President Obama announces that an eleventh-hour debt deal has been reached

I was just listening to him on the BBC radio station and he was talking about how the banks do not have the countries best interests, and sometimes lowering your lending rate is not that big of a deal, there is relatively little difference between AAA and AA.

Of course he also said they should have let Greece and others default, and reset their economies....

I am no economist, but it sounds pretty reasonable to me to focus more on what is right for the country and not worry so much about the banks.

DD

 

Good thing there weren't any really deep cuts then. The apoplexy from the left over this deal is startling. Even if the "cuts" weren't backloaded, they amount to an average cut of about 90 billion per year. That is only about 6 percent of the deficit. We aren't even talking about reducing the debt with this, just growing the debt slightly slower than before. I understand that the deal doesn't tax the rich enough to satisfy some people, but this is hardly the deep and meaningful spending cuts that some of us were looking for. If the cuts they were doing were permanent reductions in spending and the amounts they were talking about were the amount by which annual spending would be reduced, then we would have this discussion. Instead they didn't really fix much of anything and we basically ended up with the debt ceiling getting raised and not much else happening.

 

That might be the case if the deal actually cut spending in a weak economy. But as has been posted at least 5 separate times in this thread, there are no spending cuts in the 2012 budget.

You'd think, at some point, people would actually learn about what's in the deal before criticizing it.

 

I stopped there (Iceland) in route to Europe in the early 1970's on Icelandic Air, which had the cheapest commercial flights at the time, New York to Luxembourg (which was a trip in itself, but I digress), and while it was cold in early March, it was a lot colder in Luxembourg.

 

Cutting your spending won't help if you don't have enough money coming in anyway.
Raise taxes, at least on the rich. PLEASE.

 

how much revenue would that raise?

 

Our government is embarrassing, like a boatload of clowns. Sound and fury signifying nothing. The poor skate, the rich skate, the rest of us will pay. Will we ever have a government of the Majority, middle class working people of all races, colors, and religions

 

how many billions?

 

The rich are certainly skating free right now, we should go back to the tax rates under Reagan !

DD

 

can we go back to the spending rates under reagan as well?

 

We already are.

 

I disagree with a number of points you've made throughout this thread in support of the plan, but this is the kicker.

It was not even remotely about long-term fiscal health. It was purely political. It was designed to accomplish the goals of the Republican Party without going through the normal process... because they could not do this through the normal process. That it has the added benefit of making sure the economy is the equivalent of the Dodo Bird between now and the 2012 election is just gravy.

The people screaming about the long term fiscal health of this nation did everything possible to wreck it during the W years and only started caring about it when they lost the WH. The people who are at least aware of the realistic problems with our long term fiscal health just acquiesed to a deal that will end up harming that long term fiscal health.

This "deal" was a resolution to an absolutely unecessary crisis created out of whole cloth by Republicans to accomplish what they couldn't through legislation.

Now, we have this Supergroup of congressmen (ugh) that will come forward with recommendations. What could happen? Well, they could up with a plan that guts discretionary spending which the Dems won't agree to, they could come up with a plan that pushes the bulk of the 'savings" onto DOD which the Repubs won't agree to, or they could come up with cuts and taxes, which the Repubs will be dead set against. None of those outcomes favor the long term fiscal health of our country... but none of those will actually happen.

Instead, we'll get another hostage taking by the Repubs and the DOD cuts will be taken off the table or greatly reduced and we'll be arguing over entitlements and discretionary spending after which another "deal" will be announced which will give the Repubs something they wouldn't be able to achieve legislatively and we start all over again... but closer to the 2012 election.

The other thing that will happen is that as soon as a Republican is sitting in the WH, this concern for long term fiscal health among the GOP will vanish and they will all become corporate Keynesians and if Dems then try to emulate the scorched earth politics of the Repubs, they will get a a lot of tsk-tsking and stories about how the Dems are unreasonable and using tactics that are outside the norm.

Republicans are now like the twisted Nazi colonel that tells the town priest to pick 5 people that will be shot or else the whole town will be massacred and Democrats are like the scared townspeople that could storm the Nazis and after taking considerable losses do away with the threat but would rather stand there and hope the Nazis are reasonable and just go away.

Yep, I said it. This whole thing sucks and none of it is good for the country or the Long-term fiscal health of the country.

You know what would be good for the long term fiscal health of the country? People working and the economy growing.

 

If this deal is approved we'll be in Eisenhower territory.

 

The last time we had a surplus.

I saw an article last year that showed that out of every $1 we take in in taxes...... that .26 cents went to the INTEREST on the debt.

Not paying it down, just the interest.

That is upside down BS, right there.

DD

 

great summary, and deeper dive into the BCA from Keith Hennessey. three articles, two of which are straight analysis:

http://keithhennessey.com/2011/08/01/bca-summary/

 

The interest rate is about 3% right now on average, which would mean we pay about 450 billion in interest a year. And the government takes in around 1.8 trillion of tax a year. Sounds pretty close.