The Reality of Gov't. Deficits

[Drek]

http://www.c-spanarchives.org/clip/4161813

Watch, learn, grow.

[L.A. BRONCOS FAN]

The "reality" of deficits for right-wingers:

When a Republican is in the WH: "Deficits don't matter."

When a Democrat is in the WH: "OMG! The sky is falling!"

[Drek]

Originally Posted by L.A. BRONCOS FAN

The "reality" of deficits for right-wingers:

When a Republican is in the WH: "Deficits don't matter."

When a Democrat is in the WH: "OMG! The sky is falling!"

Dude, come on. Watch the video. It is damned insightful **** from a real PhD in economics and underscores the inherent flaw in how our nation approaches it's gov't. v. private sector relationships.

[pricejj]

Could you also post a clip regarding compounding interest, it's rapid increase over time, and it's cumulative burden on a countries finances? A current video of Greece, would suffice.

Maybe a clip showing effects of inflation over time, and it's propensity to widen the gap between the rich and the poor, and destroy the middle class? No need to look any further than Zimbabwe.

[pricejj]

Originally Posted by Drek

Dude, come on. Watch the video. It is damned insightful **** from a real PhD in economics and underscores the inherent flaw in how our nation approaches it's gov't. v. private sector relationships.

Did you miss the memo that both Democrats and Republicans agree that the deficit needs to be closed (for reasons that are obviously over your head)?

[L.A. BRONCOS FAN]

Originally Posted by Drek

Dude, come on. Watch the video. It is damned insightful **** from a real PhD in economics and underscores the inherent flaw in how our nation approaches it's gov't. v. private sector relationships.

I plan to watch - just couldn't resist a jab at the forked-tongued ones.

[pricejj]

Of course, one of the most important effects of massive government deficits, is that many governments over the world have now instituted zero interest rate policies, so that they can borrow money for cheap.

This, of course, means that you will not see any reasonable rates of return on savings (or SS) in our lifetimes.

Couple that with the Fed's stated policy of 30% inflation over 20 years...and Drek, could you please tell us how we are going to retire with our money losing so much value between now and retirement with no real opportunities for growth of savings, SS, or 401k?

As you can see, the only thing massive deficit spending creates, is a flat-lining private sector (just like you are seeing today). Thoughts?

[L.A. BRONCOS FAN]

Originally Posted by pricejj

As you can see, the only thing massive deficit spending creates, is a flat-lining private sector (just like you are seeing today).

Then how do you explain the fact that people like you were FOR massive deficit spending under Reagan, Bush I and Bush II?

[Drek]

Originally Posted by pricejj

Of course, one of the most important effects of massive government deficits, is that many governments over the world have now instituted zero interest rate policies, so that they can borrow money for cheap.

This, of course, means that you will not see any reasonable rates of return on savings (or SS) in our lifetimes.

Couple that with the Fed's stated policy of 30% inflation over 20 years...and Drek, could you please tell us how we are going to retire with our money losing so much value between now and retirement with no real opportunities for growth of savings, SS, or 401k?

As you can see, the only thing massive deficit spending creates, is a flat-lining private sector (just like you are seeing today). Thoughts?

Did you actually watch the video?

Did you comprehend any of it?

Real resources are what matters, our nation has abundant supplies on that front. You could even say we're the breadbasket of the world.

Private sector growth only happens when we run trade surpluses or we run a gov't. deficit of some kind. Clearly explained mathematically in the video. This is an either/or equation. Want real private sector growth you live with public deficits.

The effect that has on our currency is irrelevant as long as we 1. control our own currency and 2. control the resources we need to continue growth as a nation.

Further underscores how the most justified taxes are those on estate transfers and moving wealth outside the U.S.. Both take away from this nation's prosperity by removing wealth from an equation that has to balance out. End result is the sum we get to play with on how to balance said equation is reduced so the super wealthy can be hoarders of "wealth". At the expense of their fellow citizens.

[pricejj]

Originally Posted by L.A. BRONCOS FAN

Then how do you explain the fact that people like you were FOR massive deficit spending under Reagan, Bush I and Bush II?

Didn't vote for any of those guys, nor have I ever been in favor of deficit spending.

[L.A. BRONCOS FAN]

Originally Posted by pricejj

Didn't vote for any of those guys, nor have I ever been in favor of deficit spending.

You didn't start posting here until 2009.

What a coincidence.

[Drek]

Originally Posted by pricejj

Didn't vote for any of those guys, nor have I ever been in favor of deficit spending.

Who did you vote for then? If you don't mind such disclosure that is.

Only thing more irritating than someone always b****ing about politicians is someone b****ing about politicians who doesn't get involved in the political process.

[L.A. BRONCOS FAN]

Originally Posted by Drek

Who did you vote for then? If you don't mind such disclosure that is.

He says he's "never been in favor of deficit spending," but where was he between 2000-2008?

That tells me all I need to know.

[pricejj]

I guess you think ZIRP can sustain the U.S. forever...along with 3% annual inflation?

Here's a couple facts:
1. Our money we make now will be worth a lot less when we retire.
2. There are no viable options for growth other than purchasing assets (which are now too expensive), or gambling it away on the stock market.
3. Hope you're stashing at least 15% of your take home pay under the mattress. If you're lucky, you'll be able to live off of it for a few years before you die.

How long do you think this can go on before collapse? If the answer isn't 'indefinitely' then you have a serious problem on your hands.

[pricejj]

Originally Posted by L.A. BRONCOS FAN

He says he's "never been in favor of deficit spending," but where was he between 2000-2008?

Well, I wasn't on this board teaching grown men simple math...if that answers your question.

[L.A. BRONCOS FAN]

Originally Posted by pricejj

Well, I wasn't on this board criticizing the previous administration and voicing my objections to "massive deficit spending"...if that answers your question.

Fixed.

[Drek]

Originally Posted by pricejj

I guess you think ZIRP can sustain the U.S. forever...along with 3% annual inflation?

Here's a couple facts:
1. Our money we make now will be worth a lot less when we retire.
2. There are no viable options for growth other than purchasing assets (which are now too expensive), or gambling it away on the stock market.
3. Hope you're stashing at least 15% of your take home pay under the mattress. If you're lucky, you'll be able to live off of it for a few years before you die.

How long do you think this can go on before collapse? If the answer isn't 'indefinitely' then you have a serious problem on your hands.

You clearly don't even get the argument at hand here.

What does interest rate matter when you can print more money to pay the interest? What does inflation rate matter when money is just a theoretical medium we conduct barter in?

The value of the dollar is irrelevant as long as the U.S. produces enough real resources (read: food, water, etc.) to provide for it's populous. Which we do and then some, as a net exporter of agriculture (one of the few things we are an exporter of). Should that start to become a problem we can simply outlaw the export of food resources much like we currently disallow the export of oil. This will drive the price of food low, but not so low as to make agriculture an unsustainable business (as it will remain profitable within the bubble of America only supply and demand, since their labor force would be Americans with salaries commensurate with said economic practices).

The U.S. is blessed with all the resources it needs and no obligation to another foreign body's value of our currency. There is no such thing as default or bankruptcy for the U.S. government. So why worry about a boogie man when we've got real things to deal with? Like national under employment resulting in an unproductive economy.

[pricejj]

Originally Posted by L.A. BRONCOS FAN

Fixed.

I have strongly voiced my objections to the "war on terror", and previous administrations housing policies.

Bush's 2% spending deficits weren't sustainable, and we all knew that. What makes you think Obama's 7.5% spending deficits are?

[Jetmeck]

Originally Posted by pricejj

Did you miss the memo that both Democrats and Republicans agree that the deficit needs to be closed (for reasons that are obviously over your head)?

It sure as hell does need to be reduced but which way it is done is the important thing.

Rich ****s paying their fair share and not dumping all this on the middle class.

We won on this premise....get with the program.

[Jetmeck]

Originally Posted by pricejj

Well, I wasn't on this board teaching grown men simple math...if that answers your question.

Bill Clinton agrees ...... simple math and don't blame the black guy for problems created by the good ole boy....ok ?

[pricejj]

Originally Posted by Drek

You clearly don't even get the argument at hand here.

What does interest rate matter when you can print more money to pay the interest? What does inflation rate matter when money is just a theoretical medium we conduct barter in?

The value of the dollar is irrelevant as long as the U.S. produces enough real resources (read: food, water, etc.) to provide for it's populous. Which we do and then some, as a net exporter of agriculture (one of the few things we are an exporter of). Should that start to become a problem we can simply outlaw the export of food resources much like we currently disallow the export of oil. This will drive the price of food low, but not so low as to make agriculture an unsustainable business (as it will remain profitable within the bubble of America only supply and demand, since their labor force would be Americans with salaries commensurate with said economic practices).

The U.S. is blessed with all the resources it needs and no obligation to another foreign body's value of our currency. There is no such thing as default or bankruptcy for the U.S. government. So why worry about a boogie man when we've got real things to deal with? Like national under employment resulting in an unproductive economy.

The problem is real wages are dropping and prices are skyrocketing. What you are left with is a vanishing middle class. Basically, an enormous permanent lower class (who can't even afford to put food on their table or own their own house), and a few wealthy elites who own all the resources. That isn't the American dream, and it isn't a recipe for success. In fact, it's eerily reminiscent of a fuedal system.

[pricejj]

Now, we are faced with either: 1. Doubling the taxes on the middle class or 2.running 7.5% of GDP deficits (or more, once the Obamacare entitlement hits in 2014)

Basically, you are creating the future for the world which you profess to hate. A 1% who own everything, and a 99% who own nothing.

[pricejj]

Drek, the term for ZIRP is actually called "financial repression"...and is being used all over the world by governments to contain their debt servicing costs, and stimulate their economies.

It basically amounts to a tax on everyone equalling what rate they would have been able to get in a normal economy (3% - 5%) + the rate of inflation (CPI is 3%, asset inflation is much higher). Basically, you're looking at at least a 8% tax on everyone across the board. And this is something that the U.S., will take 20 years to grow out of...and that's only if ZIRP stops once Obama's gone, and deficits are brought down to reasonable levels again.

That's why the Obama plan is so dumb. A minor recession that the U.S. could have gotten out of in a couple years, now turns into a multi-decade fiasco, and permanent low growth (if at all).

[Drek]

Originally Posted by pricejj

The problem is real wages are dropping and prices are skyrocketing. What you are left with is a vanishing middle class. Basically, an enormous permanent lower class (who can't even afford to put food on their table or own their own house), and a few wealthy elites who own all the resources. That isn't the American dream, and it isn't a recipe for success. In fact, it's eerily reminiscent of a fuedal system.

It also isn't based on federal budget deficits.

Very fixable by instituting a higher minimum wage and empowering unions.

[pricejj]

Originally Posted by Drek

It also isn't based on federal budget deficits.

Very fixable by instituting a higher minimum wage and empowering unions.

Yes, it sure is based on federal budget deficits. Deficits lead to increasing prices for everyone, and zero-ability for personal financial growth.

Instituting a higher minimum wage would kill more full-time jobs than Obamacare, and that's not a laughing matter.

Empowering unions also leads to higher prices, and lower employment (see Hostess).