CBO claims Unsustainable Debt

Eladar

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28 Jan '15 02:22

no1marauder
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29 Jan '15 18:351 edit
Originally posted by sh76
There are too many variables in the stock market to be able to assert causation out of that correlation. Someone would need to find a convincing way to correct for all other variables to support an assertion that raising the capital gains tax would not depress stock prices as that assertion is counterintuitive. I'd still be in favor of it though, even if it does depress stock prices.
You asked a question with an implied premise that taxing capital gains as ordinary income would depress stock prices. I'd prefer some actual evidence supporting that claim to a bland assertion that it would. As you properly say there are many variables involved, but my point is that the capital gains rate was raised just two years ago for the top 2% (who receive the majority of capital gains) and the result was the opposite of what a simple model would have predicted.

EDIT: As this chart shows, the top one-tenth of 1 percent of taxpayers will receive 47 percent of all capital gains in 2012, according to the Tax Policy Center. (The top 1 percent of taxpayers will receive 71 percent of all capital gains.) http://www.cbpp.org/cms/?fa=view&id=3798

So taxes were raised on the majority of capital gains and stock prices rose anyway.
Eladar
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29 Jan '15 23:17
It never amazes me how people who don't want to talk about a subject can simply change the topic so easily.

The fact is that we are running out of money eventually and that's according to the CBO. A government can't simply continue to spend on debt. That's amazing.
no1marauder
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30 Jan '15 01:59
Originally posted by Eladar
It never amazes me how people who don't want to talk about a subject can simply change the topic so easily.

The fact is that we are running out of money eventually and that's according to the CBO. A government can't simply continue to spend on debt. That's amazing.
From your OP:

debt would exceed 100 percent of GDP 25 years from now, and would continue on an upward trajectory thereafter. That trend that could not be sustained.

So there's 25 years (at least) before the debt becomes "unsustainable". Plenty of time to fix the situation. After WWII, total government debt was 120% of GDP and by 1974 it had been reduced to 31.7% of GDP.http://www.huffingtonpost.com/harlan-green/how-did-we-reduce-world-w_b_4612683.html

That was done by lots of productive investment in infrastructure and human capital and somewhat higher tax rates on the wealthy. No reason that formula can't work again.
Eladar
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30 Jan '15 03:27
Originally posted by no1marauder
From your OP:

debt would exceed 100 percent of GDP 25 years from now, and would continue on an upward trajectory thereafter. That trend that could not be sustained.

So there's 25 years (at least) before the debt becomes "unsustainable". Plenty of time to fix the situation. After WWII, total government debt was 120% of GDP and by 1974 it had bee ...[text shortened]... n capital and somewhat higher tax rates on the wealthy. No reason that formula can't work again.
I didn't say that it couldn't be fixed, merely that the government credit card is not without limit.

Do you agree that the government can't continue on the road it is on?
Hugh Glass
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30 Jan '15 23:23
Originally posted by DeepThought
The catch is that there is a considerable industry supplying the military and cutting the military budget harms the defence industry. This isn't a reason not to do it, but does mean that you have to do some careful planning to work out how you're going to replace the jobs lost.
what military bases should we close first? Where should we withdraw troops from... Europe, South Korea? It's about time they started watching after themselves right?
AThousandYoung
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31 Jan '15 00:57
Originally posted by Hugh Glass
what military bases should we close first? Where should we withdraw troops from... Europe, South Korea? It's about time they started watching after themselves right?
Germany and Italy they don't need us.
Hugh Glass
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31 Jan '15 01:05
Originally posted by AThousandYoung
Germany and Italy they don't need us.
right on then.. lets put it up for a vote... give them 6 months to prepare for the crash in their economies..
Eladar
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31 Jan '15 03:16
Originally posted by Hugh Glass
right on then.. lets put it up for a vote... give them 6 months to prepare for the crash in their economies..
I'd love to see the US move our bases out of places like Germany and into places like Poland.
whodey
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31 Jan '15 04:06
Originally posted by Eladar
http://www.breitbart.com/video/2015/01/27/cbo-director-predicts-unsustainable-debt-heightening-the-risk-of-fiscal-crisis/

[b]By 2025, in our baseline projections, federal debt rises to nearly 79% of GDP. When CBO last issued long-term budget projections in the summer, we projected that, under current law, debt would exceed 100 percent of GDP 25 years from ...[text shortened]... nd that could not be sustained.

I guess the government's credit card does have a limit.[/b]
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KazetNagorra
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31 Jan '15 07:31
Originally posted by Hugh Glass
right on then.. lets put it up for a vote... give them 6 months to prepare for the crash in their economies..
Don't be ridiculous. How much influence do you think military presence of American soldiers has on economies in Europe?
~~Duchess64~~
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01 Feb '15 00:19
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normbenign
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01 Feb '15 01:25
Originally posted by no1marauder
Cut the military budget in half and tax dividends, capital gains and inheritances like other income.

Goodbye budget deficit + we'd have money left over to improve our infrastructure and thus improve our long run balance sheet.
This fantasy land tale is courtesy of Joseph Stiglitz, who after prescribing this to close the budget deficit, also wants to spend the money a second and third time, for education, welfare, reeducation, and financing elections, not to mention controlling those wascally white wingers.

That's exactly what happened when an unexpected budget surplus appeared while he was a budget adviser to the Clinton administration. A surprise surplus (projected, not actual mind you) and all the government lefties including Stiglitz wanted to spend the extra money for their pet projects, not a word about debt reduction.

Well reality soon got the better of all of them including the Pubbies who wanted tax reductions. Another quarter and the surplus mysteriously disappeared, and for the fiscal year debt grew.

There is almost no doubt that we spend too much on the military, and there is some reasonable argument to taxing all income at somewhat equal rates. The arguments aren't as black and white as Stiglitz tries to make them. Trouble is, that you only get to spend the same money once, then it's gone. What would you do? Eliminate deficit? Pay the debt, reducing interest payments? Create new social welfare?

In my opinion, the only way to stop politicians from spending excessively it to take away their supply of money. It's like Ted Kennedy's boozing. If he had liquor, he was going to drink it, and if he had tax money he was going to spend it (and most often he spent even if the money wasn't there).
normbenign
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01 Feb '15 01:30
The post that was quoted here has been removed
That is almost universally true of all non profits.
normbenign
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01 Feb '15 01:34
Originally posted by no1marauder
Righto.

http://www.ciponline.org/research/entry/military-spending-poor-job-creator
Again, the prescription is not going to save what is cut from the military budget, but just redirect it. That saves exactly zero. It is a matter of conjecture whether one or the other produces more jobs.

When you hear someone say we can spend the money better somewhere else, better hold onto your wallet, because you are usually looking at spending increases, above the budget cutbacks.
normbenign
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01 Feb '15 01:39
Originally posted by no1marauder
None based on historical evidence.

At worst, rather than waste their money on financial speculation, rich people might actually have to do something productive with their cash.
All investment is financial speculation, but without that speculation, a lot of ideas would never be tried, businesses would not be financed, and the stock market would not exist.

Perhaps you think paying taxes is more productive? How much beyond your liability do you voluntarily pay?

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CBO claims Unsustainable Debt