Taxes and the GOP walkout of debt ceiling negotiations.

[WizWom]

Let's see...

• * Social security taxes are treated by the government as any other tax, and put into the general coffers
  * The proceeds from taxes let the government make all payments to interest, social security and other retirements, and the military salaries. They would also cover medicaid. But the order of payments is chosen by the Treasurer of the United States, and he wouldn't be able to keep paying government grants for boondoggles and pork if he did that.
  * Obama floated an argument based on the 14th Amendment which would let him continue spending past the debt ceiling, based on equal protection of all the corporations.
  * No one is actually suggesting reducing spending, except the "cut, cap and balance" people - and they want to go so slow to get to balanced that its cheating

[Ivy Matt]

Going solely by that graphic, I'd say we either need a Republican congress (both houses) and a Democrat president, or a Republican congress and low spending on defense.

[KitemanSA]

Or a Libertarian H, S, & P?

[rjaypeters]

I had an evil speculative thought:

Aside from the publicly protrayed arguments about spending and taxation, the Republican leadership may be trying to do enough damage to the U.S. economy (by prolonging and increasing fears of a default) to worsen the President's chances of re-election, but not enough damage the Republican Party gets the blame.

Who knows? It might work. But a dangerous strategy, if true.

[Ivy Matt]

Or a Libertarian H, S, & P?

Well, that would require me to speculate beyond the data contained in the graphic. But yes, if a budget surplus and/or low taxes is what we want most, that would probably be an ideal arrangement.

Aside from the publicly protrayed arguments about spending and taxation, the Republican leadership may be trying to do enough damage to the U.S. economy (by prolonging and increasing fears of a default) to worsen the President's chances of re-election, but not enough damage the Republican Party gets the blame.

It takes two to prolong a compromise.

[TDPerk]

Aside from the publicly portrayed arguments about spending and taxation, the Republican leadership may be trying to do enough damage to the U.S. economy (by prolonging and increasing fears of a default) to worsen the President's chances of re-election, but not enough damage the Republican Party gets the blame.

Far more likely that a particular Democrat is taking that tack.

The key thing which is true is that a lack of taxation is not and has not been the problem since the Reagan first reduced them.

Spending is the whole problem.

The ludicrous and excuseless increase in spending is the whole problem, near term. Long term, we need to get rid of FDR's New Deal entitlements. Replace them with nothing, let the blue state tie a millstone around their own neck if they think they must. I give Romneycare 5 years.

More immediately scary is this prospect, with which I agree. The key bit out of it is quoted below:

"And so maybe, just maybe, Republican strategy (what little there is of it) has badly misread the opposition. Obama tried to add 400 billion in taxes to a deal he had already agreed with Boehner at the last minute. Boehner walks out cause Obama is negotiating in bad faith and has been all along, but what if Obama is actually incapable of good faith negotiation? I think right now that it’s actually possible we won’t see a deal at all. Because the Republicans are looking at the math and at reality and saying “Okay, Democrat demands can’t be serious because they can’t possibly work” and Democrats are looking at politics and how it works and saying “We don’t have to give in cause that’s not how you win these things. You pin it on the other guy politically and then reap the political dividends.”"

I don't believe the Democrats are sane, previous claims of how racist the GOP is or how welfare queens never existed--like that negative has been proved (this is the mainstream media, how hard would they look)--are silly. They amount to the Dems explaining and justifying their position only by shouting "Shut up!".

We need to stop borrowing other people's money, and recognize we have run out of it to steal, which is what unconstitutional spending is, theft.

The Republicans should walk out of the debt negotiations. They should repetitively pass a reasonable bill--what the public wants, and what the GOP has offered--as the world crashes down around our heads, until enough Democrats decorate lamposts that they get the idea.

Don't that's where it will go? Obama already made clear it will be his personal decision if the socialist insecurity checks don't go out.

[TDPerk]

"Anyway, apparently the Democrats weren't so into raising the Debt ceiling thing a few years ago. "

Not when it made things easier for a Republican, no. Now it's the most vital thing. Assume with Democrats that they have no principles which differentiate them from Republicans which are actually just or reasonable.

"Here's an interesting chart that shows the debt ceiling, the total, and who was in control of the House and Senate from Carter to Obama. I see more red on the climb uphill of the famous "debt hockey stick" than blue.

I think both parties are to blame for not putting on the brake earlier and avoid certain follies undertaken in the recent 10-15 years."

Hey dummy, you got your graph all wrong. The colors show which party held the Oval Office.

All but two years of Reagan's red he was negotiating with Dems. Clinton had Dems in control of Congress for I think half his time, and Bush for two--which two year reversed his otherwise trend of reducing deficits-- also, Obama and the Dems of course entirely own the catatrophic rise since 2008.

What Reagan had to say about negotiating with Dems on the budget is this:

"In 1982, President Reagan agreed to the same deal being offered the party today: three dollars in spending cuts for every dollar in tax increases to which he assented. As he ruefully told this writer more than once, he was lied to. He got one dollar in spending cuts for every three in tax increases."

The best way to deal with the Democrats is refuse to play their dishonest game let them choke on their bile--or a noose--whichever comes first.

"Too bad Obama needed to spend like crazy to catch up for the three conflicts that bled us dry when we that money could have been used for here instead with some saner limit."

Just to reiterate, the vast majority of that time, the Dems have held the power of the purse. And they lied. They're lying now.

[rjaypeters]

It takes two to prolong a compromise.

Not really. Classic negotiation tactics allow one party to do as it pleases. Delay, delay, delay...

However, I'm trying to come up with a reason why the President wants to scare the markets and put greater stress on the economy. I can't come up with one. Can you?

[Ivy Matt]

You're right, it would have been better to say that either side can prolong a compromise.

However, I'm trying to come up with a reason why the President wants to scare the markets and put greater stress on the economy. I can't come up with one. Can you?

I have no idea, but as the past 2½ years amply demonstrate, he has no qualms about doing it. Perhaps he has an underdeveloped sense of cause and effect.

[TDPerk]

"Perhaps he has an underdeveloped sense of cause and effect."

Alternatively, he believes the Republicans will primarily be blamed for the effect he is trying to cause.

If Obama really did move the goalposts to 400 billion in new taxes, then the Republicans have not walked out on the debt negotiations, they never had anything to walk to.

Obama has always been lying and not negotiating in good faith.

[Jccarlton]

I wish that somebody could convince me that any course but truly huge cuts in spending and a return to a asset based currency will not end in disaster:
http://www.lewrockwell.com/orig11/clark-j29.1.html
The Democrats have done everthing to create this coming disaster and they want somebody else to pay for it?

[choff]

The fear expressed by Bernake and other economists is deflation. The logic is that the government was the only large source of economic activity while corporations don't reinvest in the US economy, they prefer the BRIC countries. Cut the government spending and if the private sector doesn't compensate by picking up the slack then prices sag.
Countries don't pay down government debt, never have, they inflate it away. GDP growth and inflation reduce debt proportionally. The danger with default is with the credit downgrade, the whole system has been fortunate with interest rates so far, but once borrowing costs rise the system is screwed.
Its a very tight box, you need growth but the resulting inflation costs can kill spending power and raise interest rates. Interest rate hikes raise the debt. Deflation raises debt as a percentage of GDP.
All they can really do is print more money to pay the bills. If they can make the healthcare system competitive with the rest of the western world then you have comprably low taxes and employee costs. If corporations still find the BRIC countries a better bet then you might as well close all the tax loopholes and use the large corporations as cash cows to pay for the system. Otherwise if they just take money out of the country and never put it back in, eventually the whole system will collapse and the money they sit on is worthless anyway.
That's the logic they use.

[Jccarlton]

The fear expressed by Bernake and other economists is deflation. The logic is that the government was the only large source of economic activity while corporations don't reinvest in the US economy, they prefer the BRIC countries. Cut the government spending and if the private sector doesn't compensate by picking up the slack then prices sag.
Countries don't pay down government debt, never have, they inflate it away. GDP growth and inflation reduce debt proportionally. The danger with default is with the credit downgrade, the whole system has been fortunate with interest rates so far, but once borrowing costs rise the system is screwed.
Its a very tight box, you need growth but the resulting inflation costs can kill spending power and raise interest rates. Interest rate hikes raise the debt. Deflation raises debt as a percentage of GDP.
All they can really do is print more money to pay the bills. If they can make the healthcare system competitive with the rest of the western world then you have comprably low taxes and employee costs. If corporations still find the BRIC countries a better bet then you might as well close all the tax loopholes and use the large corporations as cash cows to pay for the system. Otherwise if they just take money out of the country and never put it back in, eventually the whole system will collapse and the money they sit on is worthless anyway.
That's the logic they use.

The problem history demonstrates over and over again that inflation never end well. If beranake thinks that inflation is not a problem he is not paying attention or our ruling elite are lying throught their teeth t oavoid the consequences of their actions.

[Jccarlton]

1. Reagan opposed the Civil Rights Act of 1964

2. He opposed the Voting Rights Act of 1965 (calling it "humiliating to the South")

3. He ran for governor of California in 1966 promising to wipe the Fair Housing Act off the books. "If an individual wants to discriminate against Negroes or others in selling or renting his house," he said, "he has a right to do so."

4. After the Republican convention in 1980, Reagan traveled to the county fair in Neshoba, Mississippi, where, in 1964, three Freedom Riders had been slain by the Ku Klux Klan. Before an all-white crowd of tens of thousands, Reagan declared: "I believe in states' rights."

5. Reagan supported the apartheid government in South Africa and even labeled Nelson Mandela’s African National Congress a notorious terrorist organization.

6. He was elected using the fictitious welfare queen to convince millions of white voters that Black women on welfare were the reason for high taxes.

7. He started his reelection campaign in Philadelphia, Mississippi, the place where three civil rights workers were killed by the KKK in 1964.

8. He consistently opposed affirmative action and all attempts to seriously enforce civil rights laws.

Easier to list.

Do you have citations for any of this irrelevancy?