Abolish the debt ceiling before it commits austerity again

What remains to be seen is if GOP donors will allow them tank the economy in order to ensure wins in 2022 and 24.

41 thoughts on “Abolish the debt ceiling before it commits austerity again

  1. They are already blaming on the Democrats. Funny how important the debt ceiling is when there is a (semi) Republican in the Oval Office. The scary part is a majority of folks are blaming the Dems for what should be a simple Yes vote for any representative who believes it is NOT a good ide for the country to default.

    Political power plays at the risk of our economy is worse than any kinds of Social Democratic spending plans put forth by Biden and the House. McConnell’s brain works one way and one way only. “It matters not what we do to the country as long as we end up back in power so we can screw it up….AGAIN.”

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    1. When banks give people who are questionable credit risks a card with a low limit, it is not an act of cruelty. They are protecting the person from digging too deep a hole.

      Similarly, Democrats must be protected from themselves.

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  2. Democrats are like teenagers with daddy’s credit card. No concept of controlling spending. Biden and co want to add 7 trillion to the debt in ONE YEAR???? Are you people really that stupid? (did I really need to ask that)

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    1. The article (if you’d read it) makes a very compelling case for why the federal government of the United States is considerably different than yours or my household budget—“daddy’s credit card” and whatnot. The author cites examples of people from both parties agreeing with the premise.

      I’m busy at the moment, but I’m sure one of my fellow “Democrats” will be happy to share some stats on how much Republicans have added to the deficit over the years. Money for The police state and tax cuts for the wealthy have to come from somewhere after all.

      Liked by 1 person

      1. There is ZERO difference between household debt and government debt in the context of having debt, debt to income ratio, having to repay debt, having to pay interest on debt and going into default if you cannot pay debt. Have you already poo pooed Greece as as an anomoly? Do you socialists revel in self destruction?

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        1. Republicans run up the debt every administration from Reagan, through Bush and Trump. Instead of paying through taxes, they borrow. During the last administration the ration of debt to GDP is the highest recorded since WW2, at 129% (WW2 was around 113%).

          Reagan, 186%; Bush the Elder, 54% (4 years); Clinton, 31.6%; Bush the Younger, 101%; Obama, 74%, Trump, 33% (4 years)

          It is pretty obvious that the biggest increases are in Republican administrations. And Obama inherited an economy on the brink of collapse worldwide. Even with that, after 8 years, he had shrunk the annual deficit dramatically as he promised. Yes, this is a bit simplistic, but it points out the baloney in conservative circles about fiscal responsibility during Republican administrations.

          https://www.thebalance.com/us-debt-by-president-by-dollar-and-percent-3306296

          “Tax and spend” is the effort to cover our expenses and is the method Democrats try. The tax increases, a few percentage points on the top, a few for corporate taxes, some wealth taxes at the margins, etc. are designed to cover the spending over its 10 year span.

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  3. Your article makes an issue of the “debt ceiling,” but doesn’t make an issue of federal debt per se. It is both facetious and foolish to argue that the debt ceiling is bad while pretending that federal debt itself is not bad. The reality is that federal debt is inherently bad because debt must be repaid.

    When the federal debt cannot be repaid, default must occur. I think federal default is inevitable today in part because articles like the one you posted misrepresent reality.

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    1. Dude has a PhD in Economics and is the director of research at a major think tank. I assume he knows what he’s talking about. His conclusions suggest the risk of default is fully self-imposed for political reasons.

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      1. RE: I assume he knows what he’s talking about.”

        Maybe you do, but so what?

        The issue you must deal with is debt repayment.

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  4. How does one ‘commit’ austerity?

    Note that what the Democrats want is not to RAISE the debt ceiling by an agreed upon amount, they want to SUSPEND the debt ceiling, allowing them to buy as many votes as they want without limit.

    What the GOP should do is to agree to raise the limit enough to support the government at pre-pandemic levels, and no more.

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    1. I believe it’s an, admittedly, clumsy attempt at word play (commit adultery).

      Are republicans “buying votes” when they deliver tax cuts and bailouts to their constituents? Why are Democrats delivering for their constituents different? At least infrastructure benefits everyone.

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      1. It would be an exceedingly poor choice to ‘buy’ the votes if less than 5% of the electorate. Not much ROI.

        There is a huge difference between letting people keep money they rightfully earned by serving their fellow citizens. and giving stolen money from them to people who have not earned it.

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        1. “Stolen money”?

          Every tax was legislated. Every legislative act is voted on by people you selected by virtue of your participation in our form of representative democracy.

          If you don’t like the results, your recourse is simple. Convince enough citizens that you have a better idea, prove it, then get you or your candidate elected.

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          1. Bastiat characterized it perfectly 160 years ago

            “When plunder becomes a way of life for a group of men in a society, over the course of time they create for themselves a legal system that authorizes it and a moral code that glorifies it.”

            While Democrats have succeeded in making plunder legal, that does not change the underlying reality.

            You can make a case for taxation to cover a person’s share of the cost of defense and providing for the Rule of Law, but taxation for the purpose of redistribution is nothing other than armed robbery by proxy.

            Plunder by the majority of the productive minority is the basic purpose of your party, own it.

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          2. Productive minority cannot produce unless they depend upon the labor and consumption of the majority.

            That is just an economic fact of life.

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          3. Still doesn’t make theft right.

            The top 1% pays 41% of income taxes, the bottom 50% pays 3%.

            If there is a flood, do the top 1% get rescued first?

            The consumers benefit by buying from the most efficient sellers, and the labor is paid the market value of the labor. Nothing more is owed.

            Democrats take more because they have the power to do so. but that does not in any way make it right.

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          4. So why do the top pay more federal taxes, even at lower effective rates than most middle level and upper middle class quintiles?

            Short answer, of course, is they have vastly higher incomes and most of the wealth.

            Can’t really get more money from the median and lower incomes without affecting consumption.

            Our tax system is a Gordian Knot, and most, if not all the parts have been lobbied and legislated by the most powerful and wealthy folks and businesses.

            These simple observations do not mean I want redistribution to the point of total equality. However, we can’t ignore reality. If it benefits us as a nation, a free market economy and a democratic institution to have well educated and healthy workforce, we should consider how to pay for this. We already dump 3/4’s+ Trillion each year for a military that we overuse more than any nation on earth. We already pay the lion’s share of drug research. And yet we can’t build a decent road for lack of money? Or our food supply is dependent upon illegal immigrant labor to keep prices low? And we have a propensity to go to war without raising revenue. (And we go to war a lot.)

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          5. The basic problem is that we want a European style social medicine and welfare system, but we want American style taxation.

            We tax the rich far more than Europe, because we only tax income. Europe has VAT consumption taxes to fund their social programs.

            The result is that too many people see only the goodies but do not see the burden, even though it ultimately falls on them.

            http://tinyurl.com/bakers-taxes

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          6. We tax for Medicare and SS separately from federal income tax. With a cap on SS. Workman’s Comp is effectively a tax on the worker’s pay, as is health insurance.

            When any company decides to hire, the total compensation is determined by the cost to the company, of which take home pay is just a portion. Ideally, this is terrible. All this puts a good chunk of earned income in the hands of an adverse party. Adverse because labor and management are traditionally adversarial rather than cooperative.

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          7. Still doesn’t change the fact that our tax system is far more progressive, especially at the low end, than the European countries we compare our social programs with.

            As former President Obama would put it, people have to have ‘skin in the game’ and for all practical purposes, over half the people in the US don’t. That leads to a prejudice toward reckless spending.

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          8. It’s only progressive if your income comes from actual wages. If you’re primarily “paid” in stock options, dividends, or deferred compensation, like most of the ultra wealthy are, you’re taxed at the capital gains rate—effectively less than a minimum wage worker. But you know that.

            And the majority of non tax payers are children, retirees, disabled, etc. There are few actual “able bodied” non workers. You know that too.

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          9. Skin in the game is a good idea. I have mentioned that many times. Of course skin for the low income bracket is a lot less than for Gates. But even the lowest income needs to cough up an affordable amount.

            Half the people may not pay actual federal income taxes, but they do pay SS, Medicare, etc.

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          10. Which are dedicated to specific uses.

            The discretionary monies appropriated by Congress come entirely from our progressive income tax, and at least 60% of the voters do not pay enough income tax to care about the burden imposed.

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          11. SS has been blended with general revenue for decades. Most people do look at 15.3% as a tax. Whether is is spent on your SS or a bomb is moot.

            The IRS estimates that about $1 Trillion/year in owed taxes are uncollected. that would be about double the amount needed to cover infrastructure and social spending in the most generous versions of the bills in Congress now. They are projected out over 10 years and the tax shortfall would be $10 Trillion.

            And yet, Republicans are adamant about not collecting what is legally owed.

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          12. A $trillion a year? Cite?

            SS is blended in the form of special bonds which have a priority obligation on the general fund. The “blending” was just for appearances sake to hide deficits. In reality, there is still a Trust Fund, just some of its assets are special obligation government bonds.

            Regardless of how people “look at” FICA deductions, they still have no contribution to Federal spending.

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          13. Same article.

            So, $441 billion in owed but uncollected taxes(some of which has been owed for years and wouldn’t recur if collected)

            Much of that is owed but the debtor doesn’t have the money to pay it. For example, Al Sharpton’s tax debt exceeds his net worth.

            The other $560 billion includes the taxes owed on such things as the drug cartel’s unreported income.

            Good luck with that.

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          14. No contribution to federal spending? Geez, what is SS and Medicare but long term federal obligations?

            As a $20.00/hour worker why his paycheck is not $800 at the end of the week.

            Again, we might try to actually collect the Trillion we are owed each year.

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          15. SS and Medicare are independently funded, though at some point, the money borrowed from the SS Trust Fund will have to be repaid from income taxes, unless we default on the retirees.

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          16. That is all of course true. Again, not speaking for the liberal Democrats, (I don’t think most of them share my politics) but the issue is which group of people you consider “productive”—working people who have the value of their labor stolen, or the idle rich.

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          17. I don’t disagree that the valuation of executive vs skilled labor is not supported by true value, but while the marketplace is imperfect in valuing these contributions, it’s less imperfect than anything else.

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          18. So essentially, there is no market value for labor if “imperfect” is the best we can do.

            Global economics pits our labor against the lowest common denominator in the Third World. But executive pay is determined by a board of peers who will have their compensation decided by the same executives.

            Tails I win, heads you lose is not economic theory except as determined by power and influence.

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    2. Suspend the debt ceiling? Like was done during the Trump administration with no hypocritical cries from the Democrats?

      H-Y-P-O-C-R-I-T-E is the correct spelling of Republican Party. Always has been; always will be.

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  5. The national debt increased by 6.1 Trillion during Trump’s 4 years. At the same time, the debt to GDP ratio went from 104% to 129%.

    https://www.debtconsolidation.com/us-debt-presidents/

    I seem to recall the mantra of “debt is good” about the same time period. What did we get for all that debt?

    No infrastructure repairs and expansion. Some one time bonuses for some employers, Lots of stock buy backs. Unemployment did follow the same trajectory set during the previous administration, so there is that. But hiring was doing fine under Obama also.

    Of course there was COVID, which continues to affect us still.

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      1. Reagan was asked whether he wore boxers or briefs. His answer was “Depends”.
        Well, to carry out an analogy to the absurd, the Depends are full and that is the trickle you feel.

        Liked by 1 person

  6. Is a debt ceiling even a necessity? The full faith and credit clause kinda makes it stupidly redundant since constitutionally the gov’t will honor its debts.

    Liked by 1 person

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