Debt commission warns of fiscal 'cancer'

Gregg · Jul 14, 2010

This is what the commission appointed by President Obama said about the nations' future:

"The co-chairmen of President Obama's debt and deficit commission offered an ominous assessment of the nation's fiscal future here Sunday, calling current budgetary trends a cancer "that will destroy the country from within" unless checked by tough action in Washington. "

and this:
Bowles said that unlike the current economic crisis, which was largely unforeseen before it hit in fall 2008, the coming fiscal calamity is staring the country in the face. "This one is as clear as a bell," he said.

and:

"We can't grow our way out of this," Bowles said. "We could have decades of double-digit growth and not grow our way out of this enormous debt problem. We can't tax our way out. . . .

Is Bowles right? or, as Bill Clinton's former Chief of Staff, is he trying to undermine Obama? Note that the commission is co-chaired by former Senator Alan Simpson of Wyoming, a Republican.

http://www.washingtonpost.com/wp-dyn/content/article/2010/07/11/AR2010071101956.html

Plot Device · Jul 14, 2010

The part where he says "We can't grow our way out of this" is all by itself the most important statement he could make.

Growth is an activity that is inherently incapable of continuing ad infinitum. It MUST come to an end at some point. And because (over the past 60 years) we restructured our entire economy on the insanity-based notion of "endless growth," we were doomed to hit a brick wall eventually.

And thus we did.

I hope to god he doesn't get fired for such candor. We need more reason in Washington, not more fantasies.

GregB · Jul 14, 2010

How would telling the truth about the long-term debt problem be undermining Obama, who formed the debt commission to report on the long-term debt problem? It might be undermining the yahoos in Congress who don't want to raise taxes or cut Medicare/SS/defense spending.

Don · Jul 14, 2010

This is the train behind "the light at the end of the tunnel" that some people have been warning about for decades. Like every other warning, it will be ignored.

SPMiller · Jul 14, 2010

And in the end, it doesn't matter.

thothguard51 · Jul 14, 2010

And of course, this will hit the middle class the hardest...

Gregg · Jul 14, 2010

What really bothers me is when some local politician proclaims "we can do this project because there are federal funds to (help) pay for it".
There are no funds - the federal deficit just passed $1 Trillion - with 3 months left in the fiscal year.

We need to start at the local level and tell the Feds that we don't want their money - and we don't want them to give "our money" to someone else. And move up the ladder from there.

Plot Device · Jul 14, 2010

My two cents (which ain't worth the copper it's struck from with current rates of inflation) is that this crisis will NOT merely cause us major setbacks. It will NOT merely require we make some radical changes.

Nope.

I say we've already passed the point of no return and that we are soundly fucked.

Maxinquaye · Jul 15, 2010

It will be described as "not a problem". Trying to do something will be framed as "politicians being evil toward [insert some underpriveleged group here]. It's sort of like in the UK where the debt has been revealed to be $6 trillion, instead of just $1.5 trillion (as was said under the previous government).

There's no way around that but slashing everything. The UK has 60m people in it, and has 6 times the debt of the US (with 260 million people). I feel bad for my friends in the UK at the moment.

Shadow Dragon · Jul 15, 2010

Maxinquaye said:
It will be described as "not a problem". Trying to do something will be framed as "politicians being evil toward [insert some underpriveleged group here]. It's sort of like in the UK where the debt has been revealed to be $6 trillion, instead of just $1.5 trillion (as was said under the previous government).

Yep, so that leaves politicians two choices. Do the right thing money wise and get blasted by (insert special interest group), probably causing him to lose the next election. Or pander to people and thoroughly screw over future generations. Sadly, I think most politicians would gladly pick the latter.

icerose · Jul 15, 2010

Maxinquaye said:
It will be described as "not a problem". Trying to do something will be framed as "politicians being evil toward [insert some underpriveleged group here]. It's sort of like in the UK where the debt has been revealed to be $6 trillion, instead of just $1.5 trillion (as was said under the previous government).

There's no way around that but slashing everything. The UK has 60m people in it, and has 6 times the debt of the US (with 260 million people). I feel bad for my friends in the UK at the moment.

We have something like 13 trillion in debt, as far as I understood it, one trillion has simply been added on top of it this year alone.

I could be wrong.

What the politicians need to do is burn the current budget and make a new one. Take the money we have, pick a debt to pay off first and restructure the damn thing from the bottom up rather than modeling it after a budget that is adding debt at an alarming rate.

Don · Jul 15, 2010

icerose said:
We have something like 13 trillion in debt, as far as I understood it, one trillion has simply been added on top of it this year alone.

I could be wrong.

We're talking US only now, just for clarification. Check out the nifty display at http://www.usdebtclock.org/ if you want to see the real ugly.

That $13 trillion ($43 k per citizen) is just the on-the-books debt of FedGov. Add in $3 trillion for state and local Gov, personal debt, consumer debt, etc. and you're up to $175 k/c.

Don't forget the unfunded liabilities to seniors. Medicare, Soc Sec, the drug plan add another $110 trillion ($354 k/c) to the bill.

Note the clock has no number for unfunded liabilities for welfare programs, but there are over 40 million food stamp recipients alone. Your guess for that number is as good as mine.

Total up just the numbers we know, and we're north of a half-million dollars in debt for every man, woman and child in the country.

To give it some perspective, business and household assets combined total less than half that amount.

Meh, there's no real financial problem. Our great leaders will fix it... somehow. :sarcasm

Plot Device · Jul 15, 2010

icerose said:
We have something like 13 trillion in debt, as far as I understood it, one trillion has simply been added on top of it this year alone.

I could be wrong.

What the politicians need to do is burn the current budget and make a new one. Take the money we have, pick a debt to pay off first and restructure the damn thing from the bottom up rather than modeling it after a budget that is adding debt at an alarming rate.

I'm all for that.

But maybe eliminating a war or two might help also.

And then once we quit shooting bullets, we should bring our sons and daughters home and then properly attend to ALLLLLLLLLLL of their medical needs.

Diana Hignutt · Jul 15, 2010

Eh...I'm not worried.

We've only got to hold out another 2-1/2 years before the Reptoids and Zetas takeover completely. That's what I worry about.

Debt, much like the money it negatively represents isn't real. That's why I invest in Hormel's SPAM. Every week I buy two cans. Soon, I will be the SPAM-richest person in the world. Bwahahaha!

icerose · Jul 15, 2010

Don said:
We're talking US only now, just for clarification. Check out the nifty display at http://www.usdebtclock.org/ if you want to see the real ugly.

That $13 trillion ($43 k per citizen) is just the on-the-books debt of FedGov. Add in $3 trillion for state and local Gov, personal debt, consumer debt, etc. and you're up to $175 k/c.

Don't forget the unfunded liabilities to seniors. Medicare, Soc Sec, the drug plan add another $110 trillion ($354 k/c) to the bill.

Note the clock has no number for unfunded liabilities for welfare programs, but there are over 40 million food stamp recipients alone. Your guess for that number is as good as mine.

Total up just the numbers we know, and we're north of a half-million dollars in debt for every man, woman and child in the country.

To give it some perspective, business and household assets combined total less than half that amount.

Meh, there's no real financial problem. Our great leaders will fix it... somehow.

So it's not just me who thinks it's utterly ridiculous. Good to know.

Plot Device said:
I'm all for that.

But maybe eliminating a war or two might help also.

And then once we quit shooting bullets, we should bring our sons and daughters home and then properly attend to ALLLLLLLLLLL of their medical needs.

Agreed. I had high hopes Obama would stick to the withdraw timetable on the two mess of wars Bush started, but nope, that was hoping for too much.

The whole learn from history or be doomed to repeat it was apparently lost on our great leaders.

clintl · Jul 15, 2010

I think the Commission is exaggerating a bit when they say we can't grow out of it. Which is fine, I don't have a problem with them doing that. But we are still way below the debt level as a percentage of GDP that existed at the end of World War II, and we grew out of that. So I don't see any reason it couldn't happen again.

http://en.wikipedia.org/wiki/File:USDebt.png

Don · Jul 15, 2010

Who's planning to pay off their personal half-million dollars in debt? Show of hands?

Plot Device · Jul 15, 2010

Don said:
Who's planning to pay off their personal half-million dollars in debt? Show of hands?

This can all be easilly solved if we would all just hurry up and win the lottery.

It's do-able, right?

What.

.

Don · Jul 15, 2010

I think you're absolutely correct to relate lottery-magnitude odds to the possibility that everything will be just fine if we'd only listen to our ~~betters~~ leaders.

Romantic Heretic · Jul 15, 2010

Feh. The Western nations aren't experiencing a debt crisis, they're experiencing a taxation crisis. After about half a century of exceptions and loopholes added to the tax code a lot of people and organizations with a lot of money aren't paying nearly as much tax as they were.

As I've pointed out before in the late 50s-early 60s the jointly held stock corporations carried about thirty to forty per cent of the debt load in the West. By the early 90s they carried between ten and fifteen per cent.

Debt commission warns of fiscal 'cancer'

Gregg

Life is good

Plot Device

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GregB

practical experience, FTW

Don

All Living is Local

SPMiller

Prodigiously Hanged

thothguard51

A Gentleman of a refined age...

Gregg

Life is good

Plot Device

A woman said to write like a man.

Maxinquaye

That cheeky buggerer

Shadow Dragon

icerose

Lost in School Work

Don

All Living is Local

Plot Device

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Diana Hignutt

Very Tired

icerose

Lost in School Work

clintl

Represent.

Don

All Living is Local

Plot Device

A woman said to write like a man.

Don

All Living is Local

Romantic Heretic

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