Check Out THIS Chart !!! - 'What’s Driving Projected Debt?'

[WillyT]

Maybe Congress should take another look at the Progressive ("People's") Budget

What’s Driving Projected Debt?
May 20, 2011 at 12:11 pm

<snip>

As we’ve noted, my colleagues Kathy Ruffing and Jim Horney have updated CBPP’s analysis showing that the economic downturn, President Bush’s tax cuts, and the wars in Afghanistan and Iraq explain virtually the entire federal budget deficit over the next ten years. So, what about the public debt, which is basically the sum of annual budget deficits, minus annual surpluses, over the nation’s entire history?

The complementary chart, below, shows that the Bush-era tax cuts and the Iraq and Afghanistan wars — including their associated interest costs — account for almost half of the projected public debt in 2019 (measured as a share of the economy) if we continue current policies.



<snip>

Link: http://www.offthechartsblog.org/what%E2%80%99s-driving-projected-debt/

:kick:

[Scuba]

1. Good find. Thanks for posting. n/t

[NYC_SKP]

2. I'm kicking this.

Recommended.

:kick:

[liberalmuse]

3. I saw this earlier on Huffpo...

Unbelievable!! Yet the Republicans (and some Dems) would prefer to pull the rug out from under the sick, poor and elderly to help with the deficit. Meanwhile, the rich get loads richer and the middle class continues to hold up everyone on their breaking backs. :(

[WillyT]

5. Yep... And The Progressive Budget Gets Us To A Surplus By 2021, By...

eliminating the Bush Tax Cuts, and ending the wars, as a starter...

But there are two big reasons we won't go this way...

1) It makes too much sense, and...

2) I's the right thing to do.

:banghead:

:hi:

[vandelay]

4. The problem is that if the tax cuts had not occurred - we would have spent the money anyway.

Does anyone really believe that if we had even tax rates of 75% that we wouldn't figure out a way to not only spend all that money, but a ton more?

I may be a liberal, but when it comes to taxes.........I want to keep mine.

[mike_c]

7. the question is, what would we have spent the money on...

...and what would the people get for their money? Tax breaks for billionaires and perpetual global war to support the MIC are what we "invested" our economy into. I would feel a whole lot less angry about the state of the nation's debt if we were spending the money on public health care funding, sustainable energy research and development, environmental protection and cleanup, etc. I'm PROUD to pay taxes when my taxes help to build infrastructure for a prosperous and sustainable future. Instead, we're funding playtime for the wealthy and the destruction of poor people's lives all around the globe.

[Sherman A1]

53. And how many more jobs and taxes that spending would

have generated. Building a missile will generate some jobs, but once it's expended you get nothing more from those dollars. The same money spent on sewers continues to provide a benefit.

[Kolesar]

78. *That* is why military spending is inflationary

It consumes resources and drives up the cost of the remaining resources.

[Name removed]

101. Deleted message

Message removed by moderator. Click here to review the message board rules.

[WillyT]

9. Ok... But Then We Taxpayers Really Need You To Stay The Hell Off Of Our Roads...

we paid for them.

And don't call our fire dpartment, our police department, try to enroll your child in our schools, use our parks, our campgrounds, our beaches, etc.

We paid for them... with our tax dollars.

[SlimJimmy]

16. We are talking about federal tax dollars here, not state and local. The

only example that applies is for roads - but even then, a lot of that money comes from state and local taxes as well.

[truedelphi]

17. Uh, you ar eraare that the Federal Government funnels money to the states -

Are you not?

[SlimJimmy]

20. Yes, I am quite aware of that. And that is part of the problem. States and local

governments should take care of their own fire, police, education, and other services. Those "federal dollars" are better known as taxes. Since when did that become a federal responsibility? Being a Democrat should never mean trying to be everything to everybody. That's where this party has gone wrong in my opinion.

[JDPriestly]

58. SlimJimmy. What is "liberal" about your thinking?

On what issues do you consider yourself to be liberal?

[Name removed]

79. Deleted message

Message removed by moderator. Click here to review the message board rules.

[WillyT]

18. Ok... Stay Off Of Our Interstates, Out Of Our Airports, Our National Parks...

don't watch our weather forecasts, use our medical/scientific research advances, heed our warnings about tainted food or water, use the water or electricity from our dams...

:shrug:

[SlimJimmy]

19. Time for you to backpedal? That's what I thought.

[WillyT]

21. Whoosh...

:rofl:

[SlimJimmy]

23. No, not even close. I got it the first time. It's an old meme about paying

for fire, education and police services using federal dollars. If he had said, EPA, FDA, ATC, and other federal services, I would have never responded. Woosh, right back at you.

[Control-Z]

45. Backpedal?

Your snark is so misplaced here.

[SlimJimmy]

51. You're mistaking a statement of fact for snark. (nt)

[vandelay]

26. The government is spending around $4 TRILLION a year.

That is $12,500 PER MAN WOMAN and CHILD, or $40,000 per taxpayer.

Every DIME of that $40,000 means the cost of whatever you buy is more than double what it would be without that tax burden. Think about it.

[WillyT]

29. Yeah... And If Bill Gates Walks Into My Buddy's Bar...

the average wealth of everybody in the bar goes up millions, if not billions, of dollars.

Unfortunately, when he walks out, I go back to being the paycheck to paycheck working stiff that I am.

IOW - The reason you tax the wealthy and the corporations more, is because they can afford it.

:shrug:

[vandelay]

30. and the cost of that drink doubles because of layers of taxes. NT

[Name removed]

32. Deleted message

Sub-thread removed by moderator. Click here to review the message board rules.

[JDPriestly]

61. The problem isn't the layers of taxes. The problem is what the

taxes are spent on. If we increased taxes on the rich and ended these extravagant, unnecessary wars, then taxes on the rest of us could go down.

My plan would be to cut the money spent on our military (closing half of our overseas bases would be a good start), and increase taxes on the wealthy IN A WAY THAT ENCOURAGES THE INVESTMENT OF WEALTH IN THE CREATION OF JOBS IN THE USE.

I think we should throw out our trade agreements. Free trade is ruining our country, costing us jobs and depriving our children of opportunities. Then we should tax imports. And, as I said, change our taxes so that they encourage investment in American jobs, not Chinese or Indian or Mexican jobs.

The tax burden could, after a not very long time, be reduced as the nation prospered.

Look backwards and you will see that our economic problems including our deficits really got bad due to our dependence on foreign oil and our adoption of "free trade" policies. Those two things have destroyed our economy.

[stockholmer]

98. +1.... I like your logic (and would add 'for-profit' medical expenses to the economic problem bin)

[JDPriestly]

59. The point of the chart is that too large a portion of the

$40,000 per taxpayer is paying for the Bush tax cuts (from which most people in the country get little or no benefit) and the wars. If we reduce or eliminate the levels of the tax cuts and end the wars, our debt problem will disappear in time.

If we increase taxes on the rich and end the wars, then we can invest money in things like development of local sources of energy and better systems for distributing and storing energy and basic research in those areas. Improving our energy economy would make manufacturing, living and working in our country more profitable for private businesses.

Another investment that would make our private businesses more profitable would be high-speed rail. They would reduce the cost of employees' and business travel and absenteeism and the other costs to employers of traffic accidents. There are so many things of that nature, often small things, that we as a people could invest in through our government but that we cannot as individuals do.

Right now, wealthy people are flush with cash. They rush to try to make profits on stupid investments like sub-prime mortgages and similar fads. It's their money that causes the bubbles, the dot-com bubble, the sub-prime mortgage and derivative bubbles, and who knows what the next bubble will be. They don't invest in real businesses because our government is too busy wasting money on wars to build the infrastructure that is needed for them and us to compete with other economies in the world.

If you were a parent and had to choose between buying a new car for your son or paying his college tuition for a semester, which would you choose? Which would be the better investment? A car that he would have fun with (until he crashed it or it got old) or a start on a career?

As a nation we have to make similar choices. Is it better to just let rich people spend the wealth that our nation produces on yachts and fast cars and huge houses and servants and the easy lifestyle or is it better to educate our children and build the infrastructure that our children will need for their future?

Much is said about how terrible it will be if we leave a lot of debt for our children. But leaving debt to them is only terrible if the debt was created in order to allow a few people to enjoy a fancy lifestyle. If the debt is the result of investments by our government in things that will improve our children's opportunities for a better life, then it is a gift, not a burden.

[Enthusiast]

81. Excellent post.

And this is why I feel that extending the Bush tax cuts was such a betrayal.

[Enthusiast]

80. They will simply have

to reduce the military by 75%. By a huge majority, the American people are tired of unnecessary foreign entanglements. Read the damn chart!

Besides, why are you on DU arguing on the behalf of the GOP position?

[ejpoeta]

92. federal money makes sure our products meet certain safety standards.

like being able to trust the food you buy isn't going to kill you? how about safe drinking water or clean air? there are a lot of things that our federal taxes are paying for that we seem to take for granted without ever even thinking about.

[SlimJimmy]

106. I agree with everything you said. Now let me ask a question. Do we need

to have a 1.7 trillion dollar deficit to make sure those things happen? And for how long can we maintain that kind of budget? Trust me, I'm not the only progressive that is expressing these views. And we sure as hell aren't right-wingers when we do. Ending these unnecessary wars, taxing the rich more, and cutting defense won't get us anywhere near the place we need to be. What other suggestions do you have?

[ejpoeta]

110. i do not think you are the enemy for asking questions. we are supposed to ask questions.

what are we? republicans!! you make a valid point. where can we cut back. i think there are lots of places we can cut back. but i think things like health and safety are an important part of what the federal government is supposed to do. as long as the agencies aren't co-opted by the companies they are supposed to be regulating that is. i think we could go a long way if we could make it so these agencies are independent of those they are overseeing and prevent the kind of mingling and i don't just mean the MMS's type of mingling. but there are places that we can cut the fat.

first we need to start with defense before looking anywhere else. that is the most bloated area we have. we could cut half our spending and still spend way more than any country on this earth. and as far as i am concerned, if the politicians on the tv box aren't suggesting it, i mean REALLY suggesting it, then they aren't really serious about the debt. Also, we need to have the rich paying their fair share of the taxes. Getting rid of the bush tax cuts is necessary. I would say that even the bush tax cuts for the rest of us should go away if we ever get out of this recession.

But we do need to spend. Especially right now. In my mind, we aren't spending enough. We need to be investing in our infrastructure.... roads, bridges..... and expanding broadband because the internet is a utility at this point. And it should be treated as such especially with schools now requiring kids to do stuff online now for homework. but i digress. if we invested in our infrastructure, that would be the spending that would help us get out of this mess. They would have to hire americans to do the work because the work would be here.

I also think that placing preference on american goods in this endeavor would be paramount as well. And to that end, anything being made for the federal government should be made in america. a certain percentage of the materials should be from american companies. some may say we may end up overpaying, but frankly i'd say we probably already do because of corruption in the government and you scratch my back and i'll scratch yours.

Part of the problems with revenues is that the people aren't making much more than they were eight years ago. In fact, they are probably making less. And unemployment is high. And then there are those bush tax cuts. The problem here seems to be that our representatives have a conflict of interest. They have an interest in keeping their corporate donors happy, so that means we are going to get screwed no matter what.

[SlimJimmy]

111. A well thought out reply. I'd just add that I'd also like to see us look at the

third rail (entitlements). If we are serious about getting our financial house in order, we have to be honest enough to take a look at programs that so many depend on like social security and medicare. We have to make sure they are there long into the future. Plans like the "Ryan plan" are a joke. Giving vouchers for medical care or changing the rules for those close to retirement is not even remotely fair. We, as Democrats, can do much better.

[ejpoeta]

112. i think raising the cap would help. plus negotiating drug prices.

single payer would be the best thing we could do, but no one will even discuss it. a 'public option' even giving folks the option to buy in to medicare (yes i know it isn't perfect) but it does have 3% overhead, and most people are healthy and do not use it and would probably buy into that because the reason they gave for why we shouldn't have a public option would be that the private companies wouldn't be able to compete. which is true. because they have a 20% overhead vs 3% overhead. IF people at least had the option to buy into medicare then it would help medicare. raising the cap would help social security. it is ridiculous that 106k is the most income that has to pay into social security. i agree that vouchers is just a way to give money to the insurance companies so they can NOT provide a service. uggh. but then again, we have to remember who the true constituents of our congress people are these days. seems if we could separate our 'representatives' from the moneyed interests maybe they would actually start doing their damned jobs again. how much of our deficit is related to that bs.

[Name removed]

25. Deleted message

Message removed by moderator. Click here to review the message board rules.

[WillyT]

27. Dude...

We were far better off as a country when we were taxing the hell out of the wealthy.

:shrug:

[vandelay]

28. You opinion & $1,000

Will get you a flight to where our jobs have gone as a result of high taxes.

Seriously, you don't think anybody actually PAID those high tax rates from decades ago do you? If there is one thing that is for certain; the higher the tax rate; the more creative people become at hiding income.

[WillyT]

35. Wrong Again, Bob...

While it may be true that the rich will always try and find a way to avoid paying taxes, it's up to the IRS and Congress to make sure that they pay their share.

Plus... if the rich are so good at tax avoidance, why do they scream like stuck pigs anytime anybody mentions rasing their taxes??? After all they're not gonna pay them... right ???

And... when I went to junior college in the mid 70's (when the tax rate on the wealthy was 70%), it was FREE... except for books/lab fees, it was absolutely FREE.

When I transfered to state college for my four year degree, it was $90 per semester... $90.

Taxes are the price you pay to live in a civilized society. Hat-tip to Oliver Wendell Holmes, Jr.

:shrug:

[vandelay]

36. Your college was free and workers today are still trying to pay your debt.

Your "free" college was paid with debt that your grandkids won't ever be able to even pay back. And those rich people you wanted to tax to pay for all that free stuff? They MOVED.

[WillyT]

37. Riiiiight....

The 1960 Master Plan for Higher Education and the resulting Donahoe Act was a turning point in higher education in California. The UC and CSU systems were to limit their enrollments, yet an overall goal was to "provide an appropriate place in California public higher education for every student who is willing and able to benefit from attendance", meaning the junior colleges were to fulfill this role. By 1967 studies were showing that the California Department of Education was not doing an adequate job of leading the junior colleges, and legislation passed control from the Board of Education to a new community college system with a Chancellor's Office and Board of Governors. The degree of local control in this system, a side effect of the origins of many colleges within high school districts, can be seen in that 52 of the 72 districts (72%) govern only a single college; only a few districts in major metropolitan areas control more than four colleges.

The Master Plan for Higher Education also banned tuition, as it was based on the ideal that public higher education should be free to students (just like K-12 primary and secondary education). As officially enacted, it states that public higher education "shall be tuition free to all residents." Thus, California residents legally do not pay tuition. However, the state has suffered severe budget deficits ever since the enacting of Proposition 13 in 1978, which led to the imposition of per-unit enrollment fees for California residents (equivalent in all but name to tuition) at all community colleges and all CSU and UC campuses to get around the legal ban on tuition. Non-resident and international students, however, do pay tuition, which at community colleges is usually an additional $100 per unit (or credit) on top of the standard enrollment fee. Since no other American state bans tuition in public higher education, this issue is unique to California. In summer 2010, the state's public higher education systems began investigating the possibility of dropping the semantic confusion and switching to the more accurate term, tuition.<3>

Link: http://en.wikipedia.org/wiki/California_Community_Colleges_System

It was an enlightened goal by an enlightened state... until Howard Jarvis and his band of idiots eventually prevailed and screwed up the state.

[WillyT]

38. On The Other Hand... If What You Say Is True... Thanks A Lot, Man...

I really appreciate all your hard work.

:evilgrin:

:rofl:

:hi:

[JDPriestly]

64. Nonsense, Vandelay. An educated workforce pays higher taxes

than an ignorant one. Educating citizens is a profitable investment, probably the most profitable investment a society can make. India and China have learned this important lesson. They are leaping forward because they are educating their citizens.

We leaped forward after WWII thanks to the GI bill that funded higher education for a good portion of a whole generation of Americans.

It is superficial and simplistic to talk about taxes without talking about what the taxes are paying for. A car that costs $20,000 will break down in 10 years. A semester of college tuition for a bright, but poor, kid who has the ability to become a creative engineer will bring benefits for 40-50 years.

Which will it be?

Debt and taxes are not the issues. It's what our values are and where we spend what we have and where and when we save that count.

[CrispyQ]

91. Well said!

div class="excerpt"]Debt and taxes are not the issues. It's what our values are and where we spend what we have and where and when we save that count.

[JDPriestly]

102. That applies to us as individuals as well as to us as a country.

[Name removed]

85. Deleted message

Message removed by moderator. Click here to review the message board rules.

[ejpoeta]

93. actually, i believe they 'avoided' taxes by investing the money.

like paying the employees or giving bonuses. or health insurance. are these not all things that are tax deductible? or investing in their business like expanding or improving. or investing in their communities? they have no incentives to do these things now. they can just pocket the money.

[Avant Guardian]

33. The CBO says merely getting rid of the Bush tax cuts balances the budget by 2015

Get off the failed RW tax fantasy bangwagon.

[Enthusiast]

86. RW tax fantasy bangwagon

is a good choice of words.

[stockholmer]

99. link please,whilst I agree that the Bush tax cuts were horrid,the revenue lost doesn't come close to

balancing the budget based on current spending. See my post below. http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=439&topic_id=1147787&mesg_id=1153753

Now, if this CBO estimate assumes a huge reduction in spending ($1+ trillion a year in spending cuts from 2011's $3.8 trillion in budget expenditures and a deficit of $1.7 trillion) to get to balance (which it has to as at most the Bush tax cuts are costing $300 to $400 billion a year), where are these cuts going to come from?

Defense and war/security state spending? ($1.2 trillion per year). Good luck with that.

Total debt service? ($400 billion per year at historically low interest rates and will EXPLODE as discount rates go up). If so, they are advocating default.
---------------------------------------------------------------------------------------------------------------------
Lets say for argument's sake that the Bush-spawned, Obama-renewed tax cuts are killed next week (which they should be, IMHO). Lets say that in reality they recapture $600 billion a year (a number that not even the most wild-eyed optimist would hope for).

Lets say the economy improves in the next 4 years to the point where another $300 billion or so comes in per year from additional revenue.(again, this is not going to happen, but lets say it does.

Lets say that interest rates stay near historic lows (and the economic laws of science are suspended, ie. this wont have a massive inflationary impact) so the total debt service only goes up to $500 billion a year. (remember the debt ceiling is being increased soon by $2 trillion JUST to get the US through the 2012 election cycle).

Given all this fantasy, you are still left with close to a $1 trillion per year deficit.

I ask again, where are the spending cuts going to come from?

[Control-Z]

44. I guess you're too young to remember

the Clinton era?

[JDPriestly]

63. If, for our taxes, we got free university education and single payer heatlh care,

20% would be low taxes. The problem is that what we get for our taxes is a lot of idle, rich building fancy houses and hiring immigrant household help and war, war, war.

It isn't how much you pay in taxes or what percentage of your paycheck that you pay in taxes that matters, it is what you get for your taxes. If your tax money went to support hospital emergency rooms across the country, not just for the poor, but for everyone, then you would not have to spend huge amounts of your paycheck for the emergency room care if and when you need it.

You have to look beyond the percentages and beyond the numbers. Financial issues require more than a simplistic, superficial approach. Politically cute slogans do not good budgets make.

[Name removed]

83. Deleted message

Sub-thread removed by moderator. Click here to review the message board rules.

[Dragonfli]

10. The tax cuts favored the wealthy in a laughably unfair way.

We found a way not only to refrain from spending even more but also of ending up with a surplus and that was at a top tax rate of less than 40%.
I guess I just don't understand arguments that would favor the wealthy in a way that would take us from surplus to "debt crises" in just ten years only to be used as an excuse to attack the old and the poor that had nothing to do with the crises.

Working people are doing far worse and the rich have gotten quite a bit more rich at the same time.

Why do you wish to protect tax cuts that go to predators? You are not benefiting from them, in fact they are hurting you.

[4lbs]

11. REPUBLICAN President Eisenhower used billions upon billions of taxpayer money build something called

The National Highway System.


1.) Needed infrastructure.

2.) Employed thousands of people.

3.) Stimulated economy.



The government can use every bit of my taxpayer money for stuff like that any time they want, and I'll fully support it.

Yet, REPUBLICANS now say that such an idea is looney tunes.

[geckosfeet]

14. they are conservo-bot empty headed ideologues.

[JDPriestly]

65. Superficial and simplistic, robotic attitudes on taxes and financial

issues. People who think like that are the kinds who create bubbles in our economy.

[progressoid]

40. Eisenhower couldn't win today as a Republican.

And not as a Democrat either. He was way to liberal for today.

[DissedByBush]

43. Eisenhower was to the left of many Democrats these days

Especially when it comes to government cozying up with corporations to screw the people.

[Enthusiast]

87. If today's GOP ideology

had been prevalent in the 20th century we would still be without a national highway system. Of course the radicals will claim that private enterprise would have built it, lol. Everything great, every GREAT project ever done in this nation, was done by the federal government.

[Zoeisright]

15. What a stupid post.

YOU want to keep YOURS? That's not how society is built, buddy. And spending money on the right things - people, education, infrastructure, not-for-profit health care, generates MORE income for the government in the form of MORE tax collection.

Do some research before you post something so ignorant.

[SOS]

24. The money would have been spent anyway....

on paying down the existing federal debt.
When Bush took office the debt was $5.8 trillion.
His tax cuts added $2.8 trillion to the debt.
By utilizing the Clinton-level tax receipts to pay down the debt, our current debt would be $3 trillion.
(Excluding Bush's other drunken sailor spending like Iraq and the free drugs for elderly voters program).

Responsible taxation and leadership in the White House could have resulted in a federal debt of only 23% of GDP.
That would be far below the post war low under Jimmy Carter of 33% of GDP.

Our country could have been in good financial shape today.
Instead Pimco is shorting US treasuries!

[NewJeffCT]

42. Actually, no

the country's debt was very low before Reagan sliced tax rates for his trickle-down economic policies. One of our country's biggest foreign policy strengths after World War 2 until Reagan was that we had low debt & the world's biggest economy, so we were not reliant on Japan, China, etc to buy our debt.

[chervilant]

67. hmm...

Speaking of St. Ronnie: during his tenure in the White House, he spent more than EVERY other president before him COMBINED. Furthermore, the US experienced its first trade deficit EVER. Ironic, isn't it, how many sheeple think Reagan was a great president...

[Enthusiast]

88. The reality is Saint Ronnie was

one of the worst ever presidents.

[robinlynne]

46. That is not a problem. It could have been spent on universal health care, or many

other things which would make your life better. If you had free health care, wouldn't that make your income increase? if we used the money to create infrastructure for electric cars (and solar power) , you would not be spending money on petroleum. Right now it is going to mega corporations and to war. how does that help your income?

[JDPriestly]

57. Your tax cut is probably not a part of the problem.

The tax cuts for the rich including cuts to capital gains and inheritance taxes for millionaires are the problem.

[quaker bill]

62. You do recall that before Bush there was a surplus, right?

This government can and has been run without a deficit. In fact for the most part, except for times of war, it has been run without a deficit. Only since Reagan has the deficit become structural and difficult to avoid.

[chervilant]

66. Bwahahahaha!!

You wouldn't know a 'liberal' if one jumped up and bit you on your nose! (Whoever's paying you to troll DU is NOT getting their money's worth...)

[Enthusiast]

76. Yeah, you may be a liberal

but you're not. Take it back to Free Republic. You're not fooling anyone.

[SpiralHawk]

6. Thanks a big steenking pantload, Republicons

This is your doing: your dumping on America.

American voters shall not forget what you Republicons have done -- and are still trying to do -- to our beautiful nation.

[mike_c]

8. dems share a big smelly load of that responsibility, too....

eom

[SpiralHawk]

12. No. A bit. So-called 'conservative' Republicons are the Massive Offenders

No doubt about. Republicons screwed America's economic pooch, and then went AWOL on their repsonsibilities.

They are still doing it.

[geckosfeet]

13. Not a big load. But some. I think they badly miscalculated on extending the bUsh tax cuts.

Yes - they would have angered some rw conservo-bots and a segment of the wealthy/corporate classes - but middle class americans would have been pleased with the debt reduction and economic shot in the arm.

The jobs promised with the tax cut extension were fantasy.

[ProdigalJunkMail]

22. this chart makes no sense...

all of the factors BUT Bush Era Tax cuts explain what the spending is on. So, 50% of our shortfall is because of Bush Era Tax cuts...but we have to be spending that 50% on SOMETHING...

sP

[Avant Guardian]

31. Tax cuts = borrowing, not spending

[Hannah Bell]

34. rich people still paying, but they prefer to get interest on their "investment".

with the nice added bonus that the deficit provides an excuse to reduce wages & benefits

[NobodyInParticular]

70. The Meaning of Cost-cutting and Austerity

"Tax cuts" mean having to cut "costs." What are the costs to be cut? Usually they mean cuts in wages and benefits. Whose wages and benefits? Not those of the rich, but those of ordinary members of the middle and working class, a.k.a consumers. What happens when you take money out of the hands of consumers? It removes money that would stimulate the economy, and the less money ordinary people have at their discretion, the less there is a chance for economic revival. Without money, people get "tight." When people get tight,all they can do is hunker down, and a public in the hunkering down mode will never, ever revive an economy.

Yeah, but with the great national debt, who has the money?

The national creditors.

Who are they?

For the most part, the very rich.

And isn't it good to have money in the hands of the rich? After all, aren't they the ones who are rich because they know how to manage money?

True, but they manage money in such a way that only they themselves get more of it, and practically none of their money goes into the general economy where money makes it possible for people to get moving, to get working and earn money that pay for the services of other members of the middle and working class (and taxes).

I don't get it.

Look at the behavior of the rich as that of the behavior of super gold-diggers. They get the gold and they put that gold into huge safes, and the only purpose for that is to get more and more of it until they have so much of it that they buy up everything the middle and working class still owns.

Well, what if the middle and working classes refuse to sell what's left of their property?

They won't be able to do so, because since there is no cash flow in their direction, they have to sell what little they have in order to feed themselves.

So what will all that lead to?

Rock bottom salaries and wages, massive poverty, and minimal energy at the disposal of they majority of the population.

And then what?

Well, we can discuss this in our next conversation...

[The Wizard]

82. yes

The playing field is slanted.

[JDPriestly]

104. You mean the money of the rich doesn't just trickle down?

Drip, drip, drip?

[earcandle]

39. This is not rocket science... anyone can figure this out, but thanks for the charts!

[Hamlette]

41. Post it in your office/cubie at work for all to see.

I printed it out and will be putting in on my door. If I get called out, I will point out other workers who have pics of Bush up...or did. And claim it is not political.

[WheelWalker]

47. Kick

[Roy Rolling]

48. Scary picture...

but still, when I tell that story around the campfire, nobody gets scared. :-)

[PuffedMica]

49. What additional justification is needed to raise taxes on the rich

The same thing goes for ending the wars.

[Quantess]

107. Hence the slogan "punishing the rich"

That cliche gets trotted out regularly.

[PuffedMica]

50. K&R

[99th_Monkey]

52. Hope someone in Congress stands up with this graphic and makes LOTS of noise about it. ~nt

[Turbineguy]

54. It seems 27 percent

of GDP goes to the top 1 percent?

[Corruption Winz]

55. Very nice find. Rec'd...

Now, where do I click to forward this to the White House?

[JDPriestly]

56. The tax cuts and the wars have to go.

[truedelphi]

100. Too easy, and also it would penalize the

Uber Rich.

[JDPriestly]

103. Yes, we can't make things too easy on ourselves, can we?

I suppose you are right TrueDelphi.

By the way, have you ever been to Delphi?

[truedelphi]

115. No, I have n't been there. And You?

Any experiences would be greatly appreciated.

My dream tour would include that place, and all the many islands along Greece and Turkey where the Goddess and matriarchal societies came into being -- before the patriarchy thing set in. (When two leggeds ruled, and the three leggeds listened to them.)

[JDPriestly]

116. Yes. I married an expert on European languages.

And so, we have traveled. And Delphi was quite an experience. It was way, way back in 1965, and everything was simpler and not so corporate. It is probably very different now. Then it was all an amazing experience to me.

[paparush]

60. Hey Tea Party, See the Purty Colors??? nt

[Indianademocrat91]

68. The only color they like is white... n/t

[Duct Tape]

69. This is great!

We need to get this information out to the average person and shove it in the face of all those Republicans who claim that the left blames Bush too much. In all fairness though, Obama is responsible for continuing those tax cuts and the wars in Iraq and Afghanistan.

[Keith Bee]

71. K&R

This is a worthwhile topic.

[avaistheone1]

72. Great post.

Bookmarked and recommended.

:kick:

[RUMMYisFROSTED]

73. ...and interest on that debt.

:cry:

[roguevalley]

74. thank you.

[Enthusiast]

75. Alright, if this is a fact, why

is it being kept secret by both political parties?

[mountainlion55]

77. The progressive peoples budget

was voted on and 108 dems voted against it. Including Nancy Pelosi. :nuke:

[Mr. Jefferson]

84. Ridiculous...75% of fedgov spending is missing from the analysis.

[Zynx]

96. Not quite. Basically, it is showing since the 2001 baseline what has contributed to the deficit.

It is not a chart of spending, but rather what marginal changes have accumulated the debt. Back in 2000-2001, all government spending was essentially paid for by current tax revenues. Since then, various things have contributed to the rise in the debt. This chart shows what those factors are. Does that make sense to you?

[ck4829]

89. K&R

[Sheepshank]

90. "R"s are quite literally ignoring the "Elephant " in the room

Reagan's trickle down theory flies inthe face of facts, yet is so strongly defended by the rank and file Republicans. Facts don't mean diddly when the likes of Kock brothers are lining their pockets.

[slackmaster]

94. I interpret the chart as indicating that current policies are not sustainable

:kick:

[Javaman]

95. I wonder what the "other debt" is? nt

[stockholmer]

97. this chart is deeply flawed('official debt' is already almost 100% of GDP)& will explode once the..

debt ceiling is raised to $16 trillion, yet the chart shows it at only 70% or so of GDP as of January 2011.

As of May 6, 2011, the Total Public Debt Outstanding of the United States of America was $14.32 trillion and was approximately 98% of calendar year 2010's annual gross domestic product (GDP) of $14.66 trillion. Come January 2013 (20 months from now) the debt ceiling will be in need of raising again. Even projecting it out to 2019, the chart shows total debt s only 90% of GDP. Even by a best case scenario, it will be 130 to 150% of GDP by then.

Further issues:

I went to the site, and found this (they are just dead wrong on even the current deficit, which is $1.7 trillion http://www.politico.com/politico44/perm/0411/theres_your_number_b9dde4f6-c5ef-4fa7-9308-18792b860b6b.html - they say it is only $1.4). They also project DRAMITCALLY lower deficits moving forward, even with the horrid Bush-passed, Obama-renewed tax cuts in place. Welcome to fantasy land.

http://www.offthechartsblog.org/what%E2%80%99s-driving-projected-deficits/



Now, in regards to tax cuts I completely agree that the wealthiest individuals should have not received extensions of the Bush tax cuts, but this is just a start. The US has to stop the empiric war spending and finally hold the financial systemic controllers to account.

US Income Tax collected 1998 to 2006

1998 - 828.6 in billions of constant dollars (1998 = 100)
1999 - 860.5
2000 - 950.9
2001 - 915.1 Bush tax cuts passed in June 2001
2002 - 777.7
2003 - 703.1
2004 - 698.1
2005 - 773.8
2006 - 844.0 5 years later tax revenue was still down from 2001


Taking the highest year (2001) and subtracting 2006 (844.0 5 years later tax revenue was still down from 2001) you come up with only a $106 billion difference. Taking the lowest year (2004) from the 2001 totals you get $252 billion. These numbers are dwarfed by the spending on the war machine alone.

For just 2011, over $1.2 trillion will be spent on defense http://www.tomdispatch.com/post/175361/tomgram%3A_chris_hellman,_$1.2_trillion_for_national_security/ , black ops, previous military debt, etc. The overall deficit is $1.7+ trillion. $100 to 200 billion year in lost income tax revenue is not going to come close to making serious dent in the deficit.



Throughout the history of the last 65+ years, whatever the tax rates were for individuals and corporations have been, the most total revenue the Federal government has ever taken in is around 20% of the GDP. It fluctuates between 15% and 20% no matter what they do. Plus, the US GDP is now, as a percentage, composed to higher level of financial, banking transactions (not tangible good production, etc) than at any other time in its history.





What is needed is a 1% Tobin tax (a Wall Street sales tax, if you will) on all financial transactional turnover (with a $1 million bottom floor exemption on the first million dollars).

Combine that with at least a 50 to 60% reduction in war machine spending, and you have a balanced budget, the ability to start to pay down the national debt, and finally justice where the banksters are forced to pay their fair share of national upkeep. As of now they exist in an almost pure fascistic state, where they keep private 'profits' in the trillions, and yet get bailed out by having the trillions of real losses dumped onto the citizens.


Bottom line, it is a spending issue more so than revenue loss (for the bulk of the problem), but Republicans and centrist Democrats attack the wrong things, and are hideous war mongers who will NEVER vote to cut the military.

Look again at the chart I supplied for US TOTAL tax revenues (not just income tax). No matter what the rate has been over the last 65 years, you only get a 20% max take of GDP. If the GDP of the US is 15 Trillion (and I can make a strong case that this is a cooked, vastly inflated number), and you take 20% out in total tax revenue, this is only 3 trillion dollars. Yet the government is spending (officially) close to 4 trillion a year, and in reality, (counting off budget items and accounting tricks) close to 5 trillion.

Yes, taxing the rich via a fair income tax is important, but it doesn't come close to closing the huge deficits. Look at the percentage of GDP taken in tax when the top rate for the rich was 90% under Eisenhower. It didn't raise enough then, and certainly will not now. They will simply hide their income via loopholes, hoard it, or move it off-shore.

The only way to cut the deficits is to drastically cut war spending, close up many tax loopholes, institute a single-payer not-for-profit health care system, end the private Federal Reserve, and institute a Tobin tax of some sorts.

Good luck getting ANY of these done, no matter which of the two puppet parties are in power.

[divvy]

105. Actually, it is a REPUBLICAN DEBT BOMB --- Treasury proof here

President Obama inherited an enormous Bush administration debt that was financed with short term treasury notes. These notes matured during the worst recession on record, and 8 years of republican debt had to be refinanced.

Did you know that the average maturity for ALL outstanding Treasury debt when Obama took office was about 5 years?

Proof here on page 7: http://www.treasury.gov/resource-center/data-chart-center/quarterly-refunding/Documents/2009-q4-chart.pdf

For those interested (and I hope there are a few reporters who are) the parent directory is here:

http://www.treasury.gov/resource-center/data-chart-center/quarterly-refunding/Pages/qrc-index.aspx

Click on the month (November for example) and not on "chart data"

[Name removed]

108. Deleted message

Message removed by moderator. Click here to review the message board rules.

[divvy]

109. Ummmmm, The Treasury decides how much of which maturity to offer.

see this for an example

http://www.treasury.gov/resource-center/fin-mkts/Documents/financing-tables-q4.pdf

[Romulox]

113. Bullshit on calling them "Bush era tax cuts". They were renewed in 2010. "Obama era tax cuts". nt

[Yavin4]

114. Republicans Cannot Politically Win The Argument Against Social Spending. So, They've Changed...

the argument to "we cannot afford social spending", and in order to get to that argument, they have to create an artificial debt crisis through tax cuts.

[WillyT]

117. Win Win... For Them Anyway...

:shrug:

:hi: