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(FDL)   "It's not that Greece's budget deficit is growing despite austerity measures, it's because of them, exactly as prominent economists understood and predicted"   (news.firedoglake.com) divider line 107
    More: Followup, finance ministry, economic statistics, Greek economy, tranches, Greece, CDOs, deficits, European nations  
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2912 clicks; posted to Business » on 03 Oct 2011 at 4:44 PM (3 years ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2011-10-03 04:42:32 PM  
B-b -b-but Keynes was a CAWM-NIST, and Krugman is a Bad Person!1

.
 
2011-10-03 04:48:26 PM  
Yes. And yet they still couldn't spend money they didn't have and couldn't borrow.

Thats how that works.
 
2011-10-03 04:50:56 PM  
I don't understand this headline - is it supposed to be a joke? Irony?
 
2011-10-03 04:50:57 PM  
So tax cuts for the rich, right?
 
2011-10-03 04:55:25 PM  
What is stopping this from happening here in the US?
 
2011-10-03 05:00:38 PM  

EnviroDude: What is stopping this from happening here in the US?


We can print more U.S. dollars. Of course, that comes with another set of problems, but that's something our country chooses to deal with at a later time. Expect another round of quantitative easing sometime within the next few months. I recently read a quote that said something like "You can be sure that Ben Bernanke does not want his tombstone to read 'Here lies the man that allowed the U.S. to slip into a depression'"
 
2011-10-03 05:01:15 PM  

vaderstg: Yes. And yet they still couldn't spend money they didn't have and couldn't borrow.

Thats how that works.


It's almost as though, at some point, you're farked.
 
2011-10-03 05:09:19 PM  
This is exactly what will happen in the US when the Republican party finishes seizing control.
 
2011-10-03 05:14:05 PM  
So if Greece had instead spend more borrowed money, its deficit would have... shrunk?
 
2011-10-03 05:17:05 PM  

lilbjorn: This is exactly what will happen in the US when the Republican party finishes seizing control.


with $3Trillion more in debt than in 2008, the democrats are doing a fine job leading us into destruction without the assistance of the republicans.
 
2011-10-03 05:19:46 PM  

EnviroDude: with $3Trillion more in debt than in 2008, the democrats are doing a fine job leading us into destruction without the assistance of the republicans.


That figure is what the Republicans left us with. Bush never put the wars on the books, because that would be responsible. Obama finally did.
 
2011-10-03 05:20:48 PM  
Did Greece even bother to collect and/or raise taxes as part of these austerity measures?


/too lazy to look
 
2011-10-03 05:23:44 PM  
I'm sort of in agreement with some of the comments on that post. In the '30s we shut down failing banks that threatened to destroy the system. Today, we let them dictate economic policy because they're all "too big to fail." The financial sector owns our governments. This has been an astounding, naked power grab decades in the making, and regular people here and in Europe are bearing the brunt of it. I will be shocked out of my skin if ANY bank is forced to eat its losses in Greek loans at this point.
 
2011-10-03 05:29:34 PM  

LedZeppelinRule: I'm sort of in agreement with some of the comments on that post. In the '30s we shut down failing banks that threatened to destroy the system. Today, we let them dictate economic policy because they're all "too big to fail." The financial sector owns our governments. This has been an astounding, naked power grab decades in the making, and regular people here and in Europe are bearing the brunt of it. I will be shocked out of my skin if ANY bank is forced to eat its losses in Greek loans at this point.


It could happen. Someone could forget to send their bribe campaign contribution check on time and be allowed to fail as an example to the others
 
2011-10-03 05:35:02 PM  

PowerSlacker: Did Greece even bother to collect and/or raise taxes as part of these austerity measures?


/too lazy to look


Nope. They haven't. It's the Greece biggest problem.

/Other than being greek, of course.
 
2011-10-03 05:35:07 PM  
The Obvious tag bowed out, because it's looking for a cash infusion.
 
2011-10-03 05:36:42 PM  

John Paul Jones: EnviroDude: with $3Trillion more in debt than in 2008, the democrats are doing a fine job leading us into destruction without the assistance of the republicans.

That figure is what the Republicans left us with. Bush never put the wars on the books, because that would be responsible. Obama finally did.


The debt was $9.1T when Bush left office. Now it is $14.7T when Obama is the head cheese. (new window)


FYI: Bush aint POTUS no mo
 
2011-10-03 05:39:54 PM  

EnviroDude: The debt was $9.1T when Bush left office


EnviroDude: Bush never put the wars on the books, because that would be responsible. Obama finally did.


EnviroDude: Now it is $14.7T when Obama is the head cheese.

 
2011-10-03 05:40:25 PM  

Fish in a Barrel: vaderstg: Yes. And yet they still couldn't spend money they didn't have and couldn't borrow.

Thats how that works.

It's almost as though, at some point, you're farked.


That's exactly the trick that everyone is trying as hard as possible to ignore. The only people who win by playing this ridiculous game are the financial giants. The bad loans that they made either get repaid by people who didn't get entirely wiped out by the recession or by the tax payer. Meanwhile the government does nothing to grow the economy because they are cutting costs and selling government holdings to appease austerity. Long-term this means the economy won't grow, there will be more demand for government assistance (but less of it to go around), and the government revenue will be reduced due to a lower tax base and having "privatized" government services to raise a few bucks right away at the cost of decades of stable revenue and cost-control for the utility in question.

Banks that failed should have been taken over and the trading side closed down. The government should have kept the other half open and run it until they could sell it somewhere else, and if that meant the government ran all of the banks for a few years, that should have been fine. Instead we just paid the executives to fail and put all of the losses that their business strategies incurred onto the tax payer, which would be bad enough without the knife-twist that is the rich (including those executives) advocating higher taxes on the lowest 50% of society while advocating tax cuts for themselves.
 
2011-10-03 05:41:07 PM  
The grammar in that sentence makes my head hurt.

I think it's missing a semicolon or something.
 
2011-10-03 05:43:16 PM  

EnviroDude: John Paul Jones: EnviroDude: with $3Trillion more in debt than in 2008, the democrats are doing a fine job leading us into destruction without the assistance of the republicans.

That figure is what the Republicans left us with. Bush never put the wars on the books, because that would be responsible. Obama finally did.

The debt was $9.1T when Bush left office. Now it is $14.7T when Obama is the head cheese. (new window)


FYI:
Bush aint POTUS no mo



FYI, per your given link, your claim about 9.1T isn't correct, either.
 
2011-10-03 05:44:10 PM  

robmilmel: EnviroDude: The debt was $9.1T when Bush left office

EnviroDude: Bush never put the wars on the books, because that would be responsible. Obama finally did.

EnviroDude: Now it is $14.7T when Obama is the head cheese.


How much of the $5.6T is legacy Bush debt and how much is new Obama debt?

Before answering, remember that Obama chose to extend the Bush-Obama tax cuts.
 
2011-10-03 05:44:37 PM  
As I said in this morning Greece thread (really? two a day now?). Quit the farking hyper partisan spin. I'm sure you really believe that Greece is a clear proof of why your opponents political philosophy is a failure. Or that Greece's trouble is CLEARLY Gawd's punishment for hot, oily, Greek man on man loving or sum such nonsense.

The real issue is that Greek is likely going to default on its debt. Can the repercussions be contained to one nation? Or will Greece's failure spread to the other PIIGS? If that happens, It doesn't matter who is president, or who controls congress, we'll be in for a world wide depression.

Of course if that happens, we can all huddle around our computers and argue whether we should name the depression the Tea Party Depression, or the Obama Depression. Of course a few throwbacks will want to go with the Bush Depression, but he's been out of office too long, and the Americans have short memories.

/It's not both sides are bad
//this is YOUR fault, you political hack
 
2011-10-03 05:45:04 PM  
It's that thing about taxing income of people the gov't pays...

Gov't pays a person $60k, taxes him $20k. So the person shows up on the expense and revenue sides of the budget.

Cut that person to $40k and the taxes drop to $12k. So they're spending less but receiving even less.

Cut that person altogether and he files for unemployment, going from an expense generating a fraction back to just an expense.

This is not an argument in favor of gov'ts hiring every warm body, hoping they come out ahead in the long run. It's an argument against having large numbers of people employed by the gov't in the first place.

Oh, and "War as a Jobs Program" was a really sick fact.
 
2011-10-03 05:48:41 PM  

PowerSlacker: Before answering, remember that Obama chose to extend the Bush-Obama tax cuts.


"Chose"? Surely you recall every idiot with an R next to his name, every GOP pundit, fark..the entire GOP congress collectively basically told the US that they would shut everything down if they did not get those cuts extended?
 
2011-10-03 05:56:28 PM  
Cutting government spending causes the GNP to go down. The amount of debt automatically become a larger percentage of the GNP.

/maths not really that hard
 
2011-10-03 05:57:52 PM  

John Paul Jones: EnviroDude: with $3Trillion more in debt than in 2008, the democrats are doing a fine job leading us into destruction without the assistance of the republicans.

That figure is what the Republicans left us with. Bush never put the wars on the books, because that would be responsible. Obama finally did.


Lol. What an ignorant understanding of reality.

The wars were always on the books, they were off budget. Every dollar showed up against the debt.

According to your ignorance Obama is not including any spending on the books as there hasn't been a budget in two tears.
 
2011-10-03 05:59:39 PM  
SCHADENFREUDE!
 
2011-10-03 06:03:36 PM  
No see, really, it works.

First you take $10 from the people. You burn $5 of it. Then, you give $5 to the people. AND THEN YOU GET $50.

Keynesian economics: It's the next guy's problem!
 
2011-10-03 06:08:00 PM  

meddleRPI: Keynesian economics: I don't understand it!


FTFY.
 
2011-10-03 06:09:05 PM  

meddleRPI: No see, really, it works.

First you take $10 from the people. You burn $5 of it. Then, you give $5 to the people. AND THEN YOU GET $50.

Keynesian economics: It's the next guy's problem!


You missed the biggest part.

You take $10 from the people in the good times. You SAVE $5, and spend $5 on the people.

Bad times hit, you cut taxes and collect $5 from the people and spend $15 with the extra $10 coming from savings, softening the blow of the bad times.

Once good times return to raise taxes and take $10 from the people, save $5 and spend $5.
 
2011-10-03 06:16:21 PM  

meat0918: You missed the biggest part.

You take $10 from the people in the good times. You SAVE $5, and spend $5 on the people.


This is the part everyone misses. Whenever there are budget surpluses you rarely hear about the government squirreling that money away for a rainy day. They create new, permanent programs instead, which just means that when the inevitable retraction occurs, it hits the budget (and those who have come to rely on those new programs) even harder. There is always the urge to spend every last dime (plus a few more).
 
2011-10-03 06:22:57 PM  

DamnYankees: I don't understand this headline - is it supposed to be a joke? Irony?


Magical thinking. Greece spends itself into massive debt and insolvency. Only even more spending and even more massive debt can get them out of it.
 
2011-10-03 06:25:20 PM  
The problem is if we let banks fail, the rich will revolt. That's exactly what happened to German in the 1930s. The rich revolted and installed Hitler into power and then he killed six million Jews.

The rich being rich is our only chance for survival. They can enjoy a great standard of living while we get a chance to just live. The Roman Catholic Church decided to bail out the world in the 1350s with their money to fund art projects and the world has grown since then.
 
2011-10-03 06:30:44 PM  

Funk Brothers: The problem is if we let banks fail, the rich will revolt. That's exactly what happened to German in the 1930s. The rich revolted and installed Hitler into power and then he killed six million Jews.

The rich being rich is our only chance for survival. They can enjoy a great standard of living while we get a chance to just live. The Roman Catholic Church decided to bail out the world in the 1350s with their money to fund art projects and the world has grown since then.


farm4.static.flickr.com
 
2011-10-03 06:35:55 PM  

Funk Brothers: The problem is if we let banks fail, the rich will revolt. That's exactly what happened to German in the 1930s. The rich revolted and installed Hitler into power and then he killed six million Jews.


What it looks like when the poor revolt:

upload.wikimedia.org
 
2011-10-03 06:36:46 PM  
You mean tourism and olives aren't enough to run your economy on?

I, for one, am shocked.
 
2011-10-03 06:37:50 PM  
Not exactly true. Greece was going to fail no matter what. A Keynesian approach would have ended the same way.
 
2011-10-03 06:39:10 PM  

PowerSlacker: Before answering, remember that Obama chose to extend the Bush-Obama tax cuts.


Incorrect. He had no choice in the matter, as the legislative branch makes laws, not the executive. Congress made it clear to him that they were going to extend the tax cuts, and the had the votes to override his veto.
 
2011-10-03 06:41:23 PM  

Uncle Tractor: Funk Brothers: The problem is if we let banks fail, the rich will revolt. That's exactly what happened to German in the 1930s. The rich revolted and installed Hitler into power and then he killed six million Jews.

What it looks like when the poor revolt:


Seriously, when the poor revolted in China in 1989, tanks ran over them as Mao in heaven gave the Chinese Communist Party thumbs up over a job well done.

The poor will never ever revolt again thanks to the military power we have here in this country and in Europe.
 
2011-10-03 06:43:20 PM  

EnviroDude: What is stopping this from happening here in the US?


The fact that we haven't been lying about our income or our spending for decades helps. We have a huge debt, but everyone knows what it is. Also, we have a huge income.

Over the last decade, the Greeks increased spending by borrowing without increasing income by actually growing their economy. The Irish and the Greeks are roughly in the same situation, but the Irish are already starting to come out of their economic mess, because they actually built an economic base (largely in the tech sector) over the last decade.
 
2011-10-03 06:46:22 PM  

Funk Brothers: The poor will never ever revolt again thanks to the military power we have here in this country and in Europe.


Revolutions among the poor are easily put down.

You need a disenfranchised middle class to stage a successful revolution, which is why the Chinese leadership is so worried at the moment, as their middle class swells daily.

The question in this country is how bad to things have to get for our (dwindling) middle class for them to truly get pissed off and demand reforms to our government.
 
2011-10-03 06:49:19 PM  
The same thing will likely happen here with our austerity. You have to grow your way out of a recession.
 
2011-10-03 06:51:16 PM  

Dwight_Yeast: Revolutions among the poor are easily put down.

You need a disenfranchised middle class to stage a successful revolution, which is why the Chinese leadership is so worried at the moment, as their middle class swells daily.

The question in this country is how bad to things have to get for our (dwindling) middle class for them to truly get pissed off and demand reforms to our government.


Well we won't have a middle class anymore so no revolution. You can have an iPad, an iPhone, a MacBookPro, and live in a $2000 a month apartment in Brooklyn and be poor. God wants us to be poor. The Greeks are atheist so they're poor because we believe in God.
 
2011-10-03 06:53:01 PM  

PowerSlacker: Did Greece even bother to collect and/or raise taxes as part of these austerity measures?


/too lazy to look


Nope.

In fact, their tax department has run out of ink to print tax collection forms. The obvious response: stop sending out forms. Because the best thing to do when you're behind on your bills is to undermine what revenue you are getting.
 
2011-10-03 06:53:02 PM  

EnviroDude: John Paul Jones: EnviroDude: with $3Trillion more in debt than in 2008, the democrats are doing a fine job leading us into destruction without the assistance of the republicans.

That figure is what the Republicans left us with. Bush never put the wars on the books, because that would be responsible. Obama finally did.

The debt was $9.1T when Bush left office. Now it is $14.7T when Obama is the head cheese. (new window)


FYI: Bush aint POTUS no mo


On January 20, 2009, the day Bush left office the debt was 10,626,877,048,913.08 according to YOUR LINK. Also, his last budget went to Sept 30, 2009.
 
2011-10-03 06:53:05 PM  

Funk Brothers: The Greeks are atheist so they're poor because we believe in God.


wtf
 
2011-10-03 06:54:51 PM  

Funk Brothers: Seriously, when the poor revolted in China in 1989, tanks ran over them as Mao in heaven gave the Chinese Communist Party thumbs up over a job well done.


I don't have the impression that those revolts had anything to do with poverty but rather with a desire for democracy.

The poor will never ever revolt again thanks to the military power we have here in this country and in Europe.

I'm sure the French aristocrats felt the same way back then. B)

I don't think any army is strong enough to hold down a popular revolt. Just look at the trouble the US army is having in the ME. Now imagine a similar situation in Europe or the US, but with the soldiers knowing that they're shooting at their friends, neighbors, and relatives. The US soldiers are among the 99%, and I think many of them are aware of it.

If things keep getting worse we'll see a real revolt.
 
2011-10-03 06:57:43 PM  

Refudiated Strategerist: On January 20, 2009, the day Bush left office the debt was 10,626,877,048,913.08 according to YOUR LINK. Also, his last budget went to Sept 30, 2009.


The Bush Administration didn't report that much debt. We had to take on more debt in the Obama Administration because of the problems Bush created.

The American people, not the government is being greedy. The American people are out of touch with Washington D.C. The American people are the part of the problem. They must suffer the consequences so that multinationals can compete. In 10 years, debt will be more important to pay than paying for food. The American government should garnish all wages below the average income to pay off this debt.
 
2011-10-03 07:00:26 PM  
One of the things that struck me was the Greece Governments Tax Collection rates. From the article, they only collect about 70% of the taxes that are due. Tax avoidance is a national past time.

The sensible thing would be to scrap the tax code and come up with a new tax system that none of the old cheats would work on.

If the old tax system was based on Income, switch to sales or VAT. If the old system was based on sales or VAT switch to Income.

Instead they suggest higher tax rates on a broken system, which, in a depression, will just encourage more cheating, making the problem worse.
 
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