Financial Realities We Must Grasp

[ThomWV]

When the war in Iraq ends it will not free up money for other purposes. The money that pays for the war is borrowed; it is being borrowed today and it has been borrowed ever since Bush began the war. Borrowed money must be repaid. We, our children, and our grandchildren will, of necessity, be taxed mercilessly to repay the debt that is and has been incurred to finance Bush's War. There will be little to no money for domestic programs for either maintenance or improvement.

[Clear Blue Sky]

1. The debt keeps increasing.

But if the debt as a % of GDP stays about the same, we can handle it in the short term. Like having a larger income and larger mortgage. But at what point does the debt get too big? Does it ever get paid back? How?

[ThomWV]

2. Interesting analogy considering what is happening to the mortgage market

You could not have picked a better reference to make my point.

[Clear Blue Sky]

10. With a house, you sell it. The debt gets repaid and you move on to another house.

With more or less debt than before.

I guess the country can keep selling it's debt and paying interest, but what happens when the music stops playing? Who gets stuck? We all do collectively, but it's still hard to fathom.

[OmahaBlueDog]

17. I looked at this recently

in simplistic terms, the Government takes in about $2.5 T, spends more than it takes in, and we owe about $9.5T. It's like someone making $25,000 with a variable rate mortgage of $95,000. Can we pay it down? Yes, but it means taking some very bad medicine short term. We don't have the will to do that.

[Possumpoint]

3. You ought to

take that statement further out. The money for both the war and excess costs of government have borrowed on a yearly basis for many, many years. The present national debt, not including war costs, is approaching 1 trillion dollars. That doesn't include unfunded future obligations such as government employee retirement and Social Security. I understand that will take the debt up to as much as 65 trillion dollars.

By the way, Congress borrowed the excess Social Security funds for many years to expand government programs. All of this money will have to be repaid. We and our elders have screwed the future generations.

[zazen]

4. I can see it now: "Obviation of Debt Oligations to Nations Harboring Terrorists" Act of 2011

Under President McCain. If they can't wipe out the debt by deflating the dollar, then wipe it off of the books on a false moral pretense and back it up with military might. Don't know if they could get away with it with China, though.

[CanonRay]

5. And that was always the plan...

Suck the money out of "liberal" domestic programs so, as Grover put it, they can be drowned in the bathtub.

[HamdenRice]

6. There's an easy progressive solution the mainstream media won't let your hear about

But that doesn't matter because our Chinese, Japanese, European and Gulf creditors will force it down our politicians' throats eventually, perhaps with the help of the International Monetary Fund.

And that will be a good thing because domestically we are politically impotent to do it.

That is, our military budget will be slashed from it's current $400 billion per year, to around $80 billion or less.

Our pulling out of South Korean bases, Europe, and all those far flung bases you rarely hear about (like the "Stans") will look a lot like the Soviet Red Army pulling out of Eastern Europe.

Then we'll be able to solve all our problems.

[Greyhound]

18. Just a side note; our military spending is very close to $1trillion per year.

The "official" budget is almost $600B and the off-book expenses make up the rest.

Perhaps the most evil thing in all of this is that the expenditure of <10% of our military budget would make the military completely unnecessary, outside of a small, truly defensive force. We could feed, clothe, educate, and break the cycle of poverty, world-wide, for a tiny fraction of what we currently spend to make billionaires richer.

[dixiegrrrrl]

20. uh, Hamden...if that happens

what do we do for jobs for all those guys suddenly detached from the military?

[HamdenRice]

22. There are more productive things than being in the army

Freeing up $500 billion a year from military spending will have a net job producing effect on the economy. A single jet fighter costs at least $100 million. How many green buses could be built for that cost and how many more jobs would be generated as a result? Many more.

Moreover, a vast amount of military spending is pure corrupt waste. Any funds diverted from Halliburton to civilian uses is almost purely net job creation.

As for the soldiers themselves, I doubt that they will be discharged en masse, but attrition will reduce the size of the military over time. Given the Iraq debacle, most military personnel are desperate to get out, and ending stop loss and other hidden drafts should reduce the size quickly.

There are not a fixed number of jobs in an economy. As soldiers leave the military and get jobs and earn money, their demand for products and services creates other jobs.

The entire country needs to get over the notion that military spending boosts the economy and creates jobs. It did in the 1940s when Rosie the riviter was making B-24s or jeeps, but since the focus on expensive high tech weaponry and nuclear arsenels it simply doesn't. Every dollar diverted from military spending in our current economy is a net job creating dollar.

[SpiralHawk]

7. Republicon economics: borrow and spend

borrow and spend
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borrow and spend

[B Calm]

21. Then blame the democrats for doing what's necessary to clean up their mess!

[Bandit]

8. Not only that but as soon as a Democrat wins the Presidency the Fed will raise interest rates

They did it to Clinton and the will do so again. Right now, although interest rates are the lowest in almost a hundred years, we are paying almost as much in interest as we are on National Defense. Imagine if that extremely low interest rate goes up a couple of points or more..and it will happen..

[pitohui]

9. so let's just give up and kill ourselves now?

wtf is the purpose of posts like these? "boo hoo there is no hope"

[lunatica]

11. What are your suggestions?

Stick head in sand? Go shopping? Watch TeeeeeeVeeee?

The subject may be depressing but the reality is something we best start addressing.

[Telly Savalas]

12. How about lowering defence spending, raising the capital gains tax

implementing programs to eliminate waste in govt., etc.?

The United States has the highest per capita GDP in the world, so the notion that we can't afford to maintain our infrastructure, stimulate a green economy, and provide solid social programs is bullshit.

But one shouldn't be surprised to see doom-and-gloomers trot out their favorite tactic of dismissing those who disagree with them as being trite and unaware.

[ThomWV]

14. We are going to have to do those things at a minimum just to pay our bills

And they leave no room for improved infrastructure or other much needed Government programs, like universal health care coverage.

[OmahaBlueDog]

16. Perhaps, instead of raising cap gains

we should tax stock and option purchases more heavily on the front end and then let you take the profits or losses, come what may.

[ThomWV]

13. WTF is the purpose? To stop the pie-in-the-sky bullshit about what we're gonna do with all that $$

Every lieing asshole on TV is telling us what great things they are going to do with all that money we'll have once this war is ended. Horseshit, there will be no money when this war is ended. They - and by they I mean Hillary and Obama, are telling us how everything will be better. It is a lie. If they were the least bit honest with voters every god dam person in this country would be outraged. As it is the only outrage is the lies we are being told by our own side.

[TheWatcher]

19. WTF is the prupose of resposes like these?

Is your answer that we should all just go watch Reality TV, Feel Good, Read "The Secret", and wish everything to be OK, therefore it will be?

While I will concede that there is a point and relevancy to point out "boo hoo there is no hope", doom and gloom posts, it seems that some on DU have decided to level this charge and foist this label on anyone who makes well reasoned, impassioned observations about REALITY, and how things are.

We may not like the reality, but continuing to ignore what is going on is no more productive than the doom and gloom you seem to despise so much.

What we NEED to do is communicate, discuss, and ADDRESS, thre realities that face us.

And even if those realities are dire, even beyond fixing, we need to learn how to adapt to them, face them, and deal with them. We The People need to learn how to help each other, communicate with one another, and try to come up with our own ideas and solutions. Because it is beyond evident we do not have a government that will represent us, listen to us, or give two shits about us.

Simply pretending the grass is actually greener than it really is is only going to work for so long.

Sooner or later, the people in this country are going to have to face the music of what is going on.

[OmahaBlueDog]

15. The only way out I see is a ruthless campaign of energy independence

If we can stop importing oil (and perheps export electricity) we can stop shipping out a fair portion money that makes up our current trade deficit and create jobs here. With no need for imported oil, our military priorities and spending change.

You are correct -- if we don't end the war, and do other necessary things to grow Fed income while reducing spending NOW, the debt will swallow us whole.