supplant the US Dollar for the EUDollar in the Oil industry. Did someone wake you up?

[OrangeDoofus]

This is seriously scary stuff. As I explained in another thread, the total national debt is growing at a rate of about 7-8% per year, while the GDP is only growing at about 3-4% per year. In other words, our debt is growing twice as fast as our ability to pay it off.

What's even scarier is that this is part of a trend that's almost 30 years old. We've been accumulating debt since the mid-seventies. If there's a crash coming in the next five years (and I think there probably is), it's something that's been building for a quarter century, and there's really nothing that can be done to stop it at this point.

[L.A. BRONCOS FAN]

As I explained in another thread, the total national debt is growing at a rate of about 7-8% per year, while the GDP is only growing at about 3-4% per year. In other words, our debt is growing twice as fast as our ability to pay it off.

This is why Clinton made paying down the debt one of his top economic priorities for eight years (while the flying monkey right was more concerned about who he was diddling.) When the Boy King was appointed, the repukes reversed everything Clinton accomplished. BushCo = the borrow and spend administration.

If there's a crash coming in the next five years (and I think there probably is), it's something that's been building for a quarter century, and there's really nothing that can be done to stop it at this point.

Fasten your seat belts--the crash could make the great depression look like a picnic.

http://www.bartcop.com/not-swift.gif

[SteveTensi13]

Note to LABF; Take a break, have a beer, chill out. Come on over to the football board and discuss Oh, I don't know, football!

[Rohirrim]

So, not only do I (and Helen Thomas) think that Bush is the worst president in the history of the U.S. - but, history will agree with that assessment.

[SoCalBronco]

Helen Thomas isnt exactly unbiased Rohirrim but everyone has a different take i suppose.

[OrangeDoofus]

As I explained in another thread, the total national debt is growing at a rate of about 7-8% per year, while the GDP is only growing at about 3-4% per year. In other words, our debt is growing twice as fast as our ability to pay it off.

This is why Clinton made paying down the debt one of his top economic priorities for eight years (while the flying monkey right was more concerned about who he was diddling.) When the Boy King was appointed, the repukes reversed everything Clinton accomplished. BushCo = the borrow and spend administration.


That was the Federal debt that Clinton began to pay down -- the total debt owed by the Federal government. I certainly approve of that, just as I disapprove of Bush's policies which have blown the Federal deficit wide open again.

But what I'm talking about here is the national debt, which is the total debt of the entire country, both the public and private sectors. That's been growing at a pretty steady clip, something that really didn't change at all despite the Clinton surplus.

The fact is that the national debt has been growing at a very steady rate for almost 30 years now and there doesn't appear to be anything we can do to stop it.

[L.A. BRONCOS FAN]

Helen Thomas isnt exactly unbiased...

Which, even if true, still doesn't mean the facts aren't on her side.

What's disturbing is the sort of Orwellian double-speak that informs the average neocon's definition of "bias" these days.

That is, if bush supporters believed the earth was flat while Democrats claimed the earth was a sphere, then the headline would read "opinions about the earth's geometry differ."

[watermock]

No, your both wrong. maybe this will clear it up for you just a little:

What's the difference between the national debt and the federal deficit?
The federal deficit is is the difference between what the government takes in from taxes and other sources and what it spends annually.

Imagine you made $40,000 in a year, but had $50,000 in expenses. You would have a $10,000 deficit. You would need to borrow $10,000 to make up the difference.

For many years, that's exactly what happened. The government took in less than it spent and had to borrow the difference. This was called "deficit spending."

For more information concerning the deficit, visit the Financial Management Service website to view the Monthly Statement of Receipts and Outlays of the United States Government.

The national debt can be thought of as the accumulated debt the government owes from all those years of borrowing money to pay off the annual deficits. It is the total off all money owed to individuals, corporations, state or local governments, foreign governments, and other entities outside of the United States Government. The national debt is also often called the public debt, because most of the money is owed to the public.

Where does the government borrow money?
Most of the money the government borrows comes from -- us -- the general public. The public loans money to the government by purchasing U.S. Treasury securities like T-bills, notes, bonds and savings bonds as investments. [You can even buy T-bills and bonds online.]

The annual debt, and the National Debt are related. One is how much we spent over what we took in, and the National Debt is the accumulated debt.

The TRADE deficit is totally different and is the real measure of the US reliance on foreign oil and manufactured products, from the Middle East and The Far East.

The National Debt is a spit in the pan compared to the accumulating Foreign Trade Debt, which isn't really even measured in totality. The numbers are so ****ing scary they really don't even post them, they just give monthlies.

http://www.census.gov/indicator/www/img/ustrade.gif

This graph has ABSOLUTELY NOTHING TO DO WITH GOVERNMENT SPENDING. What it does refelect is that we are importing more goods than ever.

I hope this clears up any misunderstanding between the different definitions.

Goods and Services
Exports decreased to $92.8 billion in June from $97.0 billion in May. Goods were $64.3 billion in June, down from $68.7 billion in May, and services were $28.6 billion in June, up from $28.3 billion in May.
Imports increased to $148.6 billion in June from $143.9 billion in May. Goods were $124.4 billion in June, up from $120.2 billion in May, and services were $24.2 billion in June, up from $23.7 billion in May.
For goods, the deficit was $60.2 billion in June, up from $51.5 billion in May. For services, the surplus was $4.3 billion in June, down from $4.6 billion in May.
Goods by Category
The May to June change in exports of goods reflected decreases in capital goods ($2.6 billion); industrial supplies and materials ($1.3 billion); foods, feeds, and beverages ($0.3 billion); automotive vehicles, parts, and engines ($0.3 billion); and consumer goods ($0.1 billion). An increase occurred in other goods ($0.3 billion).
The May to June change in imports of goods reflected increases in industrial supplies and materials ($3.3 billion); capital goods ($1.5 billion); and consumer goods ($0.1 billion). A decrease occurred in automotive vehicles, parts, and engines ($0.7 billion). Foods, feeds, and beverages and other goods were virtually unchanged.
Goods by Geographic Area (Not Seasonally Adjusted)
The goods deficit with China increased from $12.1 billion in May to $14.2 billion in June. Exports decreased $0.2 billion (primarily raw cotton and civilian aircraft) to $2.7 billion, while imports increased $1.9 billion (primarily computers, cotton apparel, computer accessories, and coal and related fuels) to $16.9 billion.
The goods deficit with the European Union (25) increased from $7.9 billion in May to $10.6 billion in June. Exports decreased $1.2 billion (primarily civilian aircraft, organic chemicals, and passenger cars) to $13.7 billion, while imports increased $1.5 billion (primarily pharmaceutical preparations, other petroleum products, and civilian aircraft engines) to $24.3 billion.
The goods deficit with Japan increased from $5.5 billion in May to $6.3 billion in June. Exports increased $0.4 billion (primarily civilian aircraft) to $4.7 billion, while imports increased $1.1 billion (primarily automotive parts and passenger cars) to $11.0 billion.
This and more information is provided in the Bureau of the Census and Bureau of Economic Analysis press release:

U.S.International Trade in Goods and Services: June 2004 .

For further information on goods, contact Nick Orsini, Foreign Trade Division, Bureau of the Census, on (301) 763-2311; on services, contact Christopher Bach, Bureau of Economic Analysis, on (202) 606-9545.

NOTE: Total goods data are reported on a Balance of Payments basis; commodity and country detail data for goods are on a Census basis. For information on data sources and definitions, see the information section on page 26 of the FT-900 release, or at www.census.gov/foreign-trade/www/press.html or www.bea.gov/bea/rels.htm.


The next release is September 10, 2004



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Note: Total goods data are reported on a Balance of Payments basis; commodity and country detail data for goods are on a Census basis. For information on data sources and definitions, see the Information Section (PDF, 53k) (TXT, 23k)

http://www.census.gov/indicator/www/ustrade.html

I swear I have to baby sit you people.

[Rohirrim]

You can post all the graphs you want. If U.S. currency gets devalued because of debt, the show's over.

RE: The Helen Thomas quote - She's seen more presidents up close and personal than any living person. That gives her opinion some weight.

[bendog]

It's not just the debt, its the currency accounts. We have to expand the monetary supply to expand the economy, and the tax cut was aimed partly at paying the guys who paid to get BushII elected, but also at forcing the fed to let treasury expand the money supply faster than Greenspan/Rubin did, because some economists think Greenspan has been too concerned about inflation and the econ can grow faster - which would benefit ALL of us, not just those who make 500K and more. But we save so little compared to other nations, and consume so much, we have to import the capital to buy the greenbacks. But, if we consume less, people lose jobs.

But as for the national debt, what WJC was really doing was paying off debt by usiing fica dollars to buy it instead of having individuals and foreign govts buy it. Our ability to pay for social securty/medicare isn't really so much what debt the "trust" holds, but the % of gnp we have to pay to private investors and for govts to service the interest on our debt. THAT % was going down under WJC. What BushII's handlers gambled on was that the tax cut would temporaily reduce govt revenue and force the debt up once again, but that the increase in gnp would make up for the temporary reduction as more taxes were collected. Unfortunately, they failed to hold spending in check. So, were in deep ****e no matter who gets elected.

[watermock]

It's not just the debt, its the currency accounts. We have to expand the monetary supply to expand the economy, and the tax cut was aimed partly at paying the guys who paid to get BushII elected, but also at forcing the fed to let treasury expand the money supply faster than Greenspan/Rubin did, because some economists think Greenspan has been too concerned about inflation and the econ can grow faster - which would benefit ALL of us, not just those who make 500K and more. But we save so little compared to other nations, and consume so much, we have to import the capital to buy the greenbacks. But, if we consume less, people lose jobs.

You make some points, but I was just explaining the three different measures. ****ing excuse me. It's hard to talk economics when people don't even understand what the hell they are talking about. You got it yet? Now since my IQ is shorter then my forehead and I have explained fundamental economics, maybe I can even make a god damn point.

But as for the national debt, what WJC was really doing was paying off debt by usiing fica dollars to buy it instead of having individuals and foreign govts buy it. Our ability to pay for social securty/medicare isn't really so much what debt the "trust" holds, but the % of gnp we have to pay to private investors and for govts to service the interest on our debt. THAT % was going down under WJC. What BushII's handlers gambled on was that the tax cut would temporaily reduce govt revenue and force the debt up once again, but that the increase in gnp would make up for the temporary reduction as more taxes were collected. Unfortunately, they failed to hold spending in check. So, were in deep ****e no matter who gets elected.

You still don't get it. The fundamentals are not goverment debt.
The tax cut didn't cut the fundamentals which are hidden which I tried to explain to you.

The Debt means nothing. You people don't even get it. Read it again.

I am am going to explain this one more time.

The major reason to reform tax laws is to stop the trade deficit.

God you people don't understand.

They don't even have a clue.

They think the national debt is the trade deficit.

Listen you dimwits, the issue is about supplanting the EU Dollar for the Amreican dollar.

That is the war.

I get so frustrated trying to explain this stuff.

Didn't any of you even go thru Economics 102?

[OrangeDoofus]

Okay, mock, what you're calling the "trade debt" is what I'm calling the "national debt", and what you're calling the "national debt" is what I'm calling the "Federal debt".

Aside from that, you're completely right. The "big debt" has been growing steadily since the '70s. The "little debt" went down a bit in the late '90s, but the big debt just kept growing and growing.

[watermock]

It's a vampire ignored. I could give a rats ass if we run a 800 Billion budget deficit if we had a trade surplus.