The solutions are pretty clear here - want to get America out of debt?

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Medicare is not the problem. As much as Republicans want you to think Medicare is bankrupting America - it’s not. What’s really bankrupting America are tax cuts for millionaires and billionaires and two unpaid wars in the Middle East. Not only are the Bush tax-cuts the single largest contributor to our annual budget deficits over the last ten years - but as Dean Baker at the Center for Economic and Policy Research noted - Medicare shortfalls over the next 75 years pale in comparison to the cost of our military misadventures in the Arab world.

The amount of money that Medicare will add to our nation’s debt over the next three-quarters of a century is only one-fourth of the cost of the Afghanistan and Iraq wars over the last ten years - just one-fourth! Yet there is no talk of ending the wars in the Republican deficit-reduction proposals - and plenty of talk of ending Medicare as we know it.

The solutions are pretty clear here - want to get America out of debt? Then end the wars - and raises taxes on the rich just like Clinton did - which then created 23 million jobs and balanced the budget.

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The problem with your theory is that we were not out of Debt under Clinton.

I do enjoy the contrast between Dems and Reps.

Dems say it a revenue problem, Reps say it's a spending problem. The problem with the Dems is that the Reps are right. Even in the guilded age of Clinton, Gov still spent more than they brought in. Even when Taxes were 90%. Government still spent more they they brought in.

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Fan.Cl
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Federal borrowing does more than finance the operations of the government, it also provides investors a nearly risk free place to park cash. Or at least, it used to. If investors perceive Treasury notes as no longer a safe investment, they will park their cash someplace else, increasing the cost of federal borrowing for government operations.

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Quetzalcoatl
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Quote Fan.Cl:

The problem with your theory is that we were not out of Debt under Clinton.

I do enjoy the contrast between Dems and Reps.

Dems say it a revenue problem, Reps say it's a spending problem. The problem with the Dems is that the Reps are right. Even in the guilded age of Clinton, Gov still spent more than they brought in. Even when Taxes were 90%. Government still spent more they they brought in.

Actually it's a mixture of both. It's like a family in which the rich are the parents and the poor to middle class are the children. In order to pay the bills the dems say to make a little more money and we'll cut where we can but not at the expense of the children. The republicans say to hell with the kids. We'll cut back on the groceries and needs of the children but the parents should not have to quit eating caviar and drinking champagne. Tell me which solution is insane and which is not.

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Bush_Wacker
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Quote Bush_Wacker:

Actually it's a mixture of both. It's like a family in which the rich are the parents and the poor to middle class are the children. In order to pay the bills the dems say to make a little more money and we'll cut where we can but not at the expense of the children. The republicans say to hell with the kids. We'll cut back on the groceries and needs of the children but the parents should not have to quit eating caviar and drinking champagne. Tell me which solution is insane and which is not.

I do not agree with your analogy, but I'll use it.

Rebulicans are saying , Sorry Kids, we just can't afford our current lifestyle. That new shiny ceral with the prizes in them, well they cost WAY too much. Bulk cerals taste just the same, you get more of it and it cost less, but sorry no shiny toy in the box.

Democrats are saying. Honey just look at thier sad faces, lets just sign up on that new credit card so we can get them the ceral with the shiny toy in it. I do not want them to be sad.

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Fan.Cl
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Fan, explain how a 10 yr & 8 yr war with no goals other than empire building are anything but caviar for neocons.

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Phaedrus76
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Quote Phaedrus76:Fan, explain how a 10 yr & 8 yr war with no goals other than empire building are anything but caviar for neocons.

Explain what a Neocon is?

Regardless if a group of people benefit from 2, 3 or 3 1/2 wars. it is a debt and the debt need to be paid. As far as I am concerned. Objectives in both countries have been met and I see no reason to stay. The national defense issues have been midigated.

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Fan.Cl
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Quote Fan.Cl:

The problem with your theory is that we were not out of Debt under Clinton.

I do enjoy the contrast between Dems and Reps.

Dems say it a revenue problem, Reps say it's a spending problem. The problem with the Dems is that the Reps are right. Even in the guilded age of Clinton, Gov still spent more than they brought in. Even when Taxes were 90%. Government still spent more they they brought in.

Clinton had a surplus. That means they brought in more than they speant.

ah2
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Quote ah2:

Clinton had a surplus. That means they brought in more than they speant.

NO. He Did NOT.

Would you like me to prove it?

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Fan.Cl
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Incentives. The Gop is always going on about incentives to meke all us po' folks work and get off welfare. I think incentives would work better for the upper 5%. We have a bunch of wars, and as Thom has noted, in WWII we had 90% taxes [investments] on wealth over 5mil? It looks like, what happened in the ensuing years as the taxes went down to 50%, the wealthy found it advantageos to invest the money in business and jobs to make more money.

Let us insist that our public servants raise taxes on all that loot the "banksters" ripped off of the country, and only give them tax breaks if they reinvest that money and create jobs. They want the gov. to do it. Let's make the wealthy do it. Working people sould not have their taxes raised by cutting benefits.

And, of course, get their sticky paws off of Social Security. love, Eliz

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Elizabeth Barger
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Would you like me to prove it?

Sure. Why the heck not. Let's hear what you have to say.

bonnie
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Quote bonnie:
Would you like me to prove it?

Sure. Why the heck not. Let's hear what you have to say.

The Myth of the Clinton Surplus

All verifiable from the US Tresury Numbers (link inclosed) in case you feel the need to proclaim Right Wing Propaganda.

Simple rob from Peter to pay Paul. There was never a surplus.

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Fan.Cl
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Nice link. I haven't had a chance to digest the numbers yet but it looks interesting.

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mjolnir
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Reagan, Clinton, and the Bush's ....no real differences and all are responsible for the deaths of millions of innocent people. Obama is not far behind and will be joining the list soon. In a more sane, just world...they and their handlers would all be spending the rest of their lives in prison.

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norske
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Craig Steiner is the the right wing nut that is the source of the nonsense. He uses public debt vs national debt, and intergovernmental transfers. Every president has used SS/fica surplus to add to the revenue side, Steiner says that's why there was no surplus, because SS isn't really revenue.

Back to the parent analogy, when you give your kid a 20 dollar allowance from your wallet that has 50 dollars, you now have 20 dollars less, but the family still has 50 dollars.

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Craig Steiner is the the right wing nut that is the source of the nonsense. He uses public debt vs national debt, and intergovernmental transfers. Every president has used SS/fica surplus to add to the revenue side, Steiner says that's why there was no surplus, because SS isn't really revenue.

Back to the parent analogy, when you give your kid a 20 dollar allowance from your wallet that has 50 dollars, you now have 20 dollars less, but the family still has 50 dollars.

Public Debt is calculated by taking the previous year's public debt and adding the total unified budget deficit (or subtracting the surplus), and then adding any "other means of financing."

Intragovernmental Debt is calculated by taking any trust fund surpluses and adding it to the previous year's intragovernmental debt.

Total National Debt is calculated by adding the public debt to the intragovernmental debt. As a result, the national debt can increase even when the public debt decreases if the intragovernmental debt increases by a larger amount.

Why? When a trust fund (such as social security) takes in more money than it pays out in benefits, it takes the extra money and "invests" it in government bonds. Essentially social security says "We received $100 billion in social security contributions but only paid out $80 billion in benefits, so we take the extra $20 billion and buy U.S. government bonds." Social security doesn't keep the extra cash but rather loans it to the U.S. government and, in return, it gets a U.S. government bond. That means the U.S. government can immediately spend that $20 billion on normal government operations but owes that $20 billion to Social Security. Hence one part of the government (the U.S. Federal Government general fund) owes $20 billion to another part of the government (Social Security). That is intragovernmental debt.

Whenever a trust fund has a surplus intragovernmental debt will increase because the surplus money is automatically loaned to the federal government's general fund. That money is then used by the federal government for its normal operations. The fact that a trust fund has a surplus simply means the federal government doesn't need to borrow as much money directly from the public since it's receiving extra money from the trust funds. It's still borrowing money--just from a trust fund rather than the public.

If the combined surplus from general taxes plus the total surplus of trust funds actually results in a surplus, that means the government received more money than it needs that year. In that case it will pay down the public debt--even if intragovernmental debt has increased. That's what happened in 2000. The combined total of taxes and trust fund surpluses exceeded the amount of money the government needed that year, and some of the extra amount was used to pay down the public debt.

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Choose your own terms-Deficits,-debt,-and-unfunded-liability-

Social Security does not contribute to the deficit.
Social Security ran $37 billion cash flow negative last year.
Social Security has $2.6 trillion in fully callable assets in Trust.
Social Security has a projected $5.4 trillion unfunded liability over 75 years.

Lets throw in some more
Social Security ran a $72 billion surplus last year.
Social Security added $72 billion to Public Debt last year.

Couple more
Social Security goes bankrupt in 2037
Social Security will be able to pay a real benefit in 2038 25% better than the one it pays today.

Just to pile on
Public Debt is not the same as Debt Held by the Public
Unfunded liability is not Debt at all.

All ten statements are perfectly true. If carefully defined. But opponents of Social Security delight in blurring those definitions and sliding from one to another taking advantage of common misconceptions. For example a lot of people think that 'Public Debt' is a simple sum of annual 'Deficits'. It isn't. In fact in 2000 both Social Security and the General Fund ran surpluses, yet Public Debt still edged up.

The people around Peter G Peterson claim that Social Security is imposing some huge 'debt' obligation on our grandchildren, and so should be addressed through comprehensive 'deficit' legislation. But 'unfunded liability' is not debt at all, and though it can be slashed by legislation in the present, that will not in turn actually change 10 year or even 20 year deficit numbers.

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Probably since the nation produces about $140,000 per year per each family of four, (reduced from $160,000 per year with outsourcing) we could cut back a wee bit on the caviar and private jets and spend a little bit more on porridge.

Retired Monk - "Ideology is a disease".

polycarp2
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Quote douglaslee:

Craig Steiner is the the right wing nut that is the source of the nonsense. He uses public debt vs national debt, and intergovernmental transfers. Every president has used SS/fica surplus to add to the revenue side, Steiner says that's why there was no surplus, because SS isn't really revenue.

Back to the parent analogy, when you give your kid a 20 dollar allowance from your wallet that has 50 dollars, you now have 20 dollars less, but the family still has 50 dollars.

Like you are the first person to claim that. How orginal. Now did you go to the Tresury site like I told you.

No.. You just come up with a dumb analogy. Spoken like a guy who doesn't know how they calculate National Debt

How bout this for an analogy. Kid has a Piggy Bank that he been saving for years to buy his own bike. on day he opens his banks thinking to find $200, only he find IOU's to his dad. His dad spent the $200 on booze and cigerettes. Son goes to the Dad with the IOU's to cash them in. Dad says "sorry son, I don't have any money, let pay for your IOUs with this credit card"

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Fan.Cl
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Quote douglaslee:

Craig Steiner is the the right wing nut that is the source of the nonsense. He uses public debt vs national debt, and intergovernmental transfers. Every president has used SS/fica surplus to add to the revenue side, Steiner says that's why there was no surplus, because SS isn't really revenue.

Back to the parent analogy, when you give your kid a 20 dollar allowance from your wallet that has 50 dollars, you now have 20 dollars less, but the family still has 50 dollars.

Tell the class Douglaslee, How much is the Current federal debt?

Is it $14.3 trillion

or is it $9.7 trillion.

More importantly to the class, Did Clinton have a surplus?

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Fan.Cl
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One of the problems of solving problems is in defining the limit of how far the problem extends. If there are problems with Medicare, we must also consider the problem as it extends to its alternatives. When private sector insurance 1) skims 20 - 30% of premiums as 'overhead' and 2) has a greater rate of cost increase across time than Medicare, it seems clear that the private sector has lots of 'explaining away' to do if it is to be considered a legitimate alternative.

Since it appears that the health insurance industry fails the most cursory inspection as a legitimate alternative to single-payer, we are left with working to make Medicare better at its margins. The national costs of health care are primarily inflated through the private sector but those costs saddle the economy from outside the federal budget and therefore are not accounted for as a governmental burden. It is a major national economic burden nonetheless which does not occur in any other developed country. As a consequence, the U.S. is at a competitive disadvantage vis-a-vis all other developed countries.

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I am sensitive to the needs of the elderly and the sick and the young. I am a caregiver for a disabled person. I want to see America rebuild its transporation and communication infrastructure. But I am very, very tired of enabling American imperialism. if a default and loss of borrowing power and radical cuts in federal programs are what are required to dismantle America's economic and military eimpire, I am willing to consider it.

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Quote Thom Hartmann Administrator:

Medicare is not the problem. As much as Republicans want you to think Medicare is bankrupting America - it’s not. What’s really bankrupting America are tax cuts for millionaires and billionaires and two unpaid wars in the Middle East.

The wars are contributing to the deficit. They are unconstitutional,immoral and bad economics. The troops should be brought home immediately. However, tax cuts are not an expenditure. Failure to take people's money is not spending. And besides, if the government spends X, then X is exactly the level of taxation in the economy. The deficit has to be paid for by borrowing. The borrowing has to be paid for by future tax increases or by inflation. Inflation is also a tax. It hits the poor and middle class the hardest. It transfers wealth from them to the politically connected wealthy.

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Social Security tax is just another income tax. SS is not an insurance program. It is a welfare program. Any money put in now is spent.

Those IOU's in the "trust fund" have to be paid for by future taxes.

Let current workers out of the program and pay current recipients ,who have become dependent on SS , with the sales of government assets, i.e. land, mineral resources, unused military bases, buildings, etc.

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LysanderSpooner
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Quote LysanderSpooner:Social Security tax is just another income tax. SS is not an insurance program. It is a welfare program. Any money put in now is spent. Those IOU's in the "trust fund" have to be paid for by future taxes. Let current workers out of the program and pay current recipients ,who have become dependent on SS , with the sales of government assets, i.e. land, mineral resources, unused military bases, buildings, etc.
Ronald Reagan increased FICA taxes as a way of making the Baby Boomers pre-pay their benefits. Social Security incurred huge, annual surpluses thanks to the "Baby Boom Tax." Because Social Security had nothing better to do with its surpluses, it lent the money to Congress.

All Congress has to do is repay its loans from the Social Security Trust Fund. Because today's Congress doesn't want to own up to its debt, it finds other reasons to stiff the Baby Boomers.

Lesson Learned: Reagan kicked the problem down to future generations of politicians so he wouldn't take the blame. Today's Congress is doing exactly the same thing.

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Quetzalcoatl
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Jul. 11, 2011 1:09 pm

The solutions are pretty clear here - want to get America out of debt?

Seems Corburn has his big boy pants on.

Details of Sen. Tom Coburn's $9 trillion plan to balance the budget released

I sent a emial to all my congressmen in support of this plan

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About a third of SSI is spent on persons irresponsible enough to become disabled and orphans. The trust fund has around a $2.4 trillion surplus which is invested in U.S. Treasury bonds. That means you didn't have as much in the way of taxes because your government used that surplus along the way. So now that the nation (and you) benefitted for those funds, you want to fink out on redeeming the bonds and the interest accrued? Shame on those elderly folks who paid into the program and became 'dependent' on Social Security!

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ckrob
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Quote ckrob:

About a third of SSI is spent on persons irresponsible enough to become disabled and orphans. The trust fund has around a $2.4 trillion surplus which is invested in U.S. Treasury bonds. That means you didn't have as much in the way of taxes because your government used that surplus along the way. So now that the nation (and you) benefitted for those funds, you want to fink out on redeeming the bonds and the interest accrued? Shame on those elderly folks who paid into the program and became 'dependent' on Social Security!

Who is advocating defaulting on SSI treasuries? Which BTW is WAY more than $2.4T. Closer to $4T

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Fan.Cl
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The debt isnt a problem anyway. Debt is only a problem if and only if the payments are problematic. At 3% of GDP, even with our 60 year low tax rates, the payments are not a problem, and our interest rates being low reflects that everyone in the world knows that.

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Dr Mario Kart
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Quote Dr Mario Kart:

The debt isnt a problem anyway. Debt is only a problem if and only if the payments are problematic. At 3% of GDP, even with our 60 year low tax rates, the payments are not a problem, and our interest rates being low reflects that everyone in the world knows that.

You can only make payments when you can afford to do so. They may be low, but if you have to borrow to pay them, That is a systematic problem.

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Fan.Cl
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Clinton... Surpluses... FACT - cap on you sucka right winger.

George Bush jr, when he was campaigning in 2000, claimed that Bill Clinton was paying down the debt too fast!!!

Economists had to come out and challenge what Bush was saying, because the Clinton surpluses were not so large as to trigger advance payment penalties on the national debt!!!

Barack Obama you sucker look who you are talking to pretending like they are going to be sensible people!!!!!!!

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The current buzz sweeping the Senate is a group of 6 Republicans and Democrats called, "The Gang of Six" is putting together a plan of deep cuts to medicade/ medicare/ and social security without concommitant TAX INCREASES on the wealthy elites. Sander's notes the same:

http://sanders.senate.gov/

So my question to our host is: after Obama caves again and gives the Tea Party nut jobs what they want (like he has done on every Bill) how will Thom spin the latest capitulation to make the Dems look like the hero in all this?

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ekobe
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Quote MCForever:

Clinton... Surpluses... FACT - cap on you sucka right winger.

You don't see too many people use GWB as a source. Seemingly now he trustworthy.

There was no surplus. In 2000 the US gained $18B in Federal debt. Granted, hat is close, but it is NO surplus.

The reason they call it a surplus, Government counts SSI as a revenue source, yet fail to mention that revenue comes in the form of treasuries. (DEBT)

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Fan.Cl
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