Is there any scenario where you think it would be OK to raise the debt ceiling?
"No".
What do you think is the ideal solution to this impasse right now?
"The ideal solution is to cut spending so that we stop spending beyond our means. The ideal solution is what you would have to do if you were in the same situation personally that the country is in. The ideal solution is what each of us as citizens have to do when we get in financial trouble personally or what companies have to do, or what states have to do or what cities have to do. Frankly, the only entity in our nation that continues to defy reality is the federal government. It’s just time to pay the piper".
So, Mr. Meckler is advocating a 1.6 trillion dollar cut in spending THIS YEAR out of a 3.8 trillion dollar budget? In other words around a 40% reduction in Federal spending this year?
That's really his solution to the issue?
Nowhere in the interview does Meckler say what he would cut to hit this kind of target. Those pesky details are left as an exercise for the reader I guess.
What a freakin' moron.
People, I am a big fan of small government and low taxes. I would welcome Federal spending being capped at say, no more than 20% of GDP (perhaps as an average over each presidential term). But you can't get from where we are to where I'd like us to be in one year. No way, no how.
This Meckler guy is a clown.
17 comments:
To be fair, he did say that that was "the ideal solution".
It's not that hard to balance the budget next year.
1) End the 3 wars. Bring the troops home. Close 2/3rds of the 700 bases around the world.
2) Cut discretionary spending to 2000 levels (the last time we had a balanced budget, the world didn't end then)
3) Eliminate the Dept of Education, Energy, and corp farm subsidy part of Dept of Ag.
4) Eliminate loopholes used by corp and high income earners. Or raise capital gains tax.. Basically add 100B in revenue.
Net result: America doesn't project as much power around world less pork flows out of Washington. So what?
No one is in charge of the tea party. Never heard of that guy
@#2
Well, that would have the side effect of spiking the unemployment and plunging the GDP. Might take this barely recovery and plunge it right into a Depression. Blowback's a bummer, innit?
2) Cut discretionary spending to 2000 levels (the last time we had a balanced budget, the world didn't end then)
we didn't have the bush tax cuts in 2000....
I look forward to a day when governments do not get to sell multiple generations down the river via massive debt obligations. We should add, along with 'no taxation without representation', something along the lines of 'all debt incurred must be personal debt'. The fastest way to achieve this is for governments to default. Those that lend to governments need to lose their money- do that often enough, and they'll stop lending. This will lead to a weaker and less intrusive government.
I don't care much for the tea party, but I can't say this guy is a clown. From your tone, I'm thinking you assume there's some way to improve things within the parameters of the current system- via voting or whatever, so his idea seems to extreme because it endangers the structure via which this system works. I don't think he's gone far enough. Default should be declared loudly enough for Chinese politicians to hear. In order to starve the beast, you've got to remove the food.
I respectfully disagree with your post. The real clowns are the politicians making unsustainable promises.
I respect Meckler for not falling for any of the theatrics currently under way in the debt ceiling discussions. These theatrics will result in only minimal tweaks to the budget, and people who want to see more than that are understandably frustrated.
I understand that taking this frustration out on the debt ceiling issue is not constructive. But the sentiment is quite fair.
Hi Arnold: Sure the pols are clowns too. That's the message of the median post on KPC.
but there's a fair amount of space between, bogus, tweaky, "fake" cuts and an immediate 40% cut to the current budget along with a threat to target any Republicans who vote for raising the debt ceiling with a primary challenge.
Ok, what's the pathway to solvency then? I think at a bare minimum one could reasonably ask that the Gross Debt-to-GDP ratio be no more than 90% at the end of the 10-year window, say, January 2022. Let's assume NGDP at $25 Trillion, so Gross Debt capped at $22.5. It'll be 15 at the start of next year. You could do that with a series of deficits as follows (in $Billions):
2012: 1,500
2013: 1,350
2014: 1,200
2015: 1,000
2016: 900
2017: 700
2018: 500
2019: 300
2020: 100
2021: 0
That seems feasible to me, (actually a bare minimum of prudence) but I don't trust anyone to get it done. Why should I?
August,
The federal government has monopoly in issuing fiat currency. It is laughable to suggest that the government will not have money to spend if people refused to lend money to it. Please spend an hour or two to read what MMT theorists have to say. Sometimes a little bit of reflection is useful. Political economy is not a rocket science.
@Anonymous:
That is not a problem, since you already have high unemployment. It is a question of whether you want a short term unemployment shock or a long term default... I doubt that the change from government employment to private employment will be so harsh (only in the minds of Keynsians). A good example? Wars. Vietnam, WW II or WW I. After the wars soldiers returned home got on the market and found jobs. Why shouldn't that be possible for, say, a beauraucrat @ Dept. of Education?
@DeeW:
So? It's not as anyone here is necessarily a Republican?!?! Actually, we only have to return to the spending of 2007, because we will still earn the income of 2011.
So, something I just heard sparked a question: what do I want? Really? What could I live with?
1) I don’t give a #$^&#$@ #$#= #$#@ about 10-year numbers. Those numbers come in two forms: a) plucked from thin air (or someplace dark & smelly), b) the mind of someone intending to deceive the audience.
2) I DO care about TODAY’s budget. A LOT. So cut spending NOW by $10B/month. Right now.
3) I DO care about the process that got us here. I know full well that a balanced-budget amendment would be a complete joke. So here’s what I want: $900B debt limit increase today, then include the next debt limit increase in next year’s budget. Set it to run out 1 Nov of 2013. And so on. Talk about reducing spending by $20B/month in next years’ budget. (now)
That would make me happy. I expect it would make the ratings agencies happier as well.
Actually it all makes sense, from what I saw of the interview. There is NO recession. There are NOT large numbers of unemployed people. The only problem is the President of the United States, who for some totally unknown reason, has decided to indulge himself with insane levels of deficit spending. Once you understand that, everything else follows.
Isn't it wonderful that more than half our Representatives and almost half our Senators have come to accept this wisdom!
Anonymous,
They can print it, but eventually no one will use it. Internationally, printing money to cover what the U.S. now uses debt for would be regarded as a default. Russian, China, Iran- many countries are already making noise about getting away from the dollar as a reserve currency; such a move would cause the world to bolt, further depressing the value of the dollar.
Not pleasant to live through, but we shall be going through some version of it eventually. This debt/bail-out circus can't go on forever. I'd prefer some sort of receivership deal, with all these crappy deals being unwound, assets being returned to the taxpayers, but the train wreck you've mentioned is probably more likely- or yet another stupid deal where we've got to pay for the next crazy thing the U.S.G/Wall Street dreams up.
Fifteen responses: Angus has touched a nerve.
It's not fair to characterize Meckler as a clown based on his performance on TV -- he is posturing, trying to affect the result as far in his preferred direction as he can. As in most negotiation, he can't come out with the least thing he could accept.
Also, we have TRIED compromise and patience and electing new CongressCritters... look where that got us. If we keep on that path, the country will be ruined. An economic shock now is probably cheaper than an economic shock later.
Perhaps it's personal, but the doomsayers have been so hyperbolic on this issue that I want to risk it just because I know it can't be as bad as they project.
@ Tom
He isn't posturing, he is stating his actual position. If you've seen a willingness from Meckler et al to compromise on this issue, please provide a citation.
Please also provide a citation to your acts of compromise and patience. "Not yelling" isn't an act of patience. Nor can you be considered as working for "compromise" when you advocate a position that a majority of people reject (or is factually unsupported), reject valid criticism, and proceed to continue to advocate the claim without either acknowledging the same or offering a responsive change.
Please also demonstrate what you mean by "look what it got us." In such a demonstration, you also should be clear on causation and avoid similar incoherent phrases that simply allude to issues that you must not understand (otherwise, why not be clear in your statements?).
Further, the baselessness of your position (and justification for your responses) is completely clear by your willingness to project your unsupported theory on the size and effect of economic shocks either currently or in the future, but yet challenge others who have posited descriptions of what could happen in the event of a default based on known effect in the market (i.e. if you don't pay your bills, people are less likely to grant you credit going forward or believe you will still pay your bills). It's a pretty straightforward concept, I'd be interested in why you think the threat of that act in the future is more powerful/worse than doing it now (in the present).
Further, the fact that you hold opinions like "it can't possibly be as bad as they make it out so I'm going to do it to spite their face" reveals that you apparently have the mind set of a 13yr old. Not necessarily a bad thing if your 13, but you should seriously consider some introspection if the best arguments you find are those which also might be adopted by a prepubescent child as "spite" in the face of logical policy.
By the way, this also makes your comments related to "patience" and "compromise" look like a feeble attempt at irony. In my opinion, your statements tend to fall in line with most of what I see from self-proclaimed Tea Party members. They like catchphrases and slogans, but don't really care about cause and effect or substance. Typically, they also distrust persons who study such issues and would rather rely on their own intuition of events and effects they do not understand. The latter isn't the problem (lots of people don't understand a lot of things). Rather, its the ability and desire to act on willful ignorance that sets the Tea Party apart.
Isn't it depressing to be a blogger and find this quality of comments in your blog?
Post a Comment