Link.
I’m truly puzzled by this. Record deficits, and then announcements that deficit spending is unsustainable? There must be more to this than I can see - can someone interpret for me?
On a personal level, deficit spending is unsustainable, right? Ok, but I took out loans when I went to college. That excess spending is temporary and should improve my long term income.
It has to do with the reality we are faced with. It is felt by many (not all) that if the government does not spend like it is then the economic downturn will be far worse. There is merit to that argument.
Kind of a damned if you do, damned if you don’t thing.
I am guessing Obama is trying to head-off endless conservative criticism about the huge spending the government is doing. What the conservatives don’t tell you is that they’d be doing the same in this situation (Bush was already headed there). Of course the conservatives would spend the money in different ways (e.g. more tax cuts for the rich) but that is a different debate. Bottom line is we need to spend to mitigate the economic collapse.
This also starts setting the stage for when, at some point, Obama will have to pull back on spending and to also prepare people for the higher interest rates that are likely to come.
It’s a shitty situation all around but what we are stuck with currently.
Which is to say that your level of debt is fully sustainable - you have income sufficient to make the payments, and good prospects of continuing to do so until the loan is paid off.
I think Obama’s remarks clearly indicate that this isn’t true for US debts - whence the warning of possible skyrocketing interest rates.
When you take out student loans you don’t just get loans and the money evaporates. You are taking loans out to pay for tuition. So your expenses are larger than your income and you borrow money (student loans) to make up the difference.
If you’re going to a private school where tuition is $45K/year, and you make $6K/year working at the coffee shop, you are obviously running huge deficits in your personal income. Those deficits are, however, unsustainable. It’s fine in the short term because, as noted, it improves your future prospects. In the long term, borrowing $40K/year is the fast lane to ruin.
See, for instance, the Southern California housing market, where people used their homes as cash dispensers (refinancing and taking out HELOCs every year or two). They had a standard of living that was well above their means, and it was financed with debt. In the end, it simply couldn’t continue.
No one with half a brain thinks that. No one. It’s a boom and bust economic cycle. Injecting a bunch of arbitrary dollars into the system will give a transient short term benefit. It is no benefit at all, however, because the money being injected is printed money, whcih will sabotage the dollar, prolonging the duration of the bust or/and making it worse.
Damned either way, sure, that’s how cyclic capitalism works. But one way destroys the dollar. Save the economy to destroy the currency, which then destroys the economy? Gee, where do I sign!?!?! Put me in for donating 892749274230462346239346239426394938246 dollars. Just print the money. I’m good for it.
Who was it who tried to stop Bush’s bail-outs? Hmmmmmmm. I seem to recall it was a ***bunch of conservatives ***who actually voted it down in the house? Guess you like inventing reality when the actual one doesn’t suit your bogus agenda. Bottom line is, destroying or currency is a great way to become a banana republic, and Obama looks like your typical fascist banana republic dictator, so maybe that’s what dems long for. If Obama really wanted to fix the mess, he would go back to see what happened in the sub-prime mortage industry that cause the bubble in the first place, but he won’t go there because it’s a path along the failed democrat’s socialist agenda. A house for every family! Who cares how it gets paid back? It makes me feel good to pretend I did something nice.
psst… Bush pushed through and signed the bailouts and he is a conservative.
+1 for calling Obama a fascist and a socialist at the same time.
Obama is an anarcho-communist totalitarian fascist dictator socialist dirty unwashed hippie.
Bush is not a conservative. There is your problem… Garbage in, garbage out.
Did I? Rarely am I so redundant.
You forgot racist, and half a dozen commas for that matter. Oh, and that anarcho is not how you spell a-hole.
No I don’t. I’m taking on $30k a year of debt and earning $15k. That’s not sustainable. Obama’s taking on more debt now because it’ll pay off later, hence the college analogy. Obama was saying we can’t continue to increase debt, which is obviously also true for myself.
What a total crock. I love this new re-interpretation of any government spending as an ‘investment’. It’s no such thing. An investment is a decision to take some resources that are not productive and make them productive. Obama is spending money that is ALREADY ‘invested’ in the economy - tax money. His borrowing is using up money that would have been used elsewhere.
If you consider the deficit to be short-term because of the stimulus, then you’d have a slightly better argument, although I’d retort that letting government ‘invest’ your money is a bit like asking your uncle, the guy who read a book on picking stocks once, to take care of your retirement savings for you.
But the long term debt isn’t because of the stimulus, it’s because of permanent increases in the level of government service.
Having Obama complain about the deficit is like the Menendez brothers pleading for clemency on the grounds that they are orphans. It takes big brass ones to make that particular move.
My guess is that what he’s doing is softening the ground prepatory to a new push for more tax increases.
Obama is a master of double-speak. And his sycophantic followers are masters of making themselves believe multiple contradictory things at once when they come out of the mouth of The Holy One.
When I read this OP, I thought to myself, “How many posts until someone blames Obama’s wicked ways on GW Bush?” It was two.
By the by, GWB is *no *conservative…TRM
Go ahead and claim Bush isn’t a conservative, but conservatives in this country overwhelming voted for him in 2000 and 2004. And the conservative members of Congress who were against the banking bill the first time supported Bush’s national debt increasing spending when he popular in opinion polls.
Oh man…this is gonna be too easy.
No one huh? Not even librul commie bastards who want to socialize the country? Bet conservatives could never be for it since “no one” is. Unless…
That was easy and fun. Thanks for the setup.
Laughing so hard here it hurts.
Ah the irony…it burns.
Please explain why you know better than the conservative economists (indeed the “vast majority” of economists) that agree on the current need for government spending.
Unless it is just a quibble that we shouldn’t be spending it on “this” but rather spending it on “that”.
Wow! I take it you are not a fan of Obama or his policies. If what you say is a true reflection of your feelings then I offer you my sympathies - you are definitely going to be a very angry person for the next four years (at least)! Hopefully you have other distractions to keep your mind occupied and your blood from boiling …
As for the OP, I believe what other posters have said is correct. It is analogous to student loans - piling up tens of thousands of dollars a year in debt is horribly unsustainable, yet it is not necessarily a bad investment when taking into account future potential earnings, assuming you spend four years in college, not forty. Similarly, the President appears to feel that this spending is necessary now in order to recover from the current mess, even though if we kept spending at this rate too long into the future we would be in trouble.
The analogy is sound, and record deficits followed by announcements that these deficits are not sustainable is reasonable in itself. Of course, naturally there will be disagreement about our specific situation: is the spending really helping, and could even short term spending at this level be damaging? I’m not really worried about the second item, I think the United States has recovered from far worse in the past. I am more concerned that we will not reduce the gap in the long term, and that the administration and legislature will not have the willpower to either decrease spending or increase taxes to make up the difference.
How positively Freudian, attributing to Obama’s followers exactly what Bush followers most certainly did for eight years. Believing contradictory things; regarding him as a Messiah; all characteristics of his followers towards Bush.
This idea that Obama’s supporters look at him as a Messiah is manufactured by the Right, not reality.
Considering how much damage Bush did to America, it’s inevitable that much of what Obama does will revolve around fixing it to the extent it can be fixed.
He’s evil, stupid, a worshiper of the wealthy, and a religious lunatic - all core conservative values.
Meant to add…
Which party controlled Congress from 2001 - 2007. Hint: Republicans (well, in the 107th Congress Dems controlled the Senate by one vote and then barely when Jeffords left the Republicans and went Independent and decided to caucus with the Dems).
Which branch of government holds the purse strings? (No hint)
Are the Republicans in Congress not conservatives either? Is this a “no true Scotsman” thing?
If you think “Republican” is synonymous with “Conservative” (and obviously, you think both are equivalent to “evil”) then you, sir, are sadly mistaken. And a bigot.