History of the US Debt, what we must do now. - Politics Forum.org | PoFo

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Everything from personal credit card debt to government borrowing debt.

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#13742300
Jefferson once said that leaving the next generation with the debt of the present, was irresponsible, But as I will show you history not only agree's with his statement, leaving the debt to our children and grandchildren is just plain mean.

After the War for our Independence, which would have never happened without the aid of the French military, The United States had a debt that grew to 75 million in 1789, Our Forefathers could not accept this debt that would be left for following generations and worked to reduce the debt to almost zero by the 1830's.

The Civil War almost bankrupt America, but again the Presidents worked hard to bring that debt in order.

1913 and the Income tax implemented by President Wilson was to build our Infrastructure needed for the operation, services, and facilities necessary for an economy to function. Also aided our involvement in WW1.

The Great depression of 1929 was another blow to our economy, But by the time WW2 erupted, Americans bought WAR Bonds by the billions as a responsible way to pay that debt off. Not today people.

In 1945 almost 100% of our debt was American owned.

Vietnam another mess, added to our debt, But we were still a manufacturing Nation of great exports. Tough times ahead with the Arab oil embargo yes, But we were working on controlling the debt.

Now for the TRUTH about our modern debt!

1980 The Nations debt before Reaganomic's was 909 billion dollars, By the time he left office, America was addicted to spending with a debt of 2.6 TRILLION dollars. You might say he ended the cold war, Big deal Russia was more scared of us then we were of them. That spending at the time and big tax cuts for the wealthy were called by Bush I Voodoo economics, and was the beginning of our out of control fiscal irresponsibility.

Funny when Bush 1 was elected he wasn't much better at controlling the debt than Reagan,the debt would rise to approx. 4 Trillion. You think someone got to him like they are now doing with Obama?

In 1992 Ross Perot along with most American's called for fiscal responsibility and Clinton won the Presidency, pretty much knowing that the American people, like myself had had enough, and wanted a Balanced budget.

Clinton knew he had to make tough decisions and cutting spending or raising taxes were about the only two ways he would achieve a balanced budget.

Certainly not giving Big Tax breaks to the top 5%.

Now some would say that stealing from trust funds such as SS helped him achieve this, This has been going on well before Clinton and every President has done this since, Sad but true. should not be allowed, but you know how it is in Washington.

But he did balance the budget and came up with a plan to pay down our debt, for the next 20 years, That is if Bush II would have continued it.

Bush II admitted he was only B student in economics, But an A student in his own words at giving tax cuts to the American people. (The Wealthiest did the best) TAX CUT'S during a WAR! when Bush II left office he never looked back at the almost 11 TRILLION dollar debt, NO REGRETS!

Does anyone remember after Clinton balanced the budget the Debt Clock was shut off for a few years because it couldn't go backwards, that didn't last long after Bush got in office, It was started again.

When Bush II took office we had a debt of approx. 5 Trillion dollars. Bush got it running again faster than all Presidents that came before him. And he didn't care about the future debt left for the next generations. No regrets Remember!

By 2004 The debt climbed to 7.4 Trillion dollars, and unlike the debt from WW2, owned and financed by American's buying WAR Bond's, Bush II just added it to the National debt. Many of you here accepted that and elected him then.

Paul O'neil argued with the President that we can't keep spending at this pace without looking at raising taxes, Soon after Cheney asked Paul to report to the White house with his resignation, and wanted him to say he was looking forward to going back to the private sector.

NO! Paul wasn't going to lie! He just left and went home, Getting fired wasn't something a man of his fiscal knowledge was used to. so he just went home without a word. Bush wanted him to lie, But he was fired. Ahh the Bush lying again!

By 2008 our debt had climbed to over 10 Trillion! can you believe this? The debt clock was flying along at unheard of speed.

Rumsfeld even held a press conference admitting that Military "WAR" money, approx. 2.3 TRILLION dollars was now lost, not accountable, and you the tax payer will shoulder the burden. Where was the outrage?

Let's take a good look at out budget in 1945, Almost all of it was American bond owned, Today over 50% is owned by Countries like China, Japan, India, and oil producing Nations.

A fiscal call in for their money from these Nations would cripple if not destroy the American economy.

President Eisenhower used this tactic the year I was born 1956, when the British and the French wanted war with Egypt, He knew a huge sum of British debt was owned by the United States and declared no involvement and threatened the British with calling in our money. Many Historians say this was the official end of the British Empire.

You can only Imagine the tremendous power China today has over the U.S. (Luckily they need us to import their goods) and Oil producing Nations that provide us with their products.

And when will the Petrodollar end? Soon Countries won't be using U.S. dollars to purchase oil. Those very Countries that want to discontinue using the U.S. dollar are those we presently call the Axis of EVIL. Another reason we use are military against them. Other Countries will follow.

And what do you think of Greenspan in 2007 lowering interest rates in order to please the Stock Market only to leave you with savings that won't grow? barely 1% on your savings? Even when I was a kid in the 60's it was 5%?

American's NEED to save But the incentives are all in the Stock Markets, and that alone can be scary.

China is the number one exporter of goods in the World, America is just about dead last, this can't go on, well it can for awhile, but we are on borrowed time.

Do you know the three largest exports of the United states are to China?

1. Electrical Machinery.
2. Nuclear Machinery.
3. Scrap metal

We have lost our place in the Worlds Manufacturing, and that is the flaw in Clinton's projected 20 years of a balanced budget. We tried to inform him of Fair Trade, Not just FREE TRADE! But like all modern Presidents The Big Boys prevail again.

But give credit where credit is due, he did balance a budget.

Printing more money will only add to other nations owning more of the US. The levy around us is soon to break.

Obama probably went in to office with all the right intentions, But as we can see in modern History corruption is like cancer, and the President comes down with it pretty quickly.

The Baby Boomer's will be using SS very quickly and at an amazing rate.

This raided trust fund will leave the future generations broke, when it should have been the sacred cow.

If you count all our debt's and the hidden agenda cost's, We owe about 60 Trillion dollars, We must fix it. sadly the economic truth will not be accepted by America until we witness it on our own soil. Then it will be too late.

If not fixed today, in a decade or so we will need a tax rate double what we are paying today. That's just to pay a small amount to SS and bare bones if any Government services.

The way to correct what we can now, is: End the Bush tax cuts to the top three wealthiest groups, we need the money badly.

No more earmarks to be funded. Sorry lobbyist's

Time to get out of Iraq, Libya, and stop policing the World. We can't afford this.

Admit we can no longer fund other Nations with bribes just to be our friends.

We can be the best looking horse in the glue factory, but what good will it do us?

Rome fell for three reasons,
Moral decline
Over extending it's military
Fiscal irresponsibility

Sound familiar?

I hope I'm not in the minority of those that see what's coming our way if we don't act quickly.
User avatar
By Daktoria
#13771290
...if we don't act quickly.


K, so...... watcha wanna do?

I see a lot of things you wanna stop doing, but what do you WANT to do?

Lower taxes for example don't make a difference if they aren't complemented by actual economic activity.
User avatar
By lubbockjoe
#13772562
I see a lot of things you wanna stop doing, but what do you WANT to do?

Stopping something is doing something.

It seems the rising tide of debt grew the economy for the last 30 years...

Supply side talking point wrote:A rising tide lifts all boats.


A rising tide lifts all boats [temporarily].
Fixed

.
Last edited by lubbockjoe on 03 Aug 2011 18:31, edited 1 time in total.
User avatar
By Daktoria
#13772568
Yes lubbock.

The issue with lowering taxes is it's only effective as long as you have endogenous fundamentals underneath.

Unfortunately, Americans take pride in busy work, stupidity, conscientiousness, laziness, and "work ethic" so these fundamentals never existed. You need to be inventively forward seeking in order to really get something out of increased liquidity, not historically backward seeking.

The problem is there are inventors in society who get dragged down by this haphazard culture, so they get punished because the rest of society is filled with fucking tools who can't (or at least won't) think for themselves. They insist upon acting out on emotion like little kids and never really growing up aside from realizing how life is a power politics game. Economic success works no differently from becoming popular in your elementary school classes.
By neel5
#13772979
Here is a good post on US economy by the Washington Post, the article titled as "White House pursues ways to boost economy"
The White House is exploring new proposals to boost the struggling economy, including tax cuts to spur hiring and programs that could provide a lift to the housing market, as President Obama shifts his focus from the debate over the debt, said people familiar with the efforts.
#13776369
:) there are always solutions we just need to brainstorm... get the ideas and give them to someone who can do something and then take the credit from us :hmm: . But I give a fuu....
Recently I read a book called 'remade in america' it tells how importing so many goods from foreign countries have caused the huge debt, because so many retailers get their products from other countries, and home companies cannot compete with the price of foreign companies (china). Taking away hundreds of jobs with them because goods cant be produced here anymore. So were else does the government get taxes if it doesnt have an industry to pay for its daily operations...so they borrow and hope for the best :eek: . NOT to mention the unemployment and subisdies :knife: So the book recommends citizens to buy american products to support local bussiness and stop the money(and jobs) from fleeing the country. :hmm:
#13776543
OP wrote:Jefferson once said that leaving the next generation with the debt of the present, was irresponsible, But as I will show you history


This is just a broken premise from the get go. Jefferson was not a historicist. Hamilton was.

It's like criticizing red for not being blue. Oh really?
#13779401
I just wrote a reply, but then realised there is an excellent animated video on youtube which explains everything I was going to say much more coherently. http://www.youtube.com/watch?v=5DvuyvuHmJI&feature=related


My own view. The fact remains that no matter what America's public deficit is, so long as there is a demand for US consumers and a demand for the US dollar as a reserve currency, it will continue on a free ride. If people start to see America as a declining nation in monetary terms, and if it's hegemonic status declines, if China unpegs from the dollar and ends up having a strong Yuan, that's when everyone should be concerned. But for the moment America is riding on a free roller coaster. Capitalism is built on debt, but riding on a imbalanced system is completely unpredictable.
#13785162
ThePublicOpinions wrote:Forcing consumers to subsidize wealth industrial magnets is definitely not the answer, I assure you of that! As far as debt is concerned the solution is simple - repudiate it and save the taxpayer trillions. Cancel entitlement programs and save the taxpayer tens of trillions. Easy game.

Democrats will vigorously defend entitlement programs. That is where most of their votes come from.

By 2012, we would be spending about $1 Trillion on welfare alone. That is up from $550 Billion when Obama took office.

Also, 49% of Americans do not pay taxes. That is a huge number, and a huge amount of revenue lost.
#13785214
rik wrote:Also, 49% of Americans do not pay taxes. That is a huge number, and a huge amount of revenue lost.

Actually, that is some epic bullshit that you just made up. That 49% is Federal Income Tax. 49% of them did not pay anything in Federal Income Tax in 2009, but they paid a whole assortment of other taxes. So don't fuck around.

What this is, is that you are suddenly wanting to raise taxes on those people because you want to kick the tax-obligation ball down the court into the arms of the working class and the middle class, while your ideological masters are proposing more and more tax cuts for the upper-middle class, multinational companies, and international financiers.

No one is fooled by this nonsense any more Rik. It's rather transparent.
#13785224
Instead of free trade, balanced trade.

Balanced Trade (like Fair Trade) are primarily empty slogans and window-dressing for protectionism.

At the end of the day, the prosperity of individual US consumers is maximized by allowing them to source their purchases from the least expensive source (or any other source they choose.
#13785311
Rei Murasame wrote:Actually, that is some epic bullshit that you just made up. That 49% is Federal Income Tax. 49% of them did not pay anything in Federal Income Tax in 2009, but they paid a whole assortment of other taxes. So don't fuck around.

What this is, is that you are suddenly wanting to raise taxes on those people because you want to kick the tax-obligation ball down the court into the arms of the working class and the middle class, while your ideological masters are proposing more and more tax cuts for the upper-middle class, multinational companies, and international financiers.

No one is fooled by this nonsense any more Rik. It's rather transparent.

What she said.

Balanced Trade (like Fair Trade) are primarily empty slogans and window-dressing for protectionism.

Balanced Trade
#13785317
In other words, you want to outlaw foreign investments?

As a reminder, for all intents and purposes, every dollar used to purchase Chinese (or any other) goods comes back to the US.

It might come back through exports, or through investments.

Imposing a limit on trade imbalance is exactly the same as imposing a limit on foreign investments in your country.
#13785505
Eran wrote:In other words, you want to outlaw foreign investments?

I don't see why a balanced trade policy necessarily leads to that conclusion.

As a reminder, for all intents and purposes, every dollar used to purchase Chinese (or any other) goods comes back to the US.

Ok they get the dollars, we get the goods. But that is not the kind of balance referred to with respect to a 'balanced trade policy.'

It might come back through exports, or through investments.

The key idea is that a country should import only as much as it exports so that trade and money flows are balanced.

Imposing a limit on trade imbalance is exactly the same as imposing a limit on foreign investments in your country.

Limits are not all bad, especially if they lead to sustainability. The current 'free' trade system without limits is unsustainable. Imbalances cannot last forever you know.

A more sustainable approach to trade is a balanced policy.
#13785959
I don't see why a balanced trade policy necessarily leads to that conclusion.

Balanced Trade means that the value of goods exported is equal to the value of goods imported. Foreign investment is equal to the difference between the value of goods imported and the value of goods exported. If the two are equal, their difference, i.e. foreign investment, is zero.

The current 'free' trade system without limits is unsustainable.

First, in evolving system, unsustainability is not necessarily a negative. Rather, it is merely an indication that system behaviour will need to change in the future. For example, babies grow at an unsustainable rate. That's not a problem since later in life their growth rate will naturally slow down.

Second (and only partially contradicting my first point :)), the truly unsustainable component is the growing debt of the US government. The combination of insatiable demand for more debt from the American government, and the similarly insatiable demand for "safe haven" investments by the Chinese and other foreign governments allows the current trade imbalance to persist.

If one or both of those disappeared, as they will ultimately have to, the dynamics would change very quickly - less foreigners would want to purchase dollar-denominated assets. The value of the dollar would decline, until the flow of imports and exports rebalances itself. Simples.
#13786766
Eran wrote:First, in evolving system, unsustainability is not necessarily a negative. Rather, it is merely an indication that system behaviour will need to change in the future. For example, babies grow at an unsustainable rate. That's not a problem since later in life their growth rate will naturally slow down.

You acknowledge that "system behavior will need to change in the future." A balanced trade policy would ensure what you acknowledge will happen anyway.

Second (and only partially contradicting my first point ), the truly unsustainable component is the growing debt of the US government. The combination of insatiable demand for more debt from the American government, and the similarly insatiable demand for "safe haven" investments by the Chinese and other foreign governments allows the current trade imbalance to persist.

If one or both of those disappeared, as they will ultimately have to, the dynamics would change very quickly - less foreigners would want to purchase dollar-denominated assets. The value of the dollar would decline, until the flow of imports and exports rebalances itself. Simples.

If I am understanding you correctly, we both agree with the principle of balanced trade. The difference between our views is that you put off into the indefinite future what I prefer as a built in mechanism [a balanced trade policy].

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