Obama's new budget saves $24 billion

[geni]

how much would we have to decrease spending in the 2012 budget, to have a balanced budget?

About 1.1 trillion if there are no tax increases.

 

[Thunder]

About 1.1 trillion if there are no tax increases.

Jesus.

we have got to find a way to raise revenue. maybe we should sell more Obama bobble-heads?


.....or we could just raise taxes on the rich......or just let the Bush tax-cuts expire.

 

[KoihimeNakamura]

It doesn't help that both budgets ignore the elephants in the room.

 

[Puppycow]

We already pay about 41 cents on every federal dollar to service the debt.

I think you've got your facts wrong. It says here that interest payments on the debt were $185 billion in 2010 (compared to tax receipts of $2,162 billion) and are projected to rise to $554 billion in 2015. Now, that's a serious increase, but it means that we aren't paying nearly 41 cents on every dollar to service the debt, nor will we be in 2015. We paid less than 9 cents on the dollar in 2010, and even if tax receipts don't increase at all, it would be about 25 cents on the dollar by 2015.

If we allow the debt to increase by continuing to run deficit budgets, that percentage will continue to increase -- at the expense of everything else we need our gov't to do, like maintain infrastructure and public health, btw -- until our debt becomes unmarketable, at which point our economy collapses.

Basic economics.

Well, eventually, sure. Is there any pressing reason why there need to be major cuts in the 2012 budget though?

http://en.wikipedia.org/wiki/List_of_sovereign_states_by_public_debt

If these figures are correct, the US public debt as a percentage of GDP was roughly 58.9 as of 2010, less than that of Germany or Canada. Treasury bonds are rated AAA or whatever the top rating is by all major ratings agencies. The yields demanded by the bond market are quite modest.

 

[Piggy]

Because the cuts would not be temporary. When economic times improve, and it comes time to reverse the "temporary" cuts, how do you think such a move would be spun:

1) "NASA budget returned to previous levels."

or

2) "Massive increase proposed in NASA budget."

I think you know the answer. It's like when the expiration of a "temporary" tax cut is spun as a massive tax increase.

If your real question is "Why fund NASA at all?", the answer is more complicated. The best I could answer it in a single sentence would be something like: We should strive for more, as a species, than mere survival.

These are not times of ordinary priorities.

There are a lot of things that don't normally make sense, but which have to be done when you're facing severe consequences.

We're over $14T in debt, and running nearly $1T/yr projected deficits for the next 10 years even after Obama's proposed cuts. If we do that, we risk our debt becoming junk, which would crash the economy.

Where would NASA be then?

Time to make hamburger of a few sacred cows.

Or perhaps we should cut heating subsidies for the poor even further?

 

[Piggy]

I think you've got your facts wrong.

You're correct, I do have my facts wrong.

The figure I was mis-remembering is that 41 cents of every federal dollar spent is borrowed. Interest on the debt makes up between 8 and 9 percent.

Thanks for the correction.

 

[Newtons Bit]

I think you've got your facts wrong. It says here that interest payments on the debt were $185 billion in 2010 (compared to tax receipts of $2,162 billion) and are projected to rise to $554 billion in 2015. Now, that's a serious increase, but it means that we aren't paying nearly 41 cents on every dollar to service the debt, nor will we be in 2015. We paid less than 9 cents on the dollar in 2010, and even if tax receipts don't increase at all, it would be about 25 cents on the dollar by 2015.


Well, eventually, sure. Is there any pressing reason why there need to be major cuts in the 2012 budget though?

http://en.wikipedia.org/wiki/List_of_sovereign_states_by_public_debt

If these figures are correct, the US public debt as a percentage of GDP was roughly 58.9 as of 2010, less than that of Germany or Canada. Treasury bonds are rated AAA or whatever the top rating is by all major ratings agencies. The yields demanded by the bond market are quite modest.

That's internal debt. The debt we owe to ourselves (mostly to the social security administration). Our total debt is 14.1 trillion dollars. Our ~ 100% of our GDP. That's not terrible compared to many western countries, but considering how fast it's gotten there it's something to be seriously concerned about.

 

[Puppycow]

That's internal debt. The debt we owe to ourselves (mostly to the social security administration).

No, this is public debt. Debt owed by the federal government to the public, excluding debt held by the federal government itself, such as the social security trust fund. And part of it is owed to foreigners.

Our total debt is 14.1 trillion dollars. Our ~ 100% of our GDP. That's not terrible compared to many western countries, but considering how fast it's gotten there it's something to be seriously concerned about.

This is including state and local governments? Or do you refer to external debt, which includes private debt?

 

[Puppycow]

Time to make hamburger of a few sacred cows.

Or perhaps we should cut heating subsidies for the poor even further?

I do agree that when we are cutting heating subsidies for the poor (unless the levels were really too high to begin with) or other basic safety net programs, we should not be spending new money on high speed rail.
I am also skeptical of the value of the manned space program, although I hope they at least save the next generation James Webb telescope, which is supposed to replace the Hubble.
What else to cut? How about winding down the war in Afghanistan, and cutting the size of the military?
How about getting rid of ethanol mandates and farm subsidies?
How about reforming Medicare?
And finally, how about -- gasp! -- raising some taxes a bit?

 

[Piggy]

I do agree that when we are cutting heating subsidies for the poor (unless the levels were really too high to begin with) or other basic safety net programs, we should not be spending new money on high speed rail.
I am also skeptical of the value of the manned space program, although I hope they at least save the next generation James Webb telescope, which is supposed to replace the Hubble.
What else to cut? How about winding down the war in Afghanistan, and cutting the size of the military?
How about getting rid of ethanol mandates and farm subsidies?
How about reforming Medicare?
And finally, how about -- gasp! -- raising some taxes a bit?

I'm with you buddy. In favor of all of that.

 

[JudeBrando]

I say let them cut the pork from the military. So long as they don't cut NASA or the money for high speed rail I'm happy with it.

Trim military spending. Yes.

Yeah rocket trains........thats what we need

No.

Why not cut NASA? What's NASA doing that makes it sacrosanct from even temporary cuts during a time when the interest on our growing debt threatens the very stability of our nation?

Reduce NASA. Efficiency. Bang for buck.
Yes. Stability of the nation is of paramount concern.

No, most importantly it continues to run deficits, which adds more and more to our $14T+ debt. That is its most important feature.

Most Important. Period.

Liberals want more trains...what century is this!?
where is my rocket pack and/or teleporter!

http://www.youtube.com/watch?v=Yjy-fnsmWR4

You know what, the more I think about it, the more I agree that high-speed rail shouldn't be a priority when the budget deficit is this big.
It should probably be one of the sacrificial lambs.
I did a little checking on the numbers, and it seems doubtful that the benefit will be worth the cost (in the US).

Absolutely true.

We already pay about 41 cents on every federal dollar to service the debt. If we allow the debt to increase by continuing to run deficit budgets, that percentage will continue to increase -- at the expense of everything else we need our gov't to do, like maintain infrastructure and public health, btw -- until our debt becomes unmarketable, at which point our economy collapses. Basic economics.

This bears repeating. It seems a great many people still refuse to recognize the severity and urgency of the situation.

It is easy for politicians to say they are going to do things in the future especially spending cuts , raising taxes and balancing budgets.

Nothing but now is acceptable.

Odd it only took the feds 3 years to increase it by that much. If that isn't an argument for a balanced budget amendment, I don't know what is.

Balanced Budget Amendment.

I think high-speed trains are a great idea, when the nation has a surplus.

Yes, when we can afford the and where we can afford them.

i'd rather just spend money rebuilding dieing infrastructure. lots of construction jobs there.

Yes. We must make wise decisions within our limited resources for a change.

Using the standard formular you would need about $936billion in cuts and about $234 billion in tax rises.

The money we have is the money we have. The answer is not to take yet more money out of Citizens' pockets and into Government hands. We stop spending more than we can afford. Hard but wise decisions are required. There are no other options. The drunken orgy is over.. or we continue and die, literally just like my brother.

we have got to find a way to raise revenue.

No. The problem is not a lack of confiscated revenue.
Who would you authorize that we steal from to bribe who?

These are not times of ordinary priorities.
There are a lot of things that don't normally make sense, but which have to be done when you're facing severe consequences.
We're over $14T in debt, and running nearly $1T/yr projected deficits for the next 10 years even after Obama's proposed cuts. If we do that, we risk our debt becoming junk, which would crash the economy.
Where would NASA be then?

Apparently it cannot be emphasized too much. Can and will enough of this population recognize the reality of The State of the Nation while there still may barely be time to avert and salvage even if only with great difficulty.


These are hard decisions that can easily be made.

Simple.

 

[JudeBrando]

I do agree that when we are cutting heating subsidies for the poor (unless the levels were really too high to begin with) or other basic safety net programs, we should not be spending new money on high speed rail.
I am also skeptical of the value of the manned space program, although I hope they at least save the next generation James Webb telescope, which is supposed to replace the Hubble.
What else to cut? How about winding down the war in Afghanistan, and cutting the size of the military?
How about getting rid of ethanol mandates and farm subsidies?
How about reforming Medicare?
And finally, how about -- gasp! -- raising some taxes a bit?

Agreed. All of the above. Yes. Simple. Any opposed?
So who is it that is opposed?

 

[KoihimeNakamura]

People who don't have this urge to reduce things beyond what is sane and who don't have this hardon for deficit DISASTER.

 

[Puppycow]

Agreed. All of the above. Yes. Simple. Any opposed?
So who is it that is opposed?

There are politically powerful interest groups that would be opposed to all those things I'm afraid.

 

[Piggy]

People who don't have this urge to reduce things beyond what is sane and who don't have this hardon for deficit DISASTER.

We owe $14 trillion.

The proposed budget adds more than $7 trillion to that figure over the next decade.

With $22 trillion in debt, over 40% of our annual budget being borrowed, and absolutely no plan for doing anything except heaping even more debt upon that ad infinitum, what happens to the value of that debt on the market?

Like it or not, if the market loses confidence in American debt, our economy will collapse.

And if we fail to implement a concrete plan sometime soon that stops adding debt and begins reducing debt, the market will lose confidence.

That is unavoidable.

Tell me, how long would you continue to loan money to a friend who borrows over 40% of what he spends each year, who pays some 9% of his income in interest at present, and who has a budget plan which calls for borrowing more than he earns every single year into the future, and no plans to change that practice?

 

[KoihimeNakamura]

We owe $14 trillion.

The proposed budget adds more than $7 trillion to that figure over the next decade.

With $22 trillion in debt, over 40% of our annual budget being borrowed, and absolutely no plan for doing anything except heaping even more debt upon that ad infinitum, what happens to the value of that debt on the market?

Like it or not, if the market loses confidence in American debt, our economy will collapse.

And if we fail to implement a concrete plan sometime soon that stops adding debt and begins reducing debt, the market will lose confidence.

That is unavoidable.

Tell me, how long would you continue to loan money to a friend who borrows over 40% of what he spends each year, who pays some 9% of his income in interest at present, and who has a budget plan which calls for borrowing more than he earns every single year into the future, and no plans to change that practice?

When I have a friend that's a sovereign nation, I'll get back to you on that.

 

[JudeBrando]

Apparently it cannot be emphasized too much. Can and will enough of this population recognize the reality of The State of the Nation while there still may barely be time to avert and salvage even if only with great difficulty?

And then, all the more often it seems ever more abundantly clear that a spectacular crash and burn fate of the nation is the deliberate, deserved, imminent and foregone conclusion. Interesting times we live in.

 

[Piggy]

When I have a friend that's a sovereign nation, I'll get back to you on that.

Nice dodge.

 

[Puppycow]

We owe $14 trillion.

Only if you count the money that the government owes itself. The debt to the public is $9.45 trillion
http://www.treasurydirect.gov/NP/BPDLogin?application=np

The proposed budget adds more than $7 trillion to that figure over the next decade.

With $22 trillion in debt, over 40% of our annual budget being borrowed, and absolutely no plan for doing anything except heaping even more debt upon that ad infinitum, what happens to the value of that debt on the market?

Like it or not, if the market loses confidence in American debt, our economy will collapse.

And if we fail to implement a concrete plan sometime soon that stops adding debt and begins reducing debt, the market will lose confidence.

That is unavoidable.

Tell me, how long would you continue to loan money to a friend who borrows over 40% of what he spends each year, who pays some 9% of his income in interest at present, and who has a budget plan which calls for borrowing more than he earns every single year into the future, and no plans to change that practice?

You have a point. Some hard choices will have to be made eventually. But I don't think that disaster is as immanent as you see it. The bond markets and the rating agencies don't see it in nearly as dire the terms as you do, because America has a AAA rating, and the yields on treasurys are modest. There's a case to be made for waiting for the economy to pick up some more momentum and the unemployment rate to come down some more before trying too hard to balance the budget.

 

[KoihimeNakamura]

Nice dodge.

Didn't feel like responding to something when the point I was making that while we do need to do cuts (and raise taxes) I don't feel it's worthy of DRASTIC AUSTERITY MEASURES