The $106 Trillion deficit

[TGHusker]

This may wake us up. What should we do?

 

 

http://www.nationalreview.com/article/350983/ron-johnsons-transformative-proposal-jonathan-strong

[krill]

In the good old days, when nations went to war and won, cities were sacked and pillaged, the population enslaved, and the conquered nations were then squeezed for money as a client state. We have the most powerful military in the history of world, maybe we should start looking for a military solution. Historically Parthia (modern day Iran) was always a juicy target for conquest, maybe we could start there?

 

I do consider this a more serious proposal than the ones presented by our politicians.

[carlfense]

I wonder why the GOP chose to switch the projection from 10 years to 30 years?

[JJ Husker]

I wonder why the DNC chooses to rely on heavily manipulated shorter term CBO projections. ;P

 

And I wonder why so many seem so willing to readily pick up the tab for continued mismanagement of financial concerns of our government rather than forcing change.

[carlfense]

I wonder why the DNC chooses to rely on heavily manipulated shorter term CBO projections. ;P

Yeah . . . the bipartisan CBO projections are "heavily manipulated" and the GOP Senate projections are pure as the driven snow.

 

Why switch to 30 years when 10 years has been the standard? It couldn't be because the deficit is falling, could it? I mean . . . that would sound like we aren't on the brink of catastrophe.

[TGHusker]

I wonder why the DNC chooses to rely on heavily manipulated shorter term CBO projections. ;P

Yeah . . . the bipartisan CBO projections are "heavily manipulated" and the GOP Senate projections are pure as the driven snow.

 

Why switch to 30 years when 10 years has been the standard? It couldn't be because the deficit is falling, could it? I mean . . . that would sound like we aren't on the brink of catastrophe.

The longer the view may force us to look for longer term solutions to our overall debt mgmt issues. I think it is wise to have a longer term look - republican or not - I'd be supportive if a dem offered the idea- otherwise we keep implementing short term solutions. The further you see down the road, the more time you have to react. The reaction however should not be in panic - causing overreaction.

[carlfense]

I wonder why the DNC chooses to rely on heavily manipulated shorter term CBO projections. ;P

Yeah . . . the bipartisan CBO projections are "heavily manipulated" and the GOP Senate projections are pure as the driven snow.

 

Why switch to 30 years when 10 years has been the standard? It couldn't be because the deficit is falling, could it? I mean . . . that would sound like we aren't on the brink of catastrophe.

The longer the view may force us to look for longer term solutions to our overall debt mgmt issues. I think it is wise to have a longer term look - republican or not - I'd be supportive if a dem offered the idea- otherwise we keep implementing short term solutions. The further you see down the road, the more time you have to react. The reaction however should not be in panic - causing overreaction.

That'd be true if it were possible to accurately predict what the distant future will be. The problem is that, in general terms, the farther a projection looks ahead the less accurate that projection will be. That's why 10 years has been the standard . . . until, of course . . . it became politically inconvenient.

[TGHusker]

I wonder why the DNC chooses to rely on heavily manipulated shorter term CBO projections. ;P

Yeah . . . the bipartisan CBO projections are "heavily manipulated" and the GOP Senate projections are pure as the driven snow.

 

Why switch to 30 years when 10 years has been the standard? It couldn't be because the deficit is falling, could it? I mean . . . that would sound like we aren't on the brink of catastrophe.

The longer the view may force us to look for longer term solutions to our overall debt mgmt issues. I think it is wise to have a longer term look - republican or not - I'd be supportive if a dem offered the idea- otherwise we keep implementing short term solutions. The further you see down the road, the more time you have to react. The reaction however should not be in panic - causing overreaction.

That'd be true if it were possible to accurately predict what the distant future will be. The problem is that, in general terms, the farther a projection looks ahead the less accurate that projection will be. That's why 10 years has been the standard . . . until, of course . . . it became politically inconvenient.

I agree with that Carl - that is why one shouldn't over-react. there might be incremental changes that can be made. If Johnson's proposal is purely political, then it is given for the wrong reason. If it is done out of prudence then that is OK. Prudence would say the larger our long term debt and deficit spending commitments the longer time frame we need to manage it. Now if the economy picks up steam and does a 1980s style rebound or a mid to late 1990s type rebound, then the management changes would not be so difficult - Better economy yields more tax revenue + spending restraint = lower deficit

[carlfense]

I wonder why the DNC chooses to rely on heavily manipulated shorter term CBO projections. ;P

Yeah . . . the bipartisan CBO projections are "heavily manipulated" and the GOP Senate projections are pure as the driven snow.

 

Why switch to 30 years when 10 years has been the standard? It couldn't be because the deficit is falling, could it? I mean . . . that would sound like we aren't on the brink of catastrophe.

The longer the view may force us to look for longer term solutions to our overall debt mgmt issues. I think it is wise to have a longer term look - republican or not - I'd be supportive if a dem offered the idea- otherwise we keep implementing short term solutions. The further you see down the road, the more time you have to react. The reaction however should not be in panic - causing overreaction.

That'd be true if it were possible to accurately predict what the distant future will be. The problem is that, in general terms, the farther a projection looks ahead the less accurate that projection will be. That's why 10 years has been the standard . . . until, of course . . . it became politically inconvenient.

I agree with that Carl - that is why one shouldn't over-react. there might be incremental changes that can be made. If Johnson's proposal is purely political, then it is given for the wrong reason. If it is done out of prudence then that is OK. Prudence would say the larger our long term debt and deficit spending commitments the longer time frame we need to manage it. Now if the economy picks up steam and does a 1980s style rebound or a mid to late 1990s type rebound, then the management changes would not be so difficult - Better economy yields more tax revenue + spending restraint = lower deficit

+1

[JJ Husker]

I wonder why the DNC chooses to rely on heavily manipulated shorter term CBO projections. ;P

Yeah . . . the bipartisan CBO projections are "heavily manipulated" and the GOP Senate projections are pure as the driven snow.

 

Why switch to 30 years when 10 years has been the standard? It couldn't be because the deficit is falling, could it? I mean . . . that would sound like we aren't on the brink of catastrophe.

 

I did not mean to imply either side had better projections or were operating without bias. I simply feel when you are dealing with trillions of dollars and you know both parties are biased and generally the government cannot be trusted, then it would be best to be more conservative with the numbers. Based on this article, it would appear our economy is facing a much stiffer challenge in the future than has been indicated by some ten year CBO projections. Trillions don't turn around very quickly in a ten year period without massive change and if we let it get further out of hand, it may never turn around. Personally I would rather leave our children and their children less of a sh#t sandwich instead of assuming either political party is capable of making responsible decisions.

[carlfense]

Based on this article, it would appear our economy is facing a much stiffer challenge in the future than has been indicated by some ten year CBO projections.

Huh?

[JJ Husker]

Based on this article, it would appear our economy is facing a much stiffer challenge in the future than has been indicated by some ten year CBO projections.

Huh?

Huh what? did you read the linked article? Some excerpts;

 

"Obama officials came into the initial meetings on the Hill reiterating the president’s position that $4 trillion in deficit reduction would basically solve the problem for now. But according to GOP deficit projections subsequently prepared by Johnson and obtained by National Review Online, the true size of the problem is staggering, and surprised even many of the seasoned budget negotiators involved. $4 trillion? Try $106 trillion, the medium estimate. That’s $106,954,000,000,000. Even the lowest, extremely conservative estimate comes in at $72 trillion; the highest is over $120 trillion. The amounts are so large that some controversial reforms appear inconsequential in comparison. Take Obama’s “chained CPI” proposal: it would save an estimated $89 billion over ten years, or 1.3 percent of the total deficit over those same ten years."

 

 

"CBO’s long-term budget outlook, for example, offers two estimates: the “baseline” scenario and “alternative fiscal scenario.” Baseline is according to current law, including all of the gimmicks Congress has put in current law to game their CBO scores. According to that, we’re totally fine — the debt will slowly go down without Congress’s having to do anything. It’s also fantasy. The other scenario is more realistic. In it, debt begins to really ramp up around 2025, and quickly becomes unwieldy — even insurmountable — by 2040, when the graph ends."

 

So, my take away was that things are not near as rosy as they have been portrayed to be. What did you get out of that article?

[carlfense]

Based on this article, it would appear our economy is facing a much stiffer challenge in the future than has been indicated by some ten year CBO projections.

Huh?

Huh what? did you read the linked article? Some excerpts;

 

"Obama officials came into the initial meetings on the Hill reiterating the president’s position that $4 trillion in deficit reduction would basically solve the problem for now. But according to GOP deficit projections subsequently prepared by Johnson and obtained by National Review Online, the true size of the problem is staggering, and surprised even many of the seasoned budget negotiators involved. $4 trillion? Try $106 trillion, the medium estimate. That’s $106,954,000,000,000. Even the lowest, extremely conservative estimate comes in at $72 trillion; the highest is over $120 trillion. The amounts are so large that some controversial reforms appear inconsequential in comparison. Take Obama’s “chained CPI” proposal: it would save an estimated $89 billion over ten years, or 1.3 percent of the total deficit over those same ten years."

 

 

"CBO’s long-term budget outlook, for example, offers two estimates: the “baseline” scenario and “alternative fiscal scenario.” Baseline is according to current law, including all of the gimmicks Congress has put in current law to game their CBO scores. According to that, we’re totally fine — the debt will slowly go down without Congress’s having to do anything. It’s also fantasy. The other scenario is more realistic. In it, debt begins to really ramp up around 2025, and quickly becomes unwieldy — even insurmountable — by 2040, when the graph ends."

 

So, my take away was that things are not near as rosy as they have been portrayed to be. What did you get out of that article?

It looks like the part that you quoted is about the GOP's projected deficit and not about your claim that "our economy (emphasis added) is facing a much stiffer challenge in the future than has been indicated".

 

As you said . . . "did you read the linked article?"

[JJ Husker]

Well Carl, if you don't think the deficit adversely affects our economy, I would suggest some remedial economics classes might get you up to speed. Or, better yet, possibly quit trying to turn everything into a partisan issue. $4T to $72T to $106T is not just a few little tweaks apart. My point was that if a person is relying on the $4T figure or the ten year CBO projections, the reality is much worse for our deficit AND our economy.

[carlfense]

Well Carl, if you don't think the deficit adversely affects our economy, I would suggest some remedial economics classes might get you up to speed.

The condescension doesn't really work so well when you're just making claims up . . .

 

(Then again . . . when you say "did you read the article" when the article doesn't talk about what you're claiming . . . it's possible that you don't understand how condescension works. In that case, "I would suggest some remedial classes might get you up to speed.")

 

My point was that if a person is relying on the $4T figure or the ten year CBO projections, the reality is much worse for our deficit AND our economy.

Uh huh.