The 46th POTUS - Joseph R. Biden, Jr.

[Dscans]

Also, Ellis' John Oliver comment wasn't a bad one. It meant don't spend it on stupid shit like tax cuts for the wealthy, spend it on infrastructure projects - something that has been shown to be a good investment that ultimately pays for itself.

This conflates two different issues: (1) taxpayer money can be spent on useful things and it can be spent on stupid things (as an aside, it's always interesting to me when tax cuts are described as a government "cost") and (2) governments can spend money by raising revenue or borrowing.

Of course regardless of the way a government is paying for spending it's better for it to be spent on useful things than on foolish things that help a small group of people at everybody else's expense. But it does not follow that because the spending is on something perceived to be good (putting aside the subjectivity of that) that the accrued debt and consequences of today's spending are irrelevant.

Can you weigh in on the risks of taking on this much debt?

[4/5]

What exactly is this an existential fear of? Explain to me what you think might happen.

This is also really bizarre to me, but what else is new.

I find it bizarre that everybody's default position isn't that too much debt can be a bad thing.

One downside to ever-increasing deficits and a growing debt is the increase in interest payments. This year the federal government is spending about $500 billion on interest. The CBO (who systematically is off by about 10%) projects it will be $818 billion in interest in 2030. The federal government in recent years raises about $3.3 to 3.7 trillion in tax revenue. That means that currently at ultra low interest rates that approximately 1 out of every 7 dollars the government brings in via taxes is spent on interest to pay for past spending. No new goods or services coming in. That ratio is going to get worse.

This interest spending affects the government's ability to undertake other spending efforts since they are left with smaller shares of tax revenue to spend. So policymakers either choose not to spend more (or give tax cuts to their friends) or more likely they finance their spending projects and tax cuts through more borrowing, which leads to increased interest payments, and a shrinking share of tax revenue that can be spent, and I think you see how this goes.

To prevent this post from getting even longer, I'll just mention two other things briefly: According to OMB, Social Security and Medicare, etc. constitute a $55 trillion implicit liability. This is debt that we don't officially count as debt because the government hasn't borrowed this money but rather has promised to pay it out.

There is nothing that inherently causes people to be willing to lend to the U.S. federal government or that makes the U.S. dollar the world's reserve currency. Both of these things will be true until they aren't. And when they aren't the argument that the U.S. is able to play by a different set of debt rules than everybody else on the planet will cease to be true.

[4/5]

It speaks to Trump's idiocy (and failure to be the dictator he was accused of being) that he didn't spend on infrastructure. He could have Trump written on every bridge in America right now.

He advocated for that as candidate Trump, didn't he? I'm also surprised he didn't do it.

[Bi_3]

There is nothing that inherently causes people to be willing to lend to the U.S. federal government or that makes the U.S. the world's reserve currency. Both of these things will be true until they aren't. And when they aren't the argument that the U.S. is able to play by a different set of debt rules than everybody else on the planet will cease to be true.

This.

Hence why export-to-US based economies are working to find new trading partners. And they've figured out if one doesnt exist, or like the EU they cant get their shit together, you can make one via economic colonization. Like of a whole continent maybe. With a road to get to it and a belt to hold it in place.

[verb_to_trust]

None of you are economists. Isn't it kind of pie in sky ignorance to think that at no point the debt can reach a level that matters?

guy who bitches about masks and an epidemic says what?

Fuck off Jerry

wow, an epidemiologist and an economist

******

[elliseamos]

What exactly is this an existential fear of? Explain to me what you think might happen.

This is also really bizarre to me, but what else is new.

I find it bizarre that everybody's default position isn't that too much debt can be a bad thing.

One downside to ever-increasing deficits and a growing debt is the increase in interest payments. This year the federal government is spending about $500 billion on interest. The CBO (who systematically is off by about 10%) projects it will be $818 billion in interest in 2030. The federal government in recent years raises about $3.3 to 3.7 trillion in tax revenue. That means that currently at ultra low interest rates that approximately 1 out of every 7 dollars the government brings in via taxes is spent on interest to pay for past spending. No new goods or services coming in. That ratio is going to get worse.

This interest spending affects the government's ability to undertake other spending efforts since they are left with smaller shares of tax revenue to spend. So policymakers either choose not to spend more (or give tax cuts to their friends) or more likely they finance their spending projects and tax cuts through more borrowing, which leads to increased interest payments, and a shrinking share of tax revenue that can be spent, and I think you see how this goes.

To prevent this post from getting even longer, I'll just mention two other things briefly: According to OMB, Social Security and Medicare, etc. constitute a $55 trillion implicit liability. This is debt that we don't officially count as debt because the government hasn't borrowed this money but rather has promised to pay it out.

There is nothing that inherently causes people to be willing to lend to the U.S. federal government or that makes the U.S. dollar the world's reserve currency. Both of these things will be true until they aren't. And when they aren't the argument that the U.S. is able to play by a different set of debt rules than everybody else on the planet will cease to be true.

So if we taxed everything more than we are currently and we spent, say $2T over the next 10 years on things that provided greater opportunity for employment and increased commerce (both of which expands the tax pool) we could do something about this interest equation you speak of?

[elliseamos]

Somebody tell Joe Manchin about this middle of the road option between the unpaid tax cuts and the unpaid progressive plans!

[96583UP]

he almost bought a house 2 doors down from me one time

[96583UP]

if we don't upgrade infrastructure, we fail

spend this money now before it is used on a war

[4/5]

So if we taxed everything more than we are currently and we spent, say $2T over the next 10 years on things that provided greater opportunity for employment and increased commerce (both of which expands the tax pool) we could do something about this interest equation you speak of?

I think in a reply to Trag I said that the administration claims this infrastructure plan will be budget neutral over 15 years. It probably won't truly be, but if it's even close that's a major win. My post that you quoted is my response to why budget deficits and a growing debt matters and a basic intro to the argument that it's not sustainable, that the bills come due and there will be painful consequences; it's not a critique of this particular bill.

Infrastructure seems as reasonable a thing to spend money on as there is. And I don't doubt that there could be positive results and that it could even boost growth. But again, my issue is with the sentiment that it should 5 times larger. And then another $10 trillion for healthcare. And a trillion or two for student loan forgiveness and "free" college. I don't think there's anyway to expand tax revenue enough for that not to be fiscally disastrous. I respect this plan for at least purporting to pay for itself.

[elliseamos]

So is the game to go as follows for all 4 years?

Present plan
Attack it from the left
Thereby spooking Manchin and his beautiful centrist beliefs
Ignore the right's debunked worries
Pass plan

Will this even work?

So far so good...

https://thehill.com/homenews/house/5459 ... astructure

That poor woman...

4/5, this kicked off by me pointing out that we're officially in step 2 of my perceived Biden approach to governance.

Which is to say, "thanks for explaining."

[4/5]

So is the game to go as follows for all 4 years?

Present plan
Attack it from the left
Thereby spooking Manchin and his beautiful centrist beliefs
Ignore the right's debunked worries
Pass plan

Will this even work?

So far so good...

https://thehill.com/homenews/house/5459 ... astructure

That poor woman...

4/5, this kicked off by me pointing out that we're officially in step 2 of my perceived Biden approach to governance.

Which is to say, "thanks for explaining."

That's about right. Manchin will steadfastly make everybody hate him by demanding the corporate tax rate only be increased to 25%.

[elliseamos]

So is the game to go as follows for all 4 years?

Present plan
Attack it from the left
Thereby spooking Manchin and his beautiful centrist beliefs
Ignore the right's debunked worries
Pass plan

Will this even work?

So far so good...

https://thehill.com/homenews/house/5459 ... astructure

That poor woman...

4/5, this kicked off by me pointing out that we're officially in step 2 of my perceived Biden approach to governance.

Which is to say, "thanks for explaining."

That's about right. Manchin will steadfastly make everybody hate him by demanding the corporate tax rate only be increased to 25%.

Sounds about right.

[elliseamos]

There is nothing that inherently causes people to be willing to lend to the U.S. federal government or that makes the U.S. the world's reserve currency. Both of these things will be true until they aren't. And when they aren't the argument that the U.S. is able to play by a different set of debt rules than everybody else on the planet will cease to be true.

This.

Hence why export-to-US based economies are working to find new trading partners. And they've figured out if one doesnt exist, or like the EU they cant get their shit together, you can make one via economic colonization. Like of a whole continent maybe. With a road to get to it and a belt to hold it in place.

Wouldn't said continent have to be "secure" and maybe the large bases the US has created with debt-bursting willfulness - in this hypothetical place of course - makes it just as risky an investment for said export-to-US economy?

[elliseamos]

Doesn't China own less than 5% of the debt? Most is owed to us Americans.

And this should be more widely and loudly pointed out.

[4/5]

Doesn't China own less than 5% of the debt? Most is owed to us Americans.

And this should be more widely and loudly pointed out.

The is one of my favorite myths to bust in the classroom. When I ask who does the federal government borrow from, everybody always says China. I haven't looked at the numbers recently but Japan actually passed China a couple of years ago as the biggest foreign holder of treasury debt. Not that I think it matters tremendously who the federal government owes.

[elliseamos]

Doesn't China own less than 5% of the debt? Most is owed to us Americans.

And this should be more widely and loudly pointed out.

The is one of my favorite myths to bust in the classroom. When I ask who does the federal government borrow from, everybody always says China. I haven't looked at the numbers recently but Japan actually passed China a couple of years ago as the biggest foreign holder of treasury debt. Not that I think it matters tremendously who the federal government owes.

Google says of our $7T the top 4 are:

Japan ($1.2T)
China ($1.0T)
UK ($440B)
Ireland ($318B)

[Bi_3]

There is nothing that inherently causes people to be willing to lend to the U.S. federal government or that makes the U.S. the world's reserve currency. Both of these things will be true until they aren't. And when they aren't the argument that the U.S. is able to play by a different set of debt rules than everybody else on the planet will cease to be true.

This.

Hence why export-to-US based economies are working to find new trading partners. And they've figured out if one doesnt exist, or like the EU they cant get their shit together, you can make one via economic colonization. Like of a whole continent maybe. With a road to get to it and a belt to hold it in place.

Wouldn't said continent have to be "secure" and maybe the large bases the US has created with debt-bursting willfulness - in this hypothetical place of course - makes it just as risky an investment for said export-to-US economy?

No. Vietnam proved soldiers can't hold foreign soil anymore, so you have to use other methods. I highly recommend reading up on how the US used debt to control developing nations for decades to understand how this alternative works.

[elliseamos]

There is nothing that inherently causes people to be willing to lend to the U.S. federal government or that makes the U.S. the world's reserve currency. Both of these things will be true until they aren't. And when they aren't the argument that the U.S. is able to play by a different set of debt rules than everybody else on the planet will cease to be true.

This.

Hence why export-to-US based economies are working to find new trading partners. And they've figured out if one doesnt exist, or like the EU they cant get their shit together, you can make one via economic colonization. Like of a whole continent maybe. With a road to get to it and a belt to hold it in place.

Wouldn't said continent have to be "secure" and maybe the large bases the US has created with debt-bursting willfulness - in this hypothetical place of course - makes it just as risky an investment for said export-to-US economy?

No. Vietnam proved soldiers can't hold foreign soil anymore, so you have to use other methods. I highly recommend reading up on how the US used debt to control developing nations for decades to understand how this alternative works.

Sorry, I meant that the US can influence security/stability (as they always have at a steep price) to jeopardize China’s return on investment. Even since Vietnam we've got plenty of examples of occupying not being an option, so my point was that unless China plans to occupy (which is yet another massive investment on their part and a flawed strategy) their plans demand cooperation between our countries.

But pass along a resource for me to understand your point better.

[Orpheus]

I meant it's more bizarre in the sense of the "existential fear" sense. There's about 100 things to fear before we get to the debt, like getting shot in the face or dying in a disaster caused by state neglect.