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sturner wrote:

robco, don't forget the real surplus that Gov. Bush inherited from a Democratic Govenor. In one year he had eliminated the  surplus, by year two we were in a deficit. The man was a financial genius.

The surplus was based on assumption of continued tech boom, reduction of military spending, reduction of intelligence spending, and some fancy book keeping.

The tech bubble started to burst before Bush took office.
After 9/11 - both military and intelligence spending had to be increased.

The republicans will NEVER make the sort of cuts they yammer on about and I can tell you exactly why.
The states that represent the heart of the republican base are mostly poor, struggling states who receive a great deal more back from the Fed than they send in as federal taxes.  Think Oklahoma, Mississippi, Luisiana, etc.
Cutting the government would mean taking cash out of the hands of the voters who keep them in power. Thats the irony of the situation, poor residents of failed states supporting politicians that want to impoverish them even more than they are.
Heck, if the Fed ever shut down Tinker AFB Oklahoma city would just dry up and blow away.

JakeTheTall wrote:

Pariah wrote:

The republicans will NEVER make the sort of cuts they yammer on about and I can tell you exactly why.
The states that represent the heart of the republican base are mostly poor, struggling states who receive a great deal more back from the Fed than they send in as federal taxes.  Think Oklahoma, Mississippi, Luisiana, etc.
Cutting the government would mean taking cash out of the hands of the voters who keep them in power. Thats the irony of the situation, poor residents of failed states supporting politicians that want to impoverish them even more than they are.
Heck, if the Fed ever shut down Tinker AFB Oklahoma city would just dry up and blow away.

Texas is a significant exception to that notion.

Ya, Texas is about 1:1 now. But the fact remains that some of their base is on welfare and they cannot afford to loose any of their base at all.

robco wrote:

To be fair, the "surpluses" Bush II inherited were mostly smoke and mirrors. But cutting taxes on the wealthy and starting two wars weren't exactly a good idea. What we need, but will never get, is someone who has the cajones to admit that we're going to need to increase revenue and reduce spending for a while before we can begin to speak of tax cuts. We've gotta pay down the massive debt. The interest alone is already killing us. For the amount we pay to service the debt, we could easily provide health care and improve education. But entitlement reform is a massive third-rail and reining in military spending is also off the table.

Unfortunately the feds are heading for a situation similar to what CA is currently undergoing and it's not pleasant.

No, the surpluses were nonexistent because it raided the Social Security surplus. It was just the same old story: borrowing against the future to finance the present.

In any case, the surpluses were inflated a bit and some accounting sleight of hand done, but we were moving in the right direction. That all was blasted to hell after the tax cuts for the wealthy and Afghanistan and Iraq.

Then again, at this point our whole economic system is pretty much one gigantic fraud.

The method of reporting was changed around 2000 or so where the SS surplus was broken out of the federal budget. When that happened, two years were still shown to be in surplus. I'll post the pdf when I get a chance.

Private debt is truly frightening. Unfortunately people and businesses living within their means and paying down debt has a detrimental effect on the entire economy. The only thing I can think of is to find some way to address the income inequality gap. When people can afford to consume, that's good, but borrowing beyond our means is not. "Leveraging" is not a long-term strategy and is incredibly risky. The piper is now anxiously tapping his foot awaiting long overdue remuneration.

Because we've shifted demographically. Being middle class meant that you had positive net worth - you had assets. But today most people aren't middle class, but they have the symbols of middle class status. The lease nice cars, they take out second and third mortgages to buy more stuff. Today it's not about how much you have in assets and how well you manage it, but how good your FICO score is. That is a poor reflection of fiscal responsibility because if you don't take on debt, you have a low score. Because most places don't bother to look at anything other than a credit score, they make poor decisions about whether or not to extend credit and by how much. The idea of actually owning a home seems quaint - why leave all that equity just sitting around when you can leverage it? Well, perhaps as a security in case things go bad, but that view is squashed.

The system has adapted because people don't have money to buy things but sellers still need to sell things. So instead of demanding better wages and such, we've settled for allowing the elite to extend credit to the masses and it hasn't exactly worked out too well.

Funny how the Germans can have a 32 hour work week, a heavily unionized work force, high wages and a thriving middle class even as they remain the worlds number one exporter of goods while here in the States we flounder around thinking "The Market" will just work everything out.
Pathetic.

Pariah wrote:

Funny how the Germans can have a 32 hour work week, a heavily unionized work force, high wages and a thriving middle class even as they remain the worlds number one exporter of goods while here in the States we flounder around thinking "The Market" will just work everything out.
Pathetic.

What do you think they are doing differently that makes the difference?

resedit wrote:

Pariah wrote:

Funny how the Germans can have a 32 hour work week, a heavily unionized work force, high wages and a thriving middle class even as they remain the worlds number one exporter of goods while here in the States we flounder around thinking "The Market" will just work everything out.
Pathetic.

What do you think they are doing differently that makes the difference?

Pretty much the opposite of what America does, really.

But here's one for you: they don't suppress (or even deflate) wages like you guys do.

I'm just curious, because other sites I've been to gives different reasons for Germany's current success than unions or high wages.
For example:

Exports have boomed thanks to German expertise in capital and intermediate goods used to make other products that are currently in demand and which have not been seriously affected by the rise of the euro.

http://www.industryweek.com/articles/ex … 16091.aspx

That suggests they found a very good niche to fill.

resedit wrote:

I'm just curious, because other sites I've been to gives different reasons for Germany's current success than unions or high wages.
For example:

Exports have boomed thanks to German expertise in capital and intermediate goods used to make other products that are currently in demand and which have not been seriously affected by the rise of the euro.

http://www.industryweek.com/articles/ex … 16091.aspx

That suggests they found a very good niche to fill.

It's far too complicated to boil down to a sentence or two.