High Deficits

[Plymkr]

Businesses are usually using their OWN money when doing the debt deal. And they then either raise prices on their goods or fire employees. Or, if Bush or Obama are in office. Ask them for a bail out. lol

Government is using tax paying dollars to spend like drunk sailors. not their own money. And then, have the nerve to ask for more, more, more.

 

[peplaw06]

The U.S. Raises its debt ceiling all the time. That may or may not be a bad thing. If it's a bad thing, I'm asking why.

Personally, I feel it's a bad thing because it does nothing but perpetuate the out of control spending. What's the point of having a ceiling if you just raise it whenever you run out of money to pay your debts?

But tax revenues are at all time lows. That's the single biggest reason there are high deficits.

I don't know about that.

 

[Plymkr]

Tax revenues could also be low because not many are working. They are not making good annual incomes each year as maybe in the past and paying their fair share of taxes.

It's all bout jobs.

 

[theogt]

Businesses are usually using their OWN money when doing the debt deal. And they then either raise prices on their goods or fire employees. Or, if Bush or Obama are in office. Ask them for a bail out. lol

Government is using tax paying dollars to spend like drunk sailors. not their own money. And then, have the nerve to ask for more, more, more.

No, by definition, when a business raises debt it's not using its own money.

 

[theogt]

Personally, I feel it's a bad thing because it does nothing but perpetuate the out of control spending. What's the point of having a ceiling if you just raise it whenever you run out of money to pay your debts?

Are you saying that spending in itself is a bad thing? Or just that "out of control" spending is bad thing? If the latter, what is "out of control" spending? I'm assuming you mean spending into a deficit. And that just gets us back to the original question -- why are high deficits bad?

I don't know about that.

It's among the most significant contributors. The "single biggest" was possibly an overstatement. I'd have to double check my facts again. Point still stands.

 

[theogt]

Tax revenues could also be low because not many are working. They are not making good annual incomes each year as maybe in the past and paying their fair share of taxes.

It's all bout jobs.

Tax revenues were low at the height of recent expansionary cycles as well. A recession does cause a drop in revenue, though, that is true. But this doesn't really get us any closer to answering the question of why deficits are bad.

 

[Plymkr]

Tax revenues were low at the height of recent expansionary cycles as well. A recession does cause a drop in revenue, though, that is true. But this doesn't really get us any closer to answering the question of why deficits are bad.

Well, I know they are bad for me. I run up a debt and can't pay it. I lose stuff. The govt doesn't lose shit. Sorry , I don't have a more definitive answer for ya.

 

[theogt]

Well, I know they are bad for me. I run up a debt and can't pay it. I lose stuff. The govt doesn't lose shit. Sorry , I don't have a more definitive answer for ya.

Yeah, it's bad for me too. But that's because I don't have the ability to raise tax revenue or issue more debt like the U.S. government does. That's why I'm curious for a clear answer as to why high deficits are bad with respect to the U.S. government, not me. I know why I can't run debt like that.

Seems no one really knows, but yet they're still very adamant against it. I'm not for or against high deficits. I can't be for or against something I don't fully grasp. Others, however, seem to take strong viewpoints even when they admit they don't fully understand the issue, which I find strange.

If someone understands the issue and can explain it to me like I'm a 6 year old, that would be great.

 

[Plymkr]

I think the biggest problem is that we have 6yr old mentalities running our country.

 

[peplaw06]

Yeah, it's bad for me too. But that's because I don't have the ability to raise tax revenue or issue more debt like the U.S. government does. That's why I'm curious for a clear answer as to why high deficits are bad with respect to the U.S. government, not me. I know why I can't run debt like that.

Seems no one really knows, but yet they're still very adamant against it. I'm not for or against high deficits. I can't be for or against something I don't fully grasp. Others, however, seem to take strong viewpoints even when they admit they don't fully understand the issue, which I find strange.

If someone understands the issue and can explain it to me like I'm a 6 year old, that would be great.

I think it's hard to explain why it's bad, because we have never seen the consequences of not being able to pay our debts as a country. At some point, if this continues, the logical conclusion is that our creditors are going to want payment and we're not going to be able to make it short of just printing money. And we all know that will just cause the value of the dollar to go down.

What happens if and when we can no longer pay our debts? I don't know. Far as I know, it's never happened.

 

[theogt]

I think it's hard to explain why it's bad, because we have never seen the consequences of not being able to pay our debts as a country. At some point, if this continues, the logical conclusion is that our creditors are going to want payment and we're not going to be able to make it short of just printing money. And we all know that will just cause the value of the dollar to go down.

What happens if and when we can no longer pay our debts? I don't know. Far as I know, it's never happened.

I agree that there is someone theoretical point at which the U.S. would not be able to service its debt. But I don't think we're anywhere close to that. If you think we are, please explain to me why that is.

One thing that will happen when we get close(r) to that point is that interest rates on U.S. debt will rise. However, interest rates on U.S. debt are at historical lows. If we're close to the tipping point, wouldn't we not be having historically low interest rates? Someone brought up the example of Greece. Greece's debt is SIGNIFICANTLY more expensive than U.S. debt, meaning interest rates are much higher. That is because they are much more likely to default. Interest rates are set based on the risk of the asset. Low interest rates means low riskiness of the asset. The U.S. has some of the cheapest debt.

 

[dbair1967]

The U.S. Raises its debt ceiling all the time. That may or may not be a bad thing. If it's a bad thing, I'm asking why.

But tax revenues are at all time lows. That's the single biggest reason there are high deficits.

They are low because we have too many unemployed

 

[jiggyfly]

So nobody could actually answer the question.

I guess nobody had the nerve to say because Fox news says so. lol

I am glad that we are having these discussions as a country but all of the doom and gloom attached to it is over the top.

This is something that needs to be addressed but it needs to be gradual with both an increase in revenues as well as cutbacks.

That display by all of the Republicans candidates saying they would not take a 10 to 1 deal in cutbacks to revenue was just shameful.

 

[Sheik]

The only way the deficit would be a bad thing, I guess, would be if the Government was held responsible and not allowed to re-adjust the ceiling whenever they want.

You or I can't do that.

If I run up an enormous debt, then get into a situation where I'm paying that debt by running up another debt, it will eventually catch up to me.

The Government doesn't have to worry. I doubt Peggy from Capital One is calling weekly to ask why the Government is behind on it's credit card bills.

 

[Sheik]

I guess it's not good or bad. It doesn't really matter until it matters.

 

[VA Cowboy]

So nobody could actually answer the question.

I guess nobody had the nerve to say because Fox news says so. lol

I am glad that we are having these discussions as a country but all of the doom and gloom attached to it is over the top.

This is something that needs to be addressed but it needs to be gradual with both an increase in revenues as well as cutbacks.

That display by all of the Republicans candidates saying they would not take a 10 to 1 deal in cutbacks to revenue was just shameful.

What are you babbling about?

 

[Plymkr]

So nobody could actually answer the question.

I guess nobody had the nerve to say because Fox news says so. lol

I am glad that we are having these discussions as a country but all of the doom and gloom attached to it is over the top.

This is something that needs to be addressed but it needs to be gradual with both an increase in revenues as well as cutbacks.

That display by all of the Republicans candidates saying they would not take a 10 to 1 deal in cutbacks to revenue was just shameful.

Thank you for your "thoughtful" answer on this subject.


Jackass.

 

[superpunk]

I think it's bad because my party tells me to think it's bad.

 

[dbair1967]

I think it's bad because my party tells me to think it's bad.

Its bad because if you udnerstand simple economics and math, it cant be sustained

Unfortunately, people like Obama, pelosi and Reid never grasped that concept

 

[theogt]

Its bad because if you udnerstand simple economics and math, it cant be sustained

Unfortunately, people like Obama, pelosi and Reid never grasped that concept

Deficits can be sustained in perpetuity. No economist disagrees with this. That wasn't the question. I'm very clear about that concept.

Or did you mean something else?