That is the deficit of the US government foreseen for the year 2006. I trust there will be enough sources on this.
With that in mind, I found this page that helps put things in perspective for mere mortals that we are. Note that we're talking about five times as much money as the page is illustrating.
Nevermind the corny images about cash though, I'd like to hear opinions about how you think this much deficit came to be (and if it was necessary or not), how it's going to affect you individually on the long term, and if you trust the government to solve the deficit at some point in time (or at the very least, do something about it). Also, I'd like to know how much you feel personally concerned by the deficit, and how you think that deficit is financed (where does the money come from)?
Discuss. No flames.
400 billion dollars
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Iceman
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Re: 400 billion dollars
5 * 272 Billion = 1360 Billion, not 400 Billion or did I misunderstand you?Tricord wrote:Note that we're talking about five times as much money as the page is illustrating
Cool page
[edit]O I C ... Its titled the $87 Billion page but it illustrates $272 Billion
My opinion - I think it is irresponsible of our government to run business this way. Good economics (Keynsian Birdseye?) dictates that the government should limit borrowing to times when the economy is depressed and they want to stimulate it. In good times (as now) we should be paying off the deficit in preparation for the next time the economy takes a dip.
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Will Robinson
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I understand a number of states either already have, or currently are passing, legislation that makes a balanced budget mandatory.
I'd love to see them band together and demand the federal government do the same.....maybe even refuse to send the fed any revenue as long as they don't have a balanced budget law in place.
Our government spends like a rock star or superstar athelete who has suddenly come into a large cash flow that inspite of their spending they just never seem to run short of cash.
Of course unlike a rock star/ superstar athelete who actually generates their own excessive income stream the working class tax payers are the source of the governments seemingly unending supply of revenue and we, the workers definitely don't appreciate it...at least those of us smart enough to realize just how wastefull and corrupt they are.
Economic education in the public schools is severely lacking and I can't help but wonder if it isn't a part of some nefarious plan to keep the workers so dumb that the average working class person thinks that they don't pay taxes since they get a refund at the end of the year!
Sorry, kind went off topic in my rant!
I'd love to see them band together and demand the federal government do the same.....maybe even refuse to send the fed any revenue as long as they don't have a balanced budget law in place.
Our government spends like a rock star or superstar athelete who has suddenly come into a large cash flow that inspite of their spending they just never seem to run short of cash.
Of course unlike a rock star/ superstar athelete who actually generates their own excessive income stream the working class tax payers are the source of the governments seemingly unending supply of revenue and we, the workers definitely don't appreciate it...at least those of us smart enough to realize just how wastefull and corrupt they are.
Economic education in the public schools is severely lacking and I can't help but wonder if it isn't a part of some nefarious plan to keep the workers so dumb that the average working class person thinks that they don't pay taxes since they get a refund at the end of the year!
Sorry, kind went off topic in my rant!
I think the government should definitely work to reduce the deficit. I'm not sure what effect it actually has on individuals, but I can't imagine it's beneficial. I think the government should also reduce in size and strive for efficiency, instead of signing off on every pork barrel project some congressman wants... that would get rid of alot of budget.
Differentiation is an integral part of calculus.
Re:
not impossible, just really expensive....Duper wrote:Can't... the Feds themselves made dang near impossible to declare bankruptcy last year.
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Lothar
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IMO, as a matter of principle the government shouldn't have a huge deficit... but I see it as a tool to get the government where it should be, because I *also* think the government should be extremely limited in what they do.
Remember, \"government\" is just a fancy word for \"people telling you what to do, and using your money to do it.\" I want the government to tell people what to do less often and using less money. Ideally, they'd cut taxes and cut spending at the same time, and they'd keep doing so until they got spending down to a reasonable level without ever having a deficit.
But the US government is nowhere close to ideal. They're not going to cut spending unless forced to -- unless they simply don't have the money available, either through taxes OR through credit. A balanced budget amendment would cut off the money available through credit, and tax cuts reduce the money available through taxes. Right now, I'll take whatever I can get from either of those. Both would be ideal, but if we can only get tax cuts, that means a deficit buildup until credit runs out. I prefer that to taxes staying the same and the deficit building up.
Remember, \"government\" is just a fancy word for \"people telling you what to do, and using your money to do it.\" I want the government to tell people what to do less often and using less money. Ideally, they'd cut taxes and cut spending at the same time, and they'd keep doing so until they got spending down to a reasonable level without ever having a deficit.
But the US government is nowhere close to ideal. They're not going to cut spending unless forced to -- unless they simply don't have the money available, either through taxes OR through credit. A balanced budget amendment would cut off the money available through credit, and tax cuts reduce the money available through taxes. Right now, I'll take whatever I can get from either of those. Both would be ideal, but if we can only get tax cuts, that means a deficit buildup until credit runs out. I prefer that to taxes staying the same and the deficit building up.
Regarding Lothar's post, giving more responsability to the government *can* be worthwile. You are promoting a community that discriminates unlucky people. People without a job, without a roof above their head, people who missed good education. Should the government do something about that, they might have more chances in life.
When I look at the Belgian tax rates (2000, hasn't change much since), I see the highest procentual figures in the world (except for Denmark). But everyone is happy to pay a buttload of tax money seeing as:
- health care is free
- education is free (and of high quality!)
- there are no homeless people here (if you have nothing, the government will house you, feed you and give you money to get going)
- if you are unemployed, you get an unemployment wage from the government
- other public services are EXCELLENT
I agree you might say that such a system makes people lazy. Why work if you can get the basics for free? Well, that may be true for a small minority, but at least they're not freezing in cardboard boxes outside. Another side effect is that unemployment is a tad higher. But it seems to work well on the overall.
All this can be done by keeping the deficit in check. In fact, Belgium has had no deficit for 7 years in a row now, which allows for a steady debt repayment.
Anyway, enough of my stupid little country, I guess the only point I wanted to make is, while you won't personally have any problems with the government cutting taxes and expenses, many other less fortunate people will.
When I look at the Belgian tax rates (2000, hasn't change much since), I see the highest procentual figures in the world (except for Denmark). But everyone is happy to pay a buttload of tax money seeing as:
- health care is free
- education is free (and of high quality!)
- there are no homeless people here (if you have nothing, the government will house you, feed you and give you money to get going)
- if you are unemployed, you get an unemployment wage from the government
- other public services are EXCELLENT
I agree you might say that such a system makes people lazy. Why work if you can get the basics for free? Well, that may be true for a small minority, but at least they're not freezing in cardboard boxes outside. Another side effect is that unemployment is a tad higher. But it seems to work well on the overall.
All this can be done by keeping the deficit in check. In fact, Belgium has had no deficit for 7 years in a row now, which allows for a steady debt repayment.
Anyway, enough of my stupid little country, I guess the only point I wanted to make is, while you won't personally have any problems with the government cutting taxes and expenses, many other less fortunate people will.
The question of course is that how long have the Belgians had these tax rates, and whether or not they are sustainable over the long haul. Regarding health care, I heard a piece on NPR the other day where they were talking about the inadequacies of the universal Canadian health care system. Apparently, it is not permitted to have private health insurance in Canada (forcing reliance on the state system), but Canadians are voting with their dollars and coming to some US facilities for treatment so they can get timely information, instead of having to wait on a long waiting list for access to the free Canadian system.
At some point the money has to come from somewhere.
At some point the money has to come from somewhere.
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Lothar
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Tricord, I know plenty of people who are way way at the bottom of the economic curve. While I personally don't rely on government handouts, I know plenty who do, and I certainly don't advocate the government screwing them (note that I suggested a \"reasonable level\" of government spending, not \"none at all\". And even if we don't touch any government spending on the poor, there's plenty of other crap that could be cut!)
But, you do raise a very legitimate question.
If you took all the people in this country and looked at their net incomes, and made a graph (# people on the y axis, amount of $ on the x axis) you'd get something like a bell curve with a long tail to the right.
Now, when the government collects taxes, it has a net effect of shifting the whole curve to the left, and kinda compressing the far left end -- everyone loses wealth, except those who have too little for the government to tax. Then, when the government spends that money, it benefits some parts of the curve. When they spend it on the poor, it shifts the left end of the curve over a little bit; when they spend it on military stuff it shifts the middle of the curve over a little; when they spend it on subsidies for corporations it shifts the right end over a little. Whoever they spend on gets a little boost along the \"money\" axis.
There are two extremes -- the government can collect all the production of the whole country and then give everyone exactly the same amount (pure communism), which has the effect of making the curve into a single spike somewhere in the middle. Over time, the best producing people in that spike get lazy because they don't really get any benefit from working hard, and the whole spike shifts downward. The government can also collect NONE of the production of the whole country and just leave the curve exactly as it is, and over time, new innovations will shift the whole curve in the upward direction, but the people at the very bottom have nothing and will surely die.
Obviously, some solution in the middle is necessary -- but the question is, what's the best solution? Should the government pull the bottom of the curve way up at the expense of pulling the top way down (therefore reducing the overall creation of wealth, but allowing the poor to live comfortably, as in Belgium), or should they pull the bottom only partway up and let people innovate in ways that pull the bottom of the curve further up (as in the US)? I think the most effective system is for the government to do the minimum -- provide the absolutely destitute with food, shelter, basic health care, and educational opportunities, not enough that they'll be comfortable and content, but enough that they won't be completely miserable. But leave most of the money in the hands of whoever started with it, and let them come up with new products and services to raise the quality of life for everyone.
My friends in the US who are the poorest of the poor are definitely not as well off as the poorest of the poor in Belgium. They do actually have free (but limited) health care, free (but limited) education, a small wage from the government, and reduced-cost housing, but they'd have more in Belgium. But I think average people are better off in this country than they are in Belgium and the rest of semi-socialist Europe... and if Europe could no longer benefit from new products developed in the US under our system, and we could no longer benefit from new products developed there under that system, I think Europe would suffer far more than the US. The innovations created within this society benefit the poor (and the average and the rich) pretty much worldwide.
But, you do raise a very legitimate question.
If you took all the people in this country and looked at their net incomes, and made a graph (# people on the y axis, amount of $ on the x axis) you'd get something like a bell curve with a long tail to the right.
Now, when the government collects taxes, it has a net effect of shifting the whole curve to the left, and kinda compressing the far left end -- everyone loses wealth, except those who have too little for the government to tax. Then, when the government spends that money, it benefits some parts of the curve. When they spend it on the poor, it shifts the left end of the curve over a little bit; when they spend it on military stuff it shifts the middle of the curve over a little; when they spend it on subsidies for corporations it shifts the right end over a little. Whoever they spend on gets a little boost along the \"money\" axis.
There are two extremes -- the government can collect all the production of the whole country and then give everyone exactly the same amount (pure communism), which has the effect of making the curve into a single spike somewhere in the middle. Over time, the best producing people in that spike get lazy because they don't really get any benefit from working hard, and the whole spike shifts downward. The government can also collect NONE of the production of the whole country and just leave the curve exactly as it is, and over time, new innovations will shift the whole curve in the upward direction, but the people at the very bottom have nothing and will surely die.
Obviously, some solution in the middle is necessary -- but the question is, what's the best solution? Should the government pull the bottom of the curve way up at the expense of pulling the top way down (therefore reducing the overall creation of wealth, but allowing the poor to live comfortably, as in Belgium), or should they pull the bottom only partway up and let people innovate in ways that pull the bottom of the curve further up (as in the US)? I think the most effective system is for the government to do the minimum -- provide the absolutely destitute with food, shelter, basic health care, and educational opportunities, not enough that they'll be comfortable and content, but enough that they won't be completely miserable. But leave most of the money in the hands of whoever started with it, and let them come up with new products and services to raise the quality of life for everyone.
My friends in the US who are the poorest of the poor are definitely not as well off as the poorest of the poor in Belgium. They do actually have free (but limited) health care, free (but limited) education, a small wage from the government, and reduced-cost housing, but they'd have more in Belgium. But I think average people are better off in this country than they are in Belgium and the rest of semi-socialist Europe... and if Europe could no longer benefit from new products developed in the US under our system, and we could no longer benefit from new products developed there under that system, I think Europe would suffer far more than the US. The innovations created within this society benefit the poor (and the average and the rich) pretty much worldwide.
I see your point. However, your opinion to minimize taxes is based on what effect the taxes have on the curve you describe. Obviously, you disagree with the way the government spends taxpayer's money. I am no socialist, but I do think for instance the government should provide for quality health care and education for everyone. And I'd be happy to pay taxes for that.
I'd even be willing to condone government deficit for that. However, I can't help but frown very much about what caused the deficit in the US.
You sound like you have a prejudice about the government, that it can't do much good and as such, should be given the least possible financial resources and the least possible responsibilities. It may well work if some policies were to be reviewed.
I don't have a solution, I can only say I see this as a trade-off system. If you tax the rich too much, you're taking away incentive for people to make a difference and work their way to the top, which is bad for productivity and innovation all round. On the other hand, if you give too much to the poor, they will get lazy and take too much for granted.
I was also wondering... Tell me if you have this in America. Here, the government gives a monthly pay for each child you are parenting. Though I am 23, my parents still receive money to raise me since I am still attending university and not working and contributing to the taxes yet. Also, when you retire at 65 (or whatever age retirement is set to), the government gives you a monthly pay in proportion to your wage when you still had a job, and this till you die.
I find all of this very secure and worth paying for. But not through deficit spending.
But back to the US deficit. I was wondering, who/what finances the deficit? It is often said that Arab countries, that just float around in oil cash, re-invest their money in the US thereby re-financing the US economy. Sometimes I hear the same about strong economic countries from Asia. Can someone shed some light on this? Birds? I doubt Bush is pulling $400 bil. out from a high hat.
I'd even be willing to condone government deficit for that. However, I can't help but frown very much about what caused the deficit in the US.
You sound like you have a prejudice about the government, that it can't do much good and as such, should be given the least possible financial resources and the least possible responsibilities. It may well work if some policies were to be reviewed.
I don't have a solution, I can only say I see this as a trade-off system. If you tax the rich too much, you're taking away incentive for people to make a difference and work their way to the top, which is bad for productivity and innovation all round. On the other hand, if you give too much to the poor, they will get lazy and take too much for granted.
I was also wondering... Tell me if you have this in America. Here, the government gives a monthly pay for each child you are parenting. Though I am 23, my parents still receive money to raise me since I am still attending university and not working and contributing to the taxes yet. Also, when you retire at 65 (or whatever age retirement is set to), the government gives you a monthly pay in proportion to your wage when you still had a job, and this till you die.
I find all of this very secure and worth paying for. But not through deficit spending.
But back to the US deficit. I was wondering, who/what finances the deficit? It is often said that Arab countries, that just float around in oil cash, re-invest their money in the US thereby re-financing the US economy. Sometimes I hear the same about strong economic countries from Asia. Can someone shed some light on this? Birds? I doubt Bush is pulling $400 bil. out from a high hat.
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Lothar
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Re:
It's a two-part question: first, what effect do various policies actually have on the curve, and second, which of those possible effects is the best one? We have enough different countries with different policies that I think we can at least get a good feel for different effects, and I don't mind having multiple nations experimenting with different policies. The fun part of the question, IMO, is what the "best" policy is -- what do we want to accomplish?Tricord wrote:your opinion to minimize taxes is based on what effect the taxes have on the curve you describe.
I think the government should provide basic healthcare and education at the bottom of the ladder, but I think it should be such that everyone who has even a minimal capability to work should want to do so in order to have access to better services. The terminology someone gave earlier was good -- I want a safety net (to catch people when they're down), not a safety hammock (to let people relax and enjoy being lazy.)I do think for instance the government should provide for quality health care and education for everyone.
I agree. We spend a lot of money on stuff the government has no business spending money on.I can't help but frown very much about what caused the deficit in the US.
It's not that I think the government is entirely worthless... just mostly worthless. "Government" is just the short way of saying "people telling you what to do and using your money to do it". There are some cases where that's a good idea, but the government is not the ideal agent for a lot of the things they currently do. Even an ideal government shouldn't do everything, but especially when a government is as incompetent as ours (or yours or any other in the history of the world) it should only have very limited power.You sound like you have a prejudice about the government, that it can't do much good and as such, should be given the least possible financial resources and the least possible responsibilities.
Doesn't happen here. There are tax credits relating to the number of children you're currently raising, and those on welfare/SSI/SSDI get slightly increased payouts if they have more children, but for the most part, you're expected to raise your kids with whatever you earn doing whatever it is you do.Here, the government gives a monthly pay for each child you are parenting.
Out here, it's part private, part government. Each individual has the ability, during their career, to set up a retirement account. Sometimes this is just a large collection of stock or savings (with special "retirement" tax laws associated with it), while other times the company will agree to pay retirees a fixed salary based on how long they worked. The government part is called Social Security, and basically, they write checks of a certain amount per month to any retirees who don't have large enough retirement accounts to cover them. (Because payouts decrease for those who have substantial savings, my grandpa bought a vacation home just to keep the government from dropping the value of his checks.)Also, when you retire at 65 (or whatever age retirement is set to), the government gives you a monthly pay
Again, I come from the perspective that social security should be a safety net -- it should provide a liveable, but not luxurious, wage for those who don't save up for retirement. But most people should save up through their companies or on their own, and have no need to take any government payouts whatsoever.
Anybody who thinks it'll be profitable for them. A lot of Arab and Chinese companies do, but there are also banks in the US that do as well. I think there are even some individuals who finance the deficit, thinking they'll get a nice big payout next time a balanced budget amendment comes through.who/what finances the deficit?
