On the debt ceiling debate, the House is planning to vote on a "cut-cap-balance" plan Tuesday that would cut about $110B from the 2012 budget, place a cap future spending, and approve a Balanced Budget Amendment to be sent to the states for ratification. Similar Balanced Budget Amendment proposals are scheduled to be voted on by the Senate, as well.

Predictably, these proposals - all of them - have been decried by the Democrats. And yet, I have still to see a serious plan for restoring fiscal discipline from the socialist and Progressive New Left. Has anyone else happened to come across one?

collegestudent22 wrote:a serious plan for restoring fiscal discipline from the socialist and Progressive New Left.

Well there's your problem. Or half of it anyway. The other half is that politicians are not in power to work toward the common good but to do whatever they can to buy their constituents' love in the short term.

collegestudent22 wrote:Predictably, these proposals - all of them - have been decried by the Democrats. And yet, I have still to see a serious plan for restoring fiscal discipline from the socialist and Progressive New Left. Has anyone else happened to come across one?

Increase marginal tax rates to 70% starting at $25,000 is about it. There is no typo in that sentence.

That can't be right. Source?

Surely they know that would be political suicide.

John Adams wrote:There are two ways to conquer and enslave a country. One is by the sword. The other is by debt.

I would love to see a balanced budget. I would love to see excessive spending cut back. I no longer have any faith that I shall see it though.

Deacon wrote:Surely they know that would be political suicide.

Recent polling suggests the "blame the Republicans" approach is working far better than it should for Obama. A recent CBS News poll put the numbers of those "disappointed" with the Republicans' handling of the debt problem (you know, proposing solutions and expecting there to be options from the party in power to debate and eventually reach a compromise on what to cut) at 71%.

I would hope the American people are smart enough to recognize that it is spending that must be cut, not taxes raised. For all this rhetoric of "paying their fair share", the top 1% pay more taxes than the bottom 95% combined. That is the very opposite of fair. Even a 100% tax rate on all money over $250,000 would barely put a dent in the budget deficit, although it would eliminate the economy entirely.

George Washington wrote:No pecuniary consideration is more urgent, than the regular redemption and discharge of the public debt: on none can delay be more injurious, or an economy of time more valuable.

Dr. Adrian Rogers said, "When half the people get the idea that they do not have to work because the other half is going to take care of them, and when the other half gets the idea that it does no good to work because somebody else is going to get what they work for, that my dear friend, is the beginning of the end of any nation." Yet we have ignored these kinds of warnings.

Deacon wrote:That can't be right. Source?

Surely they know that would be political suicide.

Only half joking. Practically, that's what it would take to balance the budget in about 20 years at the way costs are increasing. see here.

Those damn rich folks making $30k/yr need to be punished for their success. How dare they shirk their social responsibility? They owe society that money! They make enough, in our judgment. They're lucky we let them keep any of it. The only reason they're making that much is that they climbed up on the backs of those making anything less than that.

</Fuggle>

Me thinks some senators and economists don't understand the definition of inflation.

The government currently uses the Consumer Price Index for Urban Wage Earners and Clerical Workers — the CPI-W — to adjust pensions. But economists say the CPI-W overstates inflation because it doesn't take into account the fact that most consumers change their buying habits as the prices of goods go up.

Summed up pretty well by one of the other commentators there,

The "chained" CPI makes no sense - the point of the CPI is to account for price increases in the SAME products and services. By the "chained" logic, I guess the fact that I might drive less if gas goes up would also make my net cost of living go up less, but I would have a reduced standard of living.

But economists say the CPI-W overstates inflation because it doesn't take into account the fact that most consumers change their buying habits as the prices of goods go up.

Wouldn't that mean it understates inflation, as luxury items tend to be cheaper (due to a reduction in demand) as buying habits change, due to the rising prices of necessities? Who are these economists that have forgotten the law of supply and demand?

The CPI is a horrible way to measure inflation, anyway, as prices can (and do) drop and rise, regardless of an inflationary devaluing of the currency.

For instance, it is pointed out by many that healthcare costs have risen much faster than inflation. So have the benefits, so that comparison is meaningless. Rising costs on par with inflation would only make sense if there was no increased benefit to healthcare - if it still left us dying at 65 or so.



On the flip side, electronics technology, due to advancement in the technology of mass production and the resultant increases in productivity, have become far cheaper over time, despite inflationary pressures rising costs - generally this tends to result in the next generation of technology costing roughly the same as the last generation (adjusted for inflation) despite being far more powerful.

Inflation judged by aggregate increases in consumer prices has a major problem. Prices are sticky. There is a strong incentive to NOT rise prices, unless it becomes absolutely necessary. For example, Netflix recently had a price hike - and this has caused a huge outcry with its customers.

To counteract this tendency, commodities are frequently sold in smaller quantities - butter tubs get slightly smaller, for instance. In this case, the average price of a tub of butter will be constant - meaning the CPI will not detect it, despite the clear rise in absolute price.

The far better measure of inflation is comparison to other countries currency, gold, and the increase of the money supply. And if you do this comparison, it becomes evident that inflation is at an 11-year high in China, where the value of the yuan has risen in comparison to the dollar. It is at a 16-year high on the Euro, and the Euro has been crushing the dollar.

Gold has risen to $1600/oz (a 632% increase between June 2001 and now - mostly in the last two years)- despite the fact that it was used as money in the past precisely due to the stable nature. When the price of gold moves drastically, it is not because a new mine hit the "mother lode", nor because speculators think this might happen. It is not because there is a vast increase in the demand for gold rings. It is entirely a response to the devaluation (and potential devaluation) of currency.

The CPI may be low, but true inflation is certainly not.

adciv wrote:

Deacon wrote:That can't be right. Source?

Surely they know that would be political suicide.

Only half joking. Practically, that's what it would take to balance the budget in about 20 years at the way costs are increasing. see here.

Of course, he does mention that there is an alternative: "Control spending growth, especially of entitlements." Ron Paul released on Monday a proposal to balance the budget in three years. And this is part of why I respect Dr. Paul. While running for President, the man has put forth [ulr=http://www.ronpaul2012.com/the-issues/ron-paul-plan-to-restore-america/]$1T of specific budget cuts.[/url] One of them consists of the President’s pay being cut from $400,000 to $39,336, which would be cutting his own salary should he win.

Warning: Above link contains math and charts, and worst of all - specific proposals!

collegestudent22 wrote:I respect Dr. Paul. While running for President, the man has put forth [ulr=http://www.ronpaul2012.com/the-issues/ron-paul-plan-to-restore-america/]$1T of specific budget cuts.[/url]

Here, let me help you with that.

Suggestion: use the "URL" button when making a post. It helps avoid typos and save keystrokes.

Ironically, I did use the button, and deleted one link in favor of a more specific one. Deleted too much, and attempted to retype the "url" - which was clearly too much for me.

Heh, given the last episode, the above image is even more relevant to my bad typing.

Anyway, I figure that the Tea Party is dead/co-opted. That can be the only reason for the Republican candidates (except Paul) getting away with (by continuing to pull so many votes) saying "I'm going to cut the budget" with zero specifics (except for a list of things they WON'T cut, like NASA and the military).