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Treasury's Geithner warns Congress again with direct details: Inaction on the debt ceiling will...

Treasury's Geithner warns Congress again with direct details: Inaction on the debt ceiling will drive interest rates up, household wealth down, "catastrophic" defaults on entitlements and service member pay - and a double-dip recession.
Comments (82)
  • Neil459
    , contributor
    Comments (2644) | Send Message
     
    We been warned before, the little girl has cried "wolf" a few too many times. We need to take our punishment and get it over with.

     

    No more government spending, no raise in the debt ceiling!
    14 May 2011, 03:32 PM Reply Like
  • EMS
    , contributor
    Comments (563) | Send Message
     
    I consider a feminist. I object to calling this person a little girl as it is very insulting to little girls.
    14 May 2011, 05:53 PM Reply Like
  • Neil459
    , contributor
    Comments (2644) | Send Message
     
    EMS, of course your right as I had my Aesop's Fables and Grimm's Fairy Tales mixed up. It was a boy that cried wolf too many times. No offense meant.
    15 May 2011, 02:05 PM Reply Like
  • DianeLee
    , contributor
    Comments (346) | Send Message
     
    My goodness! "Catastrophic"? Will the sky fall in, too? Of course it's serious, but maybe overstated? Even "service member pay." Reminds me of cutbacks in the government only effecting firemen, police, and teachers. Really, wouldn't a combination of closing loopholes as a measure of increasing taxes, budget cutbacks, and about half the increase in national debt that the Adm is asking for be a good start for negotiations?
    14 May 2011, 03:32 PM Reply Like
  • climbera5
    , contributor
    Comments (18) | Send Message
     
    Shoot the hostage!
    14 May 2011, 03:34 PM Reply Like
  • neutrinoman
    , contributor
    Comments (700) | Send Message
     
    This is more nonsense from Tiny Tim. If a technical default is accompanied by a real plan to control spending in the next five years or longer, the bond market will rally, because it will know: Congress is finally serious. Something similar happened in 1995-96, ending the 1993-94 bond market crash. We're now shielded from the consequences of Congressional recklessness only by the Fed's buying Treasuries. Thanks Ben and Al!

     

    See: online.wsj.com/article...
    14 May 2011, 03:38 PM Reply Like
  • Machiavelli999
    , contributor
    Comments (829) | Send Message
     
    Unreal talk here. We have come completely unhinged. This entire thread is a microcosm of the debate on this topic. Facts DO NOT MATTER AT ALL.

     

    Yes, neutrinman, the market will love a default. Because you know creditors love NOT getting paid back. Because you know when a homeowner defaults on his mortgage and comes into the bank with a "real plan to cut his spending down", the bank really will give a sh*t at that point.

     

    I don't think this can be pointed out enough times. So called free market conservatives warn us all the time that if we don't take the necessary hard steps then Medicare and Social Security as we know it will end and the government will go bankrupt. So their solution to this catastrophic outcomes is to............end Medicare and Social Security as we know it and force the United States into bankruptcy.

     

    The idiocy of this cannot be overstated. It is like the CFO of McDonalds coming into the board meeting of his company and saying, "We have $11.5 Billion in outstanding long term debt. The number has continued to rise over the last several years (This is true) It's so much! We need to declare bankruptcy and end our debt ridden corporation."

     

    His board would tell him.."Ummm..are you retarded? We are one of the world's richest companies and creditors are falling over themselves to lend money to us.."

     

    "But..but..but we must declare banktruptcy!"

     

    By the way, those were all true figures about McDonald's debt.
    14 May 2011, 03:52 PM Reply Like
  • Machiavelli999
    , contributor
    Comments (829) | Send Message
     
    I also think it's worth pointing out that this idea that the federal, state and local governments have been fiscally irresponsible for a long, long time is a huge joke.

     

    Only 12 short years ago, Alan Greenspan was worrying about the fact that the United States would pay off all of its debt and there wouldn't be a long term Treasury market and what ramifications this would have. Boy, wouldn't we love to have this problem now.

     

    No one even talked about the problems in state & local governments up until just 3 years ago except in truly irresponsible places like California.

     

    What happened these past few years? On the federal level, Bush tax cuts and Medicare Part D have kept us in the red even during the housing boom good times. And then the financial crash, depressed tax revenues so much which led to our current situation.

     

    On the state & local levels, the answer is simply depressed tax revenue due to depressed economy.

     

    The answer is simple. But it doesn't fit into what some ideologues want to hear. They don't want to waste this crisis and see this as an opportunity to cut everything.
    14 May 2011, 03:56 PM Reply Like
  • Jackson999
    , contributor
    Comments (468) | Send Message
     
    Creditors WILL get paid back. They will just have to wait awhile. We will probably hand out IOU's like Calif did if the ceiling is not raised.

     

    People are making more of this than they should.
    14 May 2011, 04:06 PM Reply Like
  • Econdoc
    , contributor
    Comments (2944) | Send Message
     
    Mach - I believe the ceiling should be raised because it is stupid not to but Geithner's rhetoric is too much

     

    without additional debt the US would still be able to cover interest payments - that's the acid test - what would not be covered is the 1/3 of the budget that is currently financed.
    the gap is about $1T give or take a $100 or $200B

     

    without added debt the government must do two things - raise taxes and reduce outlays

     

    you cannot really touch entitlements in the short run - unless you want to withold checks or just not pay for services maybe some of you think that's a good idea - I would tell you that it is the same as defaulting on an obligation - so no joy there and the tax base by itself will not bridge the gap so it must be a mix of non entitlement spending cuts and tax increases

     

    the biggest discretionary chunk of the budget is defence and you cut it by 40% immediately - that get's you maybe $300b -

     

    other spending cuts get's you maybe 10% of the way there. - that's $100b - so it's a chunk but not enough
    so $400b from cuts
    after that you must raise taxes
    A $1 per gallon "Keep the debt ceiling" gas tax would raise about $150b

     

    still about $350b short
    must raise the income tax - on the middle classes - the 45% who pay 30% and raise taxes on the 50% who pay nothing and eliminate the mortgage tax deduction for all
    you can probably cover it in there
    so there it is - if you do not want the ceiling raised you better have a plan and that plan needs to contain those elements or else you will be defaulting and if you do you will pretty much destroy the system - a lot more effectively than anything AlQuaeda could dream up.
    E
    14 May 2011, 04:29 PM Reply Like
  • obstacle2
    , contributor
    Comments (12) | Send Message
     
    But nobody will touch raising taxes.

     

    Because people with tons of money are too taxed...never mind that because of capital gains and dividend taxes they shouldn't be really paying anymore that around 20% on most of their money.

     

    And nobody will touch defense.

     

    The people who don't want to raise the debt ceiling also refuse to raise taxes or cut defense spending. They want to go ahead and lower taxes.

     

    As a position, that makes no logical sense.
    14 May 2011, 05:30 PM Reply Like
  • Herr Hansa
    , contributor
    Comments (3079) | Send Message
     
    That is the definition of a technical default.
    14 May 2011, 05:44 PM Reply Like
  • cgarlotti
    , contributor
    Comments (11) | Send Message
     
    "Econdoc" yet again you prove that you don't actually have an economics degree.

     

    The US cannot default (the states can, but not the federal government). He he he, only ideologues actually believe this. We aren't on a gold standard any more. We didn't surrender our sovereignty like greece did.

     

    Try reading some economics to gut up to speed:

     

    neweconomicperspective.../

     

    ...your welcome
    14 May 2011, 05:57 PM Reply Like
  • Herr Hansa
    , contributor
    Comments (3079) | Send Message
     
    en.citizendium.org/wik...

     

    The US is extremely unlikely to fully default, like Iceland or Argentina. However, if you thinnk a technical default would have zero consequences on the value of the dollar, it's status as a reserve currency, or the ability to sell Treasuries in the future, then you would be the world's greatest optimist.
    14 May 2011, 06:52 PM Reply Like
  • nmelendez
    , contributor
    Comments (1622) | Send Message
     
    And California is still there...so what's your point.
    14 May 2011, 07:45 PM Reply Like
  • Jackson999
    , contributor
    Comments (468) | Send Message
     
    That the USA will also still be there when all is said and done....
    14 May 2011, 08:33 PM Reply Like
  • Herr Hansa
    , contributor
    Comments (3079) | Send Message
     
    California is still here, without a favourable bond rating, and still in trouble. Ask some of the companies who got IOUs from California what they thought of them; they were not usable as currency (unlike in Argentina when they did something similar), and until a couple banks stepped in to take them (after charging a fee), they were basically worthless in the short term.

     

    While the US could defer or delay payments on debt, or issue longer debt to replace maturing debt notes, I seriously doubt that could happen without consequences. If the US were to take that approach, then they do not deserve AAA status.

     

    I think we are all in agreement that spending is out of control. I don't think forcing a technical default will help; I do think it will lead to higher interest payments on future debt. Without the Federal Reserve buying up Treasuries, I don't think debt sales would've been that good over the last six months. Perhaps people just think the Fed will do QE3 and all will be okay, but I don't agree with that either, and I think that would again lead to losing AAA status.

     

    Credit Default Swaps against Sovereign Default pay out on technical defaults. CDS against the US pay out in Euros. I think quite likely at least one issuer of Sovereign CDS, and maybe one clearing house, would collapse after a US default. In other words, it is so far unlikely, but if it happened it would be dramatic.

     

    Disclosure: I'm from Germany, though I live and work in the United States, in California and Texas.
    14 May 2011, 08:49 PM Reply Like
  • Monngie
    , contributor
    Comments (928) | Send Message
     
    Machiavelli999....I was worried for awhile......until you came along and injected some sense into this discussion. Your absolutely right. The whole motivation for this is the Republican strategy to "starve the beast" and institute a small federal government. That has been their unrelenting drive for at least 70 or 80 years. They don't care if they destroy this country to achieve those ends. Indeed, the more they can make the federal government appear dysfunctional the better. So, if you elect them, they will pursue policies that will fail and then blame it on big government. The irony in this is palpable. The more they complain about big government, the more they get elected. The more they get elected, the more they grow government. And they grow government in the most wasteful and idiotic ways so that big government looks as inept as possible. I'm reminded of Ronald Reagan spending millions on WWII battleships in the 1980s(!!!) and resurrecting the B-1 program when the B-1 was already obsolete because the B-2 (secret at the time) had been developed. By the time the B-2 was ready for production, he wasted sooooo much money we could only afford a relative handful of B-2s.

     

    So, if we default, they will simply blame it of big government, and uncontrolled spending, instead of their ineptitude at governing during the Bush administration. Indeed, much of the "uncontrolled spending" we've experienced in the past two years was necessary due to their ineptitude and an unnecessary war in Iraq.
    14 May 2011, 09:10 PM Reply Like
  • Monngie
    , contributor
    Comments (928) | Send Message
     
    Econdoc, good plan. I just didn't see anywhere in it where millionaires and billionaire ante up. They've been the beneficiary of tax cuts and increased productivity for at least ten years. It's time for them to chip in. (Maybe I missed it somewhere)

     

    My only criticism of your plan.

     

    However, obstacle2 is correct and that's the reality that bites. He said, "The people who don't want to raise the debt ceiling also refuse to raise taxes or cut defense spending. They want to go ahead and lower taxes."

     

    They're idiots with an one word vocabulary (NO), but, the American people must love idiots. They voted them in!!
    14 May 2011, 09:23 PM Reply Like
  • Angel Martin
    , contributor
    Comments (1291) | Send Message
     
    E, the Republicans in the House will never agree to any tax increase even if the seas turn to blood, toads fall from the sky and poisonous snakes roam the land...

     

    That's why I think there is a significant probability that this will end in a wreck. Current Intrade pricing seems to agree with me.

     

    www.intrade.com/v4/mar...

     

    I think the end game is that after a "TARP vote1" style meltdown the House Republicans will cave on spending cuts, but not on taxes.
    14 May 2011, 09:48 PM Reply Like
  • Balderdash
    , contributor
    Comments (101) | Send Message
     
    Machiavelli999 -- do a cash flow analysis of the government and McDonald's. If McDonald's had to raise its dollar menu prices to $10 just to break even on cash flow -- then it would be a good analogy!
    14 May 2011, 10:12 PM Reply Like
  • Monngie
    , contributor
    Comments (928) | Send Message
     
    And the NOT SO FISCALLY RESPONSIBLE REPUBLICANS want the economy to remain depressed until 2012. They were swept into office to cure our economic problems and they haven't done S#!+. Now that they tanked the economy and they can blame President Obama, they will "rope a dope" the economy until it's politically disadvantageous to them. That's not until after 2012.

     

    They simply don't give a s#!+ about the country. All they care about is their own political objectives. They won't waste the crisis they created and they will prolong it until their objectives are met.
    14 May 2011, 10:32 PM Reply Like
  • nmelendez
    , contributor
    Comments (1622) | Send Message
     
    I understand your logic, however there is one big flaw. The US is buying Bunds with dollars while Europe is buying treasuries with Euros. US and Europe are on the same boat. So, as the Dollar goes, so goes the Euro.
    I believe you know well this whole market is manipulated. The market is now more of a casino game than ever. CDS are nothing more than bets.
    As i said before, this is an economic war going on. Misdirection is the name of the game.
    14 May 2011, 11:34 PM Reply Like
  • TomasViewPoint
    , contributor
    Comments (4845) | Send Message
     
    Mach

     

    The world is not falling over themselves to buy our debt. They have pulled back and Ben B has stepped in to buy up the slop.

     

    If the world is already thinking our credit is not all it is cracked up to be and they are voting with their money then why do we think it is so great?
    14 May 2011, 11:36 PM Reply Like
  • Neil459
    , contributor
    Comments (2644) | Send Message
     
    "The idiocy of this cannot be overstated. It is like the CFO of McDonalds coming into the board meeting of his company and saying, "We have $11.5 Billion in outstanding long term debt. The number has continued to rise over the last several years (This is true) It's so much! We need to declare bankruptcy and end our debt ridden corporation."

     

    This is not the situation at all. Its the same as the bank/bond holders telling McDonalds they won't loan them any more money. Now McDonalds can either control costs or declare bankruptcy. Its still a choice.
    15 May 2011, 02:11 PM Reply Like
  • Machiavelli999
    , contributor
    Comments (829) | Send Message
     
    Wrong. The problem is there is no way to prove to you that I am right. You can always cry "Conspiracy! Conspiracy!" But I'll try anyway.

     

    First of all, interest rates have gone up since QE began. Second of all, I promise you that once QE ends interest rates won't shoot up. Third of all, for the last THREE YEARS every time the market has gone down, Treasuries have gone up. Why? Because everyone floods into Treasuries when times are bad.

     

    Finally, this brings me to my last point. Do you know who the biggest buyer of US debt is. It's not Ben Bernanke. It's not China. It's not foreign creditors. It's YOU TOMASVIEWPOINT. YOU!!! And me, and all the other US bank checking account holders. Because all of the banks have stopped lending and just buy US Treasuries now. We, the savers of the United Staters, are the biggest financiers of the US government.
    15 May 2011, 05:15 PM Reply Like
  • nmelendez
    , contributor
    Comments (1622) | Send Message
     
    Did you know there are over 5.4 trillion dollars in 401(K), 403(b)'s, TSP, IRA's and all the other savings accounts? Remember 1933? Need i say more?
    15 May 2011, 07:32 PM Reply Like
  • TomasViewPoint
    , contributor
    Comments (4845) | Send Message
     
    Mach:

     

    My narrow point is that foreign investors are cutting back. That is not wrong that is just a fact.

     

    They don't like the risk and return equation so they are putting money to work in other ways. Ben B is stepping up and buying at higher prices to force rates down. He has a number of reasons to force rates down which he has articulated.

     

    If anyone believes UST's are great deal they can bid at the auction on these debt securities but the low bids are filled first and Ben is bidding below where the market believes the price should be.

     

    Historically rates are at lows and especially the short end of the curve where a lot of borrowing is going on. One year Treasuries are extremely low. All things being equal interest rates will go up after QE2 because a lot of demand from Ben will leave the market who was satisfied with lower returns and all that is left is reticent buyers.

     

    Keep in mind I said "all things being equal" which holds all variables constant. If you want to change those variables then you can propose as many scenarios as you want.
    15 May 2011, 09:20 PM Reply Like
  • HA65MPH
    , contributor
    Comments (1366) | Send Message
     
    Soon , I believe , the ''gubment '' will BORROW'' THEM !
    16 May 2011, 03:15 PM Reply Like
  • Killer454
    , contributor
    Comments (783) | Send Message
     
    Tax cheat Timmy continues to attempt to unilaterally redifine the meaning of words.

     

    Default is a specific legal term related to debt service on bonds.

     

    It has nothing to do with the government refraining from making entitlement program payments or anything else the government spends money on.

     

    As for holding household wealth down, Helicoper Ben is alreadly doing a pretty good job of that by simultaneosly creating inflation via money pritning and hold down interest rates. Savers are getting paid virtually nothing on their bank or money market deposits while having to pay more for gas and food.
    14 May 2011, 03:52 PM Reply Like
  • lower98th
    , contributor
    Comments (1420) | Send Message
     
    Note to Timmy and Congress: Come clean. Just eliminate the debt ceiling. You already have, really.
    14 May 2011, 04:04 PM Reply Like
  • wkl
    , contributor
    Comments (289) | Send Message
     
    With or without a rise in the debt ceiling, there is no risk of default from our debt obligations and the treasury knows this. At the very least we merely meet our interest obligations and roll the debt over. If the world viewed this as a serious problem in just a few short months, we would already see the demand destruction in our treasury auctions. And by the way, even as bond investors know that QE2 is about to end, we have seen a short rally in bond prices.
    14 May 2011, 04:17 PM Reply Like
  • valueinvestor123
    , contributor
    Comments (327) | Send Message
     
    Stanley Druckenmiller in an interview with the WSJ said Tim was wrong. I am going to side with Druckenmiller on this one, not just because he is smarter than Tim, but also Stanley is not a shill for the banks like Tim is.

     

    www.zerohedge.com/arti...
    14 May 2011, 04:18 PM Reply Like
  • DianeLee
    , contributor
    Comments (346) | Send Message
     
    Raise the debt ceilig another two TRILLION dollars, the amount asked, with no strings attached....and you'd better believe they'll spend it.
    14 May 2011, 04:20 PM Reply Like
  • Mad_Max_A_Million
    , contributor
    Comments (1175) | Send Message
     
    Wait? My crystal ball is back into focus:

     

    Boehner will demand cuts equal to the Debt limit increase.
    Obama and Reid will bust out laughing and report on MSNBC with dire reports that the Republicans are about to kill Grandma, crash the economy, and starve the masses.
    The sheeple will rise in anger that Boehner would dare to cut any of their hard earned government freebies.
    The polls will put the popularity of a Conservative just above that of the black plague.

     

    In the end, the House does not own congress and the Prez will not sign anything he does not like.
    It reminds me of the picture of Mickey Mouse flipping the bird to a large Hawk about to pounce on poor ole Mickey. No good endings!
    14 May 2011, 04:53 PM Reply Like
  • nmelendez
    , contributor
    Comments (1622) | Send Message
     
    I keep thinking of the stork trying to swallow the frog while the frog is choking the storks scrawny neck. LMAO
    14 May 2011, 07:36 PM Reply Like
  • Monngie
    , contributor
    Comments (928) | Send Message
     
    You must be talking about our illustrious Crying John Boner. You know the one with the remarkable tan!!!

     

    I hope they make it to just BELOW the black plague.
    14 May 2011, 09:28 PM Reply Like
  • nobby73
    , contributor
    Comments (1177) | Send Message
     
    Geithner should just send a picture of a puppy with the comment, "if you don't raise the debt ceiling, this puppy will die."
    14 May 2011, 06:02 PM Reply Like
  • nmelendez
    , contributor
    Comments (1622) | Send Message
     
    Hey, now..don't mess with the puppies.
    <:::::: Card Carrying Member of PETA ( People for the Ethical Treatment of Animals)...and no, i do not include Congress or Republicans. Please do not insult the animals. :)
    14 May 2011, 07:39 PM Reply Like
  • Tomcat101
    , contributor
    Comments (963) | Send Message
     
    And the earth will stop going around the sun.
    14 May 2011, 08:18 PM Reply Like
  • The Geoffster
    , contributor
    Comments (4009) | Send Message
     
    Methinks Tiny Tim would find a way to fund military pay else the military find a way to fund its pay.
    14 May 2011, 06:10 PM Reply Like
  • nmelendez
    , contributor
    Comments (1622) | Send Message
     
    I know...Let's charge the world for policeing it...ohh wait, they don't want us policeing the world. Maybe we should just bring our troops home. What a novel idea!
    14 May 2011, 07:33 PM Reply Like
  • The Geoffster
    , contributor
    Comments (4009) | Send Message
     
    Bring the troops home and watch the dollar plummet.
    14 May 2011, 10:22 PM Reply Like
  • nmelendez
    , contributor
    Comments (1622) | Send Message
     
    So, like the US is in desperate need of....What? Food, no...energy, no.....minerals,no....... what do we really need?
    BTW, did you know if the US stopped exporting grains, famines would start worldwide? Did you know US was Saudi Arabia of Coal? Did you know we have the strongest military in the world?
    Oh, i know...you won't be able to go to Europe on vacations! So sad..:(
    14 May 2011, 11:40 PM Reply Like
  • Terry330
    , contributor
    Comments (866) | Send Message
     
    Todays GOP & Conservatives are out to destroy America by eliminating the middle class and poor. They dream of cheap labor to match China at $2.20 hour, no benefits.
    14 May 2011, 06:28 PM Reply Like
  • apberusdisvet
    , contributor
    Comments (2860) | Send Message
     
    The FED, enabled by both corrupt dems and repubs has already effectively destroyed the middle class. Where have you been?
    14 May 2011, 06:42 PM Reply Like
  • nmelendez
    , contributor
    Comments (1622) | Send Message
     
    Republicans, yes, Democrats, no. If the Republicans had won big where do you think your SS would be. Probably in the market during the downturn. Look at Ryan's plan to privitize, yes i said privitize, medicare. Do you REALLY think you can get a better deal than the US Govt. can? REALLY?
    Look at the decimation of defined benefits. Ryan's plan eliminates the last bastion of defined benefits, Govt. workers.
    The final objective, eliminate all safety's for you in old age,"... you can't work? Then just go crawl out somewhere and die!" That's the Tea Party Mantra.
    14 May 2011, 07:31 PM Reply Like
  • davidbdc
    , contributor
    Comments (3141) | Send Message
     
    Lets look a little closer than the typical "we're going to kill grandma" crap.

     

    The people retiring today have lived through the largest creation of wealth in history - not just in the USA - in the world. If you've saved nothing - your fault. If you've gained 100 pounds - your fault. If you didn't pay off your house so you could take a vacation every year - your fault. You've made your bed - now lay in it. Why should the government come over and say - hey, you blew it for 45 years but now we'll make it all better and pay for your health care and heres a nice check for spending money. What kind of nonsense is that?

     

    How about the mantra is - you live your life how you see fit - we encourage you to save money and be responsible - if you don't there will be a safety net, but its just that - not a "nice, comfortable life", but rather the bare necessities to just get by.

     

    And yes, I'm all for destroying government workers "defined benefits". More appropriately it would be called "defined cash for votes". No more step raises. No more full pensions after 20 years. Its called public service - you don't want to serve - we will live just fine without you.

     

    And finally, Yes I think I can do much better than the federal government - because the involvement of the federal government immediately means your giving up your freedom. And what was that saying again???? "Give me freedom or give me death".

     

    I'd rather die poor and crawling somewhere in my old age and have my freedom than to live under the USSR regime that our federal government has become.
    14 May 2011, 07:41 PM Reply Like
  • Monngie
    , contributor
    Comments (928) | Send Message
     
    nmelendez.........BRAV... You nailed it.
    14 May 2011, 09:33 PM Reply Like
  • Monngie
    , contributor
    Comments (928) | Send Message
     
    Davidbdc, the NOT SO FISCALLY CONSERVATIVE REPUBLICANS (NSFCR) are working so hard to make your dream to die poor and crawling somewhere in your old age come true.

     

    Whatever happened to a sense of community, where we all look out after one another. What happened to "I am my brothers keeper". An nationwide attitude like yours 80 years ago would have lost us WWII. Why should I fall on that hand grenade your in this fox hole too. Why don't you charge that machine gun I'm not that stupid.

     

    I think you've been fortunate enough to have NOT endured much hardship in your life or had to confront very much adversity. It's when hardship and adversity knocks on your door that you have to rely on other people. SS and Welfare, Medicare and Medicade and other government programs are our countries acknowledgement of that simple truth. The "Greatest Generation", the one that endured more hardship and adversity than you can even imagine, legislated these programs because they were keenly aware of the hardship and adversity life can dish out even to the best of people. I would not wish their trials on anyone, but, I would contend that they were the "Greatest Generation" because of it. If you cannot learn from their experience (history) you will be condemned to repeat it. And, the people around you will be very disappointed in you.
    14 May 2011, 09:58 PM Reply Like
  • The Geoffster
    , contributor
    Comments (4009) | Send Message
     
    Full government control of all activities of the individual is virtually the goal of both national parties.
    -Ludwig von Mises
    14 May 2011, 10:24 PM Reply Like
  • The Geoffster
    , contributor
    Comments (4009) | Send Message
     
    Put not thy faith in princes. If you rely on government for your gruel, you are nothing but a slave.
    14 May 2011, 10:35 PM Reply Like
  • davidbdc
    , contributor
    Comments (3141) | Send Message
     
    Whatever happened to a sense of community, where we all look out after one another. What happened to "I am my brothers keeper"
    --------------
    Its called charity. And the government has spent the past 40 years trying to limit what charities can do. Churches with kitchens? Well you now have to register and pay fees and pass inspections and it means you can't serve food to those that are hungry. Local shelters? Well, now you'll need fire inspections, building inspections, registrations, bonded employees, proven security, blah, blah, blah. Local food pantries - same deal.

     

    And its quite pathetic that since your argument is basically "you want to kill grandma" that you then decide you know whether or not I've faced any hardship in my life. And then you decide that only the government could be there to help.

     

    I'll ignore the personal attack and simply state that there is nothing the government is going to do to get you over any hardship. They will simply turn you into "relying" on their "help" forever.

     

    Its people like me that donate and contribute and sponsor the local charities that do exist, employ people that are down and out, and pay the taxes that feed this joke of a government.

     

    So next time save your lecture since you don't know a damn thing about me.
    15 May 2011, 02:00 PM Reply Like
  • buybuybear
    , contributor
    Comments (389) | Send Message
     
    Wasn't the decision to accrue more debt that would push us above this ceiling not already made when lawmakers agreed to AND extending the Bush tax cuts AND extending unemployment benefits back in Dec 2010?

     

    thinkprogress.org/2010.../

     

    Why couldn't they settle on NEITHER extending the tax cuts NOR extending the unemployment benefits?

     

    Surely, then we'd have this debate in a couple of months....

     

    I am saddened by the inaction of our leaders and fear they will eventually ruin us....

     

    People will only take it so long....

     

    seekingalpha.com/news-...
    14 May 2011, 06:41 PM Reply Like
  • nmelendez
    , contributor
    Comments (1622) | Send Message
     
    You really are a pessimist. I am looking at the bright side. If the dollar devalues and you make more money, china's dollars really are not going anywhere, except down. This is an economic war being waged right now. Sorry but i stand by my country. If China wants their 1.2 trillion USD, print it and give it to them. Their loss.
    14 May 2011, 07:25 PM Reply Like
  • Monngie
    , contributor
    Comments (928) | Send Message
     
    HMMMM, do I give tax cuts to the rich, or do I help someone who can't find a job in a job market that has 8.5-9% unemployment. Jeez, that's a tough one...........for someone with the values and personality of Ebenezer Scrouge.
    14 May 2011, 10:03 PM Reply Like
  • davidbdc
    , contributor
    Comments (3141) | Send Message
     
    If you don't give trillions to my rich banker friends the world as we know it will come crashing down! Geithner 2008/2009

     

    If you don't give trillions to my rich politician and bureaucrat friends the world as we know it will come crashing down!! Geithner 2011

     

    Give me a freaking break! Fool me once shame on you.... fool me twice.......

     

    No increase in the debt ceiling. Start cutting spending Timmy boy!

     

    Cut the department of education. Cut the department of commerce. Cut the department of transportation. Close 2/3 of overseas military bases. Cut all bureaucrats salaries by 30%. Cut their pensions by 30%. Raise the social security retirement age to 70.... tomorrow. Freeze Social Security payments for three years - means test it. Raise the age for Medicare to 70..... tomorrow. Throw the 75% of the people "claiming" disability that aren't really disabled off of the gravy train. No federal loans for for-profit schools. Tell people to start taking responsibility for themselves. The list of easy cuts is very long. Tell the crybabies to grow up and act like adults. If you lived for 65 years and you have nothing then you'll live a poor life for the remainder of your years. Maybe then those behind you will actually save some money - pay off their mortgages - keep themselves in good shape - and generally expect to look out for themselves.

     

    I'm so sick and tired of hearing everyone crying about everything. Balance the damn budget this year. Living within our means isn't a bad thing. What we really need to to stop voting for Republicans and Democrats - the two parties have sold out our country in favor of their own special interests. Cut off the money and weaken their power.
    14 May 2011, 07:19 PM Reply Like
  • nmelendez
    , contributor
    Comments (1622) | Send Message
     
    What? and the GOP risk not getting it's pet projects funded? No way. Just hold all govt. payments, including military, SS and Medicare, for 1 month and see what happens? jejejeje. Watch that debt limit rise.

     

    BTW just a quick observation.."If i owe the bank 10,000 dollars, I have a problem, If i owe the bank 1,000,000,000 dollars, the bank has a problem." I really think China has a BIG problem. :)
    14 May 2011, 07:20 PM Reply Like
  • Cherry Picker
    , contributor
    Comments (383) | Send Message
     
    $2.5 trillion has been looted from Social Security and has never been paid back. This story is beginning to sound more Orwellian by the day. Make way, school teachers and firefighters, you are about to be replaced as poster children for the ruination of America by old people and the sick. Social Security and Medicare will be portrayed as an evil plot to suck the lifeblood out of the young. Through the magical art of manipulation, the public is now seeing the poor, the old, the infirm and the working class as the enemy. While trillions have been looted and the richest of the rich pay next to nothing while siphoning wealth both day and night, we are being turned against one another, both Republican and Democrat, while the looting runs rampant, attempting to harvest every last dollar before the whole house of cards collapses.
    14 May 2011, 07:55 PM Reply Like
  • Monngie
    , contributor
    Comments (928) | Send Message
     
    Cherry Picker......it's called divide and conquer. Your right on.
    14 May 2011, 10:07 PM Reply Like
  • TomasViewPoint
    , contributor
    Comments (4845) | Send Message
     
    Tim G is just covering his butt because he has to say something to appear like he is managing something. Truth is interest rates are going up regardless unless Ben B keeps buying UST's in which case we have inflation. Household wealth is already gone down and continues to go down as costs of food and energy eat into DI and incomes do not increase to offset it.

     

    I would short UST's over the next year regardless of debt ceiling gymnastics because we are in over our heads and Ben B is buying a huge share of the UST's that are being floated and thereby keeping rates down. That is not sustainable.

     

    It is pain regardless of what we do next but it is clear we will not be able to continue to borrow $.42 of every dollar spent. Nobody needs a calculator to understand that is a huge problem.

     

    All the political rhetoric is getting to be a side show as the reality of our fiscal situation is slowly marching its way on to center stage.
    14 May 2011, 11:53 PM Reply Like
  • nmelendez
    , contributor
    Comments (1622) | Send Message
     
    1 question, if treasuries are paying max 4.2 % on 30 year treasuries, where do you come up with the 42 cents of every dollar? I am still waiting for a reasonable explanation, from other people even.
    15 May 2011, 12:07 AM Reply Like
  • TomasViewPoint
    , contributor
    Comments (4845) | Send Message
     
    That's the gap between revenues and expenditures at the Federal level and is of course why we are issuing debt. If we spent $1 for each dollar received in tax reciepts we would not be issuing new debt and we would hold the debt where it is at today at $14 Trillion plus last I seen.
    15 May 2011, 12:48 AM Reply Like
  • bryantlm
    , contributor
    Comments (2) | Send Message
     
    Do away with Bernanke, Tiny Tim, Education dept, get us truly out of Iraq and Afghanistan, end any Libya involvement, merge energy & EPA or better yet get rid of them! End the Fed; put us back on a true gold/silver standard! Plus I'm sure there is more fed/state fat to cut! Not to mention the pensions & health plans of career elected officials in WashDC. Maybe term limits on congress will also help!

     

    Pay interest on the debt, of course!

     

    Time and these cuts plus a flat tax will end the debt. Then you can restructure medicare, medicaid and social security (eliminating fraud would help). Once Obama is gone, we can completely repeal Obamacare! For now don't fund any part of it and anyway it may get the unconstitutional stamp on it.

     

    I'm sure there are other solutions but I definitely would not raise the debt ceiling or do away with it if some see it as draconian!
    15 May 2011, 07:27 AM Reply Like
  • nmelendez
    , contributor
    Comments (1622) | Send Message
     
    Why am i not surprised Defense spending, closing overseas bases and bringing our troops home were not included. You forgot to erect a Berlin...oops, US wall so no one can come in or get out.
    15 May 2011, 10:52 AM Reply Like
  • bryantlm
    , contributor
    Comments (2) | Send Message
     
    I did mention defense spending (Iraq, Afghanistan and Libya are definitely defense!)! No I didn't mention closing more bases simply because I forgot! Please read more closely. Thanks!

     

    The point was that the government (fed,state and local must shrink!) Lots of ways to "skin the proverbial cat" but raising the debt ceiling above $14.3T is not one. If we want to avoid a true default/dollar collapse cuts must begin now! Come up with solutions and write your congressman/woman and senators soonest!
    15 May 2011, 03:14 PM Reply Like
  • nmelendez
    , contributor
    Comments (1622) | Send Message
     
    Concede on the defense, did not read it. I agree govt must shrink but i also believe on a level playing field. Bring capitol gains taxes/dividends to 20%. No more tax loopholes for overseas companies, annual repatriation and taxing of earnings but at 25%. How about a 6% annual retirement bond with 3% minimum from me and 3% minimum from employer, gauranteed by Uncle Sam, kinda like a PBGC. SS and Medicare will work themselves out. My mother is 85. She pays for caregiver, food, medicine, etc., etc. That's 2 jobs. Many seniors on that boat. Cut Defense by 40%. That would pay our debt and start closing overseas bases. We now have Carrier Strike Groups for that.
    15 May 2011, 07:47 PM Reply Like
  • Killer454
    , contributor
    Comments (783) | Send Message
     
    "I agree govt must shrink but i also believe on a level playing field. Bring capitol gains taxes/dividends to 20%. No more tax loopholes for overseas companies,"

     

    A level playing field would mean that investment income would only be taxed once - either at the corporate level or individual level but not both. And it would also mean a flat rate tax with no exemptions, deductions or credits for anybody for any reason whatsoever.

     

    That's what a level playing field is - treating everyone exactly the same regardless of their circumstances.
    15 May 2011, 08:02 PM Reply Like
  • nmelendez
    , contributor
    Comments (1622) | Send Message
     
    "That's what a level playing field is - treating everyone exactly the same regardless of their circumstances."

     

    I agree, but individual/corporation will have to pay tax /deduction annually on gains/losses whether you sell or do not and the tax rate is same for all, no loopholes. No more rolling over gains while everyone else pays annual taxes. If i have to pay annual income taxes on earnings so does everyone else! That would be a fair field.
    16 May 2011, 04:38 PM Reply Like
  • Killer454
    , contributor
    Comments (783) | Send Message
     
    Uh no, there is no gain on investment until you sell it.

     

    You do not have to pay tax on wages until you get the cash in your hands,

     

    Until you realize a capital gain in cash, you should not pay taxes either.
    17 May 2011, 10:40 PM Reply Like
  • nmelendez
    , contributor
    Comments (1622) | Send Message
     
    So you get to roll over your gains? nope, do not agree. You wanted a level playing field. A gain is a gain whether you use it or not. I say pay taxes annually on ALL gains, including property, stocks, bonds etc, etc. Same applies to loses. No more rolling over for free. What's the difference?
    18 May 2011, 02:53 PM Reply Like
  • HA65MPH
    , contributor
    Comments (1366) | Send Message
     
    DISLIKE !
    19 May 2011, 03:25 PM Reply Like
  • alexbrooklyn
    , contributor
    Comments (93) | Send Message
     
    Republicans are wholly hypocritical on this debt ceiling question. They will raise it otherwise the resulting crisis will mean bye bye to tax cuts for the riches...
    15 May 2011, 08:11 PM Reply Like
  • wkl
    , contributor
    Comments (289) | Send Message
     
    1776-1913 No income tax or corporate tax. How did we ever survive?
    And yet America had so much to offer the rest of the world, that America was the destination of most immigrants.
    15 May 2011, 08:22 PM Reply Like
  • Herr Hansa
    , contributor
    Comments (3079) | Send Message
     
    en.wikipedia.org/wiki/...

     

    People generally did not live as long, which meant a faster turn-over in the workforce. I suppose a morbid way to look at this would be that there are too many people. Given a lower population, unemployment would drop. With a lower life expectancy, there would be less pressure upon Social Security payouts, because people would not be collecting that many years. That era also saw almost no sanitation, nor trash removal, in major cities. Few diseases could be cured, nor controlled, so death from numerous causes was more common. So are you suggesting we go back to the 1800s?
    15 May 2011, 08:33 PM Reply Like
  • wkl
    , contributor
    Comments (289) | Send Message
     
    No Karl, I guess I am suggesting nothing. I am ready to give in and allow your experiment to be tried on American society. No more property rights, no more capital gains. Whatever I have will be turned over for the betterment of the general public. How selfish of me to beleive that I should live my life based on my own self interest. After all, with our society's entire wealth in the hands of our trusted officials all ills that we face will surely be solved. Just think! No more killer diseases. All members of society with the same income level. Everyone with a beautiful house on a hill. No crime because all people will have all they need. You are exactly right, the American experience was a failure and really f'd the human race.
    15 May 2011, 09:23 PM Reply Like
  • Herr Hansa
    , contributor
    Comments (3079) | Send Message
     
    Hah hah! Too funny. Check out some American history:

     

    Panic of 1796–1797
    Panic of 1819
    Panic of 1837
    Panic of 1847
    Panic of 1857
    Panic of 1873
    Panic of 1884
    Panic of 1893
    Panic of 1896
    Panic of 1901
    Panic of 1907

     

    My name is not Karl, though I expect you are simply trying to make a slur against me because I am German. Regardless, this is what "my experiment", as you call it, would appear:

     

    Flat tax for all, including corporate, with no deductions.
    Two terms only in any Federal Government position of Congressman, Senator, or the President.
    Continue Social Security and Medicare deductions on paychecks over the $85K level; let those who make more contribute to that system to keep it going; the additional collection should balance it while the age cut-off is raised.
    Stop all welfare and stop feeding the homeless, then increase the sizes of Police forces to fight the increase in crime that would result. Of course, many would find this last item cruel and heartless.

     

    The reason so many came from Europe to the US in the 1800s was due to war and oppression in Europe, as well as the idea of possibly a better future. As migration has become easier, it has become a part of history all over the world.

     

    I would never claim that Germany has it better than the US, because there are problems there too. Outside of moving to Monaco, I don't know of any place without taxes, nor without problems. So might as well try to live within the current situation and make the best of it, which is why we invest.
    15 May 2011, 11:15 PM Reply Like
  • TomasViewPoint
    , contributor
    Comments (4845) | Send Message
     
    HerrHansa

     

    The US came into being because we had "taxation without representation" and that led to a revolution against the big mother ship England. We still don't like taxes here that much and especially when able bodied people are sucking off the government teat and people are working almost 6 months per year before they make their first $ to take home. That is criminal racketeering. Never mind the plundering of Social Security and the slush fund that has become.

     

    People came to the US for a number of reasons not the least of which is starvation as in the Irish potato famine. And then a lot of petty wars between rulers and a class of people who thought they were better than everyone else. And all the people who wanted to be independent of all the BS and hard times and make their own way got a ticket and left and never went back. America was a dream and they loved it. I know because I know my immigrant ancestors.

     

    Now generations later many of the sons and daughter of these great immigrants are obese, lazy and stupid. And politicians use the tax mechanism to centralize power around themselves and becoming a ruling elite paying favors to their vassals and taking it from the productive class.

     

    We have come full circle and we should be satisfied?
    16 May 2011, 12:44 AM Reply Like
  • Herr Hansa
    , contributor
    Comments (3079) | Send Message
     
    Thumbs up, and I don't think people in the US should be satisfied with their government. Seems to me that a great deal of reform is needed. I think most people see that, though like someone recently stated: "don't let a crisis go to waste". So people who look to gain from the situation move it towards what they perceive as gain, rather than just coming up with solutions.

     

    Like you point out, too many have become fat and lazy. Unfortunately if you cut them off cold turkey, they will turn to crime, or you will have massive civil unrest in the cities. As much as I would like to see some entitlements end, I understand that they have to be removed in steps. Cutting everything all at once just causes turmoil and chaos. The other issue is rampant fraud, and lots of people getting entitlements know how to work the system.

     

    I certainly don't think the United States is on a sustainable path. Spending is out of control, and not just at the Federal level. Maybe the answer is to dump the system, have a revolution, and start over, but when that happened in other parts of the world in the last couple decades, it was a tough and ugly process.
    16 May 2011, 01:31 AM Reply Like
  • HA65MPH
    , contributor
    Comments (1366) | Send Message
     
    DISLIKE
    19 May 2011, 03:25 PM Reply Like
  • Killer454
    , contributor
    Comments (783) | Send Message
     
    And one more thing regarding all the comments on here about the so-called "rich" being "given" tax cuts.

     

    People keeping their own money are not being "given" anything - it was their own money in the first place regardless of whether they are rich, poor or anywhere in between.

     

    Neither does refraining from taking someone's money away from them constitute a government "expenditure".

     

    Anyone who is paying more in taxes on an absolute dollar basis than the absolute dollar value of government services that they are personally receiving in return calculated on a user fee basis is already paying more than his or her "fair share" . No one's income or wealth level is a "service" that has been provided to them by the federal government.

     

    We now have over have the population who are not paying any federal income taxes. This is NOT because they aren't getting any government services.

     

    If there are going to be any tax increases, they can start with making those people start paying something to for the government services they are getting just like the rest of us do.
    15 May 2011, 08:14 PM Reply Like
  • HA65MPH
    , contributor
    Comments (1366) | Send Message
     
    forcing debts out of hiding, and forcing Americans to face their true problems....''' TRUE PROBLEMS ' ARE WITH THE 'CON-GRESS
    16 May 2011, 03:29 PM Reply Like
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