DROWNING IN RED INK … DEMOCRATS AND REPUBLICANS LOOK FOR ANOTHER DEBT CEILING INCREASE
The federal government will hit its $16.4 trillion debt limit on New Year’s Eve – a watershed event which has been almost completely overshadowed by the debate over the “fiscal cliff,” a series of tax hikes set to take effect on January 1.
For those of you keeping score at home, the national debt reached its previous $14.3 trillion limit on August 2, 2011. Just prior to that deadline, politicians in Washington, D.C. agreed to what we refer to as the “debt dereliction deal.” Under the terms of this agreement, U.S. President Barack Obama and Congressional leaders approved $2.1 trillion in new deficit spending – an amount they have exhausted in just seventeen months.
In exchange for this massive ramp-up in deficit spending, these politicians also agreed to $1.2 trillion worth of cuts – over the course of the next decade – or $109 billion a year. Does that sound sustainable? Of course not. They also agreed to $900 billion in cuts scheduled to take effect from 2019-2021 – when the debt is projected to hit $25.4 trillion – although no one believes these cuts will actually take place.
Why not? Because before the first dime of budget reductions associated with this glaringly lopsided deal takes effect – Obama and his fiscally liberal allies in both parties are already trying to weasel out of the agreement.
Just as we predicted they would …
While they weasel, they are also hoping to secure yet another extension of the nation’s debt limit – this time without the charade of accompanying spending cuts. In fact Obama has demanded that Congress give him unilateral authority to raise the debt limit whenever he wants – by any amount he wants. Remember, this is the same guy who spoke in no uncertain terms against such debt hikes prior to becoming president.
“Increasing America’s debt weakens us domestically and internationally,” then-Senator Obama said in March of 2006. “Leadership means that ‘the buck stops here.’ Instead, Washington is shifting the burden of bad choices today onto the backs of our children and grandchildren.”
Truer words have never been spoken …
Republicans and Democrats have approved $10.9 trillion worth of debt ceiling increases over the last decade. Of that total, $3.4 trillion was approved by George W. Bush and “GOP”-controlled Congresses. Another $2.35 trillion was approved by Bush and a Democratic-controlled Congress. Meanwhile $3 trillion was approved by Obama and a Democratic-controlled Congress, and $2.1 trillion has been approved by Obama and a divided Congress (although a majority of “Republican” lawmakers supported the latest deal).
In other words both parties are to blame for the rising tide of red ink about to drown our economy …
Ayn Rand once wrote that “the hardest thing to explain is the glaringly evident which everybody has decided not to see.”
The “glaringly evident” in this situation? The rapidity with which our nation is going under …
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37 comments
And it’s not like ALL the bankrupt/foreclosed individuals are helping matters……bankrupt from medical expenses, student loans, commercial loans and houses. Hmmmmn, I guess the rich hoarding all the money while paying minimum wage and creating tax loopholes for zero liabilities is really helping the cause!
We’re doomed…..
I had occassion to look up a Ch 13 bankruptcy yesterday. Guy claimed $192k of income last year and had no significant liabilities other than deciding not to pay the IRS the last decade. Now he is on a payment plan with living allowances far more generous than I give myself on much less salary.
Not really relevant to the discussion, except to beg the question of how many greedy dickheads can this once great nation absorb and keep ticking? Sadly, we may soon find out.
“I had occassion to look up a Ch 13 bankruptcy yesterday. Guy claimed $192k of income last year and had no significant liabilities other than deciding not to pay the IRS the last decade.”
So I’m confused, if he had no signifcant liabilities why on earth did he file Chap 13?
If I had a printer
I’d print in the morning
I’d print in the evening
All over this land
I’d print out Dollars
I’d print out Euros
I’d print out bonds for all my fat cats
All over this land
If I had a chopper
I’d drop cash in the morning
I’d drop cash in the evening
All over this land
I’d drop out Dollars
I’d ring out Euros
I’d ring out bonds for all my fat cats
All over this land
If I had an algo
I’d front run it in the morning
I’d front run in the evening
All over this land
I’d front run Dollars
I’d front run Euros
I’d front run all the bonds for my fat cats
All over this land
Well I’ve got a printer
And I’ve got a chopper
And I’ve got an algo
All over this land
It’s the printer of Bernanke
It’s the chopper of Timmah
It’s the algo of William Dudley and all his fat cats
All over this land
Nice job Obama…
Can this dude get ANYTHING right????
Big T:
Yes, he got elected, despite your crazy-assed projections.
Obama may be part of the problem, but he isn’t all of it. Bush II had a budget surplus when he took office and look what he did– massive tax cuts, Afganistan, Iraq– to name a few. Not to say we wouldn’t be in a mess without those, but it wouldn’t be as big of a mess.
Then some states elected their Big T’s to Congress. We see how well those idiots work with others.
STFU about Bush…
Obama has Totally F&*k#* up EVERYTHING he has touched…
Obama has outspent Bush 4-to-1…and the Bush Economy was GREAT compared to the Bull$#!* Obama has given us…
Obama is a F^&* up…so admit that. You may HATE Bush, but Obama SUCKS…
and he’s a Major Stupid F^&k up/….
what a titty reply from the village idiot. once again ignoring facts etc..keep up withthe those predictions..oh wait a sec..this asshole is too stupid to pick the winner in a one horse race..prediction record 62-0 bang up job sarah..bang up job.
witty not titty..
would rather see a titty reply. at least it’d take our minds off the fucking debt.
Stop the hate, right T. What a fuck up u are.
“Then some states elected their Big T’s to Congress. We see how well those idiots work with others.”
Thank Jebus some states didn’t! Hopefully, art and science in this country won’t completely go down the shitter…
I recently read in the state paper where two people from SC are being sent to federal prison for felony federal chickenfighting, let’s see borrow money from China to send people to prison for something that most other countries allow.
Is cock fighting allowed in a federal prison?
… just print more money.
Good fucking grief. What part of “don’t spend more than you make” do these asshats not understand.
We’re all going to hell, financially speaking, of course. Maybe literally, too, especially in my case.
Classic. +1
Debt limit? Does no one realize that this is simply a matter of Congress incurring debt by way of passing appropriations, and then trying to get out of paying up when the debts have to be paid?
Obama should just tell Geithner to pay the damn bills under the authority of the 14th Amendment, Section 4. “The validity of the public debt of the United States, authorized by law, . . . shall not be questioned.”
You can bet your ass that if a Republican were in the White House, and Republicans controlled the House and Senate, the Debt Ceiling would be on the consent calendar.
Does anyone know what is the debt to equity ratio of the USA is? 1% 10% etc.
Does anyone know what is the debt to equity ratios of Germany was before the war when their currency became worthless?
That is a tricky question because you have the issue of the reparations debt vs. the actual Weimar gov’t debt:
zerohedge.com/news/presenting-bridgewaters-weimar-hyperinflationary-case-study
As you can see 133% was the number as things kicked off, with a 50% reduction in money value via printing in 1919.
There was a major psychological factor involved, which is the reparations payments that EVERYONE knew Germany could not afford which amounted to 780% of GDP, but interestingly the currency was mostly destroyed before the payments were even started in 21′, which Weimar promptly defaulted on anyway in 22′.(which were gold denominated)
The Weimar inflationary deleveraging destroyed its people economically before they even did the right thing in defaulting on their reparations.
It’s not clear how their case might apply to ours because of several differences:
1. The Zero hedge article in March suggested global coordinated money printing as a response, which we are seeing right now, this month.
2. Weimar wasn’t able to export its inflation to the world via having the world’s reserve currency.
I have taken time to look at inflationary collapse in several countries in the last 100 years, rarely do such events(once started) last more than 4 years…most less than 2 years…a few lasted 6-10.
Though there are psychological factors that accelerate the process/kick it off in every country, it ONLY happens via fiat currency when debt is being monetized/money printed in response to the inability to meet obligations. Like we are doing now.
The scope of what we are seeing now is truly unlike anything ever seen before due to the United States dollar reserve currency standard & global use of fiat currency for the most part with coordianted money printing by almost all the major economic players.
The people that will get hurt the most as various currency is globally devalued will be what is left of the middle class & poor people, as most rich people will be asset heavy. Obviousy, if the process goes as well as it has in Japan we can look forward to decades of no real economic growth, systemic unemployment, and lower living standards than would normally be the case despite techonological advancement.
That assumes everything goes “well” though, it’s very possibe we get riots, martial law, or global war of some sort.
@?
Fascinating read. Very interesting.
Have a Great Day!! :) There won’t be many left with the Demlicans and Republicrats in charge.
Frank Pytel
T– Do you have a Bush II blow up doll that is “your” friend?
Love that comment!
My question: How long before the Obm-ites realize how STUPID they are???
And will they admit it, when they figure out that Obama SCREWED them…????
how long before you realize you get not an ounce of respect.that you are a laughing stock whose only purpose is to continually make a total asshole out of themselves? The guy who couldnt predict the winner in a one horse race yet called everyone dumbasses and how you would show us all when the elections came around..remember that our own little Sarah Palin aka T? Remember how you sore up and down how you would laugh at us..the story of your life i bet..one loser action after another..thats why you have always been and always will be called a loser.
Common Sense: Nice!! But T can only read between the lines!
Bottom line: I was WRONG in thinking that the country was not so STUPID as to re-elect Obama…
But I was am 1,000 percent RIGHT about what a TOTAL SCREW UP Obama is…
Not only did he FAIL over and over in his First Term…he has offered NOTHING now in the way of correcting the MESS he has made…
Based on that: It shows how TOTALLY Ignorant his @$$-Kissers are…Obama is an Idol for Dumb@$$ people like Common Sense and Broke-Back Mountain…
You cannot show any leadsership by Obama that is good for America…You either HATE America, or you are too Stupid to understand the damage Obama is doing…
Either way: You are BAD for This Nation: And evetually people like me are going to have to Clean up the Stinkin’ Mess you Idiots have made…
If SC can REJECT and avoid Obam-anomics to ANY degree, we’ll be better off…and Haley seems to understnad that….
T, you still using your kafir coffee mug?
You still Worshiping the Mayan calendar and claiming the end of the world on 12-21-12…and are you still a faithful Stooge of the Idiot Al-Gore and Global Warming (and the tax that Obama wants to impose on us for it)???
LMAO…Dumb@$$…
Lol, Gary! I’ve never worshiped the Mayan cal. …as for the later, I feel you’re misinformed on carbon tax. Funny, Gary! How’s the war on CAIR going?
Don’t worry, Biggie. I’m not going to out you, just hope you get some help.
Al Qaeda Disbands; Says Job of Destroying U.S. Economy Now in Congress’s Hands
WASHINGTON (The Borowitz Report) — The international terror group known as Al Qaeda announced its dissolution today, saying that “our mission of destroying the American economy is now in the capable hands of the U.S. Congress.”
In an official statement published on the group’s website, the current leader of Al Qaeda said that Congress’s conduct during the so-called “fiscal-cliff” showdown convinced the terrorists that they had been outdone.
“We’ve been working overtime trying to come up with ways to terrorize the American people and wreck their economy,” said the statement from Al Qaeda leader Ayman al-Zawahiri. “But even we couldn’t come up with something like this.”
Mr. al-Zawhiri said that the idea of holding the entire nation hostage with a clock ticking down to the end of the year “is completely insane and worthy of a Bond villain.”
“As terrorists, every now and then you have to step back and admire when someone else has beaten you at your own game,” he said. “This is one of those times.”
The Al Qaeda leader was fulsome in his praise for congressional leaders, saying, “We have made many scary videos in our time but none of them were as terrifying as Mitch McConnell.”
As for the future of Al Qaeda, the statement said that it would no longer be a terror network but would become “more of a social network,” offering reviews of new music, movies and video games.
In its first movie review, Al Qaeda gave the film “Zero Dark Thirty” two thumbs down.
How many times since the election have we heard that “the House controls the purse strings.”
If course, this is true, and the deficit has balooned because of spending that the House has already authorized. Sure, Obama requested some of it, but the House had to vote to give it to him.
There is neither courage nor conviction in deciding not to pay bills you have already incurred.
Have a debate about what we, as a nation, should be spending our tax dollars on. But it’s downright un-patriotic to allow our countryto be cast as a deadbeat.
Morality is a funny thing. I think it’s immoral to incur a debt you can’t pay off(if you know so in advance), but even worse to incur a debt that you can’t pay but instead force your kids to pay.
If we are speaking about morality, the moral thing for the generations that are buried by the debt of the parents/grandparents to do is simply repudiate it as it wasn’t their debt to begin with.
I’d say courage and conviction might first start with the current generations living within their means and not have any deficit at all.
… they won’t end ‘QE’ because they can’t end QE. Because QE isn’t really a measure taken by the Fed to ‘stimulate the economy’. It’s a euphemism for debt monetization. Put 1.5 trillion+ a year in new issuance out to the market without the Fed buying a large chunk of it, and where do you think interest rates would be? And with a 16 trillion and rising debt load, the gov’t can’t afford interest rates to rise at all, as it would immediately make clear what most for the moment are willing to ignore – the whole situation is unsustainable and doomed to collapse. There’s no way to earn out of this one through spending cuts, tax increases, or magic incantations.
It’s all about kicking the can as far as possible now.