[barrel roll]

Have you fellows heard anything about this?

The orange man showing his true colors, now that Rep Paul is on his Twilight Tour?

Honestly? I have already made it clear that I want the Republican party recalibrated. I want the Neo-Cons to burn. Hatred? Not that bad, more like disgust. I am ashamed it took me as long as it did to see true conservatism, and these fools should be shown no quarter.

Pick an article...

[drgonzo]

Boehner could be making a rare responsible move here. Teabaggers and their ilk are objectively terrible for the country. They should not be holding any levers of power.

Given the results of the recent election, Boehner and Republicans ought to know that they need to retool their party leftward. They are grotesquely distorted to the right.

[2ffu]

Originally Posted by drgonzo

Boehner could be making a rare responsible move here. Teabaggers and their ilk are objectively terrible for the country. They should not be holding any levers of power.

Given the results of the recent election, Boehner and Republicans ought to know that they need to retool their party leftward. They are grotesquely distorted to the right.

The majority of the party has gone leftward. Tod akin does not represent the main stream republican party or even the tea party for that matter. So quit trying to paint with such a broad brush when you are doing detail work.


In the governor race in my state the republican embraced gay marriage but I guess that is "grotesquely distorted to the right"

So now that the republicans have made concessions when is obama going to come forward with some material spending cuts ( not the whole Oh well we spent $1 this year, we planned to spend $1.10 next year, but instead we will only spend $1.08 resulting in a $.02 spending cut)

[licence2kill]

Originally Posted by 2ffu

The majority of the party has gone leftward. Tod akin does not represent the main stream republican party or even the tea party for that matter. So quit trying to paint with such a broad brush when you are doing detail work.


In the governor race in my state the republican embraced gay marriage but I guess that is "grotesquely distorted to the right"

So now that the republicans have made concessions when is obama going to come forward with some material spending cuts ( not the whole Oh well we spent $1 this year, we planned to spend $1.10 next year, but instead we will only spend $1.08 resulting in a $.02 spending cut)

What concessions? The republicans haven't specified anything. They just want to slash the welfare state in ways that will hurt the poor and do almost nothing on the deficit front.

And am I the only one who finds this whole debate weird? If you want deficit reduction the best move is to DO NOTHING and let sequestration kick in. However, seeing as you are negotiating to avoid the austerity bomb (which is a more accurate term for fiscal cliff) I can assume you think that fiscal retrenchment will hurt economic growth. However this also implies that you believe the economy is still suffering from an AD shock, so you should be arguing for the reverse of deficit reduction.

[TheSilentAssassin]

Originally Posted by licence2kill

And am I the only one who finds this whole debate weird? If you want deficit reduction the best move is to DO NOTHING and let sequestration kick in. However, seeing as you are negotiating to avoid the austerity bomb (which is a more accurate term for fiscal cliff) I can assume you think that fiscal retrenchment will hurt economic growth. However this also applies that you believe the economy is still suffering from an AD shock, so you should be arguing for the reverse of deficit reduction.

LTK, I'm interested in what you would do in this situation. My understanding is that going over the Fiscal cliff leads to lower debt but a recession (or atleast the CBO thinks so). Picking a combination of cuts and tax increases would simply be a lesser version of that. The last solution in my mind would to say "**** that ****" and simply not do it. You're congress. If you passed a law, you can unpass it. In my mind, now is not the time to address the debt.

But I'm not an economist for a reason, so thoughts?

[StellarKnight]

Originally Posted by TheSilentAssassin

If you passed a law, you can unpass it. In my mind, now is not the time to address the debt.

I'm no economist, but I don't understand how one could reasonably argue that now is the time to address the issue of debt. Debt isn't an inherently bad thing, and people don't seem to understand that debt at the national level in no way really resembles the debt of a household consumer (especially when you considering the sheer economic force that is the United States). Everything in this country, from tax revenues to private sector growth, is absolutely reliant upon employment. That's where our focus should lie.

You know debt's a non-issue because the people harping on it are the many of the very same people who've benefited from it's incurrence over the years. This whole "won't someone think of the children" act is a diversion, which is typical.

[2ffu]

What are interests rates at for government lending right now? .25%? How much longer can we keep printing till we have to raise rates?

I love it when people say debt doesn't matter because actually mother ****er yes it does, you have to make interest payments on that debt. If rates even go up a fraction our cost to service that debt is going to get really out of control.

How long till the interest payments are 1/4 of the federal budget?

[licence2kill]

Originally Posted by 2ffu

What are interests rates at for government lending right now? .25%? How much longer can we keep printing till we have to raise rates?

Well if we look at history no government which issues debt in it's own currency has ever hit the upper bound, so I can't really say.

I will say that we are no where near that limit though.

I love it when people say debt doesn't matter because actually mother ****er yes it does, you have to make interest payments on that debt. If rates even go up a fraction our cost to service that debt is going to get really out of control.

How long till the interest payments are 1/4 of the federal budget?

Rates going up would mean money would be moving into other asset classes which would solve our AD problem (NGDP), meaning governments wouldn't have to issue as much debt.

It's not that debt doesn't matter, it's that its currently negligible and fiscal retrenchment might actually make the problem even worse as it drives down government tax receipts.

[licence2kill]

Also don't confuse monetary and fiscal policy.

[2ffu]

Originally Posted by licence2kill

Well if we look at history no government which issues debt in it's own currency has ever hit the upper bound, so I can't really say.

I will say that we are no where near that limit though.



Rates going up would mean money would be moving into other asset classes which would solve our AD problem (NGDP), meaning governments wouldn't have to issue as much debt.

It's not that debt doesn't matter, it's that its currently negligible and fiscal retrenchment might actually make the problem even worse as it drives down government tax receipts.

True or false: If rates go up, the cost of servicing the intrest on our debt will go up.

[licence2kill]

It will on new debt we issue. What matters is why rates go up, which is a topic you seem to be avoiding.

[2ffu]

rates could go up for a couple of reasons.

[licence2kill]

I can see this is going nowhere.

[TheSilentAssassin]

Originally Posted by licence2kill

I can see this is going nowhere.

Pretty much

[2ffu]

Originally Posted by licence2kill

I can see this is going nowhere.

If I'm so materially wrong on this could you please break it down for me instead of making douchey comments?

[barrel roll]

I wouldn't put money on him not saying something ungentlemanly.

[licence2kill]

Ok.

Rates on U.S. treasures will only go up if demand for them goes down. What matters is why the demand to hold treasuries falls. I see two scenarios, with only one of them in the realm of reasonable possibility:

1) Demand for U.S. treasuries fall because markets lose faith in the U.S. government to pay back its debt. This is absurd though.

2) Demand for treasuries falls because the economy improves increasing the return on other assets.

I don't really see a third scenario.

[2ffu]

Originally Posted by licence2kill

1) Demand for U.S. treasuries fall because markets lose faith in the U.S. government to pay back its debt. This is absurd though.

How long can we sustain being 40% over budget before people lose faith?

[TheSilentAssassin]

Originally Posted by 2ffu

How long can we sustain being 40% over budget before people lose faith?

Japan (one of the strongest economies in the world) has a debt of about 225% their GDP. We are around 100%.

But "I can see this is going nowhere" too, so I'm done bothering.

[2ffu]

Didn't realize stagflation meant strongest economy in the world.

[dub CRISP]

Originally Posted by 2ffu

What are interests rates at for government lending right now? .25%? How much longer can we keep printing till we have to raise rates?

I love it when people say debt doesn't matter because actually mother ****er yes it does, you have to make interest payments on that debt. If rates even go up a fraction our cost to service that debt is going to get really out of control.

How long till the interest payments are 1/4 of the federal budget?

I think this was already addressed but the rates on the debt that the government has already issued is fixed. The only thing that can change is the interest rate on new debt that is issued. Right now we can issue new debt for practically nothing because the government is still viewed as a rock solid investment despite our credit rating downgrade last year. We won't suddenly wake up one day and find that we have to pay more interest on our debt than yesterday. When the government issues t-bills/bonds etc they have a face value that gets paid out when they come to maturity or a set coupon rate that gets paid out over the life of the bond. These do not fluctuate over the life of the bond, inflation and market interest rates have no effect on them.