So we hit the debt limit...

[Razgovory]

I wonder, would the GOP be so keen on balancing the budget if they had the presidency and control of both houses of Congress.

Assuming you're right, so what?  Now we can ignore the deficit?

We shouldn't take the GOP's advice, they'll use the issue to get reelected and then run up the deficit as soon as they get elected.

-"You know, Paul, Reagan proved deficits don't matter," - Dick Cheney

[derspiess]

Does anyone see the danger of not raising taxes?

I would agree that a tax increase at some point in time is going to have to be a part of a serious long-term solution.  But short term, the focus has to be on making large cuts in spending-- I think the GOP should keep tax increases off the table until the Democrats show they are serious about spending cuts.

My only big disappointment with the GOP at this point is that few are recognizing or admitting that even defense spending is going to have to take a hit. 

[grumbler]

... I think the GOP should keep tax increases off the table until the Democrats show they are serious about spending cuts.

I don't think that the old "if you surrender, we will do as you ask" routine has worked since Tamerlane.  I don't think the Republicans can craft a long-term plan that even they can believe in without some revenue increases, and pretending that they can see the emperor's new clothes until "the Democrats show they are serious" is the worst kind of dishonest:  blatantly obvious dishonesty.

The Republican pretnse that the problem can be solved without revenue increases just allows the Democrats to evade their responsibility to come up with a counter-proposal.  Until everything is on the table, nothing honest can be done.

[Neil]

Does anyone see the danger of not raising taxes?

I would agree that a tax increase at some point in time is going to have to be a part of a serious long-term solution.  But short term, the focus has to be on making large cuts in spending-- I think the GOP should keep tax increases off the table until the Democrats show they are serious about spending cuts.

My only big disappointment with the GOP at this point is that few are recognizing or admitting that even defense spending is going to have to take a hit.

Why are tax increases in the short term not a good idea?  Why not raise taxes while cutting spending, right now?

[Razgovory]

Cult of the tax cut.  There are still people who believe that cutting taxes actually increases revenue.

[Neil]

Cult of the tax cut.  There are still people who believe that cutting taxes actually increases revenue.

Yeah, voodoo economics still dominates the thinking of a large section of the Republican Party, but derspiess obviously doesn't fall into that category, as he has conceded that tax increases are inevitable and vital.

[MadImmortalMan]

-"You know, Paul, Reagan proved deficits don't matter," - Dick Cheney

Seems to be the same thing some of these guys are saying too, like AR. I think that's a very dangerous stance, personally. I'm uncomfortable with deficits of any kind, even "sustainable" ones.

[alfred russel]

-"You know, Paul, Reagan proved deficits don't matter," - Dick Cheney

Seems to be the same thing some of these guys are saying too, like AR.

Am I AR? I don't think I'm saying that. 

[derspiess]

Why are tax increases in the short term not a good idea?  Why not raise taxes while cutting spending, right now?

Spending is a much bigger problem than revenue  (yeah grumbler, I know-- theoretically if revenue potential were unlimited it would be an equal part of the problem/solution).  I don't see much evidence from the Dems that they recognize that.  Until they're willing to agree to cut more, I'd rather not hear any talk of tax increases.  I suspect that if the Dems had their way, they'd hike taxes and *increase* spending.

Plus, any tax increases would likely be levied against the more productive sectors of our economy.  If we want any chance of a substantial economic recovery in the near future, I don't see this as being a wise choice.

[MadImmortalMan]

-"You know, Paul, Reagan proved deficits don't matter," - Dick Cheney

Seems to be the same thing some of these guys are saying too, like AR.

Am I AR? I don't think I'm saying that. 

Didn't you say a 2 or 3 percent deficit was sustainable?

I guess that's technically true, but it feels wrong to me. The kind of thing that you could get away with but it's still not a good idea.


Edit: It was in the Bachmann thread, not this one.

[alfred russel]

Didn't you say a 2 or 3 percent deficit was sustainable?

I guess that's technically true, but it feels wrong to me. The kind of thing that you could get away with but it's still not a good idea.


Edit: It was in the Bachmann thread, not this one.

It is also academic--the deficits we have right now aren't 2-3% and are not sustainable.

But what I was getting at is your debt as a percent of GDP is most important. Say we want to sustain debt at 100% of GDP, and we are at 100% currently (to keep numbers simple). If we have no economic growth, and inflation of 3%, we can run a deficit of 3% and hold our real debt level constant. Add growth and we can sustain an even larger deficit.

[grumbler]

Spending is a much bigger problem than revenue  (yeah grumbler, I know-- theoretically if revenue potential were unlimited it would be an equal part of the problem/solution).  I don't see much evidence from the Dems that they recognize that.  Until they're willing to agree to cut more, I'd rather not hear any talk of tax increases.  I suspect that if the Dems had their way, they'd hike taxes and *increase* spending.

The problem with "I want my side to be stupid until I am convinced that their side has stopped being stupid" is that both sides have decided to double down on stupid until the other side unstupids, which, naturally, won't happen because each insists, like you do, that the other side unstupid first.  It is this kind of stupidity that got the US into this mess.  It won't get the US out of it.

[MadImmortalMan]

Geithner's gonna leave after this is settled.


http://www.bloomberg.com/news/2011-06-30/geithner-said-to-weigh-leaving-treasury-after-debt-ceiling-debate-resolved.html

[derspiess]

Obama is officially a dick.

http://www.politico.com/news/stories/0611/58098.html

[KRonn]

We're going to need tax hikes along with heavy budget cuts. The tax cuts to the wealthy seems a good place to start. I'd say they shouldn't have passed that in the first place, just a more limited portion of the Bush tax cuts should have gone through. Seems both sides are doubling down, catering to certain segments of their voting block, locked in a bash-athon, to score political points. So we have an impasse. This issue is going to require some tough medicine - tax hikes, and serious budget cuts. The parties need to come to some tough agreements together so that neither party gets bashed over the tough measures that are needed. Get serious, work together, they need to get the Fed budget to a better place so that important issues, like national infrastructure, can be taken on more easily later on.