[quote=cmartenson]And as far as the budget cuts, just blur your eyes a bit and take in this chart…and the futility of targeting the non-defense discretionary piece of the spending will be revealed:
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Here’s another chart that depicts President Obama’s cuts in a pie chart. As the saying goes, “If you blink, you’ll miss it”.
http://www.theblaze.com/stories/shock-graphics-show-severity-of-proposed-obama-budget-cuts/
Richard
[quote=Rector]Less depressingly: early this week at a gathering of 30 friends, we had a group discussion about what exactly we were going to do with ourselves as a group. This had NEVER happened before. I finally have their attention and fielded calls this week ranging from PV systems to food storage. We are getting organized just in time. . .
Rector
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I am encouraged to hear that someone is having this experience. I am still feeling like no one in my world is really taking seriously the coming chaos. It is a very isolating feeling, since it would be so wonderful to be able to share some of this.
I do appreciate having conversations like this thread, where policies are being discussed, even though they are not as “hands on” as other topics. I think it matters and I think keeping a careful eye on the behavior and mindset of the “leaders” will continue to inform us as much as possible about how things will be happening.
OK, so using President Obama’s Budget predictions, I’m predicting the following phone conversation with my wife…
Me: “Honey, I have great news! You know that yacht and 65 inch wide-screen entertainment system with surround sound I’ve been wanting to get! Well, I just used the credit card to get them!”
Wife, “Are you crazy! We’ve talked about this a thousand times! We can’t afford it! We’re already in debt up to our eye-balls… I just can’t believe you’d do something this stupid and irresponsible!”
Me, “Don’t worry about it. I know I haven’t had a salary increase in 2 years because of our company budget freeze, but President Obama said our economy was going to grow 65% over the next 4 years! I’m figuring on a 65% raise, so I went ahead and charged it.”
Wife, “@$%!@#$!.. Click”
It is a tragedy that there are no leaders or political groups willing to do something about entitlements and that the special commission’s recommendations are being ignored. Basically, the pain should be shared by everyone across the board. The Republicans and Tea Party are also to blame. If they don’t want taxes they should try to do more than take away some milk program for the poor.
I think the polticians argue over the little things and ignore the Four Big Elephants or talk abou cutting everything else except those Big Four. It’s like two doctors arguing about the red spots on the patient’s face while the patient is bleeding out.
Even Bachman, Ryan, Boehner, etc. don’t DARE talk about cuts to Social Security, Medicare/Medicaid, etc. Few Republicans want to cut Defense either - most want to increase Defense spending. it is a sad fact that too many senior citizens depend solely upon - or depend mostly upon - Social Security and Medicare/Medicaid to survive, rather than saved all their lives on their own.
Congress will posture and pose and pontificate and then they’ll decide on the budget they want to pass, which will very much resemble the budget Obama has proposed, and that’ll be that. The two sides will blame each other and every year we’ll be that much closer to disaster. It is said that in about 5 or so years, Interest Payments on the National Debt will surpass our spending on Defense. In about 15 to 20 years, Interest Payments on the National Debt will surpass everything else except Social Security and Medicare/Medicaid spending.
What’s also sad is that financially looming outside of the budget discussions are the Fannie, Freddie, FHA liabilities, Federal Reserve money-printing and financial gifts to Big Banks and Wall Street, the financial gifts that Big Ag (ethanol, farm subsidies), the financial tax loophole gifts given to Multinational Corporations (e.g. Exxon-Mobil, Google)… Not to mention the financial disasters of state and local pension and health care liabilities, the financial disasters of underfunded employer pension and health care liabilities (example: Verizon and AT&T each support more retirees than they do employees - same with the Big Three Auto), and the looming private financial disasters of the citizenry and students.
All are looking to rosier futures to help pay down debt, whereas we’re actually looking at peak oil, peak resources, and globalized competition.
Poet
r-Indeed. Folks should be able to depend on the government for subsistence if not an outright lifestyle choice. Making the decision to spend everything (and then some) now is not the fault of each and every individual who has chosen to manage credit rather than save and budget. It’s the government’s fault for not taking more from the savers and small businesses and giving it to the less frugal sooner.
No one should have to suffer for their bad decisions. Including the bad decisions at the voting booth where voting for the free lunch promises made by the morally bankrupt were expected to produce a wealth effect.
I think we need to blame the people who have been telling us to balance budgets and act responsibly all along. Not only that, but we should punish them for this mess. If they had not been so ridiculous by insisting that everyone, including the government only spend what they have, we never would have had this deficit problem.
Now if we could only get a true leader to get us out of this mess! Someone who is charismatic with a great sense of nationalism and social justice. Maybe someone who is a vegan and never cusses, and understands the true danger of those who save their money and fruits of their labor for a rainy day and those self reliant types. Someone who could put a chicken in every pot and and a car in every driveway!
Yep, a Nationalist Socialist type could really save the day here.
<sarc off>
History rhymes. Sorry if I skipped ahead too far.
Thanks for all you are doing Chris.
It is evident to me that there will be no way to avoid the current economic freeway narrowing into a marginal dirt foot path into the future. Those who get on the path first by preparing for individual and small community sustainability will be the least likely to suffer through the 308 million car pileup that is coming. Or is it a 7 billion car pileup? The current middle east dynamic indicates there could be much wider spread damage as a result of the profligate world reserve currency creation and deficit spending. This budget proposal is just another sign encouraging a higher rate of speed as we round the blind corner into economic and potentially social oblivion.
During a recent interview with Jim Puplava, John Williams stated that if the Federal governement used GAAP, and we taxed workers and corporations at 100%, we would still be running deficits. We have a monumental decline in our living standard ahead of us.On another note, I recently received notice from the SS office regarding my benefits. I entered my salary over the course of my lifetime in Excel and multiplied the column by 12.4% (employer and employee contribution). At age 66, I started to withdraw at the stated rate until my statistial death (83). My rate of return is 1.5%. And public pensions are penciled in at 7.5% to 8%?
I wish there were more hours in the day to prepare for what is coming.
The heat surrounding this thing is already quite high, emotions are elevated…it’s almost as if “unsustainable” has become something we can actually almost, you know, talk about, sort of.
Obama Vows Changes to Entitlements, Tax CodeWASHINGTON—President Barack Obama pledged Tuesday that he would do more to rein in the federal deficit, a day after offering a $3.7 trillion budget for next year that does little to address the central programs driving up the country’s debt.
Mr. Obama said a meaningful effort to rein in the deficit must include changes to Social Security and Medicare, as well as an overhaul of the U.S. tax code.
“My goal is to actually solve the problem. It’s not to get a good headline on the first day,” Mr. Obama told reporters at a hastily called news conference, in a tacit acknowledgment of the poor reviews his proposed budget has received from people who wanted it to address entitlement spending and other issues.
It is a sad fact that too many senior citizens made Social Security and Medicare/Medicaid payments throughout their working lives and were otherwise too poor (and/or too stupid) to be able to save.
Just the other side of the government Ponzi scheme, so please don’t blame the victims.
Obama ran a little political trickery on the Rs that I found amusing. Immediately after his budget speech Monday, Boehner hammered on him for not mentioning entitlements. Today he came back and said that he was happy to hear the Rs finally stepping up to the plate and talking about entitlements. Maybe there is room for a reasonable compromise. Particularly if we the people put the pressure on.
Doug
Is it possible that the huge increase in projected revenues is due to the planned expiration of the Bush era tax cuts, return of higher capital gains and dividends tax?
[quote=bsm20, post 18]The president’s budget is, as always, a purely political document.
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Your entire post 18 that I quoted from was excellent. You put the whole issue in perspective.
Travlin
"Does anybody really see these fools getting out in front of these issues? I just don’t."I agree wholeheartedly. But the problem is more with the electorate that they are responding to. Every day I see and hear so-called “anti-tax” and “small government” people who dont want to cut Medicare or Social Security or Defense. It’s a complete oxymoron. With the accent on moron. And yes, most of them are baby-boomers who are just waking up.
One of the best things about this site is just educating people that there’s no free lunch.
I have a simple question. Why do we have to cut Social Security? I find the statement ridiculous. The government owes Social Security trillions but I consistently see statements about Social Security contributing to our deficit and busting the budget. IF people would represent the problem on a reality basis, it’s repayment of borrowed money from the Social Security fund. That’s REPAYMENT you know, like you make on any loan when it comes due. In the LONG term, something has to be done with Social Security but it’s not the immediate problem unless, of course, you are advocating the government default on the repayment. And to me that’s exactly what is being advocated all over the place. This package of lies is being sold to the American public and it’s working. Routinely, I have to tell people that Social Security payments are loan payments. Statements like “Social Security is paying out more than it’s taking in”. True but that is a manipulative half truth. And it was also planned for. That’s why Social Security ran surpluses for decades.
The other part of this equation is the military budget which has been out of control for decades and is a major contributor to the present state of affairs. Once in a while I hear or read some statement but it’s rare. Meantime the Social Security/Medicare rant is at a roar. I figure the reason little to nothing is being said about the military budget is purely self interest on the part of many. Military spending is an enormous pork barrel filling the bank accounts of large numbers of Americans. I know of one instance where an individual spent four yrs in the Army as an enlisted man. During that time, the government forgave $45,000 in student loans and he got his masters degree at military expense. Plus he broke a finger playing volley ball so will receive a couple of hundred a month for the rest of his life. This is not hearsay, I know the guy very well. Not a whisper of these types of things. All is quiet!! Why?? And if you want to get into it, get into the reup bonuses.
If you are going to have a reality based discussion re the budget, you need to use a reality base to do so. That is not occuring at the present time. I do agree the budget is a farce. But so are all other options I see. The reality is the required adjustments to cut the deficit won’t be made. Americans simply won’t stand for it. Rarely, in our entire history have we paid our way. Frankly, all discusssion re the budget are a waste of time. I’m 70 and have listened to the endless rants for decades. Nothing changes. 125 million dollar airplanes to chase guys in $15,000 Toyotas and kick our buts in the process.
Chris, for the most part we have always viewed this through a similar lens. The above depiction of solution might hold more credibility if cuts and claw-backs to nobility and privilege are brought into consideration. It seems all to convenient to disregard tax increases (ex. financial transaction fee and corporate windfall). Yes, I agree there is not much political courage or honesty out there. All the same, authentic discussion should include debt renegotiation/writedowns, and offset the contractionary impact with creative revenues. I do not want to find myself down the memory hole, where inconvenient facts or solutions simply disappear on the backs of those most powerless.
[quote=gene12]I have a simple question. Why do we have to cut Social Security? I find the statement ridiculous.[/quote]And if I misread Jager06 correctly you have to be a Nazi to fix Social Security, and I don’t want to blame anyone for not being a Nazi…
The same might apply to the U.S. economy in general, e.g., economic growth consisting mostly of consumer spending in an economy that has gone through four decades of trade deficits.
The government’s own data show why entitlement programs need to be cut also.
http://www.whitehouse.gov/sites/default/files/omb/budget/fy2011/assets/tables.pdf
Table S-4 shows a 2011 deficit of $1.267 Trillion based on projections of outlays and receipts.
Total defense and non-defense descretionary spending (basically everything but SS, Medicare, and interest on the national debt) is $1.415 Trillion.
So we would have to cut 90% of descretionary spending to balance the budget and avoid cuts to SS. Since the government’s proejctions are always too rosy, let’s round it off to 100%.
There is no SS surplus; the surpluses in the past were spent. For the Treasury to repay SS it must borrow more and further increase the deficit. The government’s own documents at the Treasury website discuss the SS problem in detail.
Today it’s a problem; tomorrow it’s a predicament because we didn’t deal with the problem.
Hello all, I am pretty new here, and have been devouring so much of the information on this site from both Chris and the community at large. Thank you Chris for all you have done and are doing to change the focus of our Nation, and I thank all of my fellow members for your contributions to this site. This information and this site have truly changed my life.
When I was a child I used to sell Worlds Finest Chocolate bars to raise money for various activities and programs; e.g. baseball, football, after school programs etc. The bars sold for $1.00 and we got them for cost with a coupon on the back that essentially saved the buyer $1.00 on some other good; it was a win-win situation. The bars came 25 to a box and each kid could preorder up to 4 boxes at a time if memory serves correctly. The problem was, that me, my brothers and our friends ate the candy ourselves, and we were spending the money we made on the candy we did sell on other stuff. By the time the fundraiser was over we would have no candy left to sell and little if any money to account for the missing bars. Unfortunately, my parents told me it was high time I grew up and learned my lesson. I was on my own and I had to go shovel snow, cut grass, wash cars or whatever I had to do to earn the cash to cover that candy…and FAST. There was no bailout. The government has 3 fundraisers currently in operation…Social Security, Medicare and Medicaid, and they just established a fourth…Heath Care. All debate aside regarding the particulars of heath care, it boils down to nothing more than another fundraising ponzi-scheme that will be misallocated in an attempt to cover the money they owe on the other 3. At the end of the day the U.S. government is no better with money than a ten year old is with 100 chocolate bars. I learned my lesson the hard way. It’s high time the government grew up and did the same.