Economy

[BigRedBuster]

1 minute ago, Dr. Strangelove said:

Frankly, this isn't possible. 

 

The cuts that would have to be made - or the tax increases necessary - to make programs solvent simply aren't possible.

 

Mandatory spending (Social Security, Medicare, Medicaid, interest on Bonds)+ Defense takes up ~80% of all spending. 

 

Of the remaining ~20%, spending on Veterans Care and other benefits represents around 4%. 

 

That leaves around 16% of government spending that could be cut. They could fire every government employee, stop spending on education, end subsidies for agriculture and cease spending money on international affairs, stop funding science, etc. After all that, the country would still run a budget deficit of ~150 billion.

We were running a surplus under Clinton.

[Dr. Strangelove]

9 minutes ago, BigRedBuster said:

We were running a surplus under Clinton.

That was 30 years ago when the average Baby Boomer was in the workforce.

 

Now, those same people are retiring, at a rate of 10,000 per day. That's more Social Security money and more Medicare money that needs to be spent. As they get older and into their 80s, the healthcare costs will mount further and further. Note: the most expensive healthcare costs occur in the last year of life, which the average baby Boomer will start to reach in the 2030s.

 

Compounding the problem is a sharply dropping birthrate. The ratio of workers-per-retiree was much higher in the 90s. Now, it is much lower.

 

Long story short, the conditions that lead to the budget surplus in the 1990s - baby boomers in the workforce supporting a small number of retirees - is not possible today. Still, our demographic problems are not as bad as other places. The demographic apocalypse facing China, for example, is a lot more severe. 

[Born N Bled Red]

1 hour ago, Dr. Strangelove said:

That was 30 years ago when the average Baby Boomer was in the workforce.

 

Now, those same people are retiring, at a rate of 10,000 per day. That's more Social Security money and more Medicare money that needs to be spent. As they get older and into their 80s, the healthcare costs will mount further and further. Note: the most expensive healthcare costs occur in the last year of life, which the average baby Boomer will start to reach in the 2030s.

 

Compounding the problem is a sharply dropping birthrate. The ratio of workers-per-retiree was much higher in the 90s. Now, it is much lower.

 

Long story short, the conditions that lead to the budget surplus in the 1990s - baby boomers in the workforce supporting a small number of retirees - is not possible today. Still, our demographic problems are not as bad as other places. The demographic apocalypse facing China, for example, is a lot more severe. 

 

So maybe instead of cutting taxes on boomers to satiate their greed, over the last 25 years (thanks Bush, Trump) it should have been raised so that social security had enough to pay them in the future. They should have practiced what they preached and practices some responsibility. 

[Dr. Strangelove]

1 hour ago, Born N Bled Red said:

 

So maybe instead of cutting taxes on boomers to satiate their greed, over the last 25 years (thanks Bush, Trump) it should have been raised so that social security had enough to pay them in the future. They should have practiced what they preached and practices some responsibility. 

Correct.

 

However it was - and still is - political suicide to adequately address these problems. 

 

The best course of action is a modest tax increase on the wealthy, taxing capital gains as income, raising the retirement age by a year or two, and significant cuts to military spending.

 

However, cutting military spending is a non-starter. Contrary to popular belief, military spending is not largely in contracts or weapons acquisition (although there is bloat to cut there). Most military spending is in pay and benefits which cannot be touched. 

[Born N Bled Red]

1 minute ago, Dr. Strangelove said:

Correct.

 

However it was - and still is - political suicide to adequately address these problems. 

 

The best course of action is a modest tax increase on the wealthy, taxing capital gains as income, raising the retirement age by a year or two, and significant cuts to military spending.

 

However, cutting military spending is a non-starter. Contrary to popular belief, military spending is not largely in contracts or weapons acquisition (although there is bloat to cut there). Most military spending is in pay and benefits which cannot be touched. 

 

Agreed, take care of the troops. I think the aid and the results we've seen in Ukraine make it clear. It is important for the US to carry a big stick. Slivers of that stick (and other sticks) are leading to Russia's defeat without US personnel even involved. 

[BigRedBuster]

2 minutes ago, Dr. Strangelove said:

However, cutting military spending is a non-starter. Contrary to popular belief, military spending is not largely in contracts or weapons acquisition (although there is bloat to cut there). Most military spending is in pay and benefits which cannot be touched. 

The hell it can't.  We don't need the number of people in the military we have right now.  DOWN SIZE!!!!

[Dr. Strangelove]

1 minute ago, BigRedBuster said:

The hell it can't.  We don't need the number of people in the military we have right now.  DOWN SIZE!!!!

When I say it can't be touched, I'm simply referring to the political aspects.

 

The uncomfortable reality is that the military is a giant jobs program with extremely generous benefits - particularly retirement. They have one of the most generous retirement plans in the world. 

 

Still, even with large adjustments in pay, benefits, and a reduction in troops - the cut to defense spending is still likely to be insufficient to run a budget surplus. The issue is largely demographic: people are simply not having enough children to compensate for an aging population. 

[BigRedBuster]

2 minutes ago, Dr. Strangelove said:

When I say it can't be touched, I'm simply referring to the political aspects.

 

The uncomfortable reality is that the military is a giant jobs program with extremely generous benefits - particularly retirement. They have one of the most generous retirement plans in the world. 

 

Still, even with large adjustments in pay, benefits, and a reduction in troops - the cut to defense spending is still likely to be insufficient to run a budget surplus. The issue is largely demographic: people are simply not having enough children to compensate for an aging population. 

And, that's the problem.  Our military spending is so out of control that people can't even fathom bringing it back under control.  

 

Here's an idea!!!!  EVERYONE in the private sector is begging for employees.  NOW would be a great time to cut the military numbers because those people would easily be able to find jobs in the private sector.  

 

But, we have got to get over this idea that we need to be spending so much more than the rest of the entire world combined.  It's idiotic.  What we could do with that on infrastructure alone would be a game changer in this country.

[Archy1221]

 

[BigRedBuster]

Thanks Joe.

 

https://www.reuters.com/world/us/us-reaches-tentative-agreement-with-rail-workers-strike-2022-09-15/

[BigRedBuster]

Wow....Oil and gas took a big hit today.  Oil is below $80 for the first time since, I think, January.

 

Thanks Joe.  Keep it going.

 

FYI...Natural gas has dropped 30% since August 23rd.

[Archy1221]

5 hours ago, BigRedBuster said:

Wow....Oil and gas took a big hit today.  Oil is below $80 for the first time since, I think, January.

 

Thanks Joe.  Keep it going.

 

FYI...Natural gas has dropped 30% since August 23rd.

Right on Joe. Hopefully gas prices will get closer to what he inherited.    Now try not to be the first President with negative market returns.   Is that too much to ask??

[Born N Bled Red]

On 9/23/2022 at 1:41 PM, BigRedBuster said:

Wow....Oil and gas took a big hit today.  Oil is below $80 for the first time since, I think, January.

 

Thanks Joe.  Keep it going.

 

FYI...Natural gas has dropped 30% since August 23rd.

 

That was my birthday wish. You're welcome, haha. 

[Danny Bateman]

On 9/23/2022 at 8:08 PM, Archy1221 said:

Right on Joe. Hopefully gas prices will get closer to what he inherited.    Now try not to be the first President with negative market returns.   Is that too much to ask??

 
Ahh yes, blue collar, All-American Joe Everyman in real America watches breathlessly to see what the Dow does before deciding which lever to pull this fall.

[Archy1221]

8 hours ago, Danny Bateman said:

 
Ahh yes, blue collar, All-American Joe Everyman in real America watches breathlessly to see what the Dow does before deciding which lever to pull this fall.

Obviously not.