President Bush's Mess

[poppy]

Go to the Treasury website link I posted earlier. Create a report from 1/19/1993 to 1/19/2001; that period covers Clinton's eight years. You will see that the national debt is greater when he left office than on the date he was sworn in. The report depicts the debt every single day of each of the eight years. Scroll through each year and you will see that the debt grew larger each year. There is only one way that this could have happened: budget deficits each and every year.

I disagree. I could have personal debts that are acummulating interest I'm not paying. At the same time I could be spending less than my estimated budget from my income so I have extra money left that I could pay on my debts. Instead I stay out late getting high and charging hookers to my credit cards who's statements I toss in the trash every month ( I could have said give money to the church but what the hell, it's my imaginary money). Now I don't have budget deficits at all but my debt continues to rise. The two are separate issues.

 

[30ashopper]

I had to come back to this after re-reading these posts. Are you two talking about the same thing here? Isn't the budget something that ends each fiscal year and the national debt just runs on and on? In other words, if you have a budget and spend less than that budget amount you get a surplus, and if your budgets have a trend of less spending this is where one can project an accumulated surplus for years to come assuming revenues stay pretty much stable. This money can then be spent to reduce the national debt, give tax cuts, start a war, give no bid contracts to your VP's former companies, send billions to a foreign country and lose it because of nonexistent accounting, and maybe then have enough left over to blow on some really dumb sh_t.
I'm no economist so if I'm wrong please, anyone, feel free to set me straight on this one.

You have it right, I think. Simply put, every year the federal government takes money from somebody - that's income. Every year the federal government spends money on stuff. (Social security though is not part of this, FDR and the Congress in the 30's made sure of that.) Independent of SS, the federal government's budget has been out of whack for years. e.g.

yearly income - yearly cost of stuff = negative number

That negative number gets added to the 'public' national debt every year, which currently stands at around 6.2 trillion. That is money you and I and everybody else owes to somebody, most of whom are outside the U.S. (The central banks of China and Japan are big holders.) We also pay interest on those loans, which makes up a solid chunk of the federal budget every year. (You and I are making interest payments to the Central Bank of China, just like you would make your XX% interest payments on credit card debt you couldn't pay off.)

Social Security is different - SS income vs. expense is seperated in the books. SS currently runs a surplus - it takes in more than it spends, every year SS posts a profit. The Federal Government borrows this profit just like it borrows from China. Bill Clinton's 'surplus' during the last two years of his presidency was basically -

(fedgov yearly income + borrowed ss surplus) - (yearly cost of stuff + debt interest payments) = positive number

Look at SS as a bank the feds can borrow money from. When the feds borrow the surplus from SS, they are borrowing from you and I. When they borrow it, they promise to pay it back later, with interest, just like China. They take that money and they spend it, on bridges to nowhere, wars, Dick Cheney's former employers, NO, dams, Amtrak, farm subsidies, medicare, medicaid, food stamps, veterans benefits, etc.. The total 'intergovernmental' debt the federal government has wracked up in this department is around 4.3 trillion.

If you add the total for both of these together, that's the total national debt. It currently stands at about 10.6 trillion. (The stimulus package coming down the pipe will get added to the first part, assuming China and Japan agree to extend us the credit.)

The really bad news - In about a decade, SS will no longer generate a surplus. The SS administration will turn to the federal government and say, "yo dude, can I cash in some IOU's?" We are really screwed then. The feds will no longer have the SS bank to borrow from, and worse, they will have to start paying the loan off.

Hope this helps.

 

[traderx]

I disagree. I could have personal debts that are acummulating interest I'm not paying. At the same time I could be spending less than my estimated budget from my income so I have extra money left that I could pay on my debts. Instead I stay out late getting high and charging hookers to my credit cards who's statements I toss in the trash every month ( I could have said give money to the church but what the hell, it's my imaginary money). Now I don't have budget deficits at all but my debt continues to rise. The two are separate issues.

Interest on the debt is a budget line item. If you have a surplus at the end of any period, total debt will decrease. If you have a deficit, total debt will increase.

 

[poppy]

You have it right, I think. Simply put, every year the federal government takes money from somebody - that's income. Every year the federal government spends money on stuff. (Social security though is not part of this, FDR and the Congress in the 30's made sure of that.) Independent of SS, the federal government's budget has been out of whack for years. e.g.

yearly income - yearly cost of stuff = negative number

That negative number gets added to the national debt every year, which currently stands at around 6.2 trillion. That is money you and I and everybody else owes to somebody, most of whom are outside the U.S. (The central banks of China and Japan are big holders.) We also pay interest on those loans, which makes up a solid chunk of the federal budget every year. (You and I are making interest payments to the Central Bank of China, just like you would make your XX% interest payments on credit card debt you couldn't pay off.)

Social Security is different - SS income vs. expense is seperated in the books. SS currently runs a surplus - it takes in more than it spends, every year SS posts a profit. The Federal Government borrows this profit just like it borrows from China. Bill Clinton's 'surplus' during the last two years of his presidency was basically -

(fedgov yearly income + ss surplus) - yearly cost of stuff = positive number

Look at SS as a bank the feds can borrow money from. When the feds borrow the surplus from SS, they are borrowing from you and I. When they borrow it, they promise to pay it back later, with interest, just like China. They take that money and they spend it, on bridges to nowhere, wars, Dick Cheney's former employers, NO, dams, Amtrak, farm subsidies, ss benefits, medicare, medicaid, food stamps, veterans benefits, etc.. The total debt the federal government has wracked up in this department is around 4.3 trillion.

If you add the total for both of these together, that's the national debt. It currently stands at about 10.6 trillion. The stimulus package coming down the pipe will get added to the first part, assuming China and Japan agree to extend us the credit.

The really bad news - In about a decade, SS will no longer generate a surplus. The SS administration will turn to the federal government and say, "yo dude, can I cash in some IOU's?" We are really screwed then. The feds will no longer have the SS bank to borrow from, and worse, they will have to start paying the loan off.

Hope this helps.

Yes, and I'm fully aware of the SS problem because I expect my fair share in less than ten years. If it goes belly-up the blame falls on all 535 members of congress and all of their predecessors who knew of this problem and passed it on.:angry:

 

[poppy]

Interest on the debt is a budget line item. If you have a surplus at the end of any period, total debt will decrease. If you have a deficit, total debt will increase.

Thanks for the info

I wonder if I could apply the Feds accounting principles to my hooker and booze scenario and present it to my creditors? :roll:

 

[scooterbug44]

First, let me say that I have just come back from a wonderful dinner at a New Orleans Style restaurant in Gainesville celebrating our big win last night. I was in a joyous mood, because, you know, we're national champions (again ), and I get to see some improv comedy later tonight. And then, wanting to kill time before the comedy show, I got on the computer and was somehow drawn, as if in a trance, straight to this thread.

And now my joy is gone.

Winnie, to give you the most direct of an answer as I can: The reason why so many people believe President-Elect Obama is inheriting a "mess" is because most humans have short term memories; like memories lasting up to 8 years. We had a budget surplus once, now we don't. We were relatively safe (at least we thought we were) and now we're not. When we looked into the international mirror, we saw a kind and just nation that had the world's best interest in mind, I still see this reflection, but unfortunately most of the international community does not.

Obama is not inheriting a "mess," he's inheriting a catastrophic quandary that has no simple or direct solutions-God help him. President Bush didn't cause all of our problems, nor could he have prevented many of them, but there has been a massive leadership vacuum since our Invasion of Iraq. The reason why you felt secure, confident, and glad that George W. Bush was elected President on September 11th, 2001, was because our President showed up and led that day, and the few days that followed.

Fulltime, I can't really take your word on your preeminence over all things New Orleans since the only thing I know about you is your posting name "fulltime." But while giving money to NO may not seem like the prudent or fiscally responsible thing to do in the aftermath of a calamitous hurricane, it does shore up any lingering physiological wounds. Imagine that instead of President Bush making a heroic return to Ground Zero shortly after the 9/11 attacks, he simply circled over the city a few days afterward in AF1, and then made a brief speech a month later promising federal help and attention, and then not keeping that full promise. I don't think Winnie would have been entirely comforted by the President then. She would have probably preferred Al Gore and a speech on the dangers of CF's in the atmosphere.

There are times for state solutions, and there are times for national solutions. We're in a crisis right now, and it's something that one state won't be able to solve on its own, nor is it a crisis that demands a revolution, nor a crisis where we can afford to simply sit back and let things go the way they've gone all in the name of a conservative ideology, rather than the realism of pragmatism. We're going need big government and we're going to need someone to hold our hand for a while. We'll be lucky if we get to mock the nobel winning economists today who ascribe to the keysnian view, and then get to decide whether continue down the perilous path of apathy once again.

Folks, we have 10 days, 13 hours, and four minutes to figure out who's to blame. But after that, this young person is going to demand that for my generation's sake, we begin to look for the solutions on how we can help our neighbors, and ultimately ourselves.

And I'm late for the Improv.

Thank you for this nugget of reality and eloquence amongst all the poo and posturing.

There are those who claim to know how to do things better and have vision beyond that of the oracle at Delphi, yet never actually DO anything and then there are those who let their actions speak louder than words.

The time for talkers is over and we need doers more than ever.

 

[traderx]

Thanks for the info

I wonder if I could apply the Feds accounting principles to my hooker and booze scenario and present it to my creditors? :roll:

Poppy, I acutally think you should apply for a grant to cover your going in the hole.

 

[John R]

In response to your statement, I think you're mixing two entirely different situations. One is a localized natural disaster, the other is the failure of our banking system. I have no problem with the government helping out NO, but first and foremost I feel it is the state's responsibility. I think we should always be looking for ways to limit the federal government, not expand it.

NO would not be the first city/state to receive federal funds for emergency relief. Are you against the funds being spent on the world trade center revitalization?

again, my statement was a 'what if' scenario, can we agree on that at least?

Well this is one area you and I disagree on. The banks signed contracts, if they survive they will pay it back, with interest. If I'm wrong and they all fail, god help us all.

let's hope you're right, but i won't be holding my breath.

 

[30ashopper]

NO would not be the first city/state to receive federal funds for emergency relief. Are you against the funds being spent on the world trade center revitalization?

I'm against federal government involvement, in general. I feel we should constantly try to limit the powers of the central state whenever we can.

 

[AustinPowers!]

I'm against federal government involvement, in general. I feel we should constantly try to limit the powers of the central state whenever we can.

I believe we had a war about the issue of the power of the states vs the power of the federal government. We are ONE nation divided into states that all contribute to a central federal government that should provide for the people that it represents, in this case the people of NO.