Bruce Bartlett points out that Americans want a balanced budget, so long as it does not require cutting entitlement programs or raising taxes.

If that sounds, well absurd, it reflects the lack of willingness of voters/taxpayers to engage in any shared sacrifice. This does not bode well for the future of fiscal prudence.

Consider these recent polling results:

An April 6 NBC News/Wall Street Journal poll found that 61% of people favor a balanced budget amendment to the Constitution, down from 71% in 1995. Support falls to 27% when people are told that this would require a 20% cut in entitlement programs.

An April 4 YouGov poll found that an overwhelming majority of people favor large budget cuts. However, majorities also favor increased spending for education and medical research, and a strong plurality favor increased spending on clean energy technology.

An April 1 CNN/Opinion Research poll examined peoples’ knowledge of how the federal government spends its money. It finds that most really have no idea what percentage of the budget goes to various programs.

A March 31 Pew poll asked people which among these programs the federal government spent the most on: Medicare, education, scientific research, or interest on the debt. Only 29% of people correctly said Medicare, 7% said education, 7% said scientific research, and 36% said interest.

On March 9, the Harris poll found strong opposition to cutting Social Security or Medicare benefits to deal with the budgetary problems of those programs. People are also opposed to raising taxes to fund them.

On March 2, a NBC News/Wall Street Journal poll found strong opposition to cutting spending for Social Security, Medicare, Medicaid, K-12 education, heating assistance for the poor, college student loans, Head Start, and unemployment insurance. There was majority support only for cutting nuclear power subsidies, aid to state and local governments, the EPA budget, and spending on transportation and infrastructure projects. The poll also found that 81% of people would support a surtax on millionaires to help reduce the budget deficit, and 68% would support eliminating the Bush tax cuts for those earning more than $250,000.

On March 1, the Tarrance Group issued a poll which found that 63% of voters incorrectly believe that the federal government spends more on national defense and foreign aid than it does on Medicare and Social Security. Also, three-fifths of voters believe that the budget can be fixed just by eliminating waste, fraud and abuse.

Bruce has posted a full run of polls, and their surprising conclusions, at The Fiscal Times.
>

Source:
Recent Polls on Taxes and Spending
BRUCE BARTLETT,
Fiscal Times, April 15, 2011
http://www.thefiscaltimes.com/Blogs/Bartletts-Notations/2011/04/15/Bartletts-Notations-Recent-Polls-on-Taxes-and-Spending.aspx

Category: Psychology, Taxes and Policy

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

58 Responses to “Balancing the Budget w/o Spending Cuts or Tax Increases”

  1. foosion says:

    The poll results are misleading and the public is not quite as dumb as it sounds, at least not in this context.

    It supports a balanced budget in the abstract (don’t we all), but not if it means cutting programs the public wants, including Medicare, Medicaid and Social Security. The public is in favor of raising taxes on those making over $250,000 to help finance these programs, and may be open to raising taxes on everyone.

    We don’t need austerity to balance the budget. We need to fix healthcare spending. We’re at twice the level of the next most expensive country and our results are middling compared to other top countries. Eliminating the Bush initiatives (tax cuts, Medicare drug and some wars) would just about solve the problems.

  2. Petey Wheatstraw says:

    Did anyone ever ask about slashing the military/domestic “security” budgets? I doubt it. If anything, they’re what’s killing us.

  3. MadHemingway says:

    Polls also say the public wants the military budget cut (afterall, who really needs 1200 bases around the world at a cost of $1.5T annually).

    The public also wants tax breaks eliminated for the millionaires and billionaires (yes the Kochs’ included as well as Buffet and the hedgies too).

    The public also wants corporations to pay their fair share of taxes instead of collecting corporate welfare at the state and federal levels.

  4. foosion says:

    By the way, for the media to complain that the public is misinformed about some basics, like the general composition of the budget, shows a profound lack of self awareness by a group that should be informing the public and that is, itself, largely clueless.

  5. techy says:

    Democracy: By the stupid people, of the stupid people, for all people…welcome to the circus.

    Does anyone know what kind of drama goes on in European countries…

    I am sure its nothing like Glenn Beck, Rush, sarah palin, Trump etc..

    America looks more like a modern developed islamic country. you just have to replace the religion with christianity…. Organised religion does messes you up…. the blinders are hard to remove.

    And in a democracy the majority rules….even if that happens to be stupid, lets hope the education system is doing its job for the long run.

  6. foosion says:

    @sparky, the public clearly wants cuts to the military. We’re spending about as much as the rest of the world combined.

    However, total defense spending is about $700 billion. $1.5 T on bases is a rather large exaggeration.

    http://www.cbpp.org/cms/index.cfm?fa=view&id=1258

  7. MadHemingway says:

    We could also do away with presidential and congressional pensions and benefits.

    It’s a drop in the ocean, but it’s the thought that counts and starting with the perpetual headaches known as Congress would be a good starting point.

    Besides, why would W need a pension considering he’s a millionaire and considering the wreck he left the country in. Clinton’s cleaned since leaving the WH to the tune of about $85M.

  8. eraske says:

    I think your headline is misleading. You show a bunch of polls that are against spending cuts but no polls are against raising taxes on the wealthy. In fact the wealthy are in favor of taxes being raised on them in one poll i saw. Every poll i’ve seen people agree that taxes need to go up on the wealthy. We need more and higher tax brackets up to say 45-50% over say 20 million down to the 39.6% for 250k with other levels in between. Along with a surtax on millionaires and billionaires. Trump once proposed a 14.5% surtax on the wealthy in 1999 that would have raised 5.4 trillion at the time. I think the people’s plan by the progressive caucus is the best plan I’ve seen on the issue of spending cuts, job creation, infrastructure investment, corporate welfare subsidy cuts, and revenue increases. Every thing in the plan is backed by the majority of america according to all polls.

    ~~~

    BR: That was supposed to be ironic/tongue in cheek sarcasm — I know, sarcasm does not come across in print . . .

  9. GeorgeBurnsWasRight says:

    I’m reminded of the late Paul Simon who served for decades as a member of the House of Representatives from Illinois. He said that the very first letter he ever received from a constituent after being elected requested a dozen new major federal programs be begun, and then ended with a demand that taxes be cut.

  10. techy says:

    OT:
    Can you guys check on the other thread to see if my understanding of inflation is right?
    http://www.ritholtz.com/blog/2011/04/the-cure-for-high-prices/

  11. DeDude says:

    It is extremely difficult to solve a problem if the facts about it are not understood. Now if news media were actually used to provide the population with facts then we might get somewhere. But then people would probably just change channel and watch re-runs of American Idol or some other mind-numbing stupidity. We the people have met the enemy and it is us.

  12. I wonder if Americans would be in favor of annexing another country if it meant their entitlements would be maintained. That wouldn’t be too far from nazism

  13. I don’t believe people are quite as foolish as believed… They may be doing the best that can be expected considering the rapidly expanding efficiency of the technologies working to make them stupid.

    Our ‘attention economies’ have never been so distorted nor intentionally disconnected from reality.

    What do I mean?

    A man or woman in a hunter-gatherer society thousands of years ago… certainly didn’t know much about science or politics… or maybe even what was over the next hill. But that doesn’t mean they were irrational.

    The level of rationality applied to an issue was correlated with the amount of control they felt they could have over the issue.

    In other words… building a hut or making an arrowhead was a very practical matter, and making decisions about gathering materials, organizing the activity of construction, etc were approached pragmatically.

    It’s the stuff they couldn’t understand… and couldn’t control where they’d look to a Shaman or other ‘mystical leaders’ to make decisions for them…e.g. the weather, disease, etc.

    Its not much different now… so long as people are confused they’ll look to false Gods offering easy answers.

    The dream of the Enlightenment is that human societies would become filled with ‘skeptical individuals’… not adoring fans of simplistic ideologies. In terms we use now: Its only from such independent decision-makers that ‘crowd wisdom’ can be gleaned… (and thereby ensure viable representative government).

    Our political establishment whether consciously or unconsciously doesn’t really want that… and will not co-operate readily with creating a truly skeptical citizenry.

    Brands, whether in politics or commerce are about building myths…and are always to at least some extent about selling lies. Both governments and corporations really want ‘subjects’ not empowered citizens. They won’t admit it. They probably don’t even believe it. But that’s the way it is.

    SO… it’s up to you all to build systems and technologies to interrupt the sadly quite natural tendencies of those institutions.

    Capability ENABLES Responsibility
    http://culturalengineer.blogspot.com/2008/10/capability-enables-responsibility.html

    I’m a pragmatist. A CAPABLE CITIZENRY REQUIRES FREQUENT AND MEANINGFUL PARTICIPATION. And that needs to be as spitting across the campfire.

    Address Technologies of Representation and Political Transaction

    Its essential to liquify and unburden the micro-transaction and its networking (in politics especially but there are broader opportunities and implications.) This is actually returning these transactions to their origins… (ICT has been a continuous process of essentially liquifying information and communication and restoring proximity… unburdening them so to speak. This form of transaction needs similar relief. THIS IS NOT ANTI-BUSINESS… but actually PRO a healthier commerce.

    Sorry it’s confusing. I keep trying to think of the perfect tweet to say it all… the closest I’ve ever come was where I started with it a few years ago: Political micro-donation combined with specifically designed networking capabilities is central to the catalyzation of a necessary ‘decision’ marketplace and an empowered Commons. So I went ahead and designed and built the root that can enable that.

    Monetizing outside the transaction, networking capacity and, of course the viable micro-transaction are central to un-burdening and re-liquefying what are actually lost forms of very ancient transactions.

    The resulting mechanism and model work together to form a more general Internet Intermediate pay system (like PayPal). I believe this is a vital UTILITY that should neither be government nor corporate run… and perhaps not even a traditional non-profit.)

    (I understand how Archimedes running through the street naked could have made him seem a bit out of the ordinary to strangers. I feel a certain kinship. So I’m remaining fully dressed at all times!)

    The model is designed to assist in the rehabilitation… of very fundamental transactions. I may march to my own drummer… but I’m a pragmatist. This model is viable.

    (Just spreading the word… hoping for skepticism followed by interest… I’m throwing out fishing lines wherever I can… since two-parties don’t want any change… and VC’s get scared shitless if they think a development has political implications. And my time with a roof over my head is growing short.

    To see what is in front of one’s nose needs a constant struggle.
    – George Orwell

  14. sihaque says:

    For all the noise around entitlement cuts, most people are just asking for their money back. People feel they have fairly paid into the system, so they should get the benefit of the promised contract.

    If the government was a business, it would have raised the premiums on people’s social security contributions and medicare contributions through the years of their working lives to make up for additional costs. that’s what the proposal should be now, not to change the contract for those that have been doing what they have been asked to all their lives (the much maligned retireees).

    in America we’re always suspicious of what the other guy may be getting that we are not. By allowing politicians to dominate our reassignment of social values, we’re playing right into that insecurity. Thats why bipartisanship is the only solution to the problem.

  15. royrogers says:

    i think Bernanke can come up with a solution.

  16. rip says:

    @sihaque: Agree. Great comment.

    The politico asshats want us all to forget they’ve already spent what we paid in. So I guess we get to eat it or pay some more.

  17. MayorQuimby says:

    ********NEWSFLASH********

    People are ignorant.

  18. SteveC says:

    The Republicans have hated Social Security and Medicare since day 1. Rush Limbaugh once said on his radio show, that the passing of those bills were the darkest days in American history. But, they’re popular, the so-called 3rd rail. So the next plan to kill them was to cut taxes and spend like crazy (remember Cheney’s “deficits don’t matter”) to engineer a budget crisis, and then force their privatization because we have no choice. Well, it took 25 years but now we’re here (Enter Bush’s push for SS privatization, and now Rand Paul “end Medicare”). In the end, minor adjustments need to be made to both of these programs, but so far, there have not been enough adults in the room to actually have a conversation.

  19. dead hobo says:

    BR: That was supposed to be ironic/tongue in cheek sarcasm — I know, sarcasm does not come across in print . . .

    reply:
    ———-
    Yes it can if you first note that how you speak does not translate well into good writing, usually. Conversational writing makes poor conversation, usually. Also, you usually need to go over the top, but in a subtle way because that sets the tone otherwise missing in written speech. Basically, most people don’t think and hear the same way.

    Example:

    Spoken: Hey, Bob.
    Written: Bob, you fucking idiot. Listen to me, douch.

    Note the difference and preferred application?

  20. Bill in SF says:

    “CNN poll finds that most really have no idea what percentage of the budget goes to various programs.”

    Well, ask for a receipt.

    http://www.whitehouse.gov/taxreceipt

  21. @sihaque,

    C’mon. It is not like these folks weren’t standing around WATCHING their government squander the money. Why didn’t they say anything then? They sat and did nothing while the whole house of cards was built and now that the house is starting to wobble no one wants to make any sacrifices?

    This wasn’t done in secret. This had been going on for decades

  22. VennData says:

    To get back the jobs that pay taxes, leet’s get rid of new technological advances like the iPad….

    http://www.geekwire.com/2011/rep-jesse-jackson-jr-antitech-rant-blames-ipad-killing-jobs

    … it follows that the more technology we roll back, the more jobs we’ll create. So stop your reading of this job-killing blog, and stop driving that silly car, etc… etc…

    Jesse Jackson Jr. …as dumb as his dad.

  23. @SteveC,

    Canada did go the way of private pensions. It was the best move we ever made. We’re getting a much better ROI than what government bonds were providing and the money will be there down the road (uhh, until the government decides they want to take it for themselves, of course)

    http://www.cppib.ca/Results/Financial_Highlights/default.html

  24. rip says:

    @common man: correct. For decades.

    But as a voter what were your choices?

    Jefferson got it right: an informed educated public open to debate.

    And he also understood the notion if decentralizing politics. As in, why should a highly powerful, sharply focused industry control the fate of everyone?

    IMHO Simon Johnson nailed it. Let’s see how the MSM, dependent on national issues, picks up on that one.

    But it’s spent. And we, as taxpayers, not WS asshats, get to pick up the pieces.

  25. ilsm says:

    Do not discuss cutting entitlements which are slightly less than two-thirds US government outlays.

    A bit more than a third is for “discretionary spending”; more than 20% of US government outlays is for “national security”.

    US national security spending is roughly half of the entire world and more than 70% of the arms buying.

    The UK devoted a sinking 7% to war.

    There is huge opportunity to cut military acquisitions which run over $220B a year and are open to high risk of waste fraud and abuse identified by GAO’s “high risk identification” audits.

    The DoD acquisition system is getting no better, the management support system of defense acquisition is filled with over graded government personnel and their expensive support contractors whose purpose is to get on contract and keep from being terminated.

    If the defense establishment began demanding contracts be performed, huge sums of money would be freed for deficit reduction and infrastructure.

    See GAO 11-233sp

  26. KJ Foehr says:

    Wars without drafts or widespread sacrifice.

    Myriad spending programs increasingly funded by borrowed foreign money.

    Lack of awareness of the myriad benefits of government spending.

    A preponderance of people who have never known real hardship and sacrifice.

    Politicians’ unwillingness to make the people experience any real hardship and sacrifice.

    What does it all add up to?

    The sense that anything is doable in America without real hardship and sacrifice.

    And a lack of understanding of the need for taxes leading to an ever growing desire to lower them.

    Where does that lead to?

    Economic collapse, either through bankruptcy or runaway inflation and punishing interest rates, followed by great hardship and sacrifice.

    We should have been made to experience it in smaller doses over the year, but instead it appears we will eventually be hit with a massive dose all at once.

    .
    Ben says, “There is no such thing as a free lunch, except for QE!”

    We shall see about that.

  27. gd says:

    techy Says:
    “Does anyone know what kind of drama goes on in European countries…”

    I’d guess every European news service has an english version web site. It’s pretty easy to answer that question yourself. I spend some time in Germany, and my experience is that the level of discussion is vastly above the USA. The attempted bullshit artists usually get called on it, and usually know better than to try. Usually. You may not agree with their conclusions and policies but everyone attempts to have intelligent discourse on it. As an example, the Greens are in a tizzy because they’ve finally grown into positions of power, and can no longer run as the eternal protest party. Americans look pretty pathetic in comparision, and are looking worse year by year.

  28. @rip,

    As an individual voter, no, you had little choice. As that great hulking beast the American political system, the people voted for this. The same ones that delivered Ron Paul to office every election also delivered Ted Kennedy so the people made their bed and now they, along with their kids and grandkids, will have to lie down in it

    I often muse to myself that the people have won every election they have voted for. I haven’t but they have

  29. carleric says:

    Its tough to get the pigs away from the slop trough. Our ancestors understood shared sacrifice although there were always whiners. Today? Just pigs and envious ones they are!

  30. dougc says:

    It should be an interesting upcoming election, will the wage/debt slaves vote for their self interest or will they be manipulated by their religous beliefs and intolerance and vote republican.

  31. Bob A says:

    My name is Trump and I’m writing this from my yacht.
    Wouldn’t it be enough if we just saved all our refrigerator boxes for old and poor people to live in?
    Instead of recycling them into paper bags for wealthy shoppers?
    That makes sense doesn’t it?
    Since I have a birth certificate I was able to figure that out.
    Besides being really smart cause I’m rich of course.
    I gotta email that idea off to Paul Ryan. He’ll know what to do with it.

  32. DL says:

    What we have, on the one side, is Paul Ryan’s austerity budget.

    On the other side, we have Obama saying, essentially, “let’s put our collective head-in-the-sand and hope that the rich will bail us out”.

    In political terms, “head in the sand” wins every time.

  33. SteveC says:

    Common Man… Evidently, your government is not owned by Wall Street, like here in the us. In the US, if we privatize SS, Wall Street would immediately begin scheeming how to separate the citizens from their money. In fact, our government would likely help them.

  34. gd says:

    I’ve always assumed privatization of SS *was* a Wall Street scheme from the start. The more I think about it, the more that seems like it might be the answer to one of the recent links about the angst in the financial business, not knowing where the next big thing is coming from. It would certainly do the job.

  35. Haigh says:

    Which happens first
    - The DXY falls 50% to 37
    - The Federal government’s budget is balanced or in surplus.
    The polls suggest the first. It seems like the path of least resistance.

  36. DL says:

    Regarding privatization of social security…

    I’m no longer in my twenties – - far from it.

    But if I were, I would not be afraid of privatization.

    Can’t be any worse than IRA’s or 401K’s are now.

  37. brianinla says:

    >But if I were, I would not be afraid of privatization.
    >Can’t be any worse than IRA’s or 401K’s are now.

    Sure it can be worse. An IRA or 401k is your choice to contribute or you can keep your money and decide how to invest on your own.

    Privatization of SS is the government forcing you to contribute to yet another Wall Street-managed slush fund.

  38. BDW says:

    There is a Progressive Caucus budget that actually balances the budget instead of just lowering the debt increase by less than the other guy. Of course you haven’t heard about it because it’s not as sexy as having tea-partiers on This Week instead of actual dialog.

    http://grijalva.house.gov/uploads/CPC.Budget.112th.Memo.pdf

  39. formerlawyer says:

    @DL

    Congress just needs to do nothing for the next few years – let tax cuts expire and get medical costs under control. At least that is the CBO projection….

    http://www.slate.com/id/2291054/

  40. rktbrkr says:

    Jeez, I hope after waging undeclared wars for 60 years we’re not so destitute that we’ll have to stop warmaking in favor of meeting the needs of our citizens!

  41. hankest says:

    DL said: “What we have, on the one side, is Paul Ryan’s austerity budget.”

    Lowering the tax rate for our wealthiest people, while not cutting expenditures nearly enough to account for those tax cuts is now called “austerity?” Wow.

    I agree with formerlawyer, let the tax cuts expire for everyone is a start.

    Then contain medical costs by following the French model, add to that cutting defense spending by half and we’ll be heading in the right direction…….but everyone already knows that.

  42. DL says:

    hankest @ 6:40

    Ryan is not proposing to raise taxes. He is just proposing to abstain from raising them.

    ~~~~~~~~~~~~~~~~~~~~~~~

    If Obama can really find a way to substantially increase total IRS revenues without raising taxes on anyone below $200K, that’s O.K. with me. I just don’t think Obama will succeed in accomplishing that particular goal. (Good issue for the 2012 campaign, however).

  43. DL says:

    (Meant to say that he’s not proposing to lower them)

  44. hankest says:

    DL, he is proposing to lower the individual tax rate for the wealthiest from 35% to 25%. That’s a tax cut.

  45. deaner66 says:

    The American public is as stupid as it deserves. It is the way the system is designed. As a flaming liberal, I cannot deny that it is designed that way by politicians of all stripes. Politicians know full well the public cannot handle the bare truth. That is nothing new. So, they lie their way around every single issue that comes up.

    Now, pundits, comedians, and columnists are free with the truth because there is limited traction in their words. Hey, Bill Maher is one of my favorites, and he speaks a brutal truth, but in the end, he is only speaking to the choir.

    What politicians have done so successfully–both parties–is separated reality from ideals. Hence, tax cuts are “your money” and Medicare is a birthright. Both truth, and lies. And the American public believes both. So it’s not hard to see how our country is in the position it is in. And it is even easier to see where it could very easily end up.

    There is something inherently wrong with a society that simultaneously laments high taxes and poor infrastructure. We bitch about how expensive college is, and in the same breath we can complain that the government should be able to “make due” with what it has. The examples run forever.

    Here is the grandest example of them all, for me: the deregulated financial industry wrecked the world economy, got enormous bailouts at taxpayers expense, which led to Pres. Obama to spend unprecedented amounts of money to attempt to rescue our system. This, in turn, led to enormous deficits, which led to an influx of Tea Bagger-type of politician to be elected, which led to a cry of “overspending”, which, in a round-about way, led to a cry of “we need more deregulation”.

    HUH?

    As a liberal, it pains me to see Obama being bought off by Wall Street and urchins like Larry Summers and Bob Rubin. And what are my choices? Vote conservative? No, I’m stuck voting for Obama, and his weak spine, rather than a pro-business Republican, who are in favor of letting loose the dogs, once again.

    As an American, you might imagine how this leaves me scratching my head, wondering how much we have in common with The Roman Empire. Yeah, that’s over dramatic, and fatalistic, and possibly rooted deep in the truth. Maybe not, but also, maybe so.

    So even if most Americans are dumb as compost, or simplistically indifferent, what is our next step? The answers aren’t on “Fox and Friends”, or “Morning Joe”. Hell, they’re not even on “Real Time with Bill Maher”, for that matter. The answers are right in front of us. Yet, like a bad dream, they are impossible to get a grasp on, despite the fact they are within reach.

    Yikes.

  46. techy says:

    What will be the end game? how long can those go on?

    I have a firm beleif that the sheeples are not going to get smarter in the next 20 years…such that they encourage a politician to fight to win election based on truth….in this internet age maybe its possible…looking at middle east does give me some hope.

    start with campaign finance reform
    that should fix the nexus of corporation owning this country via politicians.
    Everything else has to fix itself….may the education system will show better results in next 20 years??

    I am not holding my breath till 40% of the population stop believing that we need to run the country as per sharia…oops…I mean using that 2000 year old book compiled by humans.

    Does anyone know the history of religious sentiments in this country….how long before they stop listening to these people like rush limbaugh, glenn beck, sarah palin etc… whose only interest is to fool these people and make money??

    BTW its not only relgion which is the issue….its also the race issue…the whites in south are still sore about the blacks….I did hear a college educated professional saying they are willing to give tickets to africa for the trouble they caused.

  47. Andy T says:

    DeDude@8.04AM

    “We the people have met the enemy and it is us.”
    ~~~~~~~~~~

    Pfft. Classic liblab babble.

    Things have never been different. It’s always been the same.

  48. victor says:

    Just because the polls show this kind of lack of info doesn’t mean Americans are stupid as some of the comments say, especially the caustic ones. My suspicion is that this is just complacency as things have been pretty good so far.

    But yes, things are changing, changing fast and we’re now in a lot of trouble with the debt approaching 100% of GDP and $1.5 T borrowed out of $3.5T total budget. I am convinced that the US Treasury will default on its obligations (China alone holds $1T of our debt) but in a stealth way as Bill Gross says, by screwing the savers as in: devaluing the greenback, causing inflation and keeping the real interest rates low or even negative all the while hoping that our creditors wont rebel against this trick, and why should they?

    China? they have some 300 million citizens practically homeless, all of China smoke cigarettes, the whole country smells like cheap stir fry, the air is unbreathable, the banks are State owned, they import half of their oil and the going price for a ticket to paradise (to work in a San Francisco restaurant kitchen or even write software in San Jose) via a visitor’s visa which the lucky visitor will promptly overstay and become illegal is $25 grand?

    Due to utter paralysis in DC, NOT A DIME will be cut and as far as soaking the rich, there aren’t enough of them to satiate our appetite for spending. I’m skeptical that increased taxes will be even used to cut the deficit when it is much easier to just spend that much more.

    Can someone of this illustrious blog confirm that 100% tax rate on the ultra rich wont do the trick and that only taxing EVERYBODY much more may work on paper but we just have no clue if it’ll work in real life? But have no worry, two things may still save us; real econ growth of above 5% for several years combined with increased productivity. Other than this, I don’t think even a Second Coming of Christ Himself would solve this mess…stay tuned and don’t forget that a big fat Black Swan may be just around the corner….the Mayan calendar ends in 2012, apocalypse now? just kidding…

  49. Peter D says:

    If you want the government to make profit, then private sector must take a loss.
    Unless people drill it into their heads they will continue to run around with stupid ideas that government is like a household, can run out of money etc. Sectoral balance people!

    G-T = S-I + M-X

    G-T : govt spending minus taxation, aka GOVT DEFICIT
    S-I: domestic non-govt saving minus investment, aka NONGOVT SURPLUS
    M-X: imports minus exports, aka TRADE DEFICIT

    Why is it so hard to understand that the govt cannot be in surplus unless private sector DISSAVES!?

  50. curbyourrisk says:

    Massive spending cuts.

    FAIR TAX (elimination of all income taxes).

    Environemtal Tarriffs

    Wage Tarriffs.

    That is just where we start, enough said.

  51. curbyourrisk says:

    Wow……once again, this post bcame nothing more than a policital he said, she said.

    KEEP POLITICS OUT OF ECONOMICS AND MAKE THE HARD DECSIONS BASED ON COMMON SENSE AND LOGIC. I know it is hard for most of you to do that, but can we have 1…..just 1……. debate without anyone dropping the R word or the L word….or actual names instead?

  52. There is no reason to raise taxes or to cut spending. The federal government has the unlimited ability to pay bills. And before you say something irrelevant about Weimar Germany or Zimbabwe, look around: Big deficits, no inflation. Inflation is caused, not by deficits, but by oil prices.

    A balanced budget is a guarantee of a depression, as has been proved repeatedly in our history. Learn from our history.

    Rodger Malcolm Mitchell

  53. DeDude says:

    “KEEP POLITICS OUT”

    How are you going to do that??? Taking politics out of the national budget is like taking sex out of procreation.

  54. AHodge says:

    hey im for stuff tha sounds good
    against what sounds bad.
    as for realism and how things work,
    my world is adjectives,

  55. Lugnut says:

    Given the amount of the ‘real’ economy that is propped up on crutches by the Federal .Gov spending, cutting spending any wheres near what it would take to seriously address our budget deficit (never mind reducing the debt) would likely be short term economic suicide, and hence political suicide for it’s propopents.

    Not addressing the structural problems will also probably lead to economic chaos at some point, whether it be the bond/treasury markets (cost of debt rollover service), dollar devaluation leading to large scale price inflation, global FX crisis, or worst case from the US POV, reserve currency status emperilment. That would be longer term political suicide, though, compared to scenario A, so hence its the course we take. It is in the interest of no one in DC to tackle seriously the issues we presently confront.

    Regarding the current budget battle, the Titanic is bearing down on the iceberg visible from the corws nest and DC is arguing over whether to turn the wheel 1 degree to port or 1.2 degrees. Its silly to watch, and quite frightening, if I think about it too long.

    small suggestion for deaner66 who is on the other side of the isle from me, politically speaking; stop looking this as left versus right. Its the connected versus the unconnected. The banks, large corporations and the military industrial complex always seem to find away to get preferential treatment come time to pass a budget or pass new legislation. Lobbyists don’t care if its a D or an R, money is the same color in everyones wallet. Lets face it, in terms of actual decisions and actions, Obama is a kissing cousin to Bush Jr. Geitner still being at his post calling the shots and pressing for the mortgage fraudclosure settlement ought to tell you that.

    My take on the whole issue; Once they start talking about reducing the size of the military, then I’ll sit up and take notice. This manure about not increasing the size of the debt ceiling is pure posturing. That’ll never happen. We’re going to ride this debt horse hard till he dies, and then we’ll whip him some more.

  56. Lugnut says:

    …. the other way to look at it is this : The stakes are WAY too high for this to get addressed on a structural level unless there is something out there that can provide some type of political cover that the Congressmen and Senators can hide behind “Its an emergency, if we didn’t do X then Y would surely have happened and would have been 10x worse.” See Hank Paulson for most recent useful example.

    Something akin to a failed treasury auction, a joint prounouncement from Moscow and Beijing of a new basket reserve currency alternative, OPEC replacing the dollar, a massive Treasury dump by multiple CBs, or some other fiscal earthquake. No one will do this because its the “right thing to do” it would never fly. Theres little to be gained politically, and much to lose.

  57. Lugnut said, “Given the amount of the ‘real’ economy that is propped up on crutches by the Federal .Gov spending, . . .”

    Federal deficit spending is the method by which the federal government adds dollars to the U.S. economy, thereby causing economic growth. That is where dollars come from, and that is the real economy.

    Those who do not understand Monetary Sovereignty argue against federal deficit spending. They do not understand the need for continuously adding dollars, nor do they understand the difference between federal financing and personal financing.

    It’s amazing how people repeatedly can see recessions follow reduced deficit growth, and recoveries correspond with increased deficit growth, yet maintain a negative attitude toward deficits. Cognitive dissonance, perhaps?

    Rodger Malcolm Mitchell

  58. Lugnut says:

    A question better posed to Standard and Poors perhaps…..

    All things in moderation, I suppose