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(The Daily Dolt)   Whoa, whoa, whoa, whoa. Now researchers are saying that running massive long-term deficits is somehow a BAD thing? We tell ya, we gotta plead ignorance on this thing   (thedailydolt.com) divider line 67
    More: Obvious, Vincent Reinhart, Kenneth Rogoff, public debt, advanced economies, Carmen Reinhart, deficits, National Bureau of Economic Research  
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1702 clicks; posted to Politics » on 18 Jun 2012 at 1:35 PM (2 years ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2012-06-18 10:11:15 AM
Teabaggers to get teabags all in a bunch in 4, 3, 2...ZOMG WE'RE SPENDING TOO MUCH, WE'RE ALL GONNA DIE!!!!!
 
vpb [TotalFark]
2012-06-18 10:25:03 AM
I thought that credit card debt paid for itself, just like tax cuts.
 
2012-06-18 10:31:16 AM
GUYS GUYS GUYS

LOOK AT ALL THIS CORRELATION WE FOUND

ISN'T THIS MEANINGFUL?
 
2012-06-18 10:39:38 AM
Two things will fix the deficit problem:

1) cut taxes
2) invade Iran

Romney 2012. Robots are good at math.
 
2012-06-18 10:42:38 AM
To be fair, THIS:

But the researchers were quick to note that their findings should not be interpreted to mean that governments should never incur deficits or should take draconian measures in alleviating their current obligations (Woohoo, Acapulco 2013!!!). They warned that they are not making a case "for rapid public debt deleveraging in an environment of extremely weak growth and high unemployment." Rather, as Ezra Klein notes, such findings simply "strengthen the case for tackling the long-term deficit in the United States, where the debt-to-growth ratio shot past 101 percent in February."
 
2012-06-18 11:32:26 AM
FTFA: Remember that time back in college when you threw $47,000 on your Visa card for Natty Light and trips to Cancun, and all you really got in return was a mild case of alcohol poisoning and a burning sensation when you pee? Yeah, Visa probably should not have extended that much credit to a 19 year-old. And you probably should have known better than to hit on someone with a tramp stamp the size of your carry-on luggage. It was a valuable growth opportunity.

But I thought government debt was IN NO WAY, SHAPE OR FORM anything like personal debt, and governments can keep on spending and spending?
 
2012-06-18 11:37:31 AM
According to republicans, there is nothing wrong with National Debt when their loser is in office. When any other party's candidate is in office then OMG!!! Socialism!!!
 
2012-06-18 12:00:51 PM

bdub77: Two things will fix the deficit problem:

1) cut taxes
2) invade Iran



While I'm against each step individually you sold me with the combination.
 
vpb [TotalFark]
2012-06-18 12:10:51 PM

xanadian: FTFA: Remember that time back in college when you threw $47,000 on your Visa card for Natty Light and trips to Cancun, and all you really got in return was a mild case of alcohol poisoning and a burning sensation when you pee? Yeah, Visa probably should not have extended that much credit to a 19 year-old. And you probably should have known better than to hit on someone with a tramp stamp the size of your carry-on luggage. It was a valuable growth opportunity.

But I thought government debt was IN NO WAY, SHAPE OR FORM anything like personal debt, and governments can keep on spending and spending?


Not spending always worked for me. Just stop paying your bills and eating. No need to increase revenue by getting a job or anything like that.
 
2012-06-18 01:17:14 PM

Ob:

imgs.xkcd.com
 
2012-06-18 01:37:40 PM
The same researchers later published a study that found a strong correlation between going hungry and being poor, and have suggested that people eat more food to improve their economic status.
 
2012-06-18 01:38:49 PM

sprawl15: The same researchers later published a study that found a strong correlation between going hungry and being poor, and have suggested that people eat more food to improve their economic status.


Don't be silly. They should just buy more money if they don't have $100M their dad gave them.
 
2012-06-18 01:56:35 PM

Politicandy: Teabaggers to get teabags all in a bunch in 4, 3, 2...ZOMG WE'RE SPENDING TOO MUCH, WE'RE ALL GONNA DIE!!!!!


You forgot the part where they then scream "KEEP GOVERNMENT OUT OF MY SOCIAL SECURITY AND MEDICARE!" You know, all while riding in the hover-round that the government paid for.
 
2012-06-18 02:00:00 PM
But I was told that if I spend way more money every year than I make that somehow my debt will magically vanish.
 
2012-06-18 02:02:18 PM

Goodfella: But I was told that if I spend way more money every year than I make that somehow my debt will magically vanish.


If it doesn't it means you're not spending enough.
 
2012-06-18 02:13:35 PM
Coming up next: Holding the economy hostage to get the guy you disagree with out of office found to be piss-poor strategy.

/that's on FUGGING DUHHHHHH News.
 
2012-06-18 02:16:47 PM
Private debt was the problem, not public debt. Public debt could bite us in the long term, but banks are basically begging the Government to take their money and give them bonds. Hell, the T note had a negative yield for a while. Bankers were willing to take a loss to own treasury debt! That doesn't happen if you're carrying an unhealthy amount of debt.

Now, paying to service existing debt is an annoying drain on our budget. But the issue was that consumers piled up massive and increasing debt loads. Houses, cars, credit. Our economy's growth was built on more and more money, ignoring that about a third of the money in play was non existent. Yeah, you put a few bucks in the pocket of a retailer and it flows around, fueling an economy, but somebody was holding that debt. When some people stopped servicing that debt, banks got nervous and shut it down. Now, guess what? The money supply is drying up as people have to pay off debt. Money that never existed is disappearing. Gee, what a shock.

The world and US economy is going to have to readjust to operating with much less money in it then before. Because that money was never really there, only an illusion.

Ya know, we should probably just inflate our way out of it. Print money, reduce the debt burden, and make it nice and cheap for the chinese to build their cheap crap here. Screw it.
 
2012-06-18 02:17:55 PM
Big debts for no reason are stupid. Such as running huge deficits to fund Tax Cuts, invasions of Iraq and Afghanistan, Medicare Part D, all during economic expansion.

Big debts during the biggest economic recession since The Great Depression is harder to show that it's worse than the next likely alternative: GREAT DEPRESSION 2.

You have a big enough shock to the system that everyone stops spending/loaning out of fear of losing their jobs, a lot of people WILL be losing their jobs because no one is spending or loaning. Accelerate downwards until rock bottom. Deficits help prevent that outcome.
 
2012-06-18 02:20:22 PM
Remember that time back in college when you threw $47,000 on your Visa card for Natty Light and trips to Cancun, and all you really got in return was a mild case of alcohol poisoning and a burning sensation when you pee?

No, I went to a real college.
 
2012-06-18 02:20:56 PM

cptjeff: That doesn't happen if you're carrying an unhealthy amount of debt.


I should say, "That doesn't happen if investment banks view the debt load as unreasonable, because they're the ones who determine the interest rates and thus how painful it is to hold public debt. If public debt is essentially free, there's not much harm in holding it. When interest rates start going up dramatically, you stop taking on new debt. When you get tired of servicing existing debt, you pay it off. Personally, I don't like the costs of servicing our debt, but right now, it's far less painful than diverting significant resources to paying it down.
 
2012-06-18 02:22:15 PM

Because People in power are Stupid: According to republicans, there is nothing wrong with National Debt when their loser is in office. When any other party's candidate is in office then OMG!!! Socialism!!!


This is really the problem here. Two major issues are affecting our budget right now:

1. The financial crisis tore out massive chunk of revenue. Not a spending issue.

2. In 2009 Obama decided to stop paying for the wars in Iraq/Afghanistan with emergency spending measures. This meant that the costs would actually show up in the budget, as opposed to pretending we weren't spending any money on them. Again, the Obama administration did not increase spending.

As much as the Republicans love to pretend that Obama is spending us into oblivion, he isn't. He's actually working to fix our revenue problems, while decreasing our spending on wars. For that, he is labeled a "socialist."
 
2012-06-18 02:33:23 PM

xanadian: FTFA: Remember that time back in college when you threw $47,000 on your Visa card for Natty Light and trips to Cancun, and all you really got in return was a mild case of alcohol poisoning and a burning sensation when you pee? Yeah, Visa probably should not have extended that much credit to a 19 year-old. And you probably should have known better than to hit on someone with a tramp stamp the size of your carry-on luggage. It was a valuable growth opportunity.

But I thought government debt was IN NO WAY, SHAPE OR FORM anything like personal debt, and governments can keep on spending and spending?


If you own 70% of the credit card company, then yeah, your personal debt is exactly like government debt.
 
2012-06-18 02:45:05 PM
The real issue here is that those that support large debt are usually Keynesian economics proponents... They love the debt part, but they ignore the part where you are supposed to pay back that debt between recessions.

So far we have never paid back any debt.. all we ever do is use smoke and mirrors and do nothing more than slow the rate of growth while hoping some sort of economic miracle will happen and the economy will boom to increase revenue.
 
2012-06-18 02:47:54 PM

Shvetz: Because People in power are Stupid: According to republicans, there is nothing wrong with National Debt when their loser is in office. When any other party's candidate is in office then OMG!!! Socialism!!!

This is really the problem here. Two major issues are affecting our budget right now:

1. The financial crisis tore out massive chunk of revenue. Not a spending issue.

2. In 2009 Obama decided to stop paying for the wars in Iraq/Afghanistan with emergency spending measures. This meant that the costs would actually show up in the budget, as opposed to pretending we weren't spending any money on them. Again, the Obama administration did not increase spending.

As much as the Republicans love to pretend that Obama is spending us into oblivion, he isn't. He's actually working to fix our revenue problems, while decreasing our spending on wars. For that, he is labeled a "socialist."


In fact recent CBO numbers suggest that both Obama and Clinton have reduced federal spending in relation to other Republican administrations.

/watches whackadoodles heads asplode
 
2012-06-18 02:47:58 PM
We should spend a lot of money because then we'll have more money!
 
2012-06-18 02:49:44 PM

dwrash: The real issue here is that those that support large debt are usually Keynesian economics proponents... They love the debt part, but they ignore the part where you are supposed to pay back that debt between recessions.

So far we have never paid back any debt.. all we ever do is use smoke and mirrors and do nothing more than slow the rate of growth while hoping some sort of economic miracle will happen and the economy will boom to increase revenue.


Yes, because Clinton didn't pay down our debt, balance the budget, etc. just before Bush the Dumber squandered it on two wars paid for off the official books while cutting revenues...yep definitely Keynesian.
 
2012-06-18 02:51:03 PM

cptjeff: Personally, I don't like the costs of servicing our debt, but right now, it's far less painful than diverting significant resources to paying it down.


Wait, what? It costs less right now to pay interest on 10-year bonds than it did to pay interest on 1-year T-bills in the early part of 2008.

In any case, what we have right now is an aggregate demand crisis and a jobs crisis, not a debt crisis. The debt crisis may come (like if the Teabaggers force one over the debt ceiling again), but it would be worse if we don't resolve the jobs issue first, regardless of the actual level of debt.
 
2012-06-18 03:00:58 PM

Arkanaut: cptjeff: Personally, I don't like the costs of servicing our debt, but right now, it's far less painful than diverting significant resources to paying it down.

Wait, what? It costs less right now to pay interest on 10-year bonds than it did to pay interest on 1-year T-bills in the early part of 2008.

In any case, what we have right now is an aggregate demand crisis and a jobs crisis, not a debt crisis. The debt crisis may come (like if the Teabaggers force one over the debt ceiling again), but it would be worse if we don't resolve the jobs issue first, regardless of the actual level of debt.


Right now new debt is ridiculously cheap. But we still have to service the old debt, and that takes a pretty big bite out of the federal budget each year. I don't like that we have to do that. But diverting even more resources to paying it down would take money out of the economy, and we need that money for jobs. It's an opportunity cost issue.

I'm on your side here. I don't like our massive debt, but now's not the time.
 
2012-06-18 03:11:28 PM

dwrash: The real issue here is that those that support large debt are usually Keynesian economics proponents... They love the debt part, but they ignore the part where you are supposed to pay back that debt between recessions.


I hope you enjoyed knocking that straw man down.
 
2012-06-18 03:18:40 PM

cptjeff: Arkanaut: cptjeff: Personally, I don't like the costs of servicing our debt, but right now, it's far less painful than diverting significant resources to paying it down.

Wait, what? It costs less right now to pay interest on 10-year bonds than it did to pay interest on 1-year T-bills in the early part of 2008.

In any case, what we have right now is an aggregate demand crisis and a jobs crisis, not a debt crisis. The debt crisis may come (like if the Teabaggers force one over the debt ceiling again), but it would be worse if we don't resolve the jobs issue first, regardless of the actual level of debt.

Right now new debt is ridiculously cheap. But we still have to service the old debt, and that takes a pretty big bite out of the federal budget each year. I don't like that we have to do that. But diverting even more resources to paying it down would take money out of the economy, and we need that money for jobs. It's an opportunity cost issue.

I'm on your side here. I don't like our massive debt, but now's not the time.


Exactly. The researchers said something similar at the end -- FTFA: "They warned that they are not making a case 'for rapid public debt deleveraging in an environment of extremely weak growth and high unemployment.'"
 
2012-06-18 03:22:22 PM

dwrash: The real issue here is that those that support large debt are usually Keynesian economics proponents... They love the debt part, but they ignore the part where you are supposed to pay back that debt between recessions.


Yeah, Keynesian economics doesn't work when Republicans replace it with Austrian economics.
 
2012-06-18 03:22:29 PM
screw it.
just print more money.
we want our free shiat.
 
2012-06-18 03:36:45 PM

colon_pow: screw it.
just print more money.
we want our free shiat.


Your deep understanding and expression of the issues is impressive.
 
2012-06-18 03:57:06 PM

iaazathot: dwrash: The real issue here is that those that support large debt are usually Keynesian economics proponents... They love the debt part, but they ignore the part where you are supposed to pay back that debt between recessions.

So far we have never paid back any debt.. all we ever do is use smoke and mirrors and do nothing more than slow the rate of growth while hoping some sort of economic miracle will happen and the economy will boom to increase revenue.

Yes, because Clinton didn't pay down our debt, balance the budget, etc. just before Bush the Dumber squandered it on two wars paid for off the official books while cutting revenues...yep definitely Keynesian.


hmm.. Clinton NEVER paid down any debt.. all he did was slow the rate of increase.
 
2012-06-18 04:14:13 PM

bdub77: Two things will fix the deficit problem:

1) cut taxes
2) invade Iran

Romney 2012. Robots are good at math.


Don't forget:
3) DEREGULATE ALL THE THINGS!
 
2012-06-18 04:20:19 PM

dwrash: iaazathot: dwrash: The real issue here is that those that support large debt are usually Keynesian economics proponents... They love the debt part, but they ignore the part where you are supposed to pay back that debt between recessions.

So far we have never paid back any debt.. all we ever do is use smoke and mirrors and do nothing more than slow the rate of growth while hoping some sort of economic miracle will happen and the economy will boom to increase revenue.

Yes, because Clinton didn't pay down our debt, balance the budget, etc. just before Bush the Dumber squandered it on two wars paid for off the official books while cutting revenues...yep definitely Keynesian.

hmm.. Clinton NEVER paid down any debt.. all he did was slow the rate of increase.


Are you saying Clinton didn't run surpluses? Because, this: http://articles.cnn.com/2000-09-27/politics/clinton.surplus_1_budget-s urplus-national-debt-fiscal-discipline?_s=PM:ALLPOLITICS
 
2012-06-18 04:22:57 PM

Arkanaut: cptjeff: Personally, I don't like the costs of servicing our debt, but right now, it's far less painful than diverting significant resources to paying it down.

Wait, what? It costs less right now to pay interest on 10-year bonds than it did to pay interest on 1-year T-bills in the early part of 2008.

In any case, what we have right now is an aggregate demand crisis and a jobs crisis, not a debt crisis. The debt crisis may come (like if the Teabaggers force one over the debt ceiling again), but it would be worse if we don't resolve the jobs issue first, regardless of the actual level of debt.


Yep, you gots it right, there's a DEMAND problem, because the consumers don't have any money to spend. There needs to be a DEMAND solution.
 
MFL
2012-06-18 04:40:07 PM
Shvetz
This is really the problem here. Two major issues are affecting our budget right now:
1. The financial crisis tore out massive chunk of revenue. Not a spending issue.


????

Not a spending issue? Before the financial crisis were we or not we borrowing between 50 and 60 cents out of every dollar spent? Was mandatory spending not taking up the majority of the budget?

2. In 2009 Obama decided to stop paying for the wars in Iraq/Afghanistan with emergency spending measures. This meant that the costs would actually show up in the budget, as opposed to pretending we weren't spending any money on them. Again, the Obama administration did not increase spending.

LOL What budget?

The last budget congress actually passed was submitted by George W Bush. At least with the emergency measures congress voted on the funding every year. But since we gots no budget, O gots no accountability.

As much as the Republicans love to pretend that Obama is spending us into oblivion, he isn't. He's actually working to fix our revenue problems, while decreasing our spending on wars. For that, he is labeled a "socialist."

How so?

1. 30% of the 16 trillion in national debt has been added in the last 4 years. How did this happen?

2. The president spent more in one stimulus bill than the cost of the entire Iraq war over the course of 9 years and revenues continued to plummet. Why did this happen?

3. Again, how is it possible that the wars in Iraq and afganistan show up in a budget that doesn't exist?

4. Why didn't Obama let the evil Bush tax cuts expire instead of extending them two years?

It's not that you're ignorant, (I can tell you're a smart person), and if are not a partisan political hack, you might want to re-evaluate some things.

1. Revenues are down because the economy is still in terrible shape and the workforce is shrinking.

2. Spending is up because there has not been a new budget since the massive one time budget of 2009 and that budget has been the baseline for federal spending ever since.

3. Entitlements are beginning to balloon like everyone has known for 30 years they would.

The only way out of this thing is to cut spending and grow the economy.
 
2012-06-18 04:42:41 PM
MFL:

Oh, just "grow the economy." Well why didn't anyone say so.
 
2012-06-18 04:44:41 PM

Politicandy: dwrash: iaazathot: dwrash: The real issue here is that those that support large debt are usually Keynesian economics proponents... They love the debt part, but they ignore the part where you are supposed to pay back that debt between recessions.

So far we have never paid back any debt.. all we ever do is use smoke and mirrors and do nothing more than slow the rate of growth while hoping some sort of economic miracle will happen and the economy will boom to increase revenue.

Yes, because Clinton didn't pay down our debt, balance the budget, etc. just before Bush the Dumber squandered it on two wars paid for off the official books while cutting revenues...yep definitely Keynesian.

hmm.. Clinton NEVER paid down any debt.. all he did was slow the rate of increase.

Are you saying Clinton didn't run surpluses? Because, this: http://articles.cnn.com/2000-09-27/politics/clinton.surplus_1_budget-s urplus-national-debt-fiscal-discipline?_s=PM:ALLPOLITICS


No.. I said he didn't pay down any of the debt..
 
2012-06-18 04:53:01 PM
I, for one, think this calls for banning abortion and gay marriage. I have it on good authority that you do these things when you want to solve any kind of fiscal anything.
 
2012-06-18 04:58:39 PM

LasersHurt: MFL:

Oh, just "grow the economy." Well why didn't anyone say so.


yup, just grow the economy, and while you're at it paint those white roses red.

(hint: when in a period of recession, or depression, there is exactly ONE economic theory that's been shown to work... )
 
2012-06-18 05:08:58 PM

EnderWiggnz: LasersHurt: MFL:

Oh, just "grow the economy." Well why didn't anyone say so.

yup, just grow the economy, and while you're at it paint those white roses red.

(hint: when in a period of recession, or depression, there is exactly ONE economic theory that's been shown to work... )


Oh oh - he should also cure cancer and effectively develop cold fusion. That would be swell. I mean, that's all he has to do.
 
2012-06-18 05:19:52 PM

LasersHurt: MFL:

Oh, just "grow the economy." Well why didn't anyone say so.


Fact check

GDP grew at 3% 3 years ago

GDP grew at 2% 2 years ago

Now predicted to grow at 1% GDP

So, Whats the argument again? GDP is now growing? We did not overspend by 5 Trillion?
 
2012-06-18 05:20:22 PM

EnderWiggnz: LasersHurt: MFL:

Oh, just "grow the economy." Well why didn't anyone say so.

yup, just grow the economy, and while you're at it paint those white roses red.

(hint: when in a period of recession, or depression, there is exactly ONE economic theory that's been shown to work... )


Well some times. Keynesian multiplier doesnt kick in when you have a recession and a banking crisis fueled by debt. Have to deleverage private sector debt prior to consumption taking off again.
 
2012-06-18 05:24:58 PM

EnderWiggnz: Arkanaut: cptjeff:

Yep, you gots it right, there's a DEMAND problem, because the consumers don't have any money to spend. There needs to be a DEMAND solution.


good point, so lets kill a pipeline, stop Oil drilling in the gulf, enact a huge new welfare program directly on the backs of the small Business class, called Obamacare.

Fund Green jobs that go belly up, and bail out some unions, so we can pay back those who voted for us in the last election.

and expect there to be a DEMAND solution?

Is that the ticket?
 
2012-06-18 05:33:07 PM

microman: EnderWiggnz: Arkanaut: cptjeff:

Yep, you gots it right, there's a DEMAND problem, because the consumers don't have any money to spend. There needs to be a DEMAND solution.

good point, so lets kill a pipeline, stop Oil drilling in the gulf, enact a huge new welfare program directly on the backs of the small Business class, called Obamacare.

Fund Green jobs that go belly up, and bail out some unions, so we can pay back those who voted for us in the last election.

and expect there to be a DEMAND solution?

Is that the ticket?


You misspelled "Medicare Part D". I didn't like Bush either.
 
2012-06-18 05:45:29 PM
Yeah but if someone else ran up a huge debt it's not your fault when you make it worse.
 
2012-06-18 05:47:48 PM

paygun: Yeah but if someone else ran up a huge debt it's not your fault when you make it worse.


That's no way to talk about Reagan and George H. W. Bush.
 
2012-06-18 06:36:08 PM

paygun: Yeah but if someone else ran up a huge debt it's not your fault when you make it worse.


Double down on stupid? Run up a 5 Trillion for your kids to pay off?
 
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