Obama Announces Deal To Raise Debt Limit, Cut Spending

[rgs2001uk]

Classy Ulysses, real classy...

Fact is Obama was handed a failing economy and was forced to take drastic action in order to prevent either a complete meltdown (depression), or a decade or more of stagflation - no growth. Japan is often cited as an example of what can happen if a government responds too slowly or with too little stimulus.

Up until the very end, much of Bush's spending, as in Iraq and Afghanistan, was elective. Clinton handed Bush a thriving economy and large budget surplus but by the time Bush passed the reins to Obama the US economy was in terrible shape.

You can try to blame the current economy on Obama all you like, but fortunately the majority of Americans know better- http://www.gallup.co...nomy-obama.aspx

Why am I reminded of this?

http://www.h-net.org/~hst306/documents/indust.htm

Wasnt it Bush who claimed the Iraq war would only cost $70 billion and most of it would be paid for with Iraqi oil reserves?

Didnt he sack Larry Lindsay for saying the war would cost $200 billion?

Isnt the true cost of these wars closer to $4,000 billion?

Bomb now pay later.

[uptheos]

If I ever get kidnapped by any fundamentalist group and they send Obama out to negotiate my release............tell my family I loved them.

[Ulysses G.]

He will be too busy apologizing to them to worry about you.

[rgs2001uk]

Classy Ulysses, real classy...

Fact is Obama was handed a failing economy and was forced to take drastic action in order to prevent either a complete meltdown (depression), or a decade or more of stagflation - no growth. Japan is often cited as an example of what can happen if a government responds too slowly or with too little stimulus.

Up until the very end, much of Bush's spending, as in Iraq and Afghanistan, was elective. Clinton handed Bush a thriving economy and large budget surplus but by the time Bush passed the reins to Obama the US economy was in terrible shape.

You can try to blame the current economy on Obama all you like, but fortunately the majority of Americans know better- http://www.gallup.co...nomy-obama.aspx

Why am I reminded of this?

http://www.h-net.org...ents/indust.htm

Wasnt it Bush who claimed the Iraq war would only cost $70 billion and most of it would be paid for with Iraqi oil reserves?

Didnt he sack Larry Lindsay for saying the war would cost $200 billion?

Isnt the true cost of these wars closer to $4,000 billion?

Bomb now pay later.

Edit, above should be the following link,

http://www.h-net.org/~hst306/documents/indust.html

[uptheos]

[Steely Dan]

He will be too busy apologizing to them to worry about you.

[koheesti]

Democratic National Commitee Chair Debra Wasserman-Schultz says that "Dems own the economy" just 6 weeks ago:

http://www.realclearpolitics.com/video/2011/06/15/dnc_chair_debbie_wasserman_schultz_we_own_the_economy.html

CNN's Ed Henry: "At what point do you take ownership?"

DNC Chair Debbie Wasserman Schultz: "I think we are clearly responsible for … I'm going to take ownership right now because we began to turn the economy around."

[uptheos]

He will be too busy apologizing to them to worry about you.

He only apologizes to Royalty.

[koheesti]

Shame. I was looking forward to watching the ship go down. Still, with the Taliban Tea Party running wild, I'm sure we'll get to see a rerun before too long.

The Tea Party met in prayer this morning. The Taliban do the same before their meetings. As did civilisations that are now extinct.

Exactly! What have politics got to do with god? And who were they praying to? Jesus I'll bet! Those idiots are dangerous as we're not all Christians and the likes of me follow no text book gods.

So now the Tea Party are all right-wing Christians? And you guys are equating them to terrorists like the Taliban? Wow, you guys are amazing.

[Jingthing]

So now the Tea Party are all right-wing Christians? And you guys are equating them to terrorists like the Taliban? Wow, you guys are amazing.

It's a fact that they are MOSTLY right wing Christians. I wouldn't call most of them like the Taliban (because then the Christian equivalent of that would be Christians who favor murdering gay people, etc. and most of the tea people aren't quite as bad as that), but you can find many commentaries in the non-radical recent media comparing them to terrorists. Not in the violence sense, in the taking hostages/blackmail sense.

Edited August 1, 2011 by Jingthing

[Ulysses G.]

In other words, like everyone else, they have been playing politics.

Edited August 1, 2011 by Ulysses G.

[Jingthing]

They were willing (and many of them are STILL willing) to throw the US into default for the first time in history. That's more than politics. That's reckless to a degree that's simply not defensible. Real American patriots need to work very hard to expose how irresponsible that movement is. It's a protest movement. The more extreme ones aren't libertarian, they are ANARCHISTS. They are not fit to govern.

Edited August 1, 2011 by Jingthing

[rotary]

Financial crisis postponed. Obama would have loved to limp through to election day with no more cuts, but the republicans extracted their pound of flesh knowing they will be likely to inherit the mess Obama left behind.

Would it not be more accurate to say that "the republicans extracted their pound of flesh knowing they will be likely to inherit the mess Obama left behind inherited from George Bush. "?

Actually FWIW, The roots of this problem started at the end of the last great depression and accelerated the moment the link between the dollar and a set amount of Gold was scrapped. Ever since then successive governments have overspent and kicked the can down the road to facilitate their hoped for reelection. A Russian economist called Kondratieff postulated there is a cycle in capitalist economies lasting around 70 years which culminate in an asset mania followed by the inevitable bust. The 'progressives' as they laughably refer to themselves believe you can cheat this cycle by printing more and more money (debt), in order to service this debt you need the population to grow at a rate faster than most western economies, hence progressively looser immigration policies and a growing population from civilisations alien or even hostile to the western one. The progressives imho naively believe they can integrate this ever growing influx without tearing their own society apart.

You can't invent a perpetual motion machine and we instead have a Ponzi scheme hidden in a hall of mirrors. When this goes bang we are going to see a shock that makes 2007-9 seem mild by comparison, so when postulating who will be the next U.S leader perhaps picking the one most suited to war will be an idea.

Obama and the Democrats need to understand the USA is bankrupt. They cannot keep printing money and borrowing from the Chinese. The time has come to cut spending and stop to borrow. Entitlement programs must be ended. It beats me why a goverment cannot understand you cannot spend money you do not have.

[Jingthing]

Obama and the Democrats need to understand the USA is bankrupt. They cannot keep printing money and borrowing from the Chinese. The time has come to cut spending and stop to borrow. Entitlement programs must be ended. It beats me why a goverment cannot understand you cannot spend money you do not have.

The USA is not bankrupt.

Remember Bush? Loved to spend. Remember Clinton? Budget surpluses. You cannot blame this all on democrats.

China isn't the biggest owner of American debt.

Cut spending, yes.

Raise revenues, yes.

Spend more money on emergency stimulus, jobs programs to repair/build infrastructure depression style? YES!

Reform and massively simplify the tax code, yes.

Tax the rich more, yes.

Eliminate the mortgage deduction, yes.

No income cap for social security payroll deduction. That solves the social security funding issue, which is very minor, overnight.

Leave Iraq sooner. Forget Afghanistan.

Universal health care, Canada style, yes. (That would SAVE massive amounts of money.)

The US spends the most in the world for health care, and the highest rate of NO ACCESS causing millions of early deaths in the advanced world. Of course, right wingers love those early deaths, they are poor people after all, so they don't care.

Kill social security and medicare. No way! But medicare and universal could be merged somehow, sure.

The main crisis in the US now is MASSIVE LONG TERM employment. Analysts think most of the millions of over 50's who have been unemployed for over a year now, or several years, will never find work again. That's the crisis, not the debt ceiling.

The USA can be saved. Tea party right wing radicals who clearly do want to throw granny under the bus, not the answer, it has become a big part of the problem.

Class warfare? You betcha. It's been going on forever, and guess what, the rich won.

Edited August 1, 2011 by Jingthing

[koheesti]

They were willing (and many of them are STILL willing) to throw the US into default for the first time in history. That's more than politics. That's reckless to a degree that's simply not defensible.

Reckless and indefensible - you mean like the politicians (of both parties) that have spent us into near bankruptcy? The liberals hate the Tea Party for one reason - MONEY. The liberals want more of it for their pet causes and the Tea Party wants to cut spending. If there's anyone evil in this equation, it's the people who want to keep spending and spending.

[koheesti]

It beats me why a goverment cannot understand you cannot spend money you do not have.

No mystery - it isn't THEIR money. Sort of like a spouse who likes to spend, spend,spend while the other works two jobs to try to keep up.

[koheesti]

Tax the rich more! Make them pay their fair share!

According to the IRS, in 2008 the top 1% of Individual Income Tax returns accounted for 21% of the income. What percentage should they pay in order to be paying their "fair share"?

[flying]

They were willing (and many of them are STILL willing) to throw the US into default for the first time in history. That's more than politics. That's reckless to a degree that's simply not defensible. Real American patriots need to work very hard to expose how irresponsible that movement is. It's a protest movement. The more extreme ones aren't libertarian, they are ANARCHISTS. They are not fit to govern.

First Time in History? What would you call it when the gold window was closed defaulting on international debt settlement?

Real American Patriots? The original Patriots would be called terrorist today just as those who rightfully spoke out against yet another increase in overspending..

Look at the vote how many liberal Dems voted No? It was not just the Tea Party freshmen a few others have brains too.

The system is broken has been for a long long time. Funny a President who was elected on the Mantra of Change cannot stomach any.

If this system is not abandoned or a new one sought now through real reform then it will implode. All that has been accomplished by raising the drunken sailors spending limit once again is the can has again been kicked down the road. But the can is now so big it will soon implode with no chance of a alternative.

As LVM said long ago...

"There is no means of avoiding a final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as a result of a voluntary abandonment of further credit expansion or later as a final and total catastrophe of the currency system involved." – Ludwig von Mises

Now we see it & know it we will soon see the ultimate outcome.

This continued devaluing of the USD is going to show you why it was wrong shortly.

Every year it is the same they need another 2 Trillion because they over spent on invasions & entitlement programs.

Yes they had a budget but blew through it in six months.

They promise to cut the debt 4 Trillion over the next 10 years.......But they will be back every year till then asking for 2 trillion +++each & every year. So they promise & never deliver 4T in cuts but will ask for 20T long before then

They cry ...but, but, but, we have to raise it because we already spent it we cannot default on debt...

PULEEZE.........

It is like your kids....no in this case your parents because they are screwing the future of the kids.....

It is like parents coming to kids & saying...Hey we need $$$$$ because we over spent.

The kids say we dont have it....They say but we already spent it so you have to loan it to us you have to or your bad kids.

The only irresponsible movement is entrenched in Congress & the Senate that continue to be allowed to vote these increases after they themselves put us in a position to need them.... They should be hung for treason against America...Betrayal of our nation

[Steely Dan]

@Flying, Ah yes the Austrian school. I showed a world map of debt as a percentage of GDP by nation. Most of the developing world and third world Countries have defaulted in the past, which has led to the IMF being called in and imposing strict Austrian school economics, meanwhile the west plus Japan have run Keynesian Ponzi schemes leading to ever increasing debt burdens, these nations if they go bust will quickly overwhelm the IMF so outright banana republic style defaults will result in creditors being shafted and huge social anger leading to major wars.

If ancient Rome were used as an analogy we are past the Nero stage and rapidly approaching the barbarians at the gate stage.

[cloudhopper]

Here's a good non-partisan review of the proposed legislation - http://globaleconomicanalysis.blogspot.com/2011/08/cuts-what-cuts-deficit-bill-has-no-cuts.html

[flying]

Here's a good non-partisan review of the proposed legislation - http://globaleconomicanalysis.blogspot.com/2011/08/cuts-what-cuts-deficit-bill-has-no-cuts.html

It is a very good read thanks

Ron Paul speaks plainly enough that anyone can understand yet few heed the common sense advice.

[flying]

If ancient Rome were used as an analogy we are past the Nero stage and rapidly approaching the barbarians at the gate stage.

Yes I would agree & as Rome went... we (most of us) can see where we are headed.

[Jingthing]

Vice President of the United States Biden commented about the extremist radical tea party --

“We have negotiated with terrorists”

Esteemed writer and commentator, Fareed Zakaria claimed the tea party is threatening to BLOW UP the economy.

This opinion piece posits the tea party are NIHILISTS. Their clear goal is NO GOVERNMENT. As I said before, if we let them win, America not only declines but declines VERY QUICKLY. Enemies of America would love that, so I wonder why we aren't hearing more accusations that they are traitors used against them ...

Still, Obama came to the White House at a tough time for a Democrat. Washington has gone topsy-turvy. The liberal party, the Democrats, has turned conservative. Its lawmakers want to conserve Social Security and conserve Medicare and conserve myriad other programs that have turned into patronage plums for important constituencies.

The Republicans of the Tea Party, on the other hand, say they are conservatives, but they are really radicals — maybe even nihilists. They would rather destroy than compromise. They are drunk on bromides about Big Government and Small Business and the virtues of a balanced budget, no matter what damage all that does to an already sick economy. In another era, folks with this mentality would be yelling “Power to the people” or some such thing, because a good slogan is more persuasive than careful analysis any day. You can, as they say, look that up.

...

The odd thing about the Tea Party is that it uses Washington to attack Washington. This is a version of Hannah Arendt’s observation that totalitarian movements use democratic institutions to destroy democracy. (This is what Islamic radicals will do in Egypt.) Note that the Tea Party is nowhere near a majority — not in the House and not in the Senate. Its followers have only 60 seats in the 435-member House, but in a textbook application of political power they were able to use parliamentary rules to drive the congressional agenda. As we have known since Lenin’s day, a determined minority is hands down better than an irresolute majority.

The Tea Party has recklessly diminished the power and reach of the United States. It has shrunk the government and will, if it can, further deprive it of revenue. The domestic economy will suffer and the gap between rich and poor, the educated and the indolently schooled, will continue to widen. International relations will lack a dominant power able to enforce the rule of law, and the bad guys will be freer to be as bad as they want. Maybe the deficit will be brought under control, but nothing else will. I worry — and I envy (but will not forgive) those who don’t.

http://www.washingtonpost.com/opinions/green-with-tea-party-envy/2011/08/01/gIQAqe5KoI_story.html

One major tea party faction calls themselves the Tea Party Patriots. An ironic name considering the path of destruction they are forcing down our throats.

Edited August 2, 2011 by Jingthing

[uptheos]

Sounds like the USA is officially, now in the 11th year of the George W. Bush presidency.

[koheesti]

Here's a good non-partisan review of the proposed legislation - http://globaleconomi...as-no-cuts.html

It is a very good read thanks

Ron Paul speaks plainly enough that anyone can understand yet few heed the common sense advice.

A Ron Paul quote from the article:

"No plan under serious consideration cuts spending in the way you and I think about it. Instead, the "cuts" being discussed are illusory, and are not cuts from current amounts being spent, but cuts in projected spending increases. This is akin to a family "saving" $100,000 in expenses by deciding not to buy a Lamborghini, and instead getting a fully loaded Mercedes, when really their budget dictates that they need to stick with their perfectly serviceable Honda. "

I first heard about this little Congressional trick/smokescreen back in the 1980's. So I wonder how long they have been doing this and for how much longer we will allow them to get away with it?!

[chuckd]

...and another quote from the same linked article:

______________________________________________________

A balanced budget is similarly simple and within reach if Washington had just a tiny amount of fiscal common sense. Our revenues currently stand at approximately $2.2 trillion a year and are likely to remain stagnant as the recession continues. Our outlays are $3.7 trillion and projected to grow every year. Yet we only have to go back to 2004 for federal outlays of $2.2 trillion, and the government was far from small that year. If we simply returned to that year's spending levels, which would hardly be austere, we would have a balanced budget right now. If we held the line on spending, and the economy actually did grow as estimated, the budget would balance on its own by 2015 with no cuts whatsoever.

______________________________________________________

It sounds like a reasonable approach to simply freeze federal spending at the 2004 level and get the budget balanced. We might lose a few federal employees in the process but it is doubtful the efficiency of the US government will be adversely affected.

[Jingthing]

Long term debt/fantasies about balancing the budget anytime soon are minor problems compared to the high probability that tea party economics will lead to a real depression. The crisis NOW is jobs, jobs, jobs, and the truth is the original stimulus spending wasn't nearly BIG ENOUGH (thanks to the republicans), and now with the hostile takeover by the tea party radicals, there can't be any more of that. Hoover redux. Another even more cynical way to view this is that the right wing is doing everything possible to PREVENT any turnaround in jobs before the 2012 election, so that then they may take the whole ballgame. Be afraid, very afraid, if a tea party president is elected. Look at the damage they have done just being a fanatic destructive minority in just the house.

Am I demonizing the tea party? You betcha. They are all about pain, suffering, and death for those in the USA who happen not to be wealthy.

Edited August 2, 2011 by Jingthing

[koheesti]

Long term debt/fantasies about balancing the budget anytime soon are minor problems compared to the high probability that tea party economics will lead to a real depression. The crisis NOW is jobs, jobs, jobs, and the truth is the original stimulus spending wasn't nearly BIG ENOUGH (thanks to the republicans),

Thanks to the Republicans? Maybe you don't remember that the first two years Obama was in the White House the Dems had a Super Majority in the Senate and in the House of Representatives. The Republicans were totally incapable of stopping the Democrats. The TRUTH is, not all Democrats towed the party line of trying to bankrupt the country either with the stimulus or healthcare fiascos.

[koheesti]

Long term debt/fantasies about balancing the budget anytime soon are minor problems compared to the high probability that tea party economics will lead to a real depression. The crisis NOW is jobs, jobs, jobs, and the truth is the original stimulus spending wasn't nearly BIG ENOUGH (thanks to the republicans), and now with the hostile takeover by the tea party radicals, there can't be any more of that. Hoover redux. Another even more cynical way to view this is that the right wing is doing everything possible to PREVENT any turnaround in jobs before the 2012 election, so that then they may take the whole ballgame. Be afraid, very afraid, if a tea party president is elected. Look at the damage they have done just being a fanatic destructive minority in just the house.

Am I demonizing the tea party? You betcha. They are all about pain, suffering, and death for those in the USA who happen not to be wealthy.

I wonder what this insane rant would sound like translated into Norwegian?

[Jingthing]

Long term debt/fantasies about balancing the budget anytime soon are minor problems compared to the high probability that tea party economics will lead to a real depression. The crisis NOW is jobs, jobs, jobs, and the truth is the original stimulus spending wasn't nearly BIG ENOUGH (thanks to the republicans),

Thanks to the Republicans? Maybe you don't remember that the first two years Obama was in the White House the Dems had a Super Majority in the Senate and in the House of Representatives. The Republicans were totally incapable of stopping the Democrats. The TRUTH is, not all Democrats towed the party line of trying to bankrupt the country either with the stimulus or healthcare fiascos.

Obama and the house/senate leaders wanted a much LARGER stimulus but couldn't get the votes. Yes, there are right wing democrats as well. However, the R party voted in a solid block so you can legitimately blame them for the result.

A relevant quote --

According to one study by political scientists Nolan McCarty, Keith Poole and Howard Rosenthal, there is less ideological overlap between the two parties in Congress than there has been at any time since the late 1890s.

http://www.washingtonpost.com/politics/what-the-debt-ceiling-battle-means-for-2012/2011/08/01/gIQAGZvJoI_story.html

The problem with the stimulus which started under Bush -- NOT BIG ENOUGH

The problem with the crappy health care bill -- NOT REAL ENOUGH. It's nothing like universal health care which is what the USA really needs, for the sake of real full access, real cost controls, and real competitiveness with nations which have solved this problem for their people. The cost issues in the US (because the system is NOT socialized) are another huge drag down the US economy compared to others.

Edited August 2, 2011 by Jingthing