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Tue Feb 26, 2013, 09:05 AM

Simple question on the Sequester

Can Congress just pass a bill saying that the Sequestration will not go into effect?

Sorry Botany =

thank you and have a Clementine

28 replies, 2069 views

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Arrow 28 replies Author Time Post
Reply Simple question on the Sequester (Original post)
Botany Feb 2013 OP
Suich Feb 2013 #1
alcibiades_mystery Feb 2013 #2
WhoWoodaKnew Feb 2013 #3
Botany Feb 2013 #4
WhoWoodaKnew Feb 2013 #5
ThomThom Mar 2013 #20
WhoWoodaKnew Mar 2013 #21
ThomThom Mar 2013 #22
WhoWoodaKnew Mar 2013 #23
ThomThom Mar 2013 #24
Democracyinkind Mar 2013 #26
lunatica Mar 2013 #25
jeff47 Feb 2013 #6
WhoWoodaKnew Feb 2013 #8
jeff47 Feb 2013 #9
WhoWoodaKnew Feb 2013 #10
jeff47 Feb 2013 #11
WhoWoodaKnew Feb 2013 #14
jeff47 Feb 2013 #15
WhoWoodaKnew Feb 2013 #16
jeff47 Mar 2013 #18
WhoWoodaKnew Mar 2013 #19
donco Mar 2013 #27
jeff47 Mar 2013 #28
Kablooie Feb 2013 #7
LiberalFighter Feb 2013 #13
LiberalFighter Feb 2013 #12
Rosa Luxemburg Feb 2013 #17

Response to Botany (Original post)

Tue Feb 26, 2013, 10:29 PM

1. According to Maddow and Ezra Klein,

yes.

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Response to Botany (Original post)

Tue Feb 26, 2013, 10:38 PM

2. Of course they can

They passed the sequestration bill. They can just repeal it.

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Response to Botany (Original post)

Wed Feb 27, 2013, 07:25 AM

3. I wonder if I'm the only one here who thinks that spending needs to be cut

I'm very good with money and am older. My strategy has always been to keep my income higher than my expenses and put a certain amount in investment accounts. I honestly don't see how any entity (government or private) can continue with massive shortfalls. But maybe I'm just stupid.

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Response to WhoWoodaKnew (Reply #3)

Wed Feb 27, 2013, 08:16 AM

4. "But maybe I'm just stupid."

You might want to check into that problem.

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Response to Botany (Reply #4)

Wed Feb 27, 2013, 03:08 PM

5. Are you saying that a better approach is to spend more than is available?

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Response to WhoWoodaKnew (Reply #5)


Response to ThomThom (Reply #20)

Fri Mar 1, 2013, 10:11 PM

21. I'm over 50 and I've never lived a day that our debt has decreased. That doesn't bother you?

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Response to WhoWoodaKnew (Reply #21)


Response to ThomThom (Reply #22)

Sat Mar 2, 2013, 12:30 PM

23. I stopped reading when you said it wasn't true. It is true. There has not been a day...

in my life where our national DEBT decreased. You're the one getting the debt and deficit confused.

And just so you'll know, I haven't vote for a republican in forever.

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Response to WhoWoodaKnew (Reply #23)


Response to WhoWoodaKnew (Reply #21)

Sat Mar 2, 2013, 02:53 PM

26. It's a feature of any and all empires in world history - debt in itself is not bad.

Only a certain subset of economic philosophy believes that debt is inherently bad.

Anyone care to name it?

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Response to WhoWoodaKnew (Reply #5)

Sat Mar 2, 2013, 02:38 PM

25. There seems to be plenty available for the Pentagon no?

And what is your idea of the 1% not having to pay taxes? Or of oil companies getting subsidized by the government?

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Response to WhoWoodaKnew (Reply #3)

Thu Feb 28, 2013, 02:30 AM

6. Personal finances and national finances are utterly different beasts

The nation doesn't make it's money from external parties, and then spend its money on external parties. You do. Money comes in from outside (your job) and it flows outside (your expenses). A country makes its money from itself and spends its money on itself*.

As a result, what's good for your own pocketbook is completely different that what's good for the nation's pocketbook.

Imagine a situation where a husband works for his wife, and buys goods only from his wife. There's no other sources of income or expenses. What happens when the husband starts spending less? The wife receives less money from his purchases. Which means she has to cut his salary. Which means he has to reduce his spending further. And so on.

Slashing our spending wouldn't actually reduce debt. Because the economy is depressed, that slashing also reduces income. So the cuts create a vicious cycle. Just take a gander at most of Europe to see how it works.

What the country needs to do is spend more now, in order to stimulate the economy. Then once the economy is humming along nicely, we should cut spending when the booming economy can absorb the cuts.

*It's possible for imports and exports to change this somewhat, but the US is not in that situation.

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Response to jeff47 (Reply #6)

Thu Feb 28, 2013, 10:16 AM

8. I don't have any problem with countries going in the red when they need to.

What I do have a problem with is increasing our debt every day for the last 40 some years.

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Response to WhoWoodaKnew (Reply #8)

Thu Feb 28, 2013, 10:33 AM

9. Good thing we haven't then.

The deficit went down in the 90s. It also went down the last 4 years.

Republicans have spent like drunken sailors when they're in charge. But that doesn't mean we should slash spending now. That means we shouldn't trust Republicans with the checkbook.

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Response to jeff47 (Reply #9)

Thu Feb 28, 2013, 02:49 PM

10. I said debt. You said deficit. Do you know the difference?

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Response to WhoWoodaKnew (Reply #10)

Thu Feb 28, 2013, 03:11 PM

11. Yes. Do you not understand that one leads to the other? (nt)

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Response to jeff47 (Reply #11)

Thu Feb 28, 2013, 04:58 PM

14. Of course. Do you now understand that I said that our debt has not decreased...

in over 40 years (and that that statement is accurate)? How many more years are we gonna pile up debt? How many more years do you think we can?

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Response to WhoWoodaKnew (Reply #14)

Thu Feb 28, 2013, 05:25 PM

15. Until eternity

We're actually constantly paying off debt and issuing new debt. So we constantly get market feedback about our debt. And the market is saying they want LOTS more debt.

Inflation-protected debt is literally paying a negative interest rate. Give the government $100, get back $98 and investors are buying it.

Japan demonstrates that you can run massive deficits for decades, and not have a problem with debt as long as you have your own currency. And before you say "OMG! WHAT ABOUT GREEEEEEEEECE!", take a look at that "have your own currency" phrase.

Could there be a future problem with too much debt? Sure. But because we have our own currency, it's not going to appear out of nowhere. Interest rates will take a while to creep up to a problematic level.

Of course, we should try to run small-to-no deficit during boom years. But people are only freaking out over debt now for one of two reasons:
1) It suits their political desires - they want a terrible economy as long as a Democrat is in the white house
2) They keep thinking of government debt in terms of personal debt. Such as you appear to be doing here. It isn't the same.

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Response to jeff47 (Reply #15)

Thu Feb 28, 2013, 09:56 PM

16. Well, you have pointed out the positives of adding to our debt for 40+ years...

so, what are the negatives? Or at least the ones you've left out.

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Response to WhoWoodaKnew (Reply #16)

Fri Mar 1, 2013, 11:22 AM

18. Theoretically, higher interest rates

as private investment is squeezed out by government debt. But we're at incredibly low interest rates.

Too much debt too quickly can cause inflation. But in a depressed economy such as ours, you can print a metric crapload of money without causing inflation - in fact the fed has been doing so and we still have no inflation.

If people stop wanting to buy our debt, then there would be very large problems as we had to pay out high yields to attract buyers. But as I mentioned, the market loves our debt so much that they're willing to lose money buying it.

There is no mechanism by which debt would go from it's current "not a problem at all" to "OMG WE'RE DOOOOOOOOMED" in a short period of time. Which means we would have time to address the problems before they became large problems.

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Response to jeff47 (Reply #18)

Fri Mar 1, 2013, 08:26 PM

19. Well, we've had a pretty steady amount of increasing TOTAL debt since the 80s

And we had increasing total debt really starting in the 50s. So, how long to we go while increasing our total debt before we address it? 10 more years? 20? 40?

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Response to WhoWoodaKnew (Reply #19)

Sat Mar 2, 2013, 03:00 PM

27. How about

debt as a percent of GDP?Would you agree that would be the correct way of judging government debt?

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Response to WhoWoodaKnew (Reply #19)

Sat Mar 2, 2013, 05:31 PM

28. And now you're back to 2 replies ago.

I've already answered this question.

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Response to WhoWoodaKnew (Reply #3)

Thu Feb 28, 2013, 07:42 AM

7. Companies often borrow so they have enough capital to create products.

The profit from the products allow them to pay back the debt.
If they try austerity when they have no products to sell they will die.

The general theory is to spend a large amount for a short time to get the economy going. This will create debt but once the economy is humming along by itself, then you cut back.
The problem is tha the Republicans don't believe in this idea and have prevented it from working.

It's like your engine is dying from lack of fuel and the Republicans think that's the time to drain the tank.

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Response to Kablooie (Reply #7)

Thu Feb 28, 2013, 03:24 PM

13. I believe lots of farmers do that.

They have to. Seeds, fertilizer, fuel, machinery, etc cost money. They don't usually have that type of capital available that allows them to buy what they need. Real farmers aren't normally rich enough to do it.

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Response to WhoWoodaKnew (Reply #3)

Thu Feb 28, 2013, 03:20 PM

12. The budget for the govt is more complex than one for a family

especially if the family is only one or two that are retired and have their house paid off and don't use the car as much as when they were working.

If you own a home that would be a major expense that usually is more than your annual wages. Along with a car and other possible long term expenses that were through a loan. If you go by what others complaining about not budgeting properly they forget that they too generally have major items that were not paid in full at time of purchase.

When the voters 'elected' Bush in 2000 they elected a fool that did not bother paying attention to the daily briefings warning of possible terrorist attacks. Which might have averted 9/11. They intentionally intended from day 1 to invade Iraq because Clown Bush wanted revenge for his Poppy Bush. They made up evidence that there were WMD in Iraq to justify a war. Because of 9/11 they reduce taxes to encourage sales. All of that increases the deficit which the American people went along with. As long as people get upset about their taxes being raised (back to pre 2001 levels) it will be difficult to balance the budget. Unless the rich are tax at a higher level and the defense budget reduced to more appropriate levels.

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Response to WhoWoodaKnew (Reply #3)

Thu Feb 28, 2013, 10:25 PM

17. the poorer end of the population gets cut whilst the rich don't

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