US budget deficit nearing $500 billion

Duty Honor Country

Duty Honor Country

Active member
http://news.google.com/nwshp?tab=wn.../mercurynews/news/politics/13778059.htm&hl=en

Take your pick of articles, the story is the same. The President is requesting another $120 billion for the War on Terror and hurricane relief. The headline for USATODAY.COM reads "Deficit could hit $500B with Congress' OK."

This is insane. The United States government needs to wake up. We cannot expect to spend 20% more than we collect in taxes and expect to prosper economically. Once upon a time, republicans were not about big givernment. However, that is what we got right now. This :cen: needs to stop. Does anyone else see where I am coming from???
 
I do doody, but you see, I currently can't hear you because I'm distracted by a very shiny object what is is... oh yeah Gay Marriage! I'll worry about crippling economic collapse and poverty later, I'm sure that's important or whatever but gay marriage, oh my god, I have to vote republican.
 
Doody said:
http://news.google.com/nwshp?tab=wn&ned=us&ncl=http://www.mercurynews.com/mld/mercurynews/news/politics/13778059.htm&hl=en

Take your pick of articles, the story is the same. The President is requesting another $120 billion for the War on Terror and hurricane relief. The headline for USATODAY.COM reads "Deficit could hit $500B with Congress' OK."

This is insane. The United States government needs to wake up. We cannot expect to spend 20% more than we collect in taxes and expect to prosper economically. Once upon a time, republicans were not about big givernment. However, that is what we got right now. This :cen: needs to stop. Does anyone else see where I am coming from???
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I hate to say this Doody but you are starting to sound like a ....Liberal!
 
Young Winston said:
I hate to say this Doody but you are starting to sound like a ....Liberal!
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I don't see where he sounds like a liberal at all. If you look at past US politics, conservatives have generally been the most fiscally conservative and liberals the opposite. Are current admin is very liberal when it comes to handling money.

I am not even close to being a liberal, I'm very conservative, although I do not cow tow any party lines, and I agree 110% with him.

 
Young Winston said:
I hate to say this Doody but you are starting to sound like a ....Liberal!
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Please don't get mad at this comment. Young Winston and I go way back. That was one of those jabs freinds take at one another. He may thing I was a republican but he may surprised to find out I am an independent. I swing both ways to get the best of both worlds. :shock:

As for Gay Marrage vs the national deficit, I really do not see the comparison. Right now, gay marrage does not affect me one bit. Although I do not agree with it, I am not about to take up the sword for a crusade against gay marrage. There are way more important things to worry about.

The budget deficit affects us all more than you realize. Right now we live in a fanticy world. Every congressman and senator knows we are deep in the red but no one wants to do the evil deed of raising taxes or cutting spending. Sooner or later we are going to have to raise taxes. THere is no way around it. If we are ever to reduce the $8 trillion in national debt, we are going to have to cut spending like we mean it.

The way our government blows needless money is mind boggling. FEMA definately struck out with Katrina. They send 10,000 people to live in New York City where rent is well over $2000 a month for a family appartment. Then we got those nice $60,000 trailors that was bought with emergency funding. When I was at HorseShoe Bend National Park, I stayed at a state park that had 200 of those things. Only half were in use. FEMA should have sent some of those displaced by Katrina to Clarksville, TN. $60,000 could get you a nice appartment for 9 years or so because rent is only $500 a month for a 3 bedroom appartment.

SOme of you will argue that we are at war. Well yea, the war has cost about $440 billion since 9/11/2001 according to USA Today. I guess 2007 figures are about $150 billion for the war give or take. That still leaves over $300 billion that is still considered budget deficit. The thing that bloggles my mind is that we are so deep in the red when the economy has been pretty decent. What is going to happen when things really turn south for the US economy?

I do have a theory on why no one really cares too much about the budget deficit. The American people are about as good as the government when it comes to budgeting. The amount of credit card debt per a house hold blew by $9,000 after this Christmas and Americans saved a dismal -.5% of their income in 2005.

I have written enough for now. I am looking forward to more debate

Doody
 
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Doody said:
As for Gay Marrage vs the national deficit, I really do not see the comparison. Right now, gay marrage does not affect me one bit. Although I do not agree with it, I am not about to take up the sword for a crusade against gay marrage. There are way more important things to worry about.
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I was giving a delightfull bit of social commentary on how the "values voters" where what most people voted for.

Life, liberty, pursuit of happiness? economy? war? Bah!
 
Oh yes, I am well aware of that. THere be many people in this country that will vote for someone only based of thier views on abortion or gay marrage. The recent Supreme Court nominations showed us all that.

I am really going to see who says they are going to "attempt" to cut spending. I think John McCain comes to mind as being one of those people who realize how much waste is in government spending. He is far from perfect, but he does more to highlight the issue than most.

But we all know governmnet officials say one thing but can do the exact opposite.
 
Forgive me for not staying awake in my economics class, but what happens if the federal deficit is too high? Inflation? US dollar is kicked off world markets? Please explain. Thanx in advance!
 
ASTRALdragon said:
Forgive me for not staying awake in my economics class, but what happens if the federal deficit is too high? Inflation? US dollar is kicked off world markets? Please explain. Thanx in advance!
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If the Federal Deficit is too high, there would be expected rising interest rates which the Fed under Greenspan have done several times during his term. As a result of the rising interest rates, it would or would not effect inflation. The US have experienced a lower CPI (Consumer price index) for the last quarter of 2005 so dramatic Inflation rate is not very likely regardless the deficit because we have countries such as Japan and China buying US bonds and providing loans, thus providing a stable money supply.
 
The economy is healthy, the stock market doesn't fall or rise by large amounts, unemployment is just over 4%. As long as there is healthy growth because of high employment and a stable market, that means the taxpayers and business at large are still confident. The Government does well as long as the economy does well and the taxes keep rolling in. A deficit doesn't hurt as bad in times of a good economy as opposed to the economic problems like during WWII. As long as the dollar stays strong, foreign investors will continue to buy US paper.
 
You have a point missileer, but history says that deficits normally shrink during the good years. Right after WWI, the US had a huge boom in the economy and government spending dropped. I think the same thing happened at around 1900. The 1990's also saw the budget hit a surpluss.

Here is what a large deficit can affect the domestic side of the United States. When the debt gets too much, the government will have to cut spending across the board. None of this nichol and dime $20 billion that the President is doing now. I am talking 100's of billions. The government will also have to rasie taxes to get the debt down aswell. Cutting spending and raising taxes takes money out of the economy which will be bad for businesses. Businesses will scale back and some sort of recession will occur.

My point is that we Americans like to say our economy is chugging along, but we are doing it on borrowed money. Sooner or later we are going to have to pay that money back. When we do, the American economy is for rough times. Since AMericans have more debt and saving less than we ever have in our history, there are going to be a lot of people in economic ruin. The panic of 1819 (give or take) shows this perfectly. The economy was great, people started to borrow borrow borrow. Then when the economy receeded, no one could pay their bills. I truely fear the same thing will happen if we Americans do not smarten up.
 
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I think the recommended savings "pad" for a household of four has now risen to three years of your salary to fall back on. Not sure if that's gross or net. A lot of people will argue that their worth includes items such as home(s) or property but the ability to liquidate such things depends on other people having enough money to buy it. If your investments are bearer bonds or gold, you'll come out okay, anything else belongs to the bank or tax man.
 
Recent studies show that a alarming number of Americans do not have that 3 years of salary buffer that you just talked about. According to Dave Ramsey, a financial guru on the radio who dennounces all debt, 40% of Americans are living paycheck to paycheck. The definition of living paycheck to paycheck is when you cannot pay the bills that allow you to live (morgage, rent, food, gas, car payments ect) if denied your very next paycheck for ANY reason. The 40% figure is confirmed via a google search.

http://www.google.com/search?hl=en&lr=&safe=off&q=paycheck+to+paycheck+america+percent&btnG=Search

A couple of sites said that number is as high as 60%. Those figures are not very comforting.

There is a sad statistic where something like 70% of Americans say they believe their retirement will be prosperous while only like 30% are saving for it. For all you number crunchers out there, I can take the time to hunt down the exact figures if requested to do so. I hope by now i have proven myself knowlegeable in this subject.
 
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Doody brother ou hit the nail on the head about the fiscal irresponsibility of the government being only a symptom of a societal problem reflected in the spending habits of common Americans. The problem is that since the New Deal government spending vis a vis the debt actually fuels a major portion of the private economy. For those slow on the uptake... the debt spending provides jobs for millions. To cut the debt there is going to be a serious wailing and gnashing of teeth as not heard since the Great Depression. If the budget is ever seriously dealt with there will be hell to pay in the economy.
 
Hey BD,

Have you heard of all the "wailing and gnashing of teeth" over the President's $40 billion budget cuts over the next 5 years? It has begun! On the flip side, the Department of Defence budget got a $24 billion boost (6%) from last year. Do the math, it does not make any financial sense. When will our elected and appointed officials "get it?"
 
I wouldnt put to many eggs in the US economic basket yet either. Its certainly true that the economy is doing better, but there is one key index that is still on shaky ground, consumer confidence. Very simply its not growing at the rate it should, in fact its falling and Thats bad. Our economy moves on the spending dollar of the middle class if the consumer confidence falls that means we may be in for tough times ahead. Added to that our enormous deficiet...

Reuters today...

http://today.reuters.com/investing/financeArticle.aspx?type=economicNews&storyID=2006-02-07T220049Z_01_N07256472_RTRIDST_0_ECONOMY-CONSUMERS-ABC.XML
 
For the short term, consumer confidence is up.
http://www.conference-board.org/economics/consumerConfidence.cfm

"Consumer Confidence is now at its highest level in more than three years (June 2002, 106.3)," says Lynn Franco, Director of The Conference Board Consumer Research Center. "This month's increase was driven solely by consumers' assessment of current economic conditions, especially their more positive view of the job market. But while consumers rate current conditions more favorably than they have in more than four years (Aug. 2001, 144.5), the improvement has not translated into greater optimism about the near-term future. In fact, the gap between consumers' assessment of current conditions and their expectations remains wide."
 
Bush has been borrowing exorbitant amounts of money from China, Japan, and the EU and probably a lot of other countries.

Who knows, maybe we'll have a USA thats made in China or Japan or whatever.

And then WWIII will start in seeing who will have ownership of USA.
 
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