If The Us Defaults On Its Debt Next Month...

[Robby nz]

US still designs, develops and produces the best weapons systems in the world but I wonder how much longer we can pay for it.

Dont forget "And uses them"

Part of the problem?

So what will raising the dept ceiling really do besides allow the US to pay the immediate bills for a few months?

Seems to me all it will do is raise the debt level which means that at some time in the future it will (should) have to be paid back.

Does the US really have the ability, income, to pay back the debt it has racked up and is planning to increase and how long will others continue to lend them money without wanting a guaranteed bigger return on their investment? after all, AAA not withstanding, it must be an increasing risk lending to the US.

[KKvampire]

The Speaker Boehner can't get his own side to vote for his "Plan" , The Teabagger freshmen said they were off to the House chapel to pray.

Good!

Because if they agree to that bill they are not doing their jobs same as the other party.

We The People sent the freshmen there for a reason.

Boehner's plan of 910B in spending cuts while raising the drunken sailors credit 900B is just the usual dog & pony show.

When your country is on a hole the first course of action is stop digging. Shrinking this bloated pig of a government has to happen one way or another.

"We the People sent the (Teaparty) Freshmen" ? Representing a minority in the country and maybe still a minority within their own party, Now it highlights the extreme ideologs they are , and the US public will now know who to blame when the interest rates go up and the pain is tougher.

At least the loon Bachmann is honest to say she wont vote to raise the Debt Ceiling "under any circumstances".

Edited July 29, 2011 by KKvampire

[flying]

and the US public will now know who to blame when the interest rates go up and the pain is tougher.

And who is to blame at this time? Well that would be all that came before.....including the yes we can but couldn't & the hope & change that

was misunderstood as hope & change for the better not worse.

Soon the US can take "In God We Trust" off the fiat currency & replace it with

"I Will Gladly Pay You Tuesday For A Hamburger Today"

We have run out of road & the can cannot/should not be kicked any further.

Any cockamamie ideas to again raise the ceiling a trillion or two while promising ....again....cuts in spending that will never come is Stupid. Four Trillion in cuts over the next 10 years? All the while running a deficit that will again next year & the next & the next require further raising of the debt ceiling another 1-4 Trillion?. How much is that in 10 years?? Hmmm more than 4 Trillion I promise you that.

It is basic math & anyone should be able to comprehend it. BIG DEBT = BIG INTEREST

They are stretched beyond the beyond.

They cannot pay the interest on what they borrowed already. The answer does not lay in allowing them to borrow more.

Higher interest is coming either way..It is here already & they cannot pay it even now...Why let the drunken sailors continue to run a tab they have no way of paying other than promising your great grand childrens future?

Party's Over sober up

Edited July 29, 2011 by flying

[craigt3365]

US still designs, develops and produces the best weapons systems in the world but I wonder how much longer we can pay for it.

Dont forget "And uses them"

Part of the problem?

So what will raising the dept ceiling really do besides allow the US to pay the immediate bills for a few months?

Seems to me all it will do is raise the debt level which means that at some time in the future it will (should) have to be paid back.

Does the US really have the ability, income, to pay back the debt it has racked up and is planning to increase and how long will others continue to lend them money without wanting a guaranteed bigger return on their investment? after all, AAA not withstanding, it must be an increasing risk lending to the US.

It's not just the US that's in this situation. Many European countries are there also...that's what's scary.

[craigt3365]

and the US public will now know who to blame when the interest rates go up and the pain is tougher.

And who is to blame at this time? Well that would be all that came before.....including the yes we can but couldn't & the hope & change that

was misunderstood as hope & change for the better not worse.

Soon the US can take "In God We Trust" off the fiat currency & replace it with

"I Will Gladly Pay You Tuesday For A Hamburger Today"

We have run out of road & the can cannot/should not be kicked any further.

Any cockamamie ideas to again raise the ceiling a trillion or two while promising ....again....cuts in spending that will never come is Stupid. Four Trillion in cuts over the next 10 years? All the while running a deficit that will again next year & the next & the next require further raising of the debt ceiling another 1-4 Trillion?. How much is that in 10 years?? Hmmm more than 4 Trillion I promise you that.

It is basic math & anyone should be able to comprehend it. BIG DEBT = BIG INTEREST

They are stretched beyond the beyond.

They cannot pay the interest on what they borrowed already. The answer does not lay in allowing them to borrow more.

Higher interest is coming either way..It is here already & they cannot pay it even now...Why let the drunken sailors continue to run a tab they have no way of paying other than promising your great grand childrens future?

Party's Over sober up

I saw an interview on CNN this week. They were talking about a request from the politicians to put together a "bi-partisan" panel to look into ways to cut the deficit. The guy on CNN laughed and said there have been 18 since around the mid 80's....and none of these panels recommendations have ever been utilized!!!!

Dysfunctional government is the key term???

[cloudhopper]

The most recent panel being appointed (and subsequently completely ignored) by the current president.

To the Not-So-Wayback Machine Mr Peabody! http://www.moneynews.com/Headline/US-Cutting-Deficits/2010/11/10/id/376632

[flying]

The most recent panel being appointed (and subsequently completely ignored) by the current president.

To the Not-So-Wayback Machine Mr Peabody! http://www.moneynews.com/Headline/US-Cutting-Deficits/2010/11/10/id/376632

Hey at least they are consistent.

Funny though how the all use fear as their 1st line of defense.

Of course the first threat is always Social Security cuts & Medicare.

Those folks who already paid into the system for decades are threatened 1st.

Cut the SS & Medicare....wonder if the Welfare will go through the roof? Duh..

Never a logical thought like maybe hey we cant afford to drive billion dollar subs around the seven seas

at costs of billions more..Especially since no threat exists....Or hey we better re-think all these invasions we have going nowhere.....except the continued bankruptcy we now see before us.

Make no mistake they will again raise the limit because the sheep among us will knuckle under with the threats to the SS & Medicare.

Instead they should threaten right back & say you will need all your military right here at home on the streets to curb the civil unrest you are about to see.

They will raise it with a short term stop gap only to be revisited again in September/October & again & again until the sheep say <deleted> it.Bring it on.

Look at how long the last raise of their spending limit lasted. This time it will last even less time & on & on & on.....

Edited July 29, 2011 by flying

[JimGant]

So what will raising the dept ceiling really do besides allow the US to pay the immediate bills for a few months? Seems to me all it will do is raise the debt level which means that at some time in the future it will (should) have to be paid back.

Don't confuse 'debt' with 'deficit.' Right now the US faces deficits -- and for several more years. And each deficit will add to the national debt. At some point, however, something like the Simpson-Bowles recommendations will have to take effect, with many painful edicts involved (and some not-so-painful, like getting out of the World's Policeman mode). But, at some point, we'll finally run a surplus again -- and then we'll have to decide whether or not to pay down some of the debt -- or maybe use the surplus for something like infrastructure, which builds on the future.

Simpson-Bowles doesn't see deficits ending for several more years. But it does see them decreasing, as a percentage of GDP. And so too the debt, as percentage of GDP.

And that's key. A nation can run indefinitely with a debt -- as long as it's manageable (in terms of being serviceable, and within a tolerable ratio of GDP). So, no, it doesn't ever have to be paid back. But, yes, deficits -- at today's rates -- definitely have to be pared back.

Any cockamamie ideas to again raise the ceiling a trillion or two while promising ....again....cuts in spending that will never come is Stupid.

Two completely separate problems:

Short term, the debt ceiling has to be raised to meet CURRENT obligations. We can't just renege on those obligations -- for obvious reasons (apparently not obvious, however, to the Tea Party). Less obvious, however, is the economy is still at death's door re recession -- so any cut in current spending brings us closer to another full-blown recession (but, again, the Tea Party doesn't believe in Keynesian theory, believing without TARP and money stimulus, we'd have been better-off. Most sensible economists agree the stimulus helped).

Long term, the deficits HAVE to be brought down. If nothing else, this stupidity in Washington has made all but the dimmest aware of this. But, this involves winding-down, over considerable time, many government programs. Using Aug 2nd as an instant 'hit the wall' date is not just stupid, but undoable. However, we know we have to go there, so expect tax code changes -- and means testing for SS and Medicare recipients (see today's Samuelson "It's the elderly, stupid" in The Wash Post).

Nothing personal but those Freshmen were elected by a majority for a reason.

The reason was, because Obama couldn't do miracles and reverse the folly he inherited from Bush. So, voters do what they always do -- vote for change. This wasn't, however, a mandate for stupidity.

I used to think all politicians should be elected to a single term. That way, assuming smart, educated (or at least 'educatable') folks are elected, they could then ignore the campaign promises gobbled up by the stupid voters -- and make the correct, albeit tough, legislation.

The Tea Party sure blew holes in that idea.

[transam]

I don't know if you are a US citizen, but our President's name is Obama, not Zobama.

That said, Mr. Obama inherited a mess, and, unfortunately,

Yes American living in America not Thailand...As such I am free to call him anything I like.

You remember the rights of Americans dont you? Respect is earned not gifted due to title.

What he inherited is a job through $ donated by the same too big too fail folks he later bailed.

The sooner he is gone the better.

Not to say the nitwit before him was any better. The so called system has been beautifully broken long ago.

As for the need for approbation from like-minded nitwits as you put it....That is more like those waiting 3 years to "hear" what they need from a hollow shell that can not deliver any of his campaign lies promises. Yes blame it on what he inherited or how he played into others hands...yet for three years there it is...proof for any thinking person to see.

Strangely, I don't totally disagree with your assessment of his performance, and I also understand you have the right to say whatever you want about him, and the right to call him names, or make slurs about his origins, etc. However, it just puts you in the same category as the other wingnuts and assorted losers who act like kindergarteners, calling names, and saying, na,n,na,n,na,na.. Grow up, and maybe someone of substance will pay attention to you. I still think the holder of the office of the President of the USA deserves some respect. Ask yourself this: would you say those things directly to his face? You wouldn't to mine, and be able to walk away...

So many 'keyboard warriors', sh*t oh dear!

Yes, and you sound like one of them eh.

[JimGant]

Cut the SS & Medicare....wonder if the Welfare will go through the roof? Duh.

Nope. But the "social" in Social Security will sure get emphasized, as it will become a quasi-welfare system, with those with "means" getting even less, while now paying FICA taxes on all earned (and unearned) income.

Interestingly, ideas on tax code changes seem to emphasize lowering marginal tax rates, while taking in more money by cancelling elements like the mortgage deduction. Hey, my mortgage is paid off -- go for it! Plus, since I still have some IRAs not converted to Roth, paying at a lower tax rate sounds good....

But, such tough actions in Congress will require something akin to BRAC to pass, since the voters will never stand for such pain. However, it will get done -- as there's no alternative. It just won't -- and can't -- be done by August 2nd. Duh.

[craigt3365]

Here's a good article.

http://online.wsj.com/article/SB10001424053111903591104576470061986837494.html

The debt-limit debate is heading toward a culmination, with President Obama reduced to pleading for the public to support a tax increase and Speaker John Boehner and Senate Majority Leader Harry Reid releasing competing plans that are the next-to-last realistic options. The question now is whether House Republicans are going to help Mr. Boehner achieve significant progress, or, in the name of the unachievable, hand Mr. Obama a victory.

Mr. Obama recognizes these stakes, threatening yesterday to veto the Boehner plan in a tactical move to block any Democratic support. The White House is afraid that it will pass the House and then become the only debt-ceiling vehicle if Mr. Reid can't get 60 votes for his own proposal in the Senate. This would short-circuit Mr. Obama's plan to blame the GOP for a U.S. credit downgrade, any market turmoil, a possible default, and the lousy economy too.

As is usual, it's all about politics. And August 2nd is NOT the date bills won't be paid. Great stuff for the media though.

[flying]

Short term, the debt ceiling has to be raised to meet CURRENT obligations. We can't just renege on those obligations -- for obvious reasons (apparently not obvious, however, to the Tea Party).

The reason was, because Obama couldn't do miracles and reverse the folly he inherited from Bush. So, voters do what they always do -- vote for change. This wasn't, however, a mandate for stupidity.

I respect your opinions Jim but do not agree

First off they have the money to pay the interest on the debts as it stands.

Secondly I feel you are too caught up in the side shows & still are trapped by party line thinking.

I could care less about whether someone is a Dem, Repub or Tea party as so many are now lumped into by the press.

The facts remain that the government is out of control & yes has been even pre Obama. But also Obama has done nothing but accelerate it.

I do not say so because of his party & I have no party to defend. Yet the facts are clear to see.

The blame game can be played ad nauseum it will solve nothing.

The repair will never be painless but the sooner it starts the sooner it is repaired.

Nothing else has worked for obvious reasons & this continued kicking of the can for what ever reason claimed only is increasing the inevitable pain.

[InterestedObserver]

First off they have the money to pay the interest on the debts as it stands.

Who decides whether to pay the interest on the National Debt or Social Security, Medicare and military retirement - Obama? We cannot pay them all under default conditions.

[JimGant]

& still are trapped by party line thinking.

A middle-of-the-road pragmatist -- lays claim to neither party.

Right now, Jon Huntsman seems closest to this quality.

Unfortunately, this quality won't allow him to get his party's nomination.

Jimmy Stewart - where are you when we really need you?

[NovaBlue05]

First off they have the money to pay the interest on the debts as it stands.

Who decides whether to pay the interest on the National Debt or Social Security, Medicare and military retirement - Obama? We cannot pay them all under default conditions.

It's Obama's decision however, He may try to deflect that responsibility as he has everything else related to this issue. I would think he would stick with the populist approach since he is in full on campaign mode now.

[midas]

89 hours to go............

I am betting that this will end with the President acting on 14th amendment and to hell with the consequences just like the invasion of Libya.

[JimGant]

and to hell with the consequences just like the invasion of Libya.

I like your metaphor -- Washington does seem like a place where drones have replaced real people....

[craigt3365]

Again, the deadline is not August 2nd. But not too many days after that for sure. Something will be done as soon as the politics are figured out.

[a99az]

Defaulting could be good for all of us, if it leads to something better than than banks and bankers.

[a99az]

The Fed reserve will just print more dollars ( but we should rename them dimes).

[flying]

The Fed reserve will just print more dollars ( but we should rename them dimes).

They already are

[cloudhopper]

Here's a great summary - http://www.theburningplatform.com/?p=19304

[flying]

Here's a great summary - http://www.theburningplatform.com/?p=19304

That is basically how I see it & the LVM quot at the top of the page you linked sums it up.

This is a game of musical chairs & we know how it ends. There is only one possible ending.

They claim we have to pay for what they spent....again.

Yet they had a budget last year that ran out months ago. Did they stop spending? No

Will they if we again raise the limit?.....I don't think anyone is that naive

It has been the same over & over & over for years gone by.

Why even have a budget if they will only ignore it & again promise future cuts

that will amount to a pittance of what they have over spent.

They should all be hung & then shot for good measure.

Finish it now I say.

We should have left this country to future generations in better shape than we found it. Shame on us

Edited July 30, 2011 by flying

[midas]

Finish it now I say.

We should have left this country to future generations in better shape than we found it. Shame on us

don't despair flying actually you already have the means to turn the tables on this in USA ............

" Obama has declared that he has the authority under the 2001 AUMF to indefinitely hold anyone “if it is necessary to protect against a significant threat to the security of the United States.”

http://emptywheel.firedoglake.com/2011/03/07/a-modest-proposal-indefinitely-detain-the-banksters/

[midas]

Short term, the debt ceiling has to be raised to meet CURRENT obligations. We can't just renege on those obligations -- for obvious reasons (apparently not obvious, however, to the Tea Party).

oh really? You mean even when the money is spent this way?

http://coburn.senate.gov/public/index.cfm?a=Files.Serve&File_id=f6cd2052-b088-44c3-b146-5baa5c01552a

[craigt3365]

Not to worry! Apple will save the day:

http://news.yahoo.com/blogs/ticket/apple-more-money-federal-government-163023405.html

[JimGant]

Short term, the debt ceiling has to be raised to meet CURRENT obligations. We can't just renege on those obligations -- for obvious reasons (apparently not obvious, however, to the Tea Party).

oh really? You mean even when the money is spent this way?

http://coburn.senate.gov/public/index.cfm?a=Files.Serve&File_id=f6cd2052-b088-44c3-b146-5baa5c01552a

Obviously, the NSF is one of those agencies due for a severe haircut. Not sure it can be done by Aug 2, or Sep 2, or Dec 2, however. (Hint: I'm being facetious.)

If you're going to quote me, please keep the context intact.

Two completely separate problems...Short term, the debt ceiling has to be raised to meet CURRENT obligations...Long term, the deficits HAVE to be brought down.

The whole Federal government needs to be turned on its head, to include redefining what it is we want government to do, as well as cleaning up those agencies we deem necessary. But defaulting on our obligations during this clean up period is not the efficient, nor effective, way to cleaning house. Yeah, it certainly gets one's attention. But most of us are wearing thin with all this spoiled brat crap.

[craigt3365]

Short term, the debt ceiling has to be raised to meet CURRENT obligations. We can't just renege on those obligations -- for obvious reasons (apparently not obvious, however, to the Tea Party).

oh really? You mean even when the money is spent this way?

http://coburn.senate.gov/public/index.cfm?a=Files.Serve&File_id=f6cd2052-b088-44c3-b146-5baa5c01552a

Obviously, the NSF is one of those agencies due for a severe haircut. Not sure it can be done by Aug 2, or Sep 2, or Dec 2, however. (Hint: I'm being facetious.)

If you're going to quote me, please keep the context intact.

Two completely separate problems...Short term, the debt ceiling has to be raised to meet CURRENT obligations...Long term, the deficits HAVE to be brought down.

The whole Federal government needs to be turned on its head, to include redefining what it is we want government to do, as well as cleaning up those agencies we deem necessary. But defaulting on our obligations during this clean up period is not the efficient, nor effective, way to cleaning house. Yeah, it certainly gets one's attention. But most of us are wearing thin with all this spoiled brat crap.

I was just watching CNN. One of the tea party republicans was on talking about his vote. According to him the US will take in some 170B or so in taxes/etc. Plenty enough to pay for bonds, interest, medicare, social security, etc. But obvious well short of the 330B in bills due this month.

This is a political game they are playing. I'm glad the tea party reps are standing tough. We need to deal with this debt limit. As he said on TV, congress can't be trusted to not spend too much. This has been proven. So, we need to tie their hands via legislation. Sad that has to happen...

[flying]

This is a political game they are playing. I'm glad the tea party reps are standing tough. We need to deal with this debt limit. As he said on TV, congress can't be trusted to not spend too much. This has been proven. So, we need to tie their hands via legislation. Sad that has to happen...

This is the truth & is verifiable by just looking back to last year & the debt ceiling raise.

They cannot be trusted to not overspend. They are worse than drunken sailors.

At least the sailors eventually barf & go to sleep.

I agree tie their hands or better yet their necks.

But do what it takes to hold them to their promises.

Why is what they have done not considered treason? Is it not a serious act of betrayal of one's nation

Edited July 30, 2011 by flying

[craigt3365]

This is a political game they are playing. I'm glad the tea party reps are standing tough. We need to deal with this debt limit. As he said on TV, congress can't be trusted to not spend too much. This has been proven. So, we need to tie their hands via legislation. Sad that has to happen...

This is the truth & is verifiable by just looking back to last year & the debt ceiling raise.

They cannot be trusted to not overspend. They are worse than drunken sailors.

At least the sailors eventually barf & go to sleep.

I agree tie their hands or better yet their necks.

But do what it takes to hold them to their promises.

Why is what they have done not considered treason? Is it not a serious act of betrayal of one's nation

I heard an interesting comment on CNN yesterday. Talking about the freshmen congressmen, the tea party guys. They don't owe anything to anybody as they are newbies. And don't seem to really care if they become life long politicians. So they are doing the right thing as opposed to going with the party line. They got elected to deal with the deficit and they are holding to their promises. Great stuff. Congrats guys...and gals....