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Thread: We Interrupt Your Regularly Scheduled Programming......

  1. #1
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    We Interrupt Your Regularly Scheduled Programming......

    With reality....

    [SIZE="4"][B]America’s Sea of Red Ink Was Years in the Making[/B][/SIZE]

    By DAVID LEONHARDT

    There are two basic truths about the enormous deficits that the federal government will run in the coming years.

    The first is that President Obama’s agenda, ambitious as it may be, is responsible for only a sliver of the deficits, despite what many of his Republican critics are saying. The second is that Mr. Obama does not have a realistic plan for eliminating the deficit, despite what his advisers have suggested.

    The New York Times analyzed Congressional Budget Office reports going back almost a decade, with the aim of understanding how the federal government came to be far deeper in debt than it has been since the years just after World War II. This debt will constrain the country’s choices for years and could end up doing serious economic damage if foreign lenders become unwilling to finance it.

    Mr. Obama — responding to recent signs of skittishness among those lenders — met with 40 members of Congress at the White House on Tuesday and called for the re-enactment of pay-as-you-go rules, requiring Congress to pay for any new programs it passes.

    The story of today’s deficits starts in January 2001, as President Bill Clinton was leaving office. The Congressional Budget Office estimated then that the government would run an average annual surplus of more than $800 billion a year from 2009 to 2012. Today, the government is expected to run a $1.2 trillion annual deficit in those years.

    You can think of that roughly $2 trillion swing as coming from four broad categories: the business cycle, President George W. Bush’s policies, policies from the Bush years that are scheduled to expire but that Mr. Obama has chosen to extend, and new policies proposed by Mr. Obama.

    The first category — the business cycle — accounts for 37 percent of the $2 trillion swing. It’s a reflection of the fact that both the 2001 recession and the current one reduced tax revenue, required more spending on safety-net programs and changed economists’ assumptions about how much in taxes the government would collect in future years.

    About 33 percent of the swing stems from new legislation signed by Mr. Bush. That legislation, like his tax cuts and the Medicare prescription drug benefit, not only continue to cost the government but have also increased interest payments on the national debt.

    Mr. Obama’s main contribution to the deficit is his extension of several Bush policies, like the Iraq war and tax cuts for households making less than $250,000. Such policies — together with the Wall Street bailout, which was signed by Mr. Bush and supported by Mr. Obama — account for 20 percent of the swing.

    About 7 percent comes from the stimulus bill that Mr. Obama signed in February. And only 3 percent comes from Mr. Obama’s agenda on health care, education, energy and other areas.

    If the analysis is extended further into the future, well beyond 2012, the Obama agenda accounts for only a slightly higher share of the projected deficits.

    How can that be? Some of his proposals, like a plan to put a price on carbon emissions, don’t cost the government any money. Others would be partly offset by proposed tax increases on the affluent and spending cuts. Congressional and White House aides agree that no large new programs, like an expansion of health insurance, are likely to pass unless they are paid for.

    Alan Auerbach, an economist at the University of California, Berkeley, and an author of a widely cited study on the dangers of the current deficits, describes the situation like so: “Bush behaved incredibly irresponsibly for eight years. On the one hand, it might seem unfair for people to blame Obama for not fixing it. On the other hand, he’s not fixing it.”

    “And,” he added, “not fixing it is, in a sense, making it worse.”

    When challenged about the deficit, Mr. Obama and his advisers generally start talking about health care. “There is no way you can put the nation on a sound fiscal course without wringing inefficiencies out of health care,” Peter Orszag, the White House budget director, told me.

    Outside economists agree. The Medicare budget really is the linchpin of deficit reduction. But there are two problems with leaving the discussion there.

    First, even if a health overhaul does pass, it may not include the tough measures needed to bring down spending. Ultimately, the only way to do so is to take money from doctors, drug makers and insurers, and it isn’t clear whether Mr. Obama and Congress have the stomach for that fight. So far, they have focused on ideas like preventive care that would do little to cut costs.

    Second, even serious health care reform won’t be enough. Obama advisers acknowledge as much. They say that changes to the system would probably have a big effect on health spending starting in five or 10 years. The national debt, however, will grow dangerously large much sooner.

    Mr. Orszag says the president is committed to a deficit equal to no more than 3 percent of gross domestic product within five to 10 years. The Congressional Budget Office projects a deficit of at least 4 percent for most of the next decade. Even that may turn out to be optimistic, since the government usually ends up spending more than it says it will. So Mr. Obama isn’t on course to meet his target.

    But Congressional Republicans aren’t, either. Judd Gregg recently held up a chart on the Senate floor showing that Mr. Obama would increase the deficit — but failed to mention that much of the increase stemmed from extending Bush policies. In fact, unlike Mr. Obama, Republicans favor extending all the Bush tax cuts, which will send the deficit higher.

    Republican leaders in the House, meanwhile, announced a plan last week to cut spending by $75 billion a year. But they made specific suggestions adding up to meager $5 billion. The remaining $70 billion was left vague. “The G.O.P. is not serious about cutting down spending,” the conservative Cato Institute concluded.

    What, then, will happen?

    “Things will get worse gradually,” Mr. Auerbach predicts, “unless they get worse quickly.” Either a solution will be put off, or foreign lenders, spooked by the rising debt, will send interest rates higher and create a crisis.

    The solution, though, is no mystery. It will involve some combination of tax increases and spending cuts. And it won’t be limited to pay-as-you-go rules, tax increases on somebody else, or a crackdown on waste, fraud and abuse. Your taxes will probably go up, and some government programs you favor will become less generous.

    That is the legacy of our trillion-dollar deficits. Erasing them will be one of the great political issues of the coming decade.

    [url]http://www.nytimes.com/2009/06/10/business/economy/10leonhardt.html?_r=2&pagewanted=print[/url]

  2. #2
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    [QUOTE=OCCH;4423946]Leopard meet spots.

    Sad you started out with an article that placed blame on BOTH sides, but then just had to hit "Submit Reply" one more time . . .:rolleyes:[/QUOTE]

    True, I tried to be funny but it did not add to the discussion so I deleted it.

  3. #3
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    [QUOTE=intelligentjetsfan;4423949]True, I tried to be funny but it did not add to the discussion so I deleted it.[/QUOTE]

    As did I;)

    Having said that, I don't even know how worried I need to be. I mean, if the game is rigged on BOTH sides, what do we really have to look forward to? Is anyone capable of making the necessary sacrifices BEFORE it destroys us, or do we have to truly hit rock-bottom before anything of any substance can get done?

  4. #4
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    [QUOTE=intelligentjetsfan;4423941]With reality....

    [SIZE="4"][B]America’s Sea of Red Ink Was Years in the Making[/B][/SIZE]

    By DAVID LEONHARDT

    There are two basic truths about the enormous deficits that the federal government will run in the coming years.

    The first is that President Obama’s agenda, ambitious as it may be, is responsible for only a sliver of the deficits, despite what many of his Republican critics are saying. The second is that Mr. Obama does not have a realistic plan for eliminating the deficit, despite what his advisers have suggested.

    The New York Times analyzed Congressional Budget Office reports going back almost a decade, with the aim of understanding how the federal government came to be far deeper in debt than it has been since the years just after World War II. This debt will constrain the country’s choices for years and could end up doing serious economic damage if foreign lenders become unwilling to finance it.

    Mr. Obama — responding to recent signs of skittishness among those lenders — met with 40 members of Congress at the White House on Tuesday and called for the re-enactment of pay-as-you-go rules, requiring Congress to pay for any new programs it passes.

    The story of today’s deficits starts in January 2001, as President Bill Clinton was leaving office. [COLOR="Red"]The Congressional Budget Office estimated then that the government would run an average annual surplus of more than $800 billion a year from 2009 to 2012. [/COLOR]Today, the government is expected to run a $1.2 trillion annual deficit in those years.

    You can think of that roughly $2 trillion swing as coming from four broad categories: the business cycle, President George W. Bush’s policies, policies from the Bush years that are scheduled to expire but that Mr. Obama has chosen to extend, and new policies proposed by Mr. Obama.

    The first category — the business cycle — accounts for 37 percent of the $2 trillion swing. It’s a reflection of the fact that both the 2001 recession and the current one reduced tax revenue, required more spending on safety-net programs and changed economists’ assumptions about how much in taxes the government would collect in future years.

    About 33 percent of the swing stems from new legislation signed by Mr. Bush. That legislation, like his tax cuts and the Medicare prescription drug benefit, not only continue to cost the government but have also increased interest payments on the national debt.

    Mr. Obama’s main contribution to the deficit is his extension of several Bush policies, like the Iraq war and tax cuts for households making less than $250,000. Such policies — together with the Wall Street bailout, which was signed by Mr. Bush and supported by Mr. Obama — account for 20 percent of the swing.

    About 7 percent comes from the stimulus bill that Mr. Obama signed in February. And only 3 percent comes from Mr. Obama’s agenda on health care, education, energy and other areas.

    If the analysis is extended further into the future, well beyond 2012, the Obama agenda accounts for only a slightly higher share of the projected deficits.

    How can that be? Some of his proposals, like a plan to put a price on carbon emissions, don’t cost the government any money. Others would be partly offset by proposed tax increases on the affluent and spending cuts. Congressional and White House aides agree that no large new programs, like an expansion of health insurance, are likely to pass unless they are paid for.

    Alan Auerbach, an economist at the University of California, Berkeley, and an author of a widely cited study on the dangers of the current deficits, describes the situation like so: “Bush behaved incredibly irresponsibly for eight years. On the one hand, it might seem unfair for people to blame Obama for not fixing it. On the other hand, he’s not fixing it.”

    “And,” he added, “not fixing it is, in a sense, making it worse.”

    When challenged about the deficit, Mr. Obama and his advisers generally start talking about health care. “There is no way you can put the nation on a sound fiscal course without wringing inefficiencies out of health care,” Peter Orszag, the White House budget director, told me.

    Outside economists agree. The Medicare budget really is the linchpin of deficit reduction. But there are two problems with leaving the discussion there.

    First, even if a health overhaul does pass, it may not include the tough measures needed to bring down spending. Ultimately, the only way to do so is to take money from doctors, drug makers and insurers, and it isn’t clear whether Mr. Obama and Congress have the stomach for that fight. So far, they have focused on ideas like preventive care that would do little to cut costs.

    Second, even serious health care reform won’t be enough. Obama advisers acknowledge as much. They say that changes to the system would probably have a big effect on health spending starting in five or 10 years. The national debt, however, will grow dangerously large much sooner.

    Mr. Orszag says the president is committed to a deficit equal to no more than 3 percent of gross domestic product within five to 10 years. The Congressional Budget Office projects a deficit of at least 4 percent for most of the next decade. Even that may turn out to be optimistic, since the government usually ends up spending more than it says it will. So Mr. Obama isn’t on course to meet his target.

    But Congressional Republicans aren’t, either. Judd Gregg recently held up a chart on the Senate floor showing that Mr. Obama would increase the deficit — but failed to mention that much of the increase stemmed from extending Bush policies. In fact, unlike Mr. Obama, Republicans favor extending all the Bush tax cuts, which will send the deficit higher.

    Republican leaders in the House, meanwhile, announced a plan last week to cut spending by $75 billion a year. But they made specific suggestions adding up to meager $5 billion. The remaining $70 billion was left vague. “The G.O.P. is not serious about cutting down spending,” the conservative Cato Institute concluded.

    What, then, will happen?

    “Things will get worse gradually,” Mr. Auerbach predicts, “unless they get worse quickly.” Either a solution will be put off, or foreign lenders, spooked by the rising debt, will send interest rates higher and create a crisis.

    The solution, though, is no mystery. It will involve some combination of tax increases and spending cuts. And it won’t be limited to pay-as-you-go rules, tax increases on somebody else, or a crackdown on waste, fraud and abuse. Your taxes will probably go up, and some government programs you favor will become less generous.

    That is the legacy of our trillion-dollar deficits. Erasing them will be one of the great political issues of the coming decade.

    [url]http://www.nytimes.com/2009/06/10/business/economy/10leonhardt.html?_r=2&pagewanted=print[/url][/QUOTE]

    You mean from those 400 dot com stocks on the NASDAQ that make 10's of thousands of "millionaires"? Guys buying 50$ ceegars and 1000$ port wine? I remember those SUPPLY SIDE days well!!! too bad the democrat controlled Wall Street fat cats pulled the string. Just remember, Bush took over an economy GOING INTO A RECESSION (FACT)

  5. #5
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    And started a war with Iraq. What did Obama inherit? Oh the blinders!


    [QUOTE=acepepe;4423964]You mean from those 400 dot com stocks on the NASDAQ that make 10's of thousands of "millionaires"? Guys buying 50$ ceegars and 1000$ port wine? I remember those SUPPLY SIDE days well!!! too bad the democrat controlled Wall Street fat cats pulled the string. Just remember, Bush took over an economy GOING INTO A RECESSION (FACT)[/QUOTE]

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    [QUOTE=cr726;4424080]And started a war with Iraq. What did Obama inherit? Oh the blinders![/QUOTE]

    with the Clinton's intel and Their and Kerry's blessing, et-al. FACT

  7. #7
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    [QUOTE=acepepe;4424267]with the Clinton's intel and Their and Kerry's blessing, et-al. FACT[/QUOTE]

    LOL, so it was ok to ignore Clinton's intel when it came Al Queda but Balls Out with the Iraq intel! You are hysterical. :yes:

  8. #8
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    [QUOTE][B][SIZE="5"]The solution, though, is no mystery. It will involve some combination of tax increases and spending cuts. And it won’t be limited to pay-as-you-go rules, tax increases on somebody else, or a crackdown on waste, fraud and abuse. Your taxes will probably go up, and some government programs you favor will become less generous.[/SIZE][/B][/QUOTE]
    .

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    [QUOTE=cr726;4424300]LOL, so it was ok to ignore Clinton's intel when it came Al Queda but Balls Out with the Iraq intel! You are hysterical. :yes:[/QUOTE]

    Do you mean when Clintoon refused to kill Bin-laden when the CIA had him in their sights or when Al-Qaeda dragged our troops (alive) through the streets of Mogadishu? or when they bombed the WTC the first time and we didn't respond? Which time are are you referring? :P

  10. #10
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    I see the "it's not Obama's Fault, really, he's doing the best he can in a hard spot" Campaign PR has begun.

    Blame Bush worked once. Why not twice?

  11. #11
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    [QUOTE=Warfish;4424334]I see the "it's not Obama's Fault, really, he's doing the best he can in a hard spot" Campaign PR has begun.

    Blame Bush worked once. Why not twice?[/QUOTE]

    Wasn't Obama part of the 2006 Congress where the Dems controlled both houses before the country tanked?

    I blame the do something Congress 2006 through 2010.

  12. #12
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    [QUOTE=acepepe;4424325]Do you mean when Clintoon refused to kill Bin-laden when the CIA had him in their sights or when Al-Qaeda dragged our troops (alive) through the streets of Mogadishu? or when they bombed the WTC the first time and we didn't respond? Which time are are you referring? :P[/QUOTE]

    The individuals responsible for the van bomb detonated at the WTC were arrested and found guilty and put in prison.

    How did the Bush Administration do when it came to catching OBL?

    Starting the war in Iraq while still at war in Afthanistan was idiotic.

  13. #13
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    [QUOTE=Warfish;4424334]I see the "it's not Obama's Fault, really, he's doing the best he can in a hard spot" Campaign PR has begun.

    Blame Bush worked once. Why not twice?[/QUOTE]

    Nah, Clinton.

  14. #14
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    Forget who is to blame, what has President Obama done?

    In his first two years in office he had a Super Majority, meaning that he did not even need GOP support to pass programs he felt would improve the economy. Instead he used his Super Majority to pass Universal Health Care, which is currently being challenged in the Supreme Court.

    What a waste!!

    Moral of the story, if you are a partisan democrat you will make excuses for the President. If we had a republican president currently in the White House, you same people would be killing him!

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    [QUOTE=cr726;4424344]The individuals responsible for the van bomb detonated at the WTC were arrested and found guilty and put in prison.

    [COLOR="DarkRed"]How did the Bush Administration do when it came to catching OBL[/COLOR]?

    Starting the war in Iraq while still at war in Afthanistan was idiotic.[/QUOTE]

    How did Obammy do it? With Intel from Bushes administration that Obammy was dead set against obtaining. FACT!

  16. #16
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    [QUOTE=acepepe;4424390]How did Obammy do it? With Intel from Bushes administration that Obammy was dead set against obtaining. FACT![/QUOTE]

    :zzz:

  17. #17
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    [QUOTE=JetsFanatic;4424363][SIZE="6"]Forget who is to blame, what has President Obama done?

    In his first two years in office he had a Super Majority, meaning that he did not even need GOP support to pass programs he felt would improve the economy. Instead he used his Super Majority to pass Universal Health Care, which is currently being challenged in the Supreme Court.

    What a waste!!
    [/SIZE]
    [/QUOTE]

    It really isn't more simple or direct than this.

  18. #18
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    Obama is super evil.

    And republi-morons are having a hard time finding a candidate that can poll more than 5 PTS above him.

    Republi-f*cks. The Pittsburgh Pirates of politics.


    Sent from my brain using Telepathy

  19. #19
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    [QUOTE=Bonhomme Richard;4424427]It really isn't more simple or direct than this.[/QUOTE]

    He followed through on his campaign promise, no?

  20. #20
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    [QUOTE=cr726;4424445]He followed through on his campaign promise, no?[/QUOTE]

    Yeah, one promise was fulfilled. And that one might be declared unconstitutional by the Supreme Court. Good for him.

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