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and looks like Trump will add another 10 trillion more or less?
Yeah the government can print money or tax it back, except it could end up in a situation where all options would cause a depression.
You're OK with the factual detail of Obama tacking on 10 Trillion, that wasn't a problem, but want to run with your hair on fire based on unproven "projections" of future unknown debt.
while for R's neither Bush nor St. Trump deficits are important.
Under what circumstances would governement debt cause a depression?
Bush 5T was a problem. Obama 10T was a twice bigger problem. Trump $20T will be a four times bigger problem, which may finally be fatal to US economy. It is quite interesting to see that for D's, St.Obama deficit did not matter, while for R's neither Bush nor St. Trump deficits are important.
One thing I don't like is there is no mention of cutting the govt by repubs.
Only 1 party has been screaming for the last 9 years how bad deficits are. The one that just sent them through the roof.
Not necessarily true, although R's are more vocal about deficits.
if the interest rates soar to high levels from current low levels.
- if inflation soars to high levels
- if the government cuts spending drastically
- if the government raises taxes by a large amount
Can he give this speech again soon?
somehow deficit just went up.
Lenders just say"It's OK! We understand that you failures can't repay your debt."What nonsense! The debt is always repaid, today, by borrowing money. Yes, it can go on forever as long as current due debt is paid.
Republican lawmakers announced a plan to pretend to be fiscally conservative again if a Democrat takes office again in 2020 or 2024.
Kakistocracy saysRepublican lawmakers announced a plan to pretend to be fiscally conservative again if a Democrat takes office again in 2020 or 2024.
Just like Democrats dismissed complaints about QE and record-busting $10T (a doubling) of the debt during the Obama Years, yet rediscovered fiscal policy after November 8th, 2016.
Here's one way for the Dems to show they're tough on spending: Require states to confirm welfare recipients are US Nationals or lose Medicaid/AFDC funding for the ones they don't verify. Will save billions a year.
Sure, but what is the connection to trillion dollar government debt? As stated above, in spite of the level of US govt debt, interest rates have been at historic lows. Asset inflation has been the norm for quite a while, related to low rates. Raising taxes has not been a required action of debt issuance. Drastic spending cuts by the gov in the absence of counter-acting growth in spending by other sectors would be troubling, but nowhere in the four scenarios you offer is there any connection to growing trillion dollar debt.
You're OK with the factual detail of Obama tacking on 10 Trillion, that wasn't a problem
anon_cf6c6 saysYou're OK with the factual detail of Obama tacking on 10 Trillion, that wasn't a problem
I'm not ok with that, but at least Obama had the excuse of fighting a recession then reducing the deficit from there.
Sounds like it will cost more than it saves
Here's one way for the Dems to show they're tough on spending: Require states to confirm welfare recipients are US Nationals or lose Medicaid/AFDC funding for the ones they don't verify. Will save billions a year.
So when the next recession hits under Trump (which it probably will, since we're due), you'll be OK with him printing Trillions to fight it too?
The connection is obvious. Debt levels have been relatively low so far, but as debt rises, options become more limited.I propose there is no limit to the amount of debt that can be issued and paid for partially or totally by more debt, but I would welcome seeing some math on the issue. And while I detest Geithner, I think he may have realized that the US casino must always pay out, especially when the entire system was in doubt.
Any proof of this? You have to provide a lot of documentation to apply. Want to document how many manage to provide fake documents for all of the requirements? I'll wait, and wait, and wait.
Friday’s issue of the Wall Street Journal did not say a word about our public purse, or what happened to it last year. In the “What’s News” section on the front page, we learn about compelling things like “Billionaire investor Thiel is relocating to Los Angeles,” “Nestle’s sales growth last year was the slowest in decades,” and “U.S. motor vehicle deaths remained near decade-high levels in 2017.”
But we don’t learn anything about the financial condition of the federal government, from neither the Wall Street Journal nor the New York Times.
The largest financial institution in world history issued its annual report yesterday, and nobody cares.
That’s probably a good thing, given the kind of fiasco it is:
Here’s a summary of the salient data points of the FY 2017 Financial Report of the U.S. Government (full PDF).
•“Net cost” before taxes and other revenues rose by $129 billion year-over-year, or 2.9%, to $4.5 trillion.
•Tax and other revenues grew by $29.3 billion year-over-year, or 0.9%, to $3.4 trillion.
•The difference, the Net Operating Cost or the “bottom line,” as the report calls it, soared 10% year-over-year to $1.157 trillion.
•The Budget Deficit, a different measure, grew by $78.3 billion, or 13.3%, to $665.7 billion.
The Net Operating Cost ($1.157 trillion) is defined as revenues minus costs. The Budget Deficit ($665.7 billion) is defined as receipts minus outlays (cash spent). The difference of $491 billion between the two is, according to the report, “primarily due to accrued costs (incurred but not necessarily paid) related to increases in estimated federal employee and veteran benefits liabilities and certain other liabilities that are included in net operating cost, but not the budget deficit.”
So the Net Operating Cost is a more realistic measure of the actual gap between the government’s revenues and expenditures.
This chart from the report compares the Net Operating Cost and the Budget Deficit over the past five years. Note that the Net Operating Cost and the Budget Deficit increased for the second year in a row:
Where We Are Headed”
That $1.156 trillion in Net Operating Cost occurred in fiscal 2017. But these are the good times, the boom years, if you will, when shortfalls should shrink into oblivion.
So what will happen to the shortfall when the economy slows down or goes into a recession? That was a rhetorical question.
For fiscal 2018 and going forward, the tax cuts will lower revenues by about $150 billion per year on average over the next ten years. And for fiscal 2018 and 2019, Congress passed the two-year budget resolution that will add about $150 billion on average per year to the outlays.
Both combined will drive up the deficit by about $300 billion a year on average.
https://wolfstreet.com/2018/02/19/us-treasury-posts-gigantic-1-16-trillion-shortfall-in-fiscal-2017-hilariously-points-out-where-we-are-headed/#comments
#Economics