Your prediction on the Debt Crisis

[obgyn65]

The IMF wants taxes to be raised by 35% and entitlements cut by 35%...
To Contain Future Budget, US Must Raise Taxes By 35%, Cut Entitlements 35% - Real Time Economics - WSJ

It is going to be ugly.

 

[harley]

This is all caused by illegal aliens taking American jobs. And drugs. And Caylee Anthony. If her mom was in jail with the druggies and the illegal aliens, none of this would be happening. Oh yeah, I forgot same sex marriage. That's in there too, somewhere.

 

[obgyn65]

Are you being serious ?

This is all caused by illegal aliens taking American jobs. And drugs. And Caylee Anthony. If her mom was in jail with the druggies and the illegal aliens, none of this would be happening. Oh yeah, I forgot same sex marriage. That's in there too, somewhere.

 

[harley]

Why start now?

(see my sig line).

Mainly I'm trying to point out that this is all political and media driven hype. There's a real problem here, but I isn't being addressed. Someone on this form (or maybe the Bogleheads, I get confused) has a sig of the Charles Dickens quote -

"Annual income twenty pounds, annual expenditure nineteen pounds nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery."

Until we realize the truth of this and legislate accordingly, we're all doomed.

 

[ERD50]

The IMF wants taxes to be raised by 35% and entitlements cut by 35%...
To Contain Future Budget, US Must Raise Taxes By 35%, Cut Entitlements 35% - Real Time Economics - WSJ

It is going to be ugly.

Interesting - I was pondering these numbers while mowing the grass today. Earlier we said we spend ~ 1.6x what we take in. So, any way you slice it to balance that, seems like we'd have a reduction in our net standard of living of approximately that ratio.

While it would be relatively ugly, most of us would still be far and away better off than most people in the world. We'd get by.

The IMF paper, written by Nicoletta Batini, Giovanni Callegari and Julia Guerreiro, shows that if the government doesn’t cut entitlements, it will have to raise taxes by 88% to pay for their costs.

With the top 10% of earners paying 70% of the FIT ( ~ 18% average tax rate), there doesn't seem to be enough rich people to tax to hit those kinds of numbers. If Feds are taking 18% now, state and property tax a sales tax are taking some more, how much is left to tax? Seems they would need to go deeper down the income scale to hit the numbers?


-ERD50

 

[Purron]

This is all caused by illegal aliens taking American jobs. And drugs. And Caylee Anthony. If her mom was in jail with the druggies and the illegal aliens, none of this would be happening. Oh yeah, I forgot same sex marriage. That's in there too, somewhere.

I blame Lindsay Lohan.

 

[devans0]

It's been a long time coming. The slide started with Elvis's hips.

 

[FUEGO]

It's been a long time coming. The slide started with Elvis's hips.

Our country has been stuck in reverse since the invention of the horseless carriage.

 

[Hamlet]

The problem with this is that everyone paying attention is going to consider the Republicans who use this tactic pretty weeny.

The Tea Party members are not going to be fooled, and everyone else is going to think that the Republicans feel that political games are more important than doing what is right for the country.

Of course, the very simple-minded might be taken in by this tactic. If people buy this, I'm concerned that we have become too dumb as a people to self-govern.

I think this is the most likely scenario. As I understand it, it will take a two-thirds vote by the Congress to override the President when he lifts the debt-limit, so the GOP won't be able to over-ride him by itself.

Actually, IMO, McConnell's proposal is quite clever in that it is a way to avoid default without actually forcing tea party members of Congress to vote to increase the debt limit.

 

[ls99]

Prediction on debt crisis: it will get solved.

For many tens of years there have been grossly overpaid self interested politicos creating the the crisis.

There still are grossly overpaid self interested, politicos legends in their own minds, who will solve the problem. No one may like the outcome or the method they use to solve it.

This blowhard mess reminds me of the time I left my car's headlights on in the parking lot. A kind fellow came and reminded me. I said to my co-w*rker, an ex car salesman, I have to go out and turn off the headlights, they will not go out by themselves. Thinking no auto shutoff.

He said: yes they will. Ah, right he was.

Moral of the story, all problems get solved, we just may not care for the outcome, but the problem will get solved.

Rome was a mighty powerful and feared nation. Once. So was the USA.

 

[FIRE'd@51]

The problem with this is that everyone paying attention is going to consider the Republicans who use this tactic pretty weeny.

The Tea Party members are not going to be fooled, and everyone else is going to think that the Republicans feel that political games are more important than doing what is right for the country.

Of course, the very simple-minded might be taken in by this tactic. If people buy this, I'm concerned that we have become too dumb as a people to self-govern.

It should be obvious that the two sides are not going to come to any meaningful agreement on spending reductions/revenue increases in the next two weeks. The default issue needs to be decoupled from the longer term debt reduction issue, as the consequences of a default (or anything that looks like a default, e.g. not sending out SS checks) could be catastrophic. Let the 2012 elections decide whether the people want spending cuts (including entitlements) or revenue increases (including tax increases on all).

 

[Hamlet]

The Republicans have always had the option to decouple raising the debt ceiling from getting an agreement.

Using political smoke and mirrors to try to pretend that they couldn't stop Obama from raising it seems pretty weak. I just don't think anyone is going to buy it. Tea Party people are going to try to get any Republican who agrees to this primaried in the next election. Moderates will not be impressed by the complete abdication of their responsibility either.

Ultimately, if the Republicans do this deal, I think it is worse for them than if they just took whatever the President has been offering and cleanly raised the debt ceiling. They'd still lose Tea Party support, but they might pick up a few moderates who saw that they bargained hard to lower spending, got somewhat less than they would like, but were not going to gamble with default.

Ultimately, the Tea Party folks aren't going to be happy unless the Republicans actually drive us into default. At some point, the Republicans are going to have to tell the Tea Party folks that they have lost their minds.

It should be obvious that the two sides are not going to come to any meaningful agreement on spending reductions/revenue increases in the next two weeks. The default issue needs to be decoupled from the longer term debt reduction issue, as the consequences of a default (or anything that looks like a default, e.g. not sending out SS checks) could be catastrophic. Let the 2012 elections decide whether the people want spending cuts (including entitlements) or revenue increases (including tax increases on all).

 

[W2R]

Thanks, everyone! ‪Porky Pig Cartoon Ending "That's All Folks!"‬‏ - YouTube