|
| 1 person marked this as a favorite. |
Now I agree with you, the government defaulting is going to be very painful, very ugly. It will cause people to get wiped out, riots, etc.
But the default is going to happen. The longer it takes to happen, the greater the pain.
Wow. It's pretty rare that you see a conservative admit that the end goal of their agenda is to trigger the deaths of Americans and provoke riots.
There are so many ways we could deal with our problems that wouldn't result in a wave of death and destruction, but hey - NPC Dave is sure it will happen eventually, so let's just pull the band-aid off and get a bunch of our fellow Americans killed by making it happen now.
Republicans new motto "Let's Rebuild America From The Ashes Of The Fire We Set!"
| 1 person marked this as a favorite. |
The times the USA has been at its worse is when the rich are increasing their ownership -- the great depression had demographics that mirror today's demographics. The times the USA was doing its best was during the middle class boom.
This isn't an accident either -- Rome had a similar situation, as did the British Kingdom before it started falling apart (in fact the revolution in the Americas was started by the greed of the rich causing them to try to force tariffs on the colonies), France before their revolutions, Russia... the list goes on and on.
No country falls when it is taking care of its citizens and providing for them -- only when it some doing so and the rich start racking it up even faster do nations start to collapse.
Keynesian myth
Past 20 years have done nothing but prov Keynesian economics right after the incredible failures of Austrian and Chicago.
Austrian under Reagan has brought us the entire culture of debt and laid the foundations for the obscene wage disparities we see today.
Chicago has brought us a whole lot of bubble that hurt us when they popped (but didn't seem to sting the ones who made it, funny, that).
Keynesian economics has been the birthplace of every modern economy, got us out of the Great Depression, and has turned many a SE Asian country into an economic juggernaut literally years after they were reduced to rubble.
Seems clear to my which schools have the "myths."
How much spending and stimulus is enough?
How much do we need to raise taxes to "fix" our budget problems?
Will a trillion dollar a year tax increase be enough to keep the supporters of a large and involved government happy? How about 1.5 or 2 trillion? Would that be enough?
Is there any intention of paying the down national debt? Are we generating trillions in debt we never intend to pay off?
How much do we have to spend to spend our way out of our spending problem?
|
|
You made two errors here, first being that I am not a conservative. Second, my agenda would be to avoid deaths and riots. That is why I pointed out the more money borrowed, the more likely for a US default, not less.
In this thread you've defended the nonsense that is supply side economics and dismissed Keynesian economics -- the only model of economics with a proven track record of working -- as "myths."
I don't care what you call yourself. You look like a duck, walk like a duck, and quack like a duck. You're a duck. You can say "I'm no duck!" all you want, but you're still a duck.
Those who want the debt ceiling raised are playing with fire.
No, they really aren't. Those who want to default are playing with fire. Those who want to raise the debt ceiling are being sensible.
There are so many ways we could deal with our problems that wouldn't result in a wave of death and destruction, but hey - NPC Dave is sure it will happen eventually, so let's just pull the band-aid off and get a bunch of our fellow Americans killed by making it happen now.Really? Is that what I said? Let's check...
"Now I agree with you, the government defaulting is going to be very painful, very ugly. It will cause people to get wiped out, riots, etc.
But the default is going to happen. The longer it takes to happen, the greater the pain."
Yep, that appears to be what you really said.
Oh sure, you suggested we could hold off until those who can insulate themselves against the shock are insulated, but there will never be a point where allowing a default to happen won't cause suffering and death for millions of Americans.
I specifically said that we can postpone the pain and people should prepare now so they won't suffer when it does happen.
It never needs to happen. We are a long ways from risking a forced default, and all of our problems could be easily solved by a) ending the Bush wars and b) ending the Bush tax cuts and c) not voting for Republicans and conservative with their We Must Destroy America To Save America Agenda.
We could double the current deficit with stimulus spending, end the recession, and then raise taxes to something approaching European levels for a decade and we would be hunky-dory. Anyone talking seriously about choosing to default is at best completely unserious, and at worse completely sociopathic.
But there isn't any point in arguing this with someone who says the sort of things you've said in this thread. The banks are currently sitting on trillions of dollars they could invest in job creation, but they aren't doing it. They are currently "stuffing it in mattresses." Why aren't they creating jobs?
Because there is no demand for goods and services! People aren't buying anything because most people are broke. The "job creators" are sitting on tons of wealth, and using it to do fun things like drive up the price of food through speculation on commodities (because after destroying the housing market, why not destroy the agricultural markets?), but not investing in new jobs (at least not in America). It's a vicious cycle that ends with America as a new third world country.
There needs to be a massive influx of money into the consumer class to kick-start buying again, so that the "job creators" can know where to invest that huge pile of money they are currently sitting on (despite the best tax climate in the Western world, and the lowest interest rates in a century).
I mean, look at your completely facetious argument against raising taxes. It won't "close the gap," whatever that means. It's like you have no clue how economics work at all. Government spending hasn't risen - non-government spending has fallen. If we raise taxes so that we aren't running deficits, we can leverage debt into stimulus, grow the economy, and thus reduce the portion of GDP that is government spending.
But reducing government spending isn't going to increase private sector spending. That's just not how it works. Reducing government spending will simply reduce the amount of money entering into the consumer market, thus reducing demand, thus causing further contraction of the markets and accelerating America's collapse into anarchy.
If you take the only institution maintaining a fourth of the economy out of play, there won't be a massive expansion in the market - there will be a massive contraction! Because you've just reduced demand by a quarter! It's really not that hard to figure out.
Seriously, the issues we are facing in our economy now are entirely a demand side problem, and using supply side solutions to address a demand side problem isn't just a bad idea, it's a suicidal idea.
And FYI, I am not a Republican.
Quack quack.
How much spending and stimulus is enough?
How much do we need to raise taxes to "fix" our budget problems?
Will a trillion dollar a year tax increase be enough to keep the supporters of a large and involved government happy? How about 1.5 or 2 trillion? Would that be enough?
Is there any intention of paying the down national debt? Are we generating trillions in debt we never intend to pay off?
How much do we have to spend to spend our way out of our spending problem?
I repeat the questions yet again.
How much spending and stimulus is enough?
The question is more "where should it go?" Our last stimulus package didn't go to job creation, it went to "job creators" who, as we have by now LONG since discovered, do a lot of things, but mostly they don't create jobs
How much do we need to raise taxes to "fix" our budget problems?
If people want 1950's standard of living they're going to need to pay 1950's standard of tax rates.
Will a trillion dollar a year tax increase be enough to keep the supporters of a large and involved government happy? How about 1.5 or 2 trillion? Would that be enough?
Define "large and involved government" because you seem to think all government cuts the same. There's a huge difference between the TSA and Medicare.
Is there any intention of paying the down national debt? Are we generating trillions in debt we never intend to pay off?
Before Reagan we were a country that loaned money out. Now we're a country that borrows. It's absolutely possible to pay down the national debt, but that means we have to abandon Reaganism.
How much do we have to spend to spend our way out of our spending problem?
We don't have a spending problem. We have an income problem.
If Greece has taught you anything it should be that austerity will not fix the problem. We're doing everything they did - ignore the issue of income and attack social benefits. Where are they now? Where are we headed?
How much spending and stimulus is enough?The question is more "where should it go?" Our last stimulus package didn't go to job creation, it went to "job creators" who, as we have by now LONG since discovered, do a lot of things, but mostly they don't create jobs
How much do we need to raise taxes to "fix" our budget problems?If people want 1950's standard of living they're going to need to pay 1950's standard of tax rates.
Will a trillion dollar a year tax increase be enough to keep the supporters of a large and involved government happy? How about 1.5 or 2 trillion? Would that be enough?Define "large and involved government" because you seem to think all government cuts the same. There's a huge difference between the TSA and Medicare.
Is there any intention of paying the down national debt? Are we generating trillions in debt we never intend to pay off?Before Reagan we were a country that loaned money out. Now we're a country that borrows. It's absolutely possible to pay down the national debt, but that means we have to abandon Reaganism.
How much do we have to spend to spend our way out of our spending problem?We don't have a spending problem. We have an income problem.
If Greece has taught you anything it should be that austerity will not fix the problem. We're doing everything they did - ignore the issue of income and attack social benefits. Where are they now? Where are we headed?
Where should it go? So the $800,000,000,000 stimulus that lowered working class taxes and sent tens of billions of dollars to "shovel ready projects" was not nearly enough in your opinion? It looks to me like your Keynesian plan failed abysmally. I gather your new plan for borrowing from the Chinese is to try again with more but spend more differently? The government thrives on failure so give it more money? This seems like a bad idea to me.
1950's, so you want 80% marginal tax rates on income or do you want much higher rates? Do you think we should jack up corporate rates as well? How does this keep jobs in the US?
TSA vrs medicare. Is the ability for the government to virtually strip search you better than the ability for the government to deny you life saving medical care? I vote for neither!
In your fantasy of reversing Reagan how do we stop being a debtor nation? Is it by borrowing, taxation, or just printing more money?
You say we don't have a spending problem when the federal government consumes a quarter of the GDP. I gather that you don't want to lower that number, but in order to balance the budget you would have to raise taxes by trillions of dollars per year. You seem to think that all of Greece's problems came from lowering spending after they spent themselves into bankruptcy, but they spent themselves into bankruptcy with social spending, IIRC.
This house of cards will collapse catastrophically as surely as the housing bubble collapsed. It's only a matter of time. The only real question is when we want to pay the price.
The notion that we can tax and spend our way out of our current crisis is just bat shit crazy.
EDIT: It seems to me that the lesson from Greece is that state control and centralized planning aren't as good as you say.
|
|
| 1 person marked this as a favorite. |
You say we don't have a spending problem when the federal government consumes a quarter of the GDP. I gather that you don't want to lower that number, but in order to balance the budget you would have to raise taxes by trillions of dollars per year.
You know, Germany spends 40% of its GDP on government and is doing much better than us in terms of education, infrastructure and development.
And you don't have to raise taxes as much as you need to get people working again. More people working means more wealth created, more wealth being created means more tax revenue, more tax revenue means that government spending as a function of the GDP shrinks.
Though as the Germany example points out, government spending as a percentage of the GDP should probably be much higher if we hope to remain competitive.
You want an example going the other way? Afghanistan spends 6% of its GDP on government. And they have no paved roads. There's a connection there, if you want to see it.
You seem to think that all of Greece's problems came from lowering spending after they spent themselves into bankruptcy, but they spent themselves into bankruptcy with social spending, IIRC.
You don't recall correctly. Greece went into bankruptcy because the global recession reduced their tax revenues below the point where they can afford to maintain their current government, which is magnified by their poor tax collection and rampant tax fraud.
EDIT: It seems to me that the lesson from Greece is that state control and centralized planning aren't as good as you say.
Then you really don't understand the nature of the Greek debt crises (which is nothing like our "crises"), or what state control and centralized planning mean. We are not in remotely the same trouble Greece is in. Our debt is 60% of GDP, their debt is 120% of GDP. We control our currency, they use the Euro and have no control over their money supply. We are the most powerful economy in the world, they are a tiny country with minimal exports and decades of lagging development. They also have massive tax fraud and evasion that they have done little to control. Using Greece to talk about America is completely nonsensical. It's apples and horseshoes.
Furthermore, Greece did not use centralized planning. Greece is a free market economy. China uses centralized planning and has a command economy. Notice that China is doing really well? I'm not suggesting we emulate China at all, but get your facts straight.
| 2 people marked this as a favorite. |
I think we SHOULD emulate China in the sense that China does not get involved in senseless wars that have no end. Betcha that would help the economy, to be a trading partner with everyone. Probably moreso than their central economic planning and rampant human rights abuses.
I honestly think President Obama didn't actually want to be involved at all. I think he felt he had to get involved due to his campaign positions and the position he wants to portray the USA in. I believe this is the reason he didn't approach Congress. He knew that if he didn't they would shut down our active involvement while not leaving our troops out on a limb -- putting us in a support position instead of lead position. Notice he didn't even fight to try and get on going funding for a lead position in the conflict
He felt he had to get involved in attacking a non threatening foreign nation because of his campaign positions?!? Hunh I dont remember him saying " George Bush is right! Lets kick the crap out of the middle East! They got oil and its not like they could threaten us, amirite?" while on the campaign trail. I call BS.
I think we SHOULD emulate China in the sense that China does not get involved in senseless wars that have no end. Betcha that would help the economy, to be a trading partner with everyone. Probably moreso than their central economic planning and rampant human rights abuses.
Let's see what happens with Vietnam and the South China Sea first before we start emulating China.
How much do we have to spend to spend our way out of our spending problem?We don't have a spending problem. We have an income problem.
If Greece has taught you anything it should be that austerity will not fix the problem. We're doing everything they did - ignore the issue of income and attack social benefits. Where are they now? Where are we headed?
No. We have both.
Failure to raise the debt ceiling (which appears likely now) will result in an economic disaster equivalent to the Lehman Brothers collapse.
But the problem is, Obama had already offered (in my opinion) the best deal possible. It was about 85% spending cuts (including Social Security and Medicare) and 15% tax increases, but the "hard line" Republicans walked away.
I think we SHOULD emulate China in the sense that China does not get involved in senseless wars that have no end. Betcha that would help the economy, to be a trading partner with everyone. Probably moreso than their central economic planning and rampant human rights abuses.Let's see what happens with Vietnam and the South China Sea first before we start emulating China.
I think you missed the point. Unless you mess with what China considers "theirs", they leave you alone and are more than happy to do business with you. The US, not so much.
I think it was well said many years ago...B-Movie Lyrics or VIDEO for those who don't like reading.
"Nostalgia, that's what we want : the good ol' days, when we gave'em hell. When the buck stopped somewhere and you could still buy something with it. To a time when movies were in black and white, and so was everything else."
|
|
Fact, the govenment has a 30+ year history of promising spending cuts (to ofset tax cuts) that never materialized. I believe that this is at (or near) the heart of the Tea Party anger.
You mean the Republicans have a 30+ year history of promising spending cuts (to ofset tax cuts) that never materialized.
The government makes no such promises, nor do the Democrats.
You know, Germany spends 40% of its GDP on government and is doing much better than us in terms of education, infrastructure and development.
And you don't have to raise taxes as much as you need to get people working again. More people working means more wealth created, more wealth being created means more tax revenue, more tax revenue means that government spending as a function of the GDP shrinks.
Just to point that out, taxes in Germany are much higher than the examples mentioned earlier in this thread, ranging from around 14 per cent (entry level) to circa 43 per cent for households earning more than ~ 52500 EUR per year. The 'rich' (being careful with that word here), meaning households earning more than ~ 250 0000 EUR p.a., come in at a whopping 48 per cent tax burden. Welcome to every German's #1 complaint ;).
[edit] Also, Kortz: you win this thread :).
You know, Germany spends 40% of its GDP on government and is doing much better than us in terms of education, infrastructure and development.
And you don't have to raise taxes as much as you need to get people working again.
Blown away; not only have I agreed with Ashiel today, I just agreed with Gailbraithe as well! On the same day!
Thats like an eclipse with Halleys Comet eclipsing that at the same time.
America stopped being a producer and became a consumer.
There needs to be a big change!
The education and health systems need reform, the joke of a Trade Union system you have in many places needs reform, and a Compulsory Voting system needs to be introduced.
Dont vote = pay a fine.
Fact, the govenment has a 30+ year history of promising spending cuts (to ofset tax cuts) that never materialized. I believe that this is at (or near) the heart of the Tea Party anger. You mean the Republicans have a 30+ year history of promising spending cuts (to ofset tax cuts) that never materialized.
The government makes no such promises, nor do the Democrats.
Not completely true:
This was what I mean by the "governmnt" making such promises.
The difference between Democrats and Republicans is that the Dems are the party of no ideas whereas the Repubs are the party of bad ideas.
Also the "best deal" for raising the debt ceiling is most certainly not Obama's, with his rediculous and utterly unneeded cuts to Medicare and the like. The best deal is a clean bill.
The difference between Democrats and Republicans is that the Dems are the party of no ideas whereas the Repubs are the party of bad ideas.
Also the "best deal" for raising the debt ceiling is most certainly not Obama's, with his rediculous and utterly unneeded cuts to Medicare and the like. The best deal is a clean bill.
I disagree.
Medicare is on an unsustainable trajectory. (Social Security also needs fixing, but is not quite the house of cards some people believe it to be.)
Yes, a "Clean Bill" would have been the best deal in a perfect world. But, Obama's plan, with the "$4 cut to $1 tax increase" it included, was likely the best deal actually possible for regaining control of the debt.
I think you missed the point. Unless you mess with what China considers "theirs", they leave you alone and are more than happy to do business with you. The US, not so much.I think we SHOULD emulate China in the sense that China does not get involved in senseless wars that have no end. Betcha that would help the economy, to be a trading partner with everyone. Probably moreso than their central economic planning and rampant human rights abuses.Let's see what happens with Vietnam and the South China Sea first before we start emulating China.
China has a history of thinking many things are "theirs" that are in fact not.
Yes, a "Clean Bill" would have been the best deal in a perfect world. But, Obama's plan, with the "$4 cut to $1 tax increase" it included, was likely the best deal actually possible for regaining control of the debt.
This article reflects my thoughts on the debt ceiling, while the Alexander Cockburn one above it is more humorous.
You don't recall correctly. Greece went into bankruptcy because the global recession reduced their tax revenues below the point where they can afford to maintain their current government, which is magnified by their poor tax collection and rampant tax fraud.
Ireland has similar problems. The "Green Tiger" had an economic boom for several years, including excess tax revenues that got piled back into community investments, thanks to very low corporate taxation as incentives. Unfortunately, when economies went down, it meant the taxation was too low to bring in sufficient revenue.
China has a history of thinking many things are "theirs" that are in fact not.I think you missed the point. Unless you mess with what China considers "theirs", they leave you alone and are more than happy to do business with you. The US, not so much.I think we SHOULD emulate China in the sense that China does not get involved in senseless wars that have no end. Betcha that would help the economy, to be a trading partner with everyone. Probably moreso than their central economic planning and rampant human rights abuses.Let's see what happens with Vietnam and the South China Sea first before we start emulating China.
So do we.
Lets see in my lifetime Ive seen the US attack Granada, Panama, Colombia, Iraq, Afghanistan, Pakistan, Libya, Somalia, Bosnia, Iraq again, as well as numerous bombing campaigns and the use of paramilitary operations against its own citizens. In that time, Ive no recollection of China actually attacking anyone (outside of its own citizens). Correct me if Im wrong. It seems that we are far more aggressive than the Chinese are.
China has a history of thinking many things are "theirs" that are in fact not.I think you missed the point. Unless you mess with what China considers "theirs", they leave you alone and are more than happy to do business with you. The US, not so much.I think we SHOULD emulate China in the sense that China does not get involved in senseless wars that have no end. Betcha that would help the economy, to be a trading partner with everyone. Probably moreso than their central economic planning and rampant human rights abuses.Let's see what happens with Vietnam and the South China Sea first before we start emulating China.So do we.
Lets see in my lifetime Ive seen the US attack Granada, Panama, Colombia, Iraq, Afghanistan, Pakistan, Libya, Somalia, Bosnia, Iraq again, as well as numerous bombing campaigns and the use of paramilitary operations against its own citizens. In that time, Ive no recollection of China actually attacking anyone (outside of its own citizens). Correct me if Im wrong. It seems that we are far more aggressive than the Chinese are.
If you take the short view, you're right. If you take the long view, you're wrong. How many times has Korea, Vietnam, and a whole host of other countries been part of China at the point of a sword? I'm saying wait and see what happens with China right now as they have a chance to do something else with respect to the growing dispute with Vietnam. They could quite easily disappoint you. However, I'm sensing we're talking past one another here, as our perspectives are too different.
Whether the debt ceiling is a big deal or not (frankly, I think it's stupid to have one and spark this trouble), I'm not pleased to have my 401K, already battered by two recessions over the last decade, take another inevitable hit over the narcissism of grandstanding politicians and their brinkmanship.
If you take the short view, you're right. If you take the long view, you're wrong. How many times has Korea, Vietnam, and a whole host of other countries been part of China at the point of a sword?
We did take a rather large portion of Mexico at the point of a sword (or, rather, firearm) and never gave it back. So, in the long view, I'm not sure there's that much difference either.
We did take a rather large portion of Mexico at the point of a sword (or, rather, firearm) and never gave it back. So, in the long view, I'm not sure there's that much difference either.
If you take the short view, you're right. If you take the long view, you're wrong. How many times has Korea, Vietnam, and a whole host of other countries been part of China at the point of a sword?
Hnnn....Good point.
Still, that's part of the country, not the country entire. I'm still wondering why America didn't just annex all of Mexico, they certainly had the firepower.
We did take a rather large portion of Mexico at the point of a sword (or, rather, firearm) and never gave it back. So, in the long view, I'm not sure there's that much difference either.
If you take the short view, you're right. If you take the long view, you're wrong. How many times has Korea, Vietnam, and a whole host of other countries been part of China at the point of a sword?Hnnn....Good point.
Still, that's part of the country, not the country entire. I'm still wondering why America didn't just annex all of Mexico, they certainly had the firepower.
They didn't want or need it.
Hnnn....Good point.Still, that's part of the country, not the country entire. I'm still wondering why America didn't just annex all of Mexico, they certainly had the firepower.
Because we wanted Mexican land (mainly California) but not the Mexicans. The territories we nabbed were fairly sparsely settled by Mexicans. The Native Tribes we could deal with (read: neutralize or obliterate) piecemeal after that.
You say we don't have a spending problem when the federal government consumes a quarter of the GDP. I gather that you don't want to lower that number, but in order to balance the budget you would have to raise taxes by trillions of dollars per year.You know, Germany spends 40% of its GDP on government and is doing much better than us in terms of education, infrastructure and development.
And you don't have to raise taxes as much as you need to get people working again. More people working means more wealth created, more wealth being created means more tax revenue, more tax revenue means that government spending as a function of the GDP shrinks.
Though as the Germany example points out, government spending as a percentage of the GDP should probably be much higher if we hope to remain competitive.
You want an example going the other way? Afghanistan spends 6% of its GDP on government. And they have no paved roads. There's a connection there, if you want to see it.
49.3% of Zimbabwe's GDP is taxed and they don't seem to be a utopia to me. I just don't agree that taking more money from the people who earn it and giving it to the government is the path to prosperity.
I'll get back to you on Greece.
EDIT: BTW, UAE and Kuwait have roads don't they? Their tax rates are less than 2% of GDP. Is there a connection there too?
Well said NPC Dave.
I would just add that none of these things- from the economy to the wars- are mistakes, or accidents or whatever. All this stuff is very carefully planned, and executed very well. It has all gone very, VERY well for the super rich.
In fact, I can't think of a single event or whatever that is considered bad for the country and the majority of the people, that hasn't been a smashing success for the super rich.
PS http://counterpunch.com/zadeh07222011.html
That is a great article!
You seem to think that all of Greece's problems came from lowering spending after they spent themselves into bankruptcy, but they spent themselves into bankruptcy with social spending, IIRC.You don't recall correctly. Greece went into bankruptcy because the global recession reduced their tax revenues below the point where they can afford to maintain their current government, which is magnified by their poor tax collection and rampant tax fraud.
I think I do recall correctly. Greece ran huge structural deficits long before it's collapse. It's position of massive debt left it exposed when the global economy corrected. This was entirely predictable in Greece and it's simply arrogant to think that our massive debt and deficits don't leave us dangerously exposed.
EDIT: It seems to me that the lesson from Greece is that state control and centralized planning aren't as good as you say.Then you really don't understand the nature of the Greek debt crises (which is nothing like our "crises"), or what state control and centralized planning mean. We are not in remotely the same trouble Greece is in. Our debt is 60% of GDP, their debt is 120% of GDP. We control our currency, they use the Euro and have no control over their money supply. We are the most powerful economy in the world, they are a tiny country with minimal exports and decades of lagging development. They also have massive tax fraud and evasion that they have done little to control. Using Greece to talk about America is completely nonsensical. It's apples and horseshoes.
Furthermore, Greece did not use centralized planning. Greece is a free market economy. China uses centralized planning and has a command economy. Notice that China is doing really well? I'm not suggesting we emulate China at all, but get your facts straight.
I know very well what state control and central planning mean. You seem to think that if the economy isn't totally controlled by the state that it's free market. This is utter nonsense. I'm guessing you would say the US has a free market economy. This is also utter nonsense. The state doesn't have to control every single aspect of an economy to pick winners and losers and steer the economy (typically in stupid directions IMO).
It seems to be you who fails to understand the nature of the Greek debt crises as well as the US debt crises. While they are not exactly the same by any means I would think that even a casual observer would note the hazards of massive levels of debt. You may think that $14,000,000,000,000 + in debt is a trivial thing. I don't. I think it is an existential threat.
We can only manipulate interest rates finitely. Eventually there will be a correction, and the cost of servicing our massive debt will become unmanageable. There is certainly no plan that I know of to pay down our debt so the interest problem is only going to deepen.
We have already produced massive amounts of new currency, but this too will end badly. As the rest of the world learns what the "full faith and credit of the US government" is really worth we will lose our reserve currency status sooner rather than later. I don't think we will be able to inflate our way out of our debt either, but inflation will hurt people at the lower end of the economic spectrum the worst.
Your statement, "Furthermore, Greece did not use centralized planning." is absurd on its face. Are you seriously arguing that the Greek government made zero effort to direct the economy ever?
You might want to get your facts straight.
EDIT: BTW, UAE and Kuwait have roads don't they? Their tax rates are less than 2% of GDP. Is there a connection there too?
The UAE and Kuwait, along with a lot of the other small ME countries, make almost all of their money by selling oil. Collecting huge fees for resource extraction makes it look like they're running on very a low tax rate.
My quick look didn't turn up the 2% tax you cited or the actual revenue from petroleum, but the Wikipedia entry for UAE shows revenue (~$54 billion) at roughly 20% of their GDP and debt at 47.2% of GDP, both in 2009.
Hardly a model you'd want to emulate, even if we had the natural resources to loot.
I was using this Wiki source.
List of countries by tax revenue as percentage of GDP
You make a good point though. If the tax revenue number excludes oil fees financing the government then it doesn't seem to have any value for this comparison. 20-25% looks right.
EDIT: I found a better chart. Good catch.
EDIT: It seems to me that the lesson from Greece is that state control and centralized planning aren't as good as you say.I know very well what state control and central planning mean. You seem to think that if the economy isn't totally controlled by the state that it's free market. This is utter nonsense. I'm guessing you would say the US has a free market economy. This is also utter nonsense. The state doesn't have to control every single aspect of an economy to pick winners and losers and steer the economy (typically in stupid directions IMO).
Whereas you seem to think that any economy that has any influence by government is state controlled and centrally planned. Which is just as much nonsense as claiming that "if the economy isn't totally controlled by the state that it's free market." The overwhelming majority of economies are a mixture of the two, with some state control and some market mechanisms. It is still useful to distinguish between those that tend strongly to one side or the other.
It seems to be you who fails to understand the nature of the Greek debt crises as well as the US debt crises. While they are not exactly the same by any means I would think that even a casual observer would note the hazards of massive levels of debt. You may think that $14,000,000,000,000 + in debt is a trivial thing. I don't. I think it is an existential threat.I don't think it's trivial. I'm also not scared by big numbers, whether you write out all the 0's or just use trillion. Absolute numbers mean nothing. It's only the size of the debt relative to the economy that matters. That does look kind of bad right now. But the best way to fix that is to grow the economy. Austerity measures haven't helped any of the countries (or states) that have tried them in this crisis.
I agree that there are various levels of state control and central planning, but by definition economies that are subject to any level of central planning are centrally planned in some degree. You want more state control over people and I want more freedom for people.
In any case the sentence, "Furthermore, Greece did not use centralized planning.", remains intellectually indefensible. I never argued that central planning is an all or nothing proposition.
We continue to be in complete disagreement about the dangers of the debt as well as the solution to the debt. I still argue that basic economic logic applies. Any entity has a problem when it constantly spends more than it brings in. If someone must consistently borrow money just to pay interest on their debt they are in trouble. The US is in deep trouble. It seems like common sense that if you spend more than you make year after year you need to spend less.
I completely disagree with your position that we can magically spend our way out of our massive spending problem. We have spent, borrowed and printed trillions to try and manipulate the economy and pick winners and losers, but it has failed utterly. How many more trillions of dollars should we steal from our great grand children to repeat failed policies?
I disagree with you entirely about budget cuts too.
A Guide for Deficit Reduction in the United States Based on Historical Consolidations That Worked
Correct me if Im wrong. It seems that we are far more aggressive than the Chinese are.
The Dalai Lama called, he asked if he could have Tibet back yet.