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I cross-edited you.
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I came upon a barroom full of bad Salon pictures in which men with hats on the backs of their heads were wolfing food from a counter. It was the institution of the "free lunch" I had struck. You paid for a drink and got as much as you wanted to eat. For something less than a rupee a day a man can feed himself sumptuously in San Francisco, even though he be a bankrupt. Remember this if ever you are stranded in these parts. ~ Rudyard Kipling, 1891 -
It will be more like 65% the way that you are counting it (the way I count it, including all governments, from federal to local, the figure is 61%).I came upon a barroom full of bad Salon pictures in which men with hats on the backs of their heads were wolfing food from a counter. It was the institution of the "free lunch" I had struck. You paid for a drink and got as much as you wanted to eat. For something less than a rupee a day a man can feed himself sumptuously in San Francisco, even though he be a bankrupt. Remember this if ever you are stranded in these parts. ~ Rudyard Kipling, 1891Comment
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It peaked, went down and now is heading up again.VANGUARDComment
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It has increased. "Heading up again" is a predictive statement that you will need to backup with numbers.I came upon a barroom full of bad Salon pictures in which men with hats on the backs of their heads were wolfing food from a counter. It was the institution of the "free lunch" I had struck. You paid for a drink and got as much as you wanted to eat. For something less than a rupee a day a man can feed himself sumptuously in San Francisco, even though he be a bankrupt. Remember this if ever you are stranded in these parts. ~ Rudyard Kipling, 1891Comment
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Also, it should be noted that debt as a percentage of our economy was higher in the 1950s. It's not like this is uncharted territory.
Lastly, in the past couple of posts we are looking at gross debt rather than net debt. Gross debt includes money that the government is lending to itself (social security, etc.). It's not as if the federal government has $8 trillion in debt on the market. Rather, the public "only" holds $4.7 trillion in federal debt, or about 38% of the economy.
The federal deficit as it's referred to state-side feeds into the net debt. Point being that the gross debt % of economy figure may go up while the net debt % of economy figure may go down.Last edited by DanS; December 1, 2005, 12:52.I came upon a barroom full of bad Salon pictures in which men with hats on the backs of their heads were wolfing food from a counter. It was the institution of the "free lunch" I had struck. You paid for a drink and got as much as you wanted to eat. For something less than a rupee a day a man can feed himself sumptuously in San Francisco, even though he be a bankrupt. Remember this if ever you are stranded in these parts. ~ Rudyard Kipling, 1891Comment
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The slope of the curve is up. Unless growth increases above our current very high rate (unlikely) or the deficit decreases dramatically (also apparently unlikely) then it will continue up. The most likely scenario is that both our growth rate and our deficit will decrease slightly. But that still leaves the debt increasing as a percentage of GDP.It has increased. "Heading up again" is a predictive statement that you will need to backup with numbers.
Which is it? Is our current debt nothing special and easily accomodated by our growth rate? Or is our current indebtedness comparable to the huge debt we ran up fighting a war across the globe----- while simultaneously developing nuclear weapons, building the world's largest fleet and building dams in every corner of America?Also, it should be noted that debt as a percentage of our economy was higher in the 1950s. It's not like this is uncharted territory.
Leaving this contradiction aside, you are also implying by this parallel that we grew our way out of our World War II debt. But this certainly isn't true. We paid off that debt by having 90% marginal tax rates.
Are you suggesting we will need similar rates to pay off this debt? If so, then why the hell are we running up the debt to give tax breaks to people now when it means that we will have to raise rates on whoever is earning money in the future?
LOL, LOL, LOL. Well, okay. If you want to include the amount held by Social Security as assets, then presumably you will also want to include the amortised amount we will owe future retirees as debt, correct? See what that does to your figures.It's not as if the federal government has $8 trillion in debt on the market. Rather, the public "only" holds $4.7 trillion in federal debt, or about 38% of the economy.
Last edited by Vanguard; December 3, 2005, 16:52.VANGUARDComment
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This is why you have to do the math. Small differences in the deficit have a large impact on the calculation.Originally posted by Vanguard
The slope of the curve is up. Unless growth increases above our current very high rate (unlikely) or the deficit decreases dramatically (also apparently unlikely) then it will continue up. The most likely scenario is that both our growth rate and our deficit will decrease slightly. But that still leaves the debt increasing as a percentage of GDP.
If we assume that the debt this fiscal year increases at the same rate as last fiscal year ($553 billion), it would take 7% nominal economic growth in order for the debt as a percentage of economy to go down. Even though we did better than that in 2005 Q3 (7.2% annualized), I think we can agree that this economic growth rate probably will not be sustained.
However, you will remember that in the final 9 months of fiscal year 2005, the fiscal position of the federal government improved by $100 billion versus what was expected in January. If we do that again this fiscal year (i.e., debt increases by $453 billion), it would take 5.7% nominal economic growth in order for the debt as a percentage of the economy to go down. 5.7% nominal economic growth during the rest of fiscal year 2006 seems doable.
Now before you start saying that the fiscal position of the federal government is not likely to improve by $100 billion this fiscal year, I note that it has already improved by $10 billion in October, the first month of this fiscal year. November likely will be a very bad month fiscally because of the hurricanes, but we'll just see how quickly revenues increase the rest of the fiscal year.Last edited by DanS; December 3, 2005, 12:24.I came upon a barroom full of bad Salon pictures in which men with hats on the backs of their heads were wolfing food from a counter. It was the institution of the "free lunch" I had struck. You paid for a drink and got as much as you wanted to eat. For something less than a rupee a day a man can feed himself sumptuously in San Francisco, even though he be a bankrupt. Remember this if ever you are stranded in these parts. ~ Rudyard Kipling, 1891Comment
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BTW I have officially been waiting two months and eight days.Try http://wordforge.net/index.php for discussion and debate.Comment
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I move that Oerdin's debt be officially exonerated.
The statute of limitations is up.12-17-10 Mohamed Bouazizi NEVER FORGET
Stadtluft Macht Frei
Killing it is the new killing it
Ultima Ratio RegumComment
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do apolyton goers have the right to a swift and speedy resolution of avatar bets?Comment
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Dan, speak now or forever hold your peace.Try http://wordforge.net/index.php for discussion and debate.Comment
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The economy grew because of the 60's deficits that were in part created by lowering that marginal tax rate. Another reason for the growth during that time period was govt spending. Ballancing budgets never played any part.Originally posted by Vanguard
Leaving this contradiction aside, you are also implying by this parallel that we grew our way out of our World War II debt. But this certainly isn't true. We paid off that debt by having 90% marginal tax rates.I drank beer. I like beer. I still like beer. ... Do you like beer Senator?
- Justice Brett KavanaughComment
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This is simply not true. Between 1948 and 1960 (when marginal tax rates were extremely high) debt fell from 90% of GDP to 55% of GDP.The economy grew because of the 60's deficits that were in part created by lowering that marginal tax rate. Another reason for the growth during that time period was govt spending. Ballancing budgets never played any part.
From 1960 to 1972, when marginal rates were somewhat lower (though still much higher than today) debt only fell from 55% to 35%.
Not only did lowering top tax rates not increase the rate at which we reduced debt, it decreased it. Nor did it increase the rate of growth in the economy, which was fairly stable.VANGUARDComment
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Your assertion was that we paid off the WW2 debt with high tax rates.Originally posted by Vanguard
This is simply not true. Between 1948 and 1960 (when marginal tax rates were extremely high) debt fell from 90% of GDP to 55% of GDP.
From 1960 to 1972, when marginal rates were somewhat lower (though still much higher than today) debt only fell from 55% to 35%.
Not only did lowering top tax rates not increase the rate at which we reduced debt, it decreased it. Nor did it increase the rate of growth in the economy, which was fairly stable.
First, no one paid those high rates because of all the loop holes in the tax law. We didn't pay off the debt by collecting taxes. We paid off the debt because the economy grew. If we would have tried to tax our way out of debt we would have returned to depression. When the highest margnal tax rates were lowered many loop holes were closed and there was little difference in tax collection. The difference, however, was enough to still lower the debt.
Second, anyone who cares so much about paying off govt debt, has their priorities screwed up. It's no where near as important as economic growth. If you sacrifice economic growth to pay off debt you hurt everyone. If you want to complain about the deficit, that's one thing, but worrying about the debt is pointless.I drank beer. I like beer. I still like beer. ... Do you like beer Senator?
- Justice Brett KavanaughComment
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Tell that to the countries which have experienced liquidity crisises.Try http://wordforge.net/index.php for discussion and debate.Comment
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