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US Government Will Never Fix It's Financial Problems


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#1 Shippou   Members   -  Reputation: 1556

Posted 25 November 2012 - 02:53 PM

( Source: - official government spending statistics )

It's almost 2013, and many politicians are talking about fixing the budget.
The problem is, the Huge gap between income, and expenses can not be closed.
----
2011 tax revenue was $2.3 Trillion.
2011 spending was $3.84 Trillion
2011 new debt was $1.55 Trillion
----
$360 Billion payed on interest on debt
$820 Billion payed to social security
$806 Billion to medial welfare
$654 Billion to other welfare programs
$707 Billion to military spending
----
How do we fix this issue realistically ?
In a real world, ether ALL taxes would have to be raised 41%, or ALL spending has to be decreased by 41%.

Cutting out a couple million here and there, or reducing certain budgets 2% or 3% will never work.

Have any better ideas than I do ?

Edited by Shippou, 25 November 2012 - 02:56 PM.

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#2 slicer4ever   Crossbones+   -  Reputation: 3906

Posted 25 November 2012 - 04:01 PM

step 1: don't pay federal works twice as much for the same job as private sector.
step 2: don't allow congress to vote themselves a pay raise.
step 3: cut the presedients salary in 1/3, or even 1/5(i don't care who's president nearly half a million a year is ridiculous).
step 4: $$$

Edited by slicer4ever, 25 November 2012 - 04:03 PM.

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#3 JTippetts   Moderators   -  Reputation: 8517

Posted 25 November 2012 - 04:25 PM

The real problem as I see it is lack of growth. The exploitation of fossil fuels as an extremely easy and extremely cheap source of abundant energy fueled the industrial revolution and gave rise to a long period of uninterrupted growth for the US economy. That growth has slowed and, in some sectors, halted or reversed. Yet the size of the government and the size of the population has only continued to increase. In a growing economy, you don't have to raise taxes to get more revenue; you just have to encourage growth, and more revenue will continue to flow.

Under the groaning weight of regulation (largely environmental), however, industrial and manufacturing jobs and trades have been shipped overseas. The US economy is no longer growing, so the only recourse they have is to cut spending or raise taxes. Cutting spending won't happen, as long as the lobbies continue to have such overwhelming power in DC. Raising taxes might happen but won't work; there is only so much blood you can squeeze from a body before the body is dead.

The government needs real stimulus, and not just corrupt billion-dollar handouts to the elite, but real economic stimulus that promotes true growth. Relaxing of regulations, elimination of bureaucracies that strangle enterprise and discourage business, and for Pete's sake stop talking about taking away from the haves and giving to the have-nots who haven't earned. That doesn't promote or encourage business; that actively discourages it. That kind of attitude among the ruling elite creates an environment so hostile toward free enterprise that it's amazing it has been allowed to continue for so long.

#4 Servant of the Lord   Crossbones+   -  Reputation: 19681

Posted 25 November 2012 - 06:31 PM

How about letting economists figure out how to balance the economy instead of politicians?
Economists should also be in charge of setting proper tax rates.

How about letting lawyers write new laws, instead of politicians? (Though many politicians are ex-lawyers)

Note: I'm not saying any lawyer or any economist, but a government group of about ~20 economists should set taxes. Likewise, a government group of about ~20 legal experts should write the details of any new laws that Congress wants to implement (so no riders get in).

Congress should say what results the federal government wants, but economists or lawyers or experts in whatever field should be the ones deciding how to best achieve those results.

As it is, you just get politicians promising supporters what they want (in their short-term interest) at the expense of long-term health of the government. Another problem is with every change in president, our long-term plans get tossed out the window and new "long-term" plans get put in place (which will get tossed out the window with the next president). How can we achieve real results (for example), if our entire government is split entirely down the middle in opinions and (both parties) are unwilling to really negotiate?

These are two of the great flaws in democracy:
A) If the people vote directly, they vote in their own short-term interest instead of the best interest of the country. Most people don't even vote for their own long-term interests, if they can have a 1/4th of it right now with immediate gratification. Posted Image
B) If we rotate our leaders (like we currently do), we succeed in keeping our leaders from significantly abusing their power, at the expense of limiting any real good they can do. We need a leader with absolute legal authority, but with the actual good of the people in mind instead of quid pro quo.

Another thing that bothers me is how people working for large corporations then get high-position jobs in regulatory agencies that regulate the industries they were employed by, and vise-versa - but I digress.
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#5 frob   Moderators   -  Reputation: 21488

Posted 25 November 2012 - 07:36 PM

Remove gerrymandering.

This will help the party politics. We can get people who focus on the country first rather than their party first.

People willing to put the country first will have economists help guide policy, instead of party politics deciding policy.
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#6 Hodgman   Moderators   -  Reputation: 30433

Posted 25 November 2012 - 08:21 PM

$707 Billion to military spending

That's just DOD spending. Total military spending (inc counter terrorism, homeland defense, the portion of NASA's budget used for military equipment, veterans programs, etc) is more like $1.4 trillion.
Surely starting a few less wars would be a good start?

How about letting economists figure out how to balance the economy instead of politicians?

You can thank Nixon/Thatcher for popularizing the idea that government is a problem of management, so the solution is to fill it with general managers. It hasn't always been this bad.
Reminds me of Neil deGrasse Tyson - "There’s no scientists? Where are the engineers? Where’s the rest of life represented here?".

...don't pay federal works twice as much for the same job as private sector
...The real problem is lack of growth
...Under the groaning weight of regulation (largely environmental)

As a non-american, these phrases all sound so stereotypically american. There always seems to be a concern that the free market economy isn't working quite right, and the solution is to always take one more step further down the same path with greater zeal this time.

#7 kburkhart84   Members   -  Reputation: 1662

Posted 25 November 2012 - 08:57 PM

What I wonder is for how long the world will accept US Dollars for payment for things. In the US(I live here BTW), we can print US Dollars, and so when we need money, we print it, which of course devalues it. And since it no longer has to have gold(or anything else) backing it is is in reality worth less than the paper and ink that was used to print it. At some point, the countries that supply the US will not want dollars anymore, and will instead request "real" payment, in physical goods, or other backup currencies.

At that point, the US is in more trouble. We complain about prices now....wait until our small amounts of consumer goods gets exported in exchange for gasoline(and other things). Things like meat will have skyrocketing prices since there will be less supply due to it being exported. The biggest problem we have related to this is that in general we use much more than we produce, and so it doesn't balance.

The biggest fools are the general populace. They want better education, new roads, welfare, free health care, etc... but all of that costs the government money. And then anytime a tax hike is mentioned, they go nuts. They want the benefits but don't want to earn them.

Don't take that last paragraph as a remark for anybody specific. I live in Texas, USA, and frankly, that is how I see the population here.



#8 morfiction   Members   -  Reputation: 118

Posted 25 November 2012 - 09:47 PM

I think the problem here is the calling the funding of a war "Defense"... It was purely nepotism on the part of the former president... who was the son of a president who had a beef with Saddam Hussien. If he just went after examining Bin Laden's whereabouts instead of declaring war on Iraq, we wouldn't be in those trillions of debt.

Dubya was paid off by rich arabian sultans or whatever the hell in oil money....

#9 way2lazy2care   Members   -  Reputation: 782

Posted 25 November 2012 - 09:53 PM

I like Warren Buffet's take:

I could end the deficit in five minutes. You just pass a law that says that anytime there is a deficit of more than 3% of GDP all sitting members of Congress are ineligible for reelection ... [T]hey're trying to use the incentive now that we're going to blow your brains out, America, in terms of your debt-worthiness over time ... A more effective threat would be just to say, 'If you guys can't get it done, we'll get some other guys to get it done.'


By and large US politicians have no stake in the future of the country, so they're free to promise non-sustainable programs for short term political gain. I would like all politicians to be forced to use the public school system and have the majority of their pay be through pensions tied to the success of the country somehow.

To say that there is any single problem to point to would be naive. Income inequality is an issue, but taxing that inequality more won't solve anything. Increasing size of government is an issue, but historically shrinking the size of government has been wildly unpopular when any actual legislation comes up. Government pensions are a huge issue, but even those won't cover enough (to my knowledge they are based off your last year's pay rather than any sort of sustainable pension system). Defense spending is more than it should be, but even it pales in comparison to our mandatory spending. Etc. etc.

I'm very seriously worried about any meaningful budget planning that can happen before the end of the year.

#10 way2lazy2care   Members   -  Reputation: 782

Posted 25 November 2012 - 09:55 PM

What I wonder is for how long the world will accept US Dollars for payment for things. In the US(I live here BTW), we can print US Dollars, and so when we need money, we print it, which of course devalues it. And since it no longer has to have gold(or anything else) backing it is is in reality worth less than the paper and ink that was used to print it. At some point, the countries that supply the US will not want dollars anymore, and will instead request "real" payment, in physical goods, or other backup currencies.

This would have a much bigger impact than people realize. The USD is the base trading currency for most of the things in the world. The effects of an unstable dollar would be huge on a global scale.

#11 Cornstalks   Crossbones+   -  Reputation: 6995

Posted 25 November 2012 - 09:57 PM

How do we fix this issue realistically?

Realistically? We don't. Not until there's a hardcore collapse and we're forced to start from scratch. At least that's how I think it will realistically be fixed.
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#12 Shippou   Members   -  Reputation: 1556

Posted 25 November 2012 - 11:09 PM

$707 Billion is the military end of things ... Homeland Security, NASA, counter intelligence, e.t.c. is $393 Billion

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#13 Prinz Eugn   Crossbones+   -  Reputation: 3629

Posted 26 November 2012 - 12:44 AM

The basic problem is people want more services but less taxation from the government, and since that's for the most part impossible to maintain, governments tend to go into debt.

People need to expect less and pay more.. but since that's essentially impossible to say and also get elected, it's going to take a disaster of some kind to get it more or less straightened out. At least for a few years.

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#14 Luckless   Crossbones+   -  Reputation: 1807

Posted 26 November 2012 - 07:07 AM

They could always move to a practical form of communism, where the focus is on efficient use of resources and labour to meet the requirements and desires of an entire population in a fair and well organized fashion, and having the side benefit of 99.9% employment and probably around a 20 hour work week in most fields, which would leave far more time for the population to engage in art, sciences, and general education or travel. A problem of debt only ever exists when two parties assume one exists. If one party finds a way where they no longer have to be bound by it, well, then it magically goes away.


(Seriously. Modern capitalism is a lie we all tell ourselves make sense because it means there is some slim chance we can take advantage of those around us and make them do more work than we have to. Once you get over that Me Me Me ME! race to the bottom we're currently in, and realize that dollars are meaningless, and what matters are resources and people with skills to use them, then capitalism and free markets start to look like very stupid ideas.)
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#15 Hodgman   Moderators   -  Reputation: 30433

Posted 26 November 2012 - 07:18 AM

They could always move to a practical form of c

I thought that using the C-word in a non-derogatory manner was punishable by death?

#16 way2lazy2care   Members   -  Reputation: 782

Posted 26 November 2012 - 07:59 AM

$707 Billion is the military end of things ... Homeland Security, NASA, counter intelligence, e.t.c. is $393 Billion

That's just DOD spending. Total military spending (inc counter terrorism, homeland defense, the portion of NASA's budget used for military equipment, veterans programs, etc) is more like $1.4 trillion.
Surely starting a few less wars would be a good start?

The wars only account for ~1/4 of our defense spending. People generally see the defense budget and think all that money is spent on war, but the reality is that we only spend a fraction of that on any sort of combat; most of it, to my knowledge, is spent on maintaining what we have and RnD. Reasonable estimates on what is cuttable from defense is around 15-30% of it's current budget, which would only be a small fraction of what is necessary to get the country on a profitable course.

Not having had the wars in the first place would have cut down on current interest, but, having already had them, cutting defense spending won't do enough.

#17 mdwh   Members   -  Reputation: 876

Posted 26 November 2012 - 08:34 AM

How about letting economists figure out how to balance the economy instead of politicians?
Economists should also be in charge of setting proper tax rates.

How about letting lawyers write new laws, instead of politicians? (Though many politicians are ex-lawyers)

Note: I'm not saying any lawyer or any economist, but a government group of about ~20 economists should set taxes. Likewise, a government group of about ~20 legal experts should write the details of any new laws that Congress wants to implement (so no riders get in).

Note that we'd still need to decide how those people are chosen. But yes, it sounds similar to how the UK interest rate is set by the Bank of England rather than politicians.

Do politicians actually write the wording of the laws directly? I'm not sure how it works in the UK, but my impression was that it was written by the relevant Government departments, which didn't necessarily mean it was penned directly by the politicians themselves (though MPs would ask for the law to be drawn up, then debate on the wording, and vote on the proposed law). I also don't see how this would prevent riders, politicians could still take the laws written by these people, and bundle them into a single bill (which happens in the UK).

What I wonder is for how long the world will accept US Dollars for payment for things. In the US(I live here BTW), we can print US Dollars, and so when we need money, we print it, which of course devalues it. And since it no longer has to have gold(or anything else) backing it is is in reality worth less than the paper and ink that was used to print it. At some point, the countries that supply the US will not want dollars anymore, and will instead request "real" payment, in physical goods, or other backup currencies.

Though isn't fiat money normal for many if not most countries?

They could always move to a practical form of communism, where the focus is on efficient use of resources and labour to meet the requirements and desires of an entire population in a fair and well organized fashion, and having the side benefit of 99.9% employment and probably around a 20 hour work week in most fields, which would leave far more time for the population to engage in art, sciences, and general education or travel. A problem of debt only ever exists when two parties assume one exists. If one party finds a way where they no longer have to be bound by it, well, then it magically goes away.

I don't see how you can magically handwave away the issues. If the amount of things that people want from the Government is more than the amount the Government receives, then that kind of problem is still faced in communism, just that you now have the state providing all the services, and everyone working for the state. So rather than questions like how much should people be taxed, and what should the Government spend money on, you now have the question of what work should people be doing.

(Seriously. Modern capitalism is a lie we all tell ourselves make sense because it means there is some slim chance we can take advantage of those around us and make them do more work than we have to. Once you get over that Me Me Me ME! race to the bottom we're currently in, and realize that dollars are meaningless, and what matters are resources and people with skills to use them, then capitalism and free markets start to look like very stupid ideas.)

I don't think that's true at all. I can understand that what matters are resources, but that doesn't make capitalism stupid - it's still a valid answer to the economic questions of what to produce, who to product it for, and how to produce it.

The wars only account for ~1/4 of our defense spending. People generally see the defense budget and think all that money is spent on war, but the reality is that we only spend a fraction of that on any sort of combat; most of it, to my knowledge, is spent on maintaining what we have and RnD. Reasonable estimates on what is cuttable from defense is around 15-30% of it's current budget, which would only be a small fraction of what is necessary to get the country on a profitable course.

Not having had the wars in the first place would have cut down on current interest, but, having already had them, cutting defense spending won't do enough.

If you're not having as many wars, surely there's less requirement to be maintaining so much, and spending so much on RnD. Yes I know politically that might be unpopular - though other countries have far less military spending, so it's not like this is impossible.
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#18 JTippetts   Moderators   -  Reputation: 8517

Posted 26 November 2012 - 09:03 AM

They could always move to a practical form of communism, where the focus is on efficient use of resources and labour to meet the requirements and desires of an entire population in a fair and well organized fashion, and having the side benefit of 99.9% employment and probably around a 20 hour work week in most fields, which would leave far more time for the population to engage in art, sciences, and general education or travel. A problem of debt only ever exists when two parties assume one exists. If one party finds a way where they no longer have to be bound by it, well, then it magically goes away.


And while we're at it, we'll sprinkle pixie dust on everyone so we can fart magical rainbows and fly through skies filled with unicorns and elves. Seriously, this is one of the most naive paragraphs I've read in a long time. It's just as easy to say, why not move to a practical form of capitalism, where everyone works to their full potential and is paid a fair wage that is proportionate to the effort they expend and the work they accomplish.

(Seriously. Modern capitalism is a lie we all tell ourselves make sense because it means there is some slim chance we can take advantage of those around us and make them do more work than we have to. Once you get over that Me Me Me ME! race to the bottom we're currently in, and realize that dollars are meaningless, and what matters are resources and people with skills to use them, then capitalism and free markets start to look like very stupid ideas.)


Look, the problem isn't just capitalism. Modern history has demonstrated very well that communism doesn't work either. The problem is people. If people are perfect, then sure... communism is the way to go. If everyone contributes their fair share, and everyone exhibits perfect compassion, then yes, all problems will magically go away. Let me know when that momentous evolutionary shift happens.

Given the imperfection of people, their tendency towards laziness and cruelty, do you honestly believe that a system that coldly enforces a false compassion through the application of state force upon a populace that would rather sit and receive handouts is in any way superior to capitalism's (admittedly cold) system of disproportionately rewards industrious effort? Both systems are fairly monstrous, but the communism path, as has been well demonstrated by history, seems to lead mostly to widespread poverty and suffering.

If there is a ME ME ME race going on, do you think that enforcing a system of taking from someone to give to someone else is really going to end that? Seriously?

#19 Khaiy   Crossbones+   -  Reputation: 1342

Posted 26 November 2012 - 10:38 AM

There are a lot of relatively small problems, which combined sum up to a pretty large problem. When talking about solutions people (in my observation) tend to want specifics, which tends to bring up those smaller problems. Then people react by saying that fixing that small problem won't be enough to address the larger problem, which is as true as it is irrelevant.

Using examples that only focus on taxes or only focus on defense spending makes the problem seem more intractable than it really is, though it is a serious and difficult issue. The biggest obstacle, to my mind, is that it will be hard to build and harder to sustain a coalition of voters who will press for necessary action long enough to make a difference. As other people have already said, the American system of representation isn't good at looking forward or sticking with commitments.

#20 Servant of the Lord   Crossbones+   -  Reputation: 19681

Posted 26 November 2012 - 01:03 PM

The problem is people. If people are perfect, then sure... communism is the way to go. If everyone contributes their fair share, and everyone exhibits perfect compassion, then yes, all problems will magically go away. Let me know when that momentous evolutionary shift happens.

Exactly - as politically incorrect as it is, history shows that people are generally evil* (and grow more and more evil as time), despite us assuming (and wanting to believe) that man is generally good.

*By "evil" I mean will, out of greed and pride, willingly do great harm to others for minor gain for themselves, whether they actually need that gain or not. It's not just 'survival', it's selfish dragon-hoarding. While living in comfort, this is hidden under the surface of man and is demonstrated by manipulation and backstabbing, but when disaster comes, the illusion is broken, and mankind acts as the worst beasts imaginable.

Given the imperfection of people, their tendency towards laziness and cruelty, do you honestly believe that a system that coldly enforces a false compassion through the application of state force upon a populace that would rather sit and receive handouts is in any way superior to capitalism's (admittedly cold) system of disproportionately rewards industrious effort? Both systems are fairly monstrous, but the communism path, as has been well demonstrated by history, seems to lead mostly to widespread poverty and suffering.

The only real system that could possibly work is (as many open source projects joke) a 'benevolent self-appointed dictator for life'. Which is exactly what Christians look for in Jesus' return*.

*Note I'm not saying this is why we believe, I'm saying that once already believing, this is one of the things we look forward to. A king that has proven to us that he has our best interests in mind, and who has the absolute legal authority to do whatever is required to bring stability - economic-ly, religiously, politically, militarily, etc... The bible doesn't actually say we'll going to float around on clouds with harps. Posted Image Nor does it say we'll all get magically poofed away to heaven unexpectedly leaving only non-christians behind - despite the common non-biblical view held even by most christians. But I digress greatly - If interested in my opinion about what the bible actually says (and not just a debate about whether God exists or not), start a new thread and shoot me a PM linking to it, or PM me directly.

If there is a ME ME ME race going on, do you think that enforcing a system of taking from someone to give to someone else is really going to end that? Seriously?

Agreed. Almost every law is either written by people abusing power, or written to keep people from abusing power. The stock market is a great example of this: It's a race to see who can 'play' the stocks enough to get rich quick at the expense of everyone else playing the stock market. Admittingly without having much experience in it, it seems to me that most the stock-market laws are designed to keep people from 'cheating' at a system that is built entirely around stealing from each other. The only honest way (again, so it seems to me, but I might be mistaken) to 'play' the stock market is to buy stocks you are intending to hold long-term. And hey, look what playing correctly does. But everyone wants instant gratification, without real labor, despite it being at someone else' expense. Pardon the italics overload. Posted Image
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