Debt Limit

[MoValley John]

Just when you think it can't get any worse, Bernanke was recently in Nebraska giving the real picture of the economy.

http://mobile.theonion.com/articles/drunken-ben-bernanke-tells-everyone-at-neighborhoo,21059/?mobile=true

[SubGod22]

http://s1221.photobucket.com/albums/..._5054738_n.jpg

Pretty much sums it up... :banghead:

[Maggie]

http://s1221.photobucket.com/albums/..._5054738_n.jpg

Pretty much sums it up... :banghead:

No, it doesn't. :banghead: But the belly laugh is there.

[SubGod22]

Despite Debt-Crisis Resolution, Wall Street Plummets Amid Economic Fears

Just when Washington thought the U.S. economy was back on track after dodging a bullet from the now-resolved debt crisis, Wall Street sent a clear signal Thursday that all is not well.

The Dow Jones industrial average fell off a cliff, dropping more than 500 points Thursday, erasing its gains for the year as investors worried about new data showing economic weakness in the U.S. and Europe. Investors were spooked by reports showing the number of Americans applying for first-time jobless benefits fell to 400,000 from a revised 401,000 in the prior week.

Perhaps it's because NOTHING has been resolved...

[Maggie]

Despite Debt-Crisis Resolution, Wall Street Plummets Amid Economic Fears

Just when Washington thought the U.S. economy was back on track after dodging a bullet from the now-resolved debt crisis, Wall Street sent a clear signal Thursday that all is not well.

The Dow Jones industrial average fell off a cliff, dropping more than 500 points Thursday, erasing its gains for the year as investors worried about new data showing economic weakness in the U.S. and Europe. Investors were spooked by reports showing the number of Americans applying for first-time jobless benefits fell to 400,000 from a revised 401,000 in the prior week.

Perhaps it's because NOTHING has been resolved...

Then don't declare things summed up via a cartoon. This deal doesn’t “solve” things? :roll:

[SubGod22]

Despite Debt-Crisis Resolution, Wall Street Plummets Amid Economic Fears

Just when Washington thought the U.S. economy was back on track after dodging a bullet from the now-resolved debt crisis, Wall Street sent a clear signal Thursday that all is not well.

The Dow Jones industrial average fell off a cliff, dropping more than 500 points Thursday, erasing its gains for the year as investors worried about new data showing economic weakness in the U.S. and Europe. Investors were spooked by reports showing the number of Americans applying for first-time jobless benefits fell to 400,000 from a revised 401,000 in the prior week.

Perhaps it's because NOTHING has been resolved...

Then don't declare things summed up via a cartoon. This deal doesn’t “solve” things? :roll:

I have never said that this deal solved anything Maggie. Not sure where that's coming from. The cartoon summed up the "logic" behind the deal. You know, raising the debt limit makes as much sense as raising the BAC for drunk driving.... Both do NOTHING to solve, or even deal with, the actual problem... Are you getting enough sleep?

[Maggie]

Despite Debt-Crisis Resolution, Wall Street Plummets Amid Economic Fears

Just when Washington thought the U.S. economy was back on track after dodging a bullet from the now-resolved debt crisis, Wall Street sent a clear signal Thursday that all is not well.

The Dow Jones industrial average fell off a cliff, dropping more than 500 points Thursday, erasing its gains for the year as investors worried about new data showing economic weakness in the U.S. and Europe. Investors were spooked by reports showing the number of Americans applying for first-time jobless benefits fell to 400,000 from a revised 401,000 in the prior week.

Perhaps it's because NOTHING has been resolved...

Then don't declare things summed up via a cartoon. This deal doesn’t “solve” things? :roll:

I have never said that this deal solved anything Maggie. Not sure where that's coming from. The cartoon summed up the "logic" behind the deal. You know, raising the debt limit makes as much sense as raising the BAC for drunk driving.... Both do NOTHING to solve, or even deal with, the actual problem... Are you getting enough sleep?

It sums things up...right?. Maybe not? That cartoon didn't sum things up.

No, I am not getting enough sleep but I am not that blinkered either. Keep in mind; you are not morally out of bounds (it is the practical you need to consider) – take a beat and think. And your analogy – not so great. And not particularly useful, if I were advising someone.

The ad hominem is cheap. All the same, I'll make sure to get some shut eye.

[engrshock]

Here is a novel idea. Don't pass a budget that cannot be paid for by incoming revenue. Use borrowing to pay for unexpected expenses as a last resort, not as a way to pass costs to the future. With this I blame the Republicans more than the Dems. The Dems want to raise taxes to "pay" for the programs but don't mind passing legislation that pushes the costs on down the line. The Republicans pass legislation with tax cuts and no way to pay for the legislation. Can there be a reasonable political party? If programs are needed then pay for them. If they are not needed then get rid of them.

[SubGod22]

What Are the Consequences of the Downgrade?

Even though I predicted it had to happen at some point because of the Bush-Obama spending binge and America’s giant long-run entitlement crisis, I confess that I’m somewhat surprised that the United States has suffered a debt downgrade for the first time.

That being said, I don’t think the downgrade will matter. Everyone knew the U.S. was heading in the wrong direction before the announcement by Standard & Poor. Moreover, big investors have very few attractive options for where to place their money – thanks to a weak global economy. As such, I suspect the federal government will still be able to borrow money at very low rates.

What does matter, however, is that the American economy is burdened with a bloated public sector that is sapping the nation’s economic vitality. And this problem will get worse every year because of a toxic combination of poorly designed entitlement programs and demographic change.

As the government gets bigger, this hinders growth by diverting resources from the productive sector of the economy. The damage is then compounded by the fact that the two main ways of financing the public sector – taxes and borrowing – both have additional adverse economic consequences.

In other words, the United States has fiscal cancer. Yet rather than try to cure the disease, politicians are – at best – kicking the can down the road. Here is my dour assessment on Bloomberg.

[SubGod22]

Unbalanced

During his brief media appearance on Monday responding to S&P's downgrade of the U.S. credit rating and the subsequent stark market plunge, Pres. Barack Obama once again renewed his call for a "balanced approach" to debt reduction, combining modest entitlement reform with tax increases. This was the same formulation repeated endlessly by the president, Democrats in Congress, and much of the media throughout the recent negotiations over raising the debt ceiling.

But beyond raw ideology, there is no reason to believe that coupling tax hikes with spending cuts would solve our debt problems.

President Obama usually couches his call for tax hikes in terms of fairness. How, he asks, can we cut programs that help people without also asking the wealthy to "sacrifice" something as well? Setting aside the fact that this formulation establishes a false moral equivalence between giving less to people who have not earned it and taking more from the people who have, this ignores the fact that the wealthy in America already pay a disproportionate share of taxes.

The richest 1 percent of Americans earn 20 percent of all income in America but pay 38 percent of income taxes. The top 5 percent earn slightly more than one-third of U.S. income while paying nearly 59 percent of income taxes. At the same time, roughly half of Americans pay no federal income tax. One might suggest, therefore, that the wealthy already pay their fair share, and then some.

Of course other taxes, such as payroll taxes, property taxes, sales taxes, and the like, tend to be more regressive. But even if you include all types of federal, state, and local taxes, the wealthy pay a considerably higher proportion of taxes than their share of income would warrant.