US gubmint shutdown + default + subprime sequel?

[ICantSpellDawg]

Im interested in calling the bluff.

[Strike For The South]

If we defualt Im going to be spending allot more time here

DO YOU REALLY WANT THAT

[Strike For The South]

Because a significant number of them live in a fantasy world where tax hikes in a stagnant economy are a good idea.

It's a repeal of one particular tax and the closing of loopholes

Or else it will just fall on the back of the middle and working class. Ho hum, rich get richer, poor get poorer

[Xiahou]

Obama's plan had 1.6 trillion dollars in cuts.

Wait, Obama has a plan? Links plz.

Not increase taxes, but close loopholes.

Those are the same thing. If you used to be able to deduct (for example) your mortgage payment, and now you can't... your taxes have gone up. This isn't really that complicated. IIRC, some of the "loopholes" bandied about are about equipment depreciation. This would be a disincentive to new purchases for businesses. Allow me to reiterate- new taxes aren't a good idea in a stagnant economy. Businesses are still grappling with the fallout from Obamacare, they don't need this heaped on as well. Our tax code, is a mess- we should eliminate deductions and lower rates accordingly.. but that's a discussion for another time.

The Republicans are still being the unreasonable ones. Obama and the Democrats are justified in calling it dead on arrival. Here is the problem. Boehner's plan would have the debt ceiling only extended for the equivalent of a few months. It will become an issue again just in time for the 2012 election. Obama wants a plan that will at least extend the debt ceiling past the 2012 election so that this issue does not become a campaign issue and so a longer term plan can be implemented.

Indeed- having the debt ceiling come up again before the election is the last thing Obama wants. It could be very damaging to him politically. Both sides are playing politics with this looking to either blame the other if things fall apart or to take credit if something gets done. In either case, they're both trying to control the narrative and neither are negotiating in good faith. If anything, it's the House GOP freshmen who have been the best about being principled on the issue. They made campaign promises to vote against any new taxes and some ran on voting against any debt ceiling increase. Like it or not, they're keeping their word and doing what they ran on.

[Major Robert Dump]

You shouldn't be able to deduct your mortgage.

You shouldn't be able to get credits for breeding.

You shoudln't be able to deduct interest on student loans.

You shouldn't get a flat credit because you are poor, thereby getting more back than you paid in.

I don't really consider any of those loophole, I just consider them stupid.

[Adrian II]

I'm sick and tired of this blame game. For God's sake starve the beast, when you're done I'll give all you Yanks a meal and a coupe euros to get by this winter.

AII

[Ironside]

Allow me to reiterate- new taxes aren't a good idea in a stagnant economy. Businesses are still grappling with the fallout from Obamacare, they don't need this heaped on as well. Our tax code, is a mess- we should eliminate deductions and lower rates accordingly.. but that's a discussion for another time.

Might not be the best option, but if you're going to pay something back quickly it's most certainly worth it. Say that a total 10% tax increase costs about 0,5% in yearly growth. You only earn money the first 20 years then.

While the example numbers are made up, it's not some fantasy numbers.
May I remind you that there's nations with more than 50% (up to 100%) higher taxes than the US? It might be argued that the much higher taxes has slowed down their growth, you're still talking about 50% increases causing perhaps a 1% slowdown.

[rory_20_uk]

Taxes should be as simple as humanly possible, both for the individual to understand and the state to enforce.

The UK has a hideous system. The biggest recent tinkerer was dear old Gordon, but he's not alone.

Everyone should start off being theoretically paid a sum of money. If you earn nothing this is pretty much all you get. You'd be very limited to where you can live and your disposable income is close to zero. You probably won't have enough money to have kids. Want to prosper? Do some work.
There is certainly no unemployment allowance. Everyone is effectively paid that - and we can scrap all the infrastructure that is employed in doling it out and ensuring people get the right amount. Want to work? Great. Go to a recruitment agency or online.
Then there is a period where tax is zero. Earning is always worthwhile. The most menial jobs mean you earn that much more money.
Then you collate all money that is coming in from basically all sources and whack it into a calculation that taxes on a slowly increasing scale.

No nasty jumps where earning more can mean getting less
No cunning "earn little and then get the money as dividends from your own company" crap. If you get the money you sum it up.

Very simple to instigate.
No complex forms to complete to work out what exactly one is going to get. The cost of instigating and sorting out the system would be a lot less.
No "incentives" not to work as the benefits lost are greater than the money earned. No U shape where people get stuck as to bother isn't worth it.
A hell of a lot less bureaucracy at the other end.

Needs fine tuning? I'm sure. The payment to everyone would have to be monthly as those that need it both will generally be poor at budgeting and not be able to wait until the end of the year.

There are few countries that need such a radical overhaul. With clarity it will be a lot easier to see how exactly to go about balancing the budget.

[Adrian II]

There is certainly no unemployment allowance.

Certainly not. Out of work? Sorry, you have to die.

If people have kids and then lose their job, well, it's like driving while drunk. They all die.

I can see this idea going very far.

AII

[rory_20_uk]

Did you bother to read the part that everyone gets off with money to start with? I know it was a very long bit I wrote... Third sentence in? Skim that bit to get to something to bash?

The point was that to ensure that there is no effective tax of 80%+ when one starts work one keeps one's benefits and then earns more. If you earn a large salary obviously you get taxed a lot more than this and so you still PAY net taxes. The point of giving it to everyone is for simplicity.

[Adrian II]

Did you bother to read the part that everyone gets off with money to start with? I know it was a very long bit I wrote... Third sentence in? Skim that bit to get to something to bash?

The point was that to ensure that there is no effective tax of 80%+ when one starts work one keeps one's benefits and then earns more. If you earn a large salary obviously you get taxed a lot more than this and so you still PAY net taxes. The point of giving it to everyone is for simplicity.

I see. Sorry, but that isn't formulated very clearly there. You didn't say who provides the basic income.

The source of basic income would be the state?

What you are talking about is a popular notion in many European countries, the "shared base income", no? In that case I totally agree. It would cut a humongous amount of red tape, and more importantly it would cut a lot of hassle and worries for individual citizens.

AII

[rory_20_uk]

I'm probably using the wrong terminology, but yes, basic income would be from the state. Good to hear that lots of other countries manage to instigate this. What a shame the UK isn't amongst them.

[Adrian II]

I'm probably using the wrong terminology, but yes, basic income would be from the state. Good to hear that lots of other countries manage to instigate this. What a shame the UK isn't amongst them.

No no, it's just popular among the perverted pinko commie Left. It hasn't been introduced anywhere yet, not that I know of.

AII

[rory_20_uk]

Odd that it's pinko. With a defined payout it can be easily adjusted as is a lot more difficult to cheat than the current system, plus has far fewer overheads, allowing for a small state. Few systems let people literally starve to death, and this seems to be the simplest way to both prevent starvation and encourage work. The fast efflux of workers from non-jobs in the state bureaucracy would also help make the country more economically effective, as the labour market would be expanded and less overheads to pay their state wages.

But then what Civil Servant is going to put forward a plan to sack probably thousands of their colleagues and make some powerful enemies in the meantime?

[Adrian II]

Odd that it's pinko. With a defined payout it can be easily adjusted as is a lot more difficult to cheat than the current system, plus has far fewer overheads, allowing for a small state. Few systems let people literally starve to death, and this seems to be the simplest way to both prevent starvation and encourage work. The fast efflux of workers from non-jobs in the state bureaucracy would also help make the country more economically effective, as the labour market would be expanded and less overheads to pay their state wages.

But then what Civil Servant is going to put forward a plan to sack probably thousands of their colleagues and make some powerful enemies in the meantime?

In the Neds we have a welfare scheme (called Wajong) for young people who are unable to work fulltime due to a handicap, either physical or mental. They receive a very modest basic income from the state, they must declare any money they make for themselves and this amount is then partially deducted from next month's income. Works very well because these people get time to find their niche, which is often difficult in view of their handicap, in order to become productive members of society. One girl I know, who has episodes of borderline behaviour about once every two months, is on this scheme and she does lots of low-paid jobs like giving extra lessons in maths to migrant kids, editing and distributing a church newspaper and organising musical events for her church.

AII

[ICantSpellDawg]

You guys are completely nuts. There are quite a few people who would not work if their needs were being met with free money, free health care, free internet, free food. Today, everyones needs are being met, we just hear everyone complaint about debt and other rich world problems. Our poor have cable tv and the ability to get free emergency care, government food, free education, free library services. Now the government has to give them additional checks every month? Where does the gov get this money, adrian asked? The reason people are "hearltess" in this country is because those hearts have been stolen by freeloading, drug abusing trash who already have their needs and more met for free, yet have the audacity to demand more. The people we need to look out for are those who work hard and have the same living standards as the useless parasitic trash. Those people I feel for, the ones who actually pay the emergency room bills, pay taxes and still can't make ends meet. Those people I worry about.

[Adrian II]

The reason people are "hearltess" in this country is because those hearts have been stolen by freeloading, drug abusing trash who already have their needs and more met for free, yet have the audacity to demand more.

Sounds like paradise, I must move to the US one of these days.

AII

[rory_20_uk]

You guys are completely nuts. There are quite a few people who would not work if their needs were being met with free money, free health care, free internet, free food. Today, everyones needs are being met, we just hear everyone complaint about debt and other rich world problems. Our poor have cable tv and the ability to get free emergency care, government food, free education, free library services. Now the government has to give them additional checks every month? Where does the gov get this money, adrian asked? The reason people are "hearltess" in this country is because those hearts have been stolen by freeloading, drug abusing trash who already have their needs and more met for free, yet have the audacity to demand more. The people we need to look out for are those who work hard and have the same living standards as the useless parasitic trash. Those people I feel for, the ones who actually pay the emergency room bills, pay taxes and still can't make ends meet. Those people I worry about.

Such an idealist. I'm a pragmatist.

Feed 'em, else they'll turn to crime which costs more.
Education as more will get better jobs (UK education system is a mess - free, streamed education. Some leave school at 14 to get apprenticeships others study to get a degree and a skilled job).
Proper healthcare is far less expensive than the USA's model. A large portion of the workforce is unfit to work. Am I saying free cosmetic surgery or fertility treatment? No, just the use of cheap drugs to fix the simple things that massively reduces the costs in Emergency clinics.

The cheques replace almost all other benefits. People just get the one. That's it. It'd easily be cheaper than the convoluted mess we've currently got. For example, in the UK, locking up a criminal for 1 week is something like £1,000. Suddenly a system that gives a lot less to keep people out of jail is a snip - if against ideology.

You work, you get more disposable income for things like cable TV and so on. No poverty trap such is the case in the UK and USA where to work a bit means loss of healthcare (USA) or benefits (UK), meaning you get less money.

[ICantSpellDawg]

Right, so we give them a check and then, when they spend it or trade it for anything other than basic needs, we let them starve and refuse them medical care? No. We write them another check, and another. Noble, but that's not pragmatism

[Adrian II]

Right, so we give them a check and then, when they spend it or trade it for anything other than basic needs, we let them starve and refuse them medical care? No. We write them another check, and another. Noble, but that's not pragmatism

This is fun, two misanthropes discussing what to do with mankind. My money is on Rory.

AII

[rory_20_uk]

Currently, in the UK we have a system where people view Sky TV as a "necessity" - and ironically one that they can afford on benefits but not by working for the jobs that they are capable of doing. We are a long way from anyone starving to death.

Refusing medical care is more expensive than giving it out. But then I would tightly combine NHS and private services rather like how one goes to a restaurant. A la carte is one price, other things there is a surcharge; the reason why I drive a Ford and not a Nissan GT-R.

Those roses that rise from the manure should be cultivated by meritocratic Grammar Schools, University Bursaries and then proceed to do whatever they choose. Those that get good jobs will end up paying vast taxes, providing a fantastic ROI. Drop the pretence that we can afford or need 50% going to increasingly bastardised universities. Get out of school earlier and do something useful. Often that will be a mix of working and training.

One Microbiology Consultant I worked with left school at 16 and worked for ICI. With them he did his A levels, then BSc, then MSc. This model should be far more the norm.

And yes, of course those with money will ensure their thick little darlings will do better than a poor stupid person. The rich can always purchase success, justice and pretty much everything else if they are rich enough. If one can think of a way of negating this, then fine. But I can't.

[Adrian II]

OK, for Tuff only the stupid poor are undeserving. For Rory the stupid rich are undeserving as well.

+1 for Rory

AII (told you so)

[Prodigal]

Obama has acting like Bush on weed for a number of years, & the "tea party" should read the "dog in manger" from Aesop's fables. Other than that I for one think the whole global economy thing is a Great Idea

[Adrian II]

And it's official: Steve Jobs now has more cash ($76.2 billion) than the US government ($73.8 billion).

Oh the chillun, think of the poor chillun..

AII

[Major Robert Dump]

I think this song is appropriate for the situation

https://www.youtube.com/watch?v=rBQYWCw8n_k

[ICantSpellDawg]

This song is actually good and speaks more clearly to the core of the issue.

[Adrian II]

I was thinking more along these lines.

[Fisherking]

I hate to rain on this parade of peace and good will but I heard they had reached a settlement by compromise.

Dose anyone have the details? Or were you just hoping for a meltdown?

[ICantSpellDawg]

damnit. we were so close this time

[Lemur]

Dose anyone have the details? Or were you just hoping for a meltdown?

damnit. we were so close this time

I think maybe TSMG was hoping for something like the Road Warrior but with more family values.

Here's a sketch of the deal:

The agreement looks like this: if the super-committee tasked with entitlement and tax reform fails to come up with $1.5 trillion in deficit reduction that passes Congress, the “neutron bomb” goes off, -- as one Democrat put it -- spending cuts that will hit the Pentagon budget most deeply, as well as Medicare providers (not beneficiaries) and other programs.

If the super-committee comes up with some deficit reduction but not $1.5 trillion, the triggers would make up the difference.

So it’s a minimum $2.7 trillion deficit reduction deal.

And the debt ceiling will be raised by $2.4 trillion in two tranches: $900 billion immediately, and the debt ceiling will be raised by an additional $1.5 trillion next year – either through passage of a Balanced Budget Amendment, which is unlikely, or with Congress voting its disapproval.