US national deficit is shrinking in spite of congressional gridlock.

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   Quilligrapherposted 10 years ago

   Some are saying it is because of the government stalemate according to a NPR report. {1} Regardless, this is good news for the country.
   
   "This week, the Treasury Department announced it will pay down some of its debt for the first time in six years."
   
   "The federal deficit is shrinking rather quickly � both in absolute dollars and as a share of the overall economy. The Congressional Budget Office projects the deficit will drop below 4 percent of GDP next year and below 2.5 percent in 2015."
   
   "Greg Valliere of Potomac Research says the improvement could come even faster, thanks to rising government tax receipts and shrinking government payouts."
   
   Has the US turned the corner in its struggle to tame deficits and the debt?
   
   {1} http://www.npr.org/blogs/itsallpolitics … 4&ft=1

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   Mighty Momposted 10 years ago

   Sorry Quill.
   Sorry Treasury Dept.
   I know the response to this good news already: It's not good enough.
   The government needs to "balance its budget like every responsible American family."
   
   MM

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   JaxsonRaineposted 10 years ago

   It's a bit misleading to say the Treasury is going to pay down some of its debt. We operate on annual budgets, so to claim that, at the same time we get all this income from tax returns, we're paying down our debt, without factoring in the rest of the spending for the year, is quite disingenuous.
   
   If I get a paycheck, and I make a payment on one credit card of $50, and I pay my $300 electric bill on another credit card... I didn't really pay down my debt.
   
   Projected deficit of $900 Billion(still double what Obama called an immoral deficit). Feds are buying 'green' jet fuel at $60/gallon, instead of regular jet fuel at something like $4/gallon...
   
   No, they are not doing a good job. Not even close. Instead of making cuts(like we've done in the past, and we did VERY well after fixing our debt in the past), we are purposefully making ANOTHER bubble.
   
   Employment participation rate is setting new lows, prices are going up... I hate to say it, but we're just setting ourselves up for another fall, and probably much worse than the last one.

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      Quilligrapherposted 10 years agoin reply to this

      To the contrary, I am afraid that your credit card example is misleading and inappropriate.
      
      There is nothing disingenuous about the Treasury announcement that it expects to repay a NET $35 billion in the second quarter. Nor can you spin the fact that this has not happened since 2007.
      
      “The forecast of a quarter of net debt repayment for the first time since 2007 shows how tax increases, a cyclical recovery in tax revenues and a squeeze on spending are ratcheting down the budget deficit.” {1}
      
      {1} http://www.cnbc.com/id/100686709

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         JaxsonRaineposted 10 years agoin reply to this

         Yeah, except it's not 'ratcheting' down the budget deficit. It's making a token tribute to the deficit.
         
         It's disingenuous because of the way it is presented. The headlines and announcements are almost unanimous in proclaiming 'Treasure to pay down federal debt'. What that says to the average reader is that we are lowering our debt. We're not. It's going to be almost a trillion more than last year.
         
         It's just like my example(albeit the timeframes are different). You are announcing that you are paying toward the principal on your credit card as if you are suddenly doing better, when in reality you are going to add far more next month. This reporting will give people the wrong impression.

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            JaxsonRaineposted 10 years agoin reply to this

            But hey, if you want to celebrate a $900 Billion deficit this year... go ahead. There's nothing in that to celebrate.

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            Quilligrapherposted 10 years agoin reply to this

            Jaxson, the deficit numbers speak for themselves. Increased tax revenues and reduced spending is having a positive affect on the deficit. “For the fiscal year to date, the deficit of $600 billion is 23% lower than in the first six months of the prior fiscal year,” reports the Wall Street Journal. {1} Furthermore, last year’s annual deficit was lower than the year before.
            
            Most noteworthy, the annual federal deficit has been essentially in decline in each year following the spike in stimulus spending in 2009. That trend is continuing although some folks find it hard to admit this reality for political reasons.
            
            {1} http://articles.marketwatch.com/2013-04 … udget-deal

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               JaxsonRaineposted 10 years agoin reply to this

               Yes, the deficit is lower this year than last year. So what? It's still outrageous. Is $900 Billion a good deficit?
               
               I've never said the deficit isn't going down. The fact is, it's ridiculous at its current rate. It's theft, plain and simple.
               
               Saying that things are better this year than last year is kind of like saying an ice-cream sundae with 5 cockroaches in it is better than an ice-cream sundae with 6 cockroaches in it.

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                  Quilligrapherposted 10 years agoin reply to this

                  Jaxson, if I was counting my calories in the same way this country is trying to reduce its national debt, I would say an ice-cream sundae with 5 cockroaches in it is better than an ice-cream sundae with 6 cockroaches in it.
                  
                  Seriously, we will not arrive at a budget surplus until we string together a number of years in which the budget deficit is smaller than in the year before it.
                  

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                     JaxsonRaineposted 10 years agoin reply to this

                     Or... and here's a crazy thought... we could just cut our budget.

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                        Quilligrapherposted 10 years agoin reply to this

                        Duh???  The deficit has been less each year since 2010. While some advocate pushing for a surplus now, economists of all stripes are warning that cutting spending too much and too fast could cause the struggling economy to relapse into recession.
                        
                        “The economy is paying a price in slower growth. Even some conservatives like Makin are now warning that austerity has gone far enough.
                        
                        ‘Deficit reduction means slowing the growth of spending and raising taxes. And nobody likes that...we're doing some short-run pain for long-run gain, but we're not doing too much of it,’ he says. ‘And that's why I think we've done enough austerity for now.’" Even some conservatives know the risks attached to over zealous spending cuts at this time. {1}
                        
                        {1} http://www.npr.org/blogs/itsallpolitics … 4&ft=1

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      Mighty Momposted 10 years agoin reply to this

      The employment participation rate is at 63.3 percent now.
      But.. here's an interesting tidbit about that:
      
      The employment participation rate peaked at 67.3 percent in 2000, reflecting an influx of women into the work force. It's been falling steadily ever since.
      
      
      
      http://www.huffingtonpost.com/2013/04/0 … 28135.html

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         JaxsonRaineposted 10 years agoin reply to this

         We didn't have a serious loss until after 2008:
         
         
         
         Women:
         
         
         Men:
         
         
         The point is, things are not getting better. We are trying SO HARD to make things better, that we are only going to make ourselves crash again, and crash harder.
         
         Our economy doesn't have the fundamental foundation to support the growth the markets are seeing. Our government won't fix the problem because we keep hiring them to fix the problem, so they keep spending and spending trying to fix the problem. All it does is create bubble after bubble after bubble.

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