[TheSilentAssassin]

Originally Posted by GundogHitman

It is interesting, when you look at the reasons behind it. To ignore the dangers of our 16 trillion and rising dollar deficit, would be like riding an air plane into the sky and thinking you will never run out of gas. Our economy is running on E, and Liberals want keep moving "forward".

Please explain how it is like this. If we are "on E", that means we are about to run out of gas and crash. How is that like our situation? How can debt cause our economy to crash? What makes you think we are on that edge?

Originally Posted by GundogHitman

To ignore the dangers of our 16 trillion and rising dollar deficit

P.S. The debt is ~16.4 trillion. The deficit is 1.089 billion. The debt and the deficit are very different things. How can you expect to have a conversation when you don't understand the simplest of terms?

[Iamamartianchurch]

Originally Posted by barrel roll

Revolt doesn't happen when people expect horrible treatment. Revolt happens when people don't get the treatment they think they are supposed to be getting.

We live a distracted existence. We will only revolt when we are denied our distractions.

[licence2kill]

Originally Posted by GundogHitman

It is interesting, when you look at the reasons behind it. To ignore the dangers of our 16 trillion and rising dollar deficit, would be like riding an air plane into the sky and thinking you will never run out of gas. Our economy is running on E, and Liberals want keep moving "forward".

What are the yields on the U.S. 10 year treasury note?

Normal Americans have one simple request... reduce spending and balanced budget. You don't need to raise a debt limit to do this, nor do you need to raise taxes. Why can't liberals make this happen? Why can't they hold themselves accountable for a balanced budget? After being taxed 1/4 of my earnings, why can't the left just agree that spending is a problem?

Actually normal Americans are more concerned about the unemployment crisis, not the deficit.

[TheSilentAssassin]

Originally Posted by licence2kill

Actually normal Americans are more concerned about the unemployment crisis, not the deficit.

As they should be

[licence2kill]

Even Republicans only care about the deficit insomuch as its a useful tool to destroy the New Deal welfare state, which is why they refuse small tax increases on the richest Americans while proposing extremely painful cuts to things like social security and medicaid which won't actually save that much money.

[Murph1329]

Originally Posted by licence2kill

raising the debt ceiling doesn't create new deficits.

ah yes you're right...the money has already been spent right?

Well if we just go along with the status quo and keep on kicking the budget down the road you're right. The problem is a line has to be drawn in the sand to force change. I'd rather go through the pains right now instead of watching another bubble burst at some random time.

[spracks21]

Ya, why wait for disaster to strike, when we can self inflict it now!

[TheSilentAssassin]

Originally Posted by Murph1329

ah yes you're right...the money has already been spent right?

Well if we just go along with the status quo and keep on kicking the budget down the road you're right. The problem is a line has to be drawn in the sand to force change. I'd rather go through the pains right now instead of watching another bubble burst at some random time.

What are we delaying? How will debt cause the economy to "burst"? What impact does debt have on an economic system?

[IgnoranceInABag]

eventually debt needs to be paid

[StellarKnight]

Originally Posted by IgnoranceInABag

eventually debt needs to be paid

That doesn't mean debt is inherently detrimental.

[IgnoranceInABag]

it does mean that eventually the federal government will have to find at least 16 trillion dollars. but as long as it isnt right now who gives a **** right?

[TheSilentAssassin]

Originally Posted by IgnoranceInABag

it does mean that eventually the federal government will have to find at least 16 trillion dollars. but as long as it isnt right now who gives a **** right?

Inflation means that over time a set debt gets smaller not bigger in terms of real dollars. From a purely fiscal perspective, we would be unwise to pay it down now when we can pay it down later for less. Also ill ask again. What's the worst that could happen if we don't?

[StellarKnight]

Originally Posted by IgnoranceInABag

it does mean that eventually the federal government will have to find at least 16 trillion dollars. but as long as it isnt right now who gives a **** right?

Please don't tell me you're one of the self-proclaimed "pro business" types.

[IgnoranceInABag]

Originally Posted by TheSilentAssassin

Inflation means that over time a set debt gets smaller not bigger in terms of real dollars. From a purely fiscal perspective, we would be unwise to pay it down now when we can pay it down later for less. Also ill ask again. What's the worst that could happen if we don't?

only if the rate of inflation is greater than the intrest rate and no new debt is added...

and what the worst that could happen if we dont pay it ever? i dont know what would happen, i dont think anyone has defaulted on a $16 trillion debt before

Originally Posted by StellarKnight

Please don't tell me you're one of the self-proclaimed "pro business" types.

i think everyone should be "pro buisness"..... and i just proclaimed it by myself, so i guess so.

[benji25]

Originally Posted by TheSilentAssassin

Inflation means that over time a set debt gets smaller not bigger in terms of real dollars. From a purely fiscal perspective, we would be unwise to pay it down now when we can pay it down later for less. Also ill ask again. What's the worst that could happen if we don't?

The value of the dollar collapses when China calls the debt we owe to it. Hyper inflation.

As the U.S. is a leading economic super power the world is heavily influenced by its currency. Since our currency is based on the "full faith and credit of the government" we would really be up **** creak if no one has faith in us and more importantly we have no credit.

Good luck trying to pay down the deficit when the government has a Caa credit rating.

[licence2kill]

Originally Posted by benji25

The value of the dollar collapses when China calls the debt we owe to it. Hyper inflation.

Do you know how a bond works? When you buy a bond there is a maturity date. You only get to collect your money when the bond hits that date. You can't do it before, derp.

However I'll be charitable and assume that what you were really referring to was the chinese selling their treasury assets on the secondary market, which would probably be expansionary for the U.S. economy as the dollar would depreciate to the remnibi, which would make our exports more competitive to chinese exports.

People leaving the U.S. bond market would be a very good thing.

[licence2kill]

Originally Posted by IgnoranceInABag

only if the rate of inflation is greater than the intrest rate and no new debt is added...

Last I checked it was.

You also seem to be under the impression that we have to pay it back all in one big lump sum, so how do you think we payed back our debts from WWII?

[benji25]

Originally Posted by licence2kill

Do you know how a bond works? When you buy a bond there is a maturity date. You only get to collect your money when the bond hits that date. You can't do it before, derp.

However, I'll be charitable and assume that what you were really referring to was the chinese selling their treasury assets on the secondary market, which would probably be expansionary for the U.S. economy as the dollar would depreciate to the remnibi, which would make our exports more competitive to chinese exports.

If the decide to stop reinvesting in said bonds, how are we going to pay for it?

[licence2kill]

tax revenue from a faster expanding economy

[benji25]

Originally Posted by licence2kill

tax revenue from a faster expanding economy

So not only would we have to come up with enough additional tax revenue to get to a balanced budget, we would then also have to get a big enough surplus to pay for our debts within a reasonable amount of time?

Are you one of those people who racks up debt because they expect to be a millionaire somewhere down the road and that they will pay for it "when things are better?"

[licence2kill]

First of all you need to sort out the difference between the cyclical deficit and the structural deficit. The cyclical deficit is just a product of depressed tax revenue and automatic stabilizers (safety net programs) from the recession. This constitutes the vast majority of our current deficits and will eventually go away on its own as the U.S. recovers.

See here: http://www.bloomberg.com/news/2012-1...-to-think.html

The structural deficit is mostly just health care cost inflation which we can curb if we want to, which is what every other OECD nation does.

Second, if we assume long run 2% growth (which I think is a pessimistic estimate for the U.S.) we can still run large deficits every year and keep debt as a % of GDP stable, since the denominator will be expanding.