OT: US National debt

[douglas]

narf poit chez BOOM said:
If I was in the US, I'd go with a 3% raise in taxes, as long as a constitutional and legal amendment was passed saying that all of the US's elected government would immediatly loose their positions if it were used for anything but debt reduction.

Any ideas for how to phrase that with no loopholes and without requiring a balanced budget? If so, I'm sure everyone who has ever tried to increase funding for something by dedicating all money from a new source of income to that cause would love to hear about it.

[mottlee]

As most of you probably know, politions DO NOT pay for things as GAS, STAMPS, you know the things that keep us going...I would like to see them start to pay for ALL the freebees they get and to stop incressing there pay when they do not even voit on the thing they are there to vote on!

[Starhawk]

Okay without trying to start a flame war here (this is a genuine question not an argument) it is my understanding that every nation on Earth has a national debt and that those "debts" are pretty much used as a sort of credit system for a nation, for example say UK owes US 5 billion dollars but instead of being forced to pay it streight up they'd be asked to back the US in a UN vote or something of that nature instead.

Now I was only using US UK as an example but is that true that often nations pay their debts to one another through non monetary means?

I mean face it if the United State called in every debt we were owed we'd get a few trillion bucks to pay off our own debts but we'd also bankrupt many nations in the process and likely be bankrupted afterwards ourselves?


Like I said I'm not doing any political US is superior stuff here I am just trying to figure out why I've heard so many people saying "national debt is a political plus sometimes". I mean I am far from a professional economist so heh .

[geoschmo]

Yah, a debt in and of itself is not always a bad thing. It's basically a line of credit. Never allowing the government to borrow for short term needs would be unrealistic and to rigid. The problem is if you run up so much debt that the interest on it becomes an unmanageable expense, or if you become unable to make your payments and default.

[Starhawk]

Ah, very interesting info there Geoschmo thanks .

[Will]

And the problem with the US debt is that the interest payments on it is the second biggest expense each year for the Federal government... the only thing costing more is the military. I think right now, the breakdown is something like 40% of income tax (this excludes the SSA and Medicare taxes taken out of paychecks, as these are supposed to be seperate budgets) goes to the military, and about 33% goes to interest on the debt. (I can't seem to find any numbers Online to confirm this...) Which is why I'm not happy with Bush for cutting taxes, because now I'm going to have to carry that huge debt for most of my life. I know it's not feasible to completely pay it off, and I don't expect the Feds to pay off everything. But paying off enough to get payments down to around 7%-12% of total budget from income tax would make things infinitely better (IMHO).

At the rate we're going now, there can legally be no more debt (we've hit the $7.4 trillion limit already). So, we're either increasing the limit to pay for the wars, or Bush is cutting more programs to keep his precious corporate tax cuts, or he raises taxes on everyone, going against his promises... While Osama laughs as his plans succeed yet again. Something has to break soon.

[Starhawk]

Will said:
And the problem with the US debt is that the interest payments on it is the second biggest expense each year for the Federal government... the only thing costing more is the military. I think right now, the breakdown is something like 40% of income tax (this excludes the SSA and Medicare taxes taken out of paychecks, as these are supposed to be seperate budgets) goes to the military, and about 33% goes to interest on the debt. (I can't seem to find any numbers Online to confirm this...) Which is why I'm not happy with Bush for cutting taxes, because now I'm going to have to carry that huge debt for most of my life. I know it's not feasible to completely pay it off, and I don't expect the Feds to pay off everything. But paying off enough to get payments down to around 7%-12% of total budget from income tax would make things infinitely better (IMHO).

At the rate we're going now, there can legally be no more debt (we've hit the $7.4 trillion limit already). So, we're either increasing the limit to pay for the wars, or Bush is cutting more programs to keep his precious corporate tax cuts, or he raises taxes on everyone, going against his promises... While Osama laughs as his plans succeed yet again. Something has to break soon.

Okay that whole Last Paragraph was rather useless as you had made a good point with the first on and then just blew that out the window with your second paragraph.

Okay we get the point you don't like Bush but at least we aren't paying for his laywers while he bangs interns lol.... Or in Kerry's case at least we're not paying for his botox hehe. (just a joke don't start anything!)

[Will]

Umm... the Last paragraph is why I don't like Bush, not me just saying I don't like him. I thought Kerry would have kept up the deficits too, just not as huge as Bush is keeping them. Just about any other politician would have run up the debt as well.

I fail to see how my point in the first paragraph (that it would be a Good Thing(tm) to get the debt down to the point where it's 7%-12% of the annual budget from income tax, instead of 33%) is invalidated by me applying it to a specific politician. Would you have prefered that I apply it to Kerry instead, even though he lost and has almost no influence on budget issues now (except as a minority senator)? That doesn't do anything.

My second paragraph makes a very valid point as I see it. The law as it stands now says the Federal government cannot accumulate more than $7.4 trillion in debt. We now have $7.4 trillion in debt, and are spending more than we have every day. At some point, Bush either has to stop paying for things, or raise taxes, or (most likely option) he continues to screw over my and your generation by shifting the burden to us. There are estimates that take the average economic growth in the US over the past few decades, and extrapolate to several decades in the future, and the estimate is that the people just now about to enter the work force will be paying 75%+ of income in taxes, if government programs stay the same. Osama stated his goal is to bankrupt this country, and so far we're doing it. And, something has to break soon.

Tell me, what part of this is not valid? Because I certainly can't see it, even after putting my conservative blinders on.