congress and the debt ceiling..

[ruffryder]

Aren't people smart enough to understand that tax breaks, tax cuts, corporate tax loop holes, reckless spending and 2 wars (that Bush cleverly left off the books) don't work in any way shape or form?

no, actually they are not

When will this country wake up?

I think our government will be able to operate with a balanced budget once the majority of American people can operate that way as well.

There are a lot of people that have a lot of debt and little savings, and it seems a lot of people that have little knowledge about how money works and more importantly, good habits to use with money.

I have been listening to Dave Ramsey quite a bit lately, especially looking for encouragement for getting and keeping the family on budget and saving for the future. He is starting a new program it seems and talks about it on his podcast for today.

http://www.thegreatrecovery.com/

 

[ruffryder]

son of a business... looks like Mitch McConnel is trying to introduce a bill to not raise the debt ceiling, so when Obama vetoes it, it will raise the ceiling..

http://www.nytimes.com/2011/07/14/us/politics/14fiscal.html?_r=1&pagewanted=all

And Senator Mitch McConnell of Kentucky, the Republican leader and procedural maestro, was pushing his plan that would allow a debt limit increase to clear Congress without Republican fingerprints — and without the guaranteed cuts many in his party are demanding. He would establish an elaborate process where Congress would vote to disapprove instead of approve a debt limit request. That would allow the president to raise the debt ceiling via a successful veto of the disapproval if it came to that.

and more..

http://www.nytimes.com/2011/07/19/us/politics/19fiscal.html

jokers to the left of me, jokers to the right... here I am stuck in the middle...

 

[DOO DAWG]

Comments News Feed



The Left Baits A Trap for Us

July 22, 2011 by Chip Wood

PHOTOS.COM​

We don’t need a balanced budget amendment.​

A lot of good people have fallen for a very bad idea. I’m referring to the notion that a balanced budget amendment will somehow help solve the fiscal disaster our country faces.
I just got a promotion from Regnery Publishing, one of my all-time favorite book-publishing companies. I can’t count the number of truly important titles it has issued, from Witness to the whole “politically incorrect guidelines” series. My shelves are filled with things it has done, including numerous best-sellers.
But the most recent email I got from Regnery stopped me short. The subject line read, “Amending the Constitution Is Our Only Hope.”
Our only hope to save our Republic? I hope Regnery doesn’t mean it. Because the amendment process is long, arduous and often unsuccessful. (And frankly, even when it’s successful, it could turn out to be a mistake.)
The subhead continued, “Washington Is Incapable of Controlling Spending. There Is Only One Solution Left.” No, Regnery isn’t advocating armed insurrection. Or even tar and feathers. The copy insists, “By doing what our Founding Fathers would do: adopt a balanced budget amendment.”
If the Founding Fathers had wanted to do it, they would have done it. I happen to think they did a darned good job on the 10 Amendments they did give us. (I also think most of the ones that followed made things worse for this country, not better. But that’s a column for another day.)
The email from Regnery is for a new book by Senator Mike Lee (R-Utah) called The Freedom Agenda. I haven’t read it, but I guess I’d better. The ad for it says the book “proves why a balanced budget amendment is the only way to rein in spendthrift politicos and cut back government overreach.”
I couldn’t disagree more. We don’t need a balanced budget amendment, as I’ll show you in a moment. And I think passing one would be dangerous. Let me explain why.
A balanced budget amendment, even if approved by two-thirds of the states, doesn’t mean that government spending will be reduced by a single penny. In fact, just the opposite is likely to occur. Because of automatic increases that are already included in much of our legislation, unless Congress decides otherwise, Federal obligations in the future are much more likely to increase than decrease.
One important example is interest payments on the national debt. For a variety of reasons, from the real estate collapse to meddling by the Federal Reserve, interest rates in this country have been kept artificially low for years. But what happens when they start to climb?
Look at the numbers, folks. Our acknowledged Federal debt is somewhere north of $14 trillion. Our average interest payments for all of that borrowing come to about 1.5 percent. While that’s a bargain today (where can you borrow money at such a low rate?), it still means we taxpayers have to fork over about $200 billion a year, just to pay the interest on the national debt.
What happens when that rate starts to climb? Right now, Ireland must promise to pay 14 percent to get anyone to lend it money. Greece has to fork out even more. I’m not saying our interest rates will ever get that high. But what happens when they double or triple from here, as I believe is all but inevitable? Where is the money going to come from to pay them?
I agree that we should balance the budget. But not if the politicos in Washington decree that we need to increase revenue to do so.
The most important thing isn’t to balance the budget; it’s to slash spending.
If a requirement gets added to the U.S. Constitution that Congress must pass a balanced budget, one horrible alternative seems frighteningly clear to me: We will be forced to raise taxes to comply with the law.
I can see the editorials in The New York Times and The Washington Post. The editorial writers won’t be so juvenile as to gloat; but I wager they will smirk a bit. Because they will know that we have fallen into a trap that they baited for us.
Yes, I think a balanced budget amendment could be dangerous. But I’m against it for a second and more basic reason: We don’t ne

 

[snowmobiler]

WASHINGTON (AP) — GOP presidential candidate Tim Pawlenty says President Barack Obama is showing no courage in the debt showdown.
"If you're the leader of the free world, would you please come to microphone and quit hiding in the basement about your proposals, and come on up and address the American people? Is he chicken?" the former Minnesota governor told CNN's "State of the Union."
He said Obama needs to talk specifically and publicly about where he would cut entitlement programs to reduce the nation's debt. Obama has been negotiating with congressional leaders in an attempt to raise the government's borrowing limit ahead of an Aug. 2 deadline to avoid a financial default.
"Where's the president of the United States on the most pressing financial challenges of our country on entitlement reform? Where is his specific Medicaid reform proposal? Where is his specific Medicare reform proposal? Where is his Social Security reform proposal?" Pawlenty asked.
"The answer is he doesn't have one. You can't find him publicly talking about that. He's ducking, he's bobbing, he's weaving. He's not leading, and that's not the kind of president we need, and that's why he needs to be removed from office.
Pawlenty himself has criticized for not being aggressive enough in his 2012 campaign.

 

[ruffryder]

doo dawg,

your article seems to say that if we had a balanced budget amendment it would be very bad because we would have to raise taxes to balance the budget?

 

[ruffryder]

He said Obama needs to talk specifically and publicly about where he would cut entitlement programs to reduce the nation's debt. Obama has been negotiating with congressional leaders in an attempt to raise the government's borrowing limit ahead of an Aug. 2 deadline to avoid a financial default.

I don't get arguments like this. It isn't the presidents job to come up with a plan that congress needs to. Congress needs to figure this out, they have the power, they have the control.

What good would it do for Obama to have a plan? You really think congress would do anything remotely similar?

It just seems like redirection to me. IMO, it doesn't matter what the president want, congress needs to come together to an agreement about what they are going to do.

It is time they do what they are getting paid for. FIGURE IT OUT CONGRESS!!

 

[DOO DAWG]

doo dawg,

your article seems to say that if we had a balanced budget amendment it would be very bad because we would have to raise taxes to balance the budget?

Blue would read it that way

 

[ruffryder]

Blue would read it that way

what is a different point of view from reading it? I do think it is stupid. Just like the redundant debt limit we have now...

 

[DOO DAWG]

I know some don't believe it, but the federal government could USE to shrink up immensely in many areas and get it's nose OUT of places it doesn't belong. and THEN raise taxes if needed. USFWS for just one. The states can do a great job without the Fed's redundant BS! Is the government not the biggest employer in Greece?
Those that want the fed gov. to grow,Grow,GROW would see it as a way to force their beliefs and ideals on those who do not. You know typical Liberal nanny state tyranny?

The other side should not allow themselves to be blindly led into such a trap, is what I read.

 

[ruffryder]

I guess I don't understand what a balanced budget amendment would have to do with the method of balancing the budget? If either reduced spending or increasing taxes balances the budget, why is it assumed in the article that you posted that only increases in taxes will be the result? Why would congress not be able to reduce spending?

I think the term "trap" seems to be a little premature...

 

[DOO DAWG]

Thought it about time to retire the No Wild Sky rally pic for a while and bring out the Three stooges. this is interesting........

http://www.theblaze.com/stories/rep...atthews-obama-doesnt-send-a-thrill-up-my-leg/

 

[snowmobiler]

save your money.horse and buggy days comming back.

 

[snowmobiler]

world markets fell Monday and Wall Street headed for a lower open

 

[ruffryder]

world markets fell Monday and Wall Street headed for a lower open

Isn't Wall Street a poor indicator of write and wrong? Don't the markets rate stability over all else?

That seemed to be Moody's point of view if I can remember correctly.

Anyone find it interesting that the ratings companies are trusted so highly, yet they were the ones that were rating Enron, and all the securities created from toxic mortgages? You would think there credibility would have been somewhat decreased..

 

[snowmobiler]

we are swirling around in the toilet bowl

 

[DOO DAWG]

Opinion
Congress Can Learn From 1995-96 Debt-Ceiling Debate

Published July 25, 2011
FoxNews.com
Failure to raise the Federal debt ceiling limit could "roil the financial markets and cause severe economic problems," "cause profound damage to our country," and have “dire consequences.” So wrote the Los Angeles Times, Washington Post, and New York Times. But the year was 1995, not 2011.

Other ills predicted during that contentious debate were rising unemployment, reduced GDP growth, and soaring interest rates. That was at a time when President Clinton and Democrats were fighting off attempts by Republicans to link cutting the deficit to the increase in the debt ceiling.

Then as now, there was a widespread misperception that failure to increase the debt ceiling would produce a default: "congressional Republicans are threatening to provoke the nation's first-ever default" (Washington Times). The Los Angeles Times reported: "the first real risk of a government default could occur November 15 [1995]." Even the then Chairman of the Federal Reserve, Alan Greenspan, warned that congressional Republicans should drop their efforts, declaring: "To default for the first time in the history of this nation is not something anyone should take in any tranquil manner."

So what happened back then? After shutting down the government for five days in late November, a temporary extension to the debt ceiling was passed, but the government was shut down again from December 16th, 1995 to January 6th, 1996 before President Clinton finally agreed to the cuts that the Republicans in Congress had been pushing and a long term increase in the ceiling was enacted. Yet, no default ever occurred. In retrospect, it is not surprising. Default only occurs if the government stops paying interest on the money that it owes. Not increasing the debt ceiling only means that the government is forbidden from borrowing more money and that spending is limited to the revenue the government brings in. And, with interest payments on the debt making up only a small fraction of revenue, the interest itself was relatively easy to pay.

Contrary to Democratic claims, these two shutdowns did not damage the economy. Unemployment remained constant during December 1995 and January 1996 and fell slightly in February 1996. And quarterly GDP kept chugging along, growing as faster or faster during the fourth quarter of 1995 and the first quarter of 1996 than it had over the preceding four quarters. Stock prices also continued to rise throughout the whole drama, with the Dow Jones Industrial Average rising by over 6 percent, from 4,873 on November 13th to 5,181 on January 5th.

As for interest rates, US Treasury bond rates did not go up -- to the contrary, they fell almost continually during 1995 and the beginning of 1996. This indicates that, despite the warnings by the politicians and the media, investors were not at all worried about any default by the US government. Had investors been concerned, they would have demand higher interest rates to compensate them for that risk. We would have seen interest rates spike as negotiations over increasing the debt ceiling failed and the supposed default was about to occur.

The contrast to the situation today in some European countries couldn't be sharper. Interest rates have soared as the fear of default has increased in such countries as Greece, Ireland, Italy, Portugal, and Spain.

Saying that there wasn't a risk of default then or now isn't to deny that there is a huge and growing debt problem, something that represents a real burden to our children and grandchildren. The current $14.3 trillion debt is huge, coming to $190,000 per family of four. President Obama’s February budget planned on adding another $10.3 trillion over the next decade, which would add yet another $130,000 more to such a family.

True, there were problems associated with the shutdowns in 1995-96. The main drawback was that some Federal “nonessential” employees had to miss a paycheck or two. That is certainly a non-trivial problem for those employees who did not have enough money save up. Yet, the lost paychecks were soon replaced, with those employees getting paid vacations, getting paid for not working.

But we should remember that the fiscal standoff had some long-term benefits. The budget battles during 1995-96 ended up reducing the next year's deficit to only $22 billion. And surpluses were produced over the next four years. Few thought that was possible to have surpluses before the shutdown.

On Friday, at President Obama's press conference where he announced the debt ceiling talks broke down, the president continued the rhetoric that failure to increase the debt ceiling means default and warned "imagine what that does to the economy when suddenly 70 million checks are put at risk.”

President Obama's warnings of “Armageddon” are just scare tactics. So are Treasury Secretary Timothy Geithner claims of “catastrophic” consequences. We can only hope that the lessons of 1995-96 are remembered and that members of Congress dare to vote for fiscal restraint.


--------------------------------------------------------------------------------------------------
One BIG difference= China didn't own us in 1996!

 

[Mafesto]

Apparently the Democrats are hell bent on financially ruining our country.

 

[Hardass]

So if it goes up 1 tri or 2.4 trillion What does that do just put off what ever is going to happen untill a later date? I have not been following close at all ,but what i have seen or think i see is we are just trying to put off what ever is going to happen any way. Is this correct?

 

[Hardass]

In simple terms for me i see we do not have enough to pay just to keep running the country. If we do not barrow more money ss will be denied and unpaid to those that paid into it along with the other programs they are talking about. So we barrow maney and can pay for it now but only untill 2013 max then what? we need to barrow more money? Is that a plan?. To me we can not keep spending more, we can not keep expanding government. It will be hard on many and i mean very hard( me included) The US is never going to be what it was again we are a sinking ship no matter what side your on. Our government does not have a clue. We the people are not doing any thing to stop it, were all to busy with our toys and entertainment to even really pay attention. Sure some are but not most. Tuff times are ahead, get use to it getting tuffer and tuffer.
Jobs and expansion are what got to where were at we were going up,up,up then it stopped Easy credit kept us going for quite some time but thats gone now as well. Credit kept it all rolling but it just got to be to much and BAM here we are. Now the Gov wants to take it to the next level and no matter which way it goes it's not good and we can't stop it.

 

[winter brew]

So if it goes up 1 tri or 2.4 trillion What does that do just put off what ever is going to happen untill a later date? I have not been following close at all ,but what i have seen or think i see is we are just trying to put off what ever is going to happen any way. Is this correct?

Yep. It's just that much more $$ the US will be paying interest on. That many more US dollars that will leave the country and the hands of Americans to be spent elsewhere.
There is so much waste and duplication at the federal level it's not funny....start with a commission that hunts out waste and gets bonuses for eliminating it (so they are less likely to overlook waste).
Have a balanced budget amendment like the states have.
Reward business for staying in in the US and penalize for going overseas (unless they can create an equal number of new jobs here perhaps??)
Encourage foreign business to come to the US.
It seems the opposite has been happening for many years (NAFTA?Free trade?), it's time to turn the bus around.