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America: Rich? Broke? Or Maybe Just 'House-Poor'

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_hm
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Supply Network Guru
Re: Government policy and budget is not solution
_hm   3/22/2013 7:29:44 PM
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@HM: I have utmost respect for USA and perhaps it was always admiration for almost four decades. But if you compare zeal of people in that period and their achivement and compare it with contemparory work ethics, my feeling was the word I used. It is basically comparision to efficiency and productivity of previous US citizen and immigrants.

Mr. Roques
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Supply Network Guru
Re: Grow, grow, grow
Mr. Roques   3/22/2013 7:11:52 PM
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That logic works when the person that owes, is afraid of what can happen if they stop paying... but what happens when that stops worrying? People stopped paying and banks started foreclosing but that's not what they want.

Can we translate that to country-terms? That can lead to war or diplomatic issues.

Eldredge
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Supply Network Guru
Re: Considering the national debt
Eldredge   3/22/2013 7:00:07 PM
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You are correct that the deficit in 2009 was 1.4 T$. But as an engineer, I know that two data points do not a trend make. So let's look at more data:

Deficit by year:

2013  0.901 T$ (estimated)

2012  1.089 T$

2011  1.30 T$

2010  1.293 T$

2009   1.413 T$

2008   0.454 T$

2007  0.161 T$

2006   0.248 T$

Since 2009, the yearly deficit has soared out of control, anr remains so even at .901T$.  This data does not show that receipts exceeded expenditures anywhere in this timeline. We won't wipe out the national debt in 30 years at this rate - we will merely finally reach a balanced budget in 30 years. For the mortgage analogy, in 30 years, we will finally be able to make the monthly payment.

Ned Ludd
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Blogger
Re: Grow, grow, grow
Ned Ludd   3/22/2013 11:38:42 AM
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Brian: Exactly. As loaded as is the phrase, "kick the can down the road," it describes 60 years of fiscal policy in which America has remained the dominant economy in the world. As your sainted father probably said many times: "If it ain't broke, don't fix it." Benj

Brian Fuller
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Grow, grow, grow
Brian Fuller   3/22/2013 11:09:03 AM
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We've had a handful of balanced budgets in the past 60 years, and it's unclear to me whether we'll ever have another handful. The U.S. is 300 million strong and has built vast numbers of safety nets for its citizens. People are loathe to give that up, especially in an aging population right now.

We probably will find some savings with defense cuts in the next two decades as warfare goes more cyber and less battlefield, but that'll be an almost imperceptible process. 

Maybe we'll just kick the can down the road forever. 

 

HM
User Rank
Stock Keeper
Re: Government policy and budget is not solution
HM   3/22/2013 3:32:22 AM
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Not sure lathargic is a right word in context. US guys are very focssed on what they want to achieve in their lives. They dont just keep saving for tommorrow, they enjoy the present. And everyone knows they have to pay for their own lunch.

_hm
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Supply Network Guru
Government policy and budget is not solution
_hm   3/21/2013 7:59:43 PM
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For a world super power like US, its economy should be completely independent of its ruling government (Democratic or Repulican), its policies and yearly budgets.

As I look at it, US has lost this edge and people are not so productive and looks more lethargic and confused. Lack of higher education is its achilles heel. If you put in sincere work, there is always a way to achieve dream, albeit it may take little more time. US citizen do not have other short cuts.

Ned Ludd
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Blogger
Re: Considering the national debt
Ned Ludd   3/21/2013 4:02:38 PM
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The deficit for 2009, Pres. Bush's last budget, was $1.4 trilion. The 2013 budget, proposed by Pres. Obama, is $901 billion. By my data, the former figure exceeds the latter figure, implying strongly that not only have receipts exceeded expenses, they done so at an annualized rate of almost nine percent. At this rate, we'll wipe out the whole National Debt in just over 30 years — which is, coincidentally, the span of your typical home mortgage.

Eldredge
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Supply Network Guru
Re: Considering the national debt
Eldredge   3/21/2013 2:46:22 PM
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Simplistic as my response may be, how can the national debt be going DOWN when expenses exceed receipts? Doen't work that way in my budget.

Sometime the common sense answers are correct.

Ned Ludd
User Rank
Blogger
Re: Considering the national debt
Ned Ludd   3/21/2013 2:36:34 PM
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Eldredge: Reluctant as I am to take remarks like yours seriously, I will refer you to the point I made about the National Debt after World war II, which — measured as a percentage of GDP — was higher than it has ever been, even in the more recent period when the two unpaid-for Bush wars in Iraq and Afghanistan, plus the Bush tax cuts, helped trigger the Great Recession. The National Debt after WWII did not decline so much because Congress made an effort to pay it down. It declined dramatically because the economy grew, partly because of investments in the nation's infrastructure under President Eisenhower: e.g., the interstate highway system, rural electrification, the GI Bill. Even the Marshall Plan, in Europe, played a role.

The National Debt does not just keep going up. It fluctuates with the economy. This is why the raw number of the National Debt is so wondrously simple-minded, and why economists prefer to count it as a percentage of GDP. Frankly, I don't know the current state of the Debt vs. GDP, but I do believe the many reports indicating that, since 2009, this percentage comparison has been declining — put simply, the National Debt has been going DOWN.

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