Detroit was once one of the largest and most profitable cities in the US. That was 50 years ago.
I am one of those handful of taxpayers who pays way more in taxes than I will ever get back, unless I manage to suck enough money out of medicare during my retirement years. Which I might, of course, if I ever get sick.
Currently, most people get a good deal more back from the Feds than they pay in. So that’s one reason for resentment on the part of those folks expected to pay more taxes. After all, any suggestions that we “raise revenue” are suggestions that weigh most heavily as you go up the income chain.
A second reason for resistance is the selfishness you mention. The tragedy of the commons ensures that we will all consume maximally under the assumption that our personal altruism will be lost in the narcissism of the majority, and therefore the only rational strategy is to maximize personal gain even if the broad public good is minimized.
A third reason for resistance to “revenue generation” is a general perception that government is wasteful and self-serving, and the more centralized it is, the more wasteful and self-serving it is. I certainly hold to that.
A fourth reason is the observation that higher revenues typically lead only to even higher spending. Over the long haul, we’ve increased total centralized revenue and increased total spending even more.
But for me, the most significant reason is a belief that we have passed the tipping point. Enough of the public has latched on to fiscal irresponsibility that we will never vote in a balanced budget. We’ve collectively figured out we should all make hay while the sun shines, and it feels to the average man that borrowing from the future is kind of painless. We are living high on Other People’s money.
I would vote for more taxes–even taxes that affect me as a high-earner most directly–only on condition that we first become fiscally responsible. That we pass an absolute requirement to spend only what we take in. Period. Budgets would be a percent of the net take, and not an absolute dollar amount, for example.
For that last reason, I will personally vote against raising my taxes even a nickel. It’s wasted money. I’m hunkering down, and right now gold is starting to look better and better over the long term, which is kind of sad. A fairly worthless metal lusted after by the polloi will have more buying power than a fiat currency from the greatest power the world has ever seen.
I give us 30 years, max, before we collapse economically. It’s gonna hurt.
Bummer
We do have more options–and more borrowing power–than Greece.
We won’t escape their fate, though. We’ll just be able to put it off longer.
The past few years we’re borrowing an incredible percent of our annual budget, considering that it’s peacetime (by peacetime, I don’t mean hobby wars like Iraq and Afghanistan).
The broad sentiment is to get personal gain but use other people’s taxes. That’s not going to turn out well for us anymore than it did for Greece.
Want an index case? Check on Illinois’ underfunded pension problem, and how effectively they are managing to solve it.
The idea fiscal irresponsibility only catches up with St Elsewhere is a bit naive.
50 years ago, Redwood City was a sleepy bedroom community that was so full of cheap land, that an entrepreneur bought up a bunch of land and opened a theme park full of giraffes, zebras, and even killer whales.
And where is that park today? about 30 miles to the north, because Redwood City is now part of the heart of Silicon Valley, and Oracle has its world headquarters right where lions used to poop.
[Paul Harvey]And now you know… the REST… of the story.[/PH]
Are there other now-n-then anecdotes you’d like to trade?
A trillion here, a trillion there, pretty soon it’s real money.
I think the simplest answer is because it can.
If there was an alternative – which US war machine makes sure does not happen – many would take it.
I’m not fully convinced US really needs to be so flagrant about keeping its 1% in charge so forcefully but not knowing the thirst for power so strong leaves a simple man in a state of unbridled cognitive dissonance.
BTW - just read who’s Obama pick for next Fed Chair
To the OP: Would you accuse of someone who has a mortgage as refusing to pay off his/her debts?
To the actual issue: I don’t think it gets much more sensible than what Chief Pendant posted.
I find it fascinating, really, I do, that people think the government is wasteful and self-serving. What does the Postal Office get out Saturday delivery? What does the National Weather Service get out of flying airplanes into the eye of hurricanes? What does the USDA get out of regulating nutrition labels? I could go on and on. I sincerely believe that the people who decry about the waste of government are likely the ones using most rely on their services (e.g. “Keep your hands off my Medicare”).
This is an interesting take, because I look at it the opposite way. Lower taxes lead to less revenues which leads to more debt. We should be honest with ourselves and admit that tax cuts do not spur economic growth. This is precisely the conundrum that occurred in the early 1990’s, Chief Pedant, where the massive tax cut of the 80’s failed to increase tax receipts as promised.
I disagree on the balanced budget for the sake of a balanced budget. Balance the budget once we abolish the tax cuts of the 1980’s.
The U.S has been - more or less - fiscally responsible since its founding. The fiscal irresponsibility started in the 1980’s, reversed slightly in the 1990’s, and is now in full-throttle. I’m also curious, do you know that if we had a balanced budget during World War I or II, the U.S would’ve collapsed? Debt isn’t a problem, it’s our profligate and unrestrained use of it that’s the problem.
In his farewell address, George Washington spoke against this kind of selfishness and how it’ll be the downfall of the Union. He’s right. The American people are too selfish, too self-absorbed, and too self-centered to have a country like this, and as you say below, “30 years max” and this country will “collapse economically”. We’re running a government on debt and are meddling militarily in other countries, two maxims that were stressed by the very 1st President of the United States.
I agree, the U.S is fucked. This is due to us running a government on debt, cutting taxes, refusing to raise revenue, and believing the government is out to get them. All is not lost, however. In the future, there’ll be another financial crisis that’ll wake people up, but by then, most of the damage would’ve already been done, and there will be a lot more people than there is now.
- Honesty
You should stop trying compare government budgets to household budgets. Debt is not a mortgage and there’s no way the government, nor the present population, can pay that back. It is something that has to be foisted upon future generations because you - and others - are too selfish and cowardly to pay the bills they racked up.
- Honesty
I can’t tell if this is a knee-jerk reaction any/all household analogies or if you honestly have an issue with what I wrote.
The debt is not a mortgage how? The government took a loan out in the form of bonds which they promise to pay back later. It’s not the exact pay structure of a mortgage but it’s not completely out of hand.
Just as nobody’s expecting the “present population” of someone with a mortgage to pay back the debt in full, nobody is expecting the “present population” of the US to pay the Debt back in full.
The benefit of being a government is that you have a theoretically infinite lifetime. Us mere mortals have to settle for 15, 20, even 30 year mortgages but the government can keep borrowing well past that.
You really lose me in the coward and selfish comment. The government has never… NEVER… not paid its debts. It’s not like the US debt is comprised of the government not paying construction crews to pave roads or skipping out on restaurant tabs. It’s entirely in the form of bonds and bills that have not matured. The second they mature, the US opens up its wallet and pays up. I fail to see the cowardice or selfishness there.
What you’re actually mad at isn’t the debt. It’s the budget.
Summers is an idiot who couldn’t even manage Harvard endowment fun IIRC.
Greece’s debt was denominated in EUROS. Greece did not have the power to devaluate the Euro, only Germany + France could do that.
If we owed our debt in a currency we didn’t control–like, if we borrowed Euros, and promised to pay back out debts in Euros–would we be unable to pay back our debt by printing more Euros.
Likewise, lots of smaller countries that have national debts don’t owe those debts in their national currency, they owe the debts in foreign currencies that they don’t control. They can’t inflate their way out of debt owed in dollars, because the US government decides how many dollars there should be, not Argentina.
Today, in 2013, the United States has no problem finding people willing to buy US debt denominated in dollars that the United States controls. We can borrow for essentially 0% interest. Obviously this is unsustainable, but 0% interest is a pretty good deal.
The notion that we owe all this money to China, and someday China is going to demand repayment, and we’ll be bankrupt, is nonsense. Our debt is not callable, it is denominated in dollars which we control, and while it is getting to be a large fraction of US GDP it is still a small fraction of US wealth.
What will happen is that our economy will slow down, people will think US bonds are not such a good deal, and we won’t be able to take out 0% interest loans anymore. And then we’ll either have to raise taxes or cut spending or keep borrowing but pay more interest, which means our debt is riskier so people will demand even more interest, and eventually we can’t borrow money at any price. Then, since due to people like Chief Pedant we won’t be able to raise taxes, and due to people like Honesty we won’t be able to cut spending, we’ll just have to devalue our currency and pay our debts at face value with currency that can only buy a fraction of the value it had when the debt was issued.
Note that devaluing the currency is extremely problematic, since it makes collecting taxes extremely difficult, pushes all sorts of economic activity off the books and into the grey market, and introduces radical uncertainty. But hey, anything’s better than raising taxes, am I right?
The answer to OP’s question is:
Because American voters are deliberately kept in a state of ignorance by right-wing propaganda machines.
Most Americans want a balanced budget and understand the need for taxes. Yet, due to an amazing level of ignorance many voters aren’t even sure which party is the party of “fiscal conservatism.”
Case in point:
Oh my. I’ve tried to squelch this confusion before. Please read my whole post, but here are some excerpts:
Hope this helps.
The problem with perpetual debt is that is has to be serviced. Many hundreds of billions of dollars per year that come out of our pockets give us nothing. Absolutely nothing. No healthcare, national defense, prosecution of Texas, nothing at all. They are interest payments on shit that we’ve already spent.
Now, if this was a one time thing, then that might be good and necessary. But we do it every year. Every year we take on more debt. Not in a world war, not after some catastrophe, but every single year in good times and bad, we spend more than we take in. We take on more debt that has to be serviced.
That alone is a reason to pay down the debt. So that our grandkids can actually use their money on stuff that they want; not use their money to pay for stuff that we already spent.
It doesn’t. Clinton’s 1993 budget decreased the deficit for a couple of years, but projected increasing and perpetual deficits into the future. The Republicans took over and asked for a balanced budget in 7 years. Clinton balked and proposed a balanced budget in 10 years.
Two years later the budget was balanced. The lucky bastard Clinton was simply sitting in a chair when the most significant invention of the 20th century took off. Kudos to him for not forcefully hampering it, but he didn’t do anything that any other President or any other person in the world wouldn’t have done in his position.
The largest package of spending cuts ever did little to reduce the deficit. Got it.
The only major tax increases since Reagan’s cuts did little to reduce the deficit. Got it.
The Clinton boom was due almost entirely to the Internet. :smack: (I suppose next we’ll learn the Internet was invented by [del]Al Gore[/del] Karl Rove.) Got it.
The theme of my post to which you responded was
Because American voters are deliberately kept in a state of ignorance by right-wing propaganda machines.
Claim confirmed. In spades. Thank you.
Not propaganda, just facts. Clinton’s “cuts” were only defense spending which would naturally be cut due to the end of the cold war. Nothing on the domestic front.
The GOP said a balanced budget in 7 years, Clinton said 10, but it was done in 2. Was that just because Clinton swung his dick around and made it happen? Of course it was the dot com boom!
I still think it really might help clarify things if the Tea Partiers follow through and stop raising the debt ceiling. Then people will see the disparity between revenue and spending and, I hope, go for more revenue and big defence cuts.
If the debt ceiling isn’t raised, then it will be pointless to raise taxes, what with tons of people losing their jobs when the economy crashes.