Treasury Secretary Timothy Geithner has warned that if the debt limit isn’t increased by August 2, the government will no longer be able to spend more than it collects in revenue. That means it will have to cut spending by about 35%, probably choosing among such items as payments to contractors, soldiers’ salaries, social security and Medicare. On average, the cuts would amount to about $3.8 billion a day, according to our own estimates based on projections from the Congressional Budget Office. At that rate, over a period of only 95 days, the cuts would add up to 2.9% of gross domestic product, adjusted for inflation. That’s just enough to negate all the economic growth forecasters expect in 2011.
In other words, the U.S. can’t afford to live within its means now, and it can’t afford not to do so later.
What should this do to currency value?
I nominate Sweden.
QuoteIn other words, the U.S. can’t afford to live within its means now, and it can’t afford not to do so later.
In other words, we're screwed.
We look on with suprise on why it took you so long to figure that out. It was evident ever since Bill Clinton left office that the US debt was soaring. It was even a bigger suprise that his spiritual successor didn't do anything about it but continued the trend of his spiritual adversary.
Agreed, cutting spending during a recession is a bad idea. I may be flashing a Keynesian leaning here, but you need to keep money moving during a recession - otherwise the money supply tends to contract as consumers become more cautious, which chokes the whole system.
Which is why we've gotta get the Bush tax cuts expire for the upper tax brackets. The people who make the most money are hoarding it, rather than paying their fair share. They even backed out on their promises to create jobs, so, honestly, they've had their chance and blew it. Instead of breaking all of the people who actually do the work (cook your meals, haul your trash, connect your calls, drive your ambulances, guard you while you sleep), make the people who benefit the most from that pay their fair share.
I'm on the fence in regards to taxing the rich, however right now I am totally against it. The reason is this, why tax them more right now? It will not help anything. Until the morons in Washington actually try to cut spending, taxing the rich is more or less spitting in the wind. I hear the battle cry, "Tax the rich!", but when you have the same idiots with the same issues about spending everyone's money, you end up at the same place. You have just more or less given them more money that will burn a hole in their pocket.
If you wouldn't give a drug addict a huge wad of cash until you are sure he has kicked the habit, you sure wouldn't give our government another dime until they do the same.
40% less debt if they instead paid taxes rather than financing the government this way. We would have a deficit, still, but not very much of one, so we could pretty much cut an Army division and fix it.
40% less debt if they instead paid taxes rather than financing the government this way. We would have a deficit, still, but not very much of one, so we could pretty much cut an Army division and fix it.
Republic of Haven Plan? :P
Republic of Haven Plan? :P
We need a short, victorious war! (Well, you do)
Republic of Haven Plan? :P
We need a short, victorious war! (Well, you do)
Except that the US is represented by the Sollies pretty much - imho. ;)
... so, just stomp the uppity neobarbs and take their systems... ah oil - i guess :p
Declare government bonds held by private investors with income of x or higher as "taxes". You won't even have to collect em, you just don't pay them back LOL. Problem solved. ;)
Kidding aside... I am wondering what drastic measures we are going to see as the short-term debt threath to the system becomes more and more acute.
(http://imageshack.us/m/829/9523/couragewolfwars.png)
The economy is better represented by the Republic of Haven post reform, though. And stomping the uppity neobarbs and taking their lucrative terminuses (oil!), to use your analogy, was exactly what the RoH was doing.
The economy is better represented by the Republic of Haven post reform, though. And stomping the uppity neobarbs and taking their lucrative terminuses (oil!), to use your analogy, was exactly what the RoH was doing.
Wellllllllll.... I don't wanna spoil anything... but...Spoiler:...assuming you mean Haven's *first* "reform" and the following "short victorious war"... keep reading. ;)
Republic of Haven Plan? :P