Kudos to Boehner, Reid, and McConnell

[normiss 620]

Or maybe because the way this is supposed to work is being blocked by Mr. Reid.

We are ALL foolish to think this is in any way one sided.

[beowulf 1]

billvon

>That "worse outcome" wasn't exactly avoided they just pushed it off into the future

Agreed. They avoided the more imminent problem and once again pushed it down the road.

(Overall it's sad that that is even worthy of note, but at least they avoided the imminent disaster.)

And by increasing the debt limit it increases the size of the disaster that they don't want to deal with today.

[billvon 2,384]

>We are ALL foolish to think this is in any way one sided.

It has been up until now. Finally people from both sides were willing to compromise and the bill was passed.

What happens now, when some cooperation is needed to reduce spending, is anyone's guess. I don't have a lot of hope. Before the president even signed the bill Boehner was trying to sneak pork into it.

[beowulf 1]

When someone tells me they have to borrow money so they can pay the bills, I would be very worried about them and would never lend them money.

When the Government says that, you know disaster is just waiting in the future. Eventually the bond market is going to force the issue. Either they deal with it now and try to mitigate the pain or deal with it later when they won't have any choices.

[kelpdiver 2]

beowulf

When someone tells me they have to borrow money so they can pay the bills, I would be very worried about them and would never lend them money.

the level of borrowing in the later 90s was fine and sustainable. Measuring debt as a percentage of GDP is a sane approach and if we can keep it level or declining, we're doing better. And by this measure, we're doing a hell of a lot better than most first world nations. But we looked much much better in 2000 than we do now.

[billvon 2,384]

>When someone tells me they have to borrow money so they can pay the
>bills, I would be very worried about them and would never lend them money.

You don't lend money to people with mortgages?

>Either they deal with it now and try to mitigate the pain or deal with it later when
>they won't have any choices.

For a long time now the government has been in a Keynesian race that has two parts to its cycle:

1) Hard times, government spends a lot on stimulus, cuts taxes, revenues go down, debt soars

2) Good times, government spends a little less, raises taxes, revenues go way up, debt is repaid

Over the last few decades politicians have thought "why deal with the pain of higher taxes and less spending, when we can just wait for the next cycle? I won't even be in office!" They have not wanted to spend less or raise taxes, thus ensuring their election in 2 years even if there's no plan beyond 5 years. And people let them get away with it.

A side effect of this is that people now expect the government to "fix" the economy with economic stimulus. One need look no further than today's news. What do people complain about? Obamacare will "cost jobs." The debt will result in "less hiring." Implicit in all that is that the government is not doing its job, which is apparently to manipulate the economy to provide lots of jobs.

So now politicians who say "we have to raise taxes" or "we have to cut social security" are unelectable, because even in good times no one likes those things.

[kallend 1,621]

normiss

Or maybe because the way this is supposed to work is being blocked by Mr. Reid.

We are ALL foolish to think this is in any way one sided.

I fail to see how Boehner deserves anything but blame. He could have called for a clean vote a week or more ago, but pandered to the wingnuts in his party instead.

...

The only sure way to survive a canopy collision is not to have one.

[beowulf 1]

billvon

>When someone tells me they have to borrow money so they can pay the
>bills, I would be very worried about them and would never lend them money.

You don't lend money to people with mortgages?

>Either they deal with it now and try to mitigate the pain or deal with it later when
>they won't have any choices.

For a long time now the government has been in a Keynesian race that has two parts to its cycle:

1) Hard times, government spends a lot on stimulus, cuts taxes, revenues go down, debt soars

2) Good times, government spends a little less, raises taxes, revenues go way up, debt is repaid

Over the last few decades politicians have thought "why deal with the pain of higher taxes and less spending, when we can just wait for the next cycle? I won't even be in office!" They have not wanted to spend less or raise taxes, thus ensuring their election in 2 years even if there's no plan beyond 5 years. And people let them get away with it.

A side effect of this is that people now expect the government to "fix" the economy with economic stimulus. One need look no further than today's news. What do people complain about? Obamacare will "cost jobs." The debt will result in "less hiring." Implicit in all that is that the government is not doing its job, which is apparently to manipulate the economy to provide lots of jobs.

So now politicians who say "we have to raise taxes" or "we have to cut social security" are unelectable, because even in good times no one likes those things.

I guess it was too complicated for you to understand that I meant someone who had a similar debt to income ratio as the US Government and not just anyone with a mortgage.

I am familiar with the Keynesian theory. As far as I know there is no evidence to support that "theory". I am not using the scientific definition of theory.

[masterrig 1]

seedy

********* . . . for being willing to negotiate to re-open the government. Let's hope they keep their willingness to negotiate between now and January 15th,

I hope they stick to their guns and do the job that we elected them to do.

They stuck to their guns all-right! Boehner tacked-on a rider for a dam project in his home state of Ohio that was approved in 1988 for millions of dollars and nothing was done. Now, that same project will cost billions.
All those politicians did was work-out a way to win mid-term elections.


Chuck

How did Boehner tack it on? The article I read said it came from the Senate that way and Feinstein claimed responsibility for it.

I have been mis-informed and should've checked more before posting what I did.


Chuck

[billvon 2,384]

>I guess it was too complicated for you to understand that I meant someone who had a
>similar debt to income ratio as the US Government

Total US revenue 2012: $2.4 trillion
Total debt 2012: $16 trillion

Average CA income: $59,000
Average CA home cost: $410,000

Mortgage that would be equivalent if they had a ratio similar to the US :$393,000

So someone who has an average job in California, and buys an average home with a 5/5/90 loan, has a similar debt ratio as the US government does. Are these the people you would refuse to loan money to?

Let me know if that was too complicated for you.

>I am familiar with the Keynesian theory. As far as I know there is no evidence
>to support that "theory"

In any case we are operating as if it does work - and people have bought into it. Thus as a politician you're not going to be able to get away with "hey, I just want a smaller government. Get your own damn job; I really don't care if the economy allows it or not. Not my issue."

[beowulf 1]

billvon

>I guess it was too complicated for you to understand that I meant someone who had a
>similar debt to income ratio as the US Government

Total US revenue 2012: $2.4 trillion
Total debt 2012: $16 trillion

Average CA income: $59,000
Average CA home cost: $410,000

Mortgage that would be equivalent if they had a ratio similar to the US :$393,000

So someone who has an average job in California, and buys an average home with a 5/5/90 loan, has a similar debt ratio as the US government does. Are these the people you would refuse to loan money to?

Let me know if that was too complicated for you.

>I am familiar with the Keynesian theory. As far as I know there is no evidence
>to support that "theory"

In any case we are operating as if it does work - and people have bought into it. Thus as a politician you're not going to be able to get away with "hey, I just want a smaller government. Get your own damn job; I really don't care if the economy allows it or not. Not my issue."

Wow you failed to put in how much the government is spending per year next to the total revenue. This year I think they are spending close to $800 billion more then revenue. So the adjusted US revenue is more like a negative $800 Billion and asking for more loans. Apparently it was too complicated for you.

[beowulf 1]

Quote

Average CA income: $59,000
Average CA home cost: $410,000

Only a moron would lend someone with that income $410,000 for a house.

The monthly mortgage payment would be $2,669.72

Their net pay would be about $1,567.75 every two weeks. They would barely have enough left over to eat.

[masterrig 1]

billvon

>We are ALL foolish to think this is in any way one sided.

It has been up until now. Finally people from both sides were willing to compromise and the bill was passed.

What happens now, when some cooperation is needed to reduce spending, is anyone's guess. I don't have a lot of hope. Before the president even signed the bill Boehner was trying to sneak pork into it.

From all I've read on the topic, there was a lot of pork from both sides! Obama care was passed without a single change. Both sides, being the opportunists that they are knew that Obama would sign it without question. Sen. McCain said that there was a lot of pork added to that bill and that it was disgraceful.



Chuck

[LyraM45 0]

DaVinci

Quote

quit supporting the dickheads that fucked over the economy between 2001-2009, and then procedded to do everything they could to prevent it's recovery from January 2009 right up to today.

You have the dates of the community reinvestment act off.

***The budget battle that recently concluded temporarily was caused by teabaggers who decided to try to nullify a law that was duly passed by Congress and found to be Constitutional by a severely right leaning Supreme Court.

And yet Obama does the same thing when it comes to gun rights. 222 years is longer than 2 BTW.

Quote

This was a totally one-sided attack on a settled law, without any precedent in US History.

You need history lessons. Again, just look at Obama's attack on the 2nd Amendment.

Quote

Trying to force negotiations over the funding of an already passed law is wrong

I assume you have told Obama to leave the 2nd Amendment alone then?

Quote

You participate in those programs while, in theory, being totally against Socialism. Repeat, you partake in the benefits of the most socialistic programs administered by the US Government, while writing that you are totally against socialism in all its manifestations.

If you make me "invest" 15% of my salary for most of my life.... Yeah, I will try and collect as much "return" as was stolen from me.

I'll make you a deal, you make it so I do not have to give my money away, and I will never draw from the pool. Deal? Or do you need people like me to support people like you?

Quote

The defining characteristics of an RWC is someone who can't discern fact from fiction, and believes things that are patently ridiculous, like the former Professor of Constitutional Law is a rabid Socialist.

The defining characteristics of an LWL is someone who can't discern fact from fiction, and believes things that are patently ridiculous, like the former head of several large corporations does not know how to run a budget. Or how a guy that had a Masters from Harvard is somehow "stupid".

You're making this apples to apples like Obama tried to shut down the government to get his way on gun laws. He did not do that. Not so.

Apologies for the spelling (and grammar).... I got a B.S, not a B.A. :)

[kelpdiver 2]

billvon

Average CA income: $59,000
Average CA home cost: $410,000

two problems:

1) you want average income for CA homeowners. The renters collectively lower it down.
2) you really want average income for current CA homebuyers. In the bay area, the average income isn't remotely enough to buy housing in most areas. Yet many do have homes, because they bought them in the past. Their incomes went up much more slowly than home prices - now they'd have difficulty doing it.

[kallend 1,621]

billvon

>I am familiar with the Keynesian theory. As far as I know there is no evidence
>to support that "theory"

In any case we are operating as if it does work...

No we aren't. We ignore the part that says you run a surplus when times are good. Instead we keep on deficit spending and reduce taxes.

...

The only sure way to survive a canopy collision is not to have one.

[normiss 620]

Pork?
WTF was the $2 billion deal tucked into it in your mind?

[billvon 2,384]

>Wow you failed to put in how much the government is spending per year next to the total revenue.

And you failed to mention how much the guy you would loan money to is spending.

But we can make some basic assumptions below.

>This year I think they are spending close to $800 billion more then revenue

OK let's run those numbers again.

US income: $2400 billion
US expenditure: $3200 billion
Percentage of overspending: 33%

Comparing that to our above guy:

Guy's income: $59,000
Guy's expenditure on that house the year he buys it: $410,000
Percentage of overspending: 690% (ignoring all his other expenses)

In this case looks like that homeowner who wants a loan is a lot more _irresponsible_ than the government.

(In both cases, of course, the issue is not how much debt they have or how much they are overspending - it is their ability to pay it back that counts.)

[billvon 2,384]

>you really want average income for current CA homebuyers. In the bay area, the
>average income isn't remotely enough to buy housing in most areas. Yet many do have
>homes, because they bought them in the past. Their incomes went up much more
>slowly than home prices - now they'd have difficulty doing it.

I would also add that many people with such incomes DID buy homes with a valuation similar to that and DID have a lot of trouble paying back the loan (especially those with ARMs.) Thus all the problems with the real estate bubble.

[DaVinci 0]

LyraM45

***

Quote

quit supporting the dickheads that fucked over the economy between 2001-2009, and then procedded to do everything they could to prevent it's recovery from January 2009 right up to today.

You have the dates of the community reinvestment act off.

***The budget battle that recently concluded temporarily was caused by teabaggers who decided to try to nullify a law that was duly passed by Congress and found to be Constitutional by a severely right leaning Supreme Court.

And yet Obama does the same thing when it comes to gun rights. 222 years is longer than 2 BTW.

Quote

This was a totally one-sided attack on a settled law, without any precedent in US History.

You need history lessons. Again, just look at Obama's attack on the 2nd Amendment.

Quote

Trying to force negotiations over the funding of an already passed law is wrong

I assume you have told Obama to leave the 2nd Amendment alone then?

Quote

You participate in those programs while, in theory, being totally against Socialism. Repeat, you partake in the benefits of the most socialistic programs administered by the US Government, while writing that you are totally against socialism in all its manifestations.

If you make me "invest" 15% of my salary for most of my life.... Yeah, I will try and collect as much "return" as was stolen from me.

I'll make you a deal, you make it so I do not have to give my money away, and I will never draw from the pool. Deal? Or do you need people like me to support people like you?

Quote

The defining characteristics of an RWC is someone who can't discern fact from fiction, and believes things that are patently ridiculous, like the former Professor of Constitutional Law is a rabid Socialist.

The defining characteristics of an LWL is someone who can't discern fact from fiction, and believes things that are patently ridiculous, like the former head of several large corporations does not know how to run a budget. Or how a guy that had a Masters from Harvard is somehow "stupid".

You're making this apples to apples like Obama tried to shut down the government to get his way on gun laws. He did not do that. Not so.

No, but he did claim the ACA is "settled law" and we should just accept it. Yet he does not follow that same advice on the 2nd.

[kelpdiver 2]

billvon

OK let's run those numbers again.

US income: $2400 billion
US expenditure: $3200 billion
Percentage of overspending: 33%

Comparing that to our above guy:

Guy's income: $59,000
Guy's expenditure on that house the year he buys it: $410,000
Percentage of overspending: 690% (ignoring all his other expenses)

In this case looks like that homeowner who wants a loan is a lot more _irresponsible_ than the government.

This would be more accounting I don't believe to be valid.

That homeowner didn't overspend by 690% - he bought an asset and financed it over 15-30 (or 40...gulp) years. If the mortgage was properly underwritten, he won't be spending more than 28-30some percent of his income supporting this debt. That sounds much more responsible than overspending by 33% for essentially no new assets, just maintaining the status quo.

Now you already pointed out some warning flags. Someone who puts 0-5% down and gets a 3 year ARM to allow him to afford it today - is going to be toast because the rates of the past couple years never occurred before. If you didn't get a fixed rate under 4, it should be because you know you will move by the end of the fixed period, before the resets ramp up your costs.

And of course, if you lied (liar loans) about your income to get a 400k mortgage with a 59k salary, then that's reckless speculation, the kind that blew up badly for the waiters who had multiple houses they hoped to flip. Vallejo seemed to be a perfect firestorm for this sort of thing, and the collapse ended up taking the city down with it.

[kelpdiver 2]

DaVinci

No, but he did claim the ACA is "settled law" and we should just accept it. Yet he does not follow that same advice on the 2nd.

Really not the same thing, no more than GOP proposals to prevent flag burning is an attempt to overturn the 1st amendment. Both parties propose laws that try to regulate/attack/moderate civil rights.

The ACA is enacted law, signed off on by the Supreme Court. If we want to modify it, the process is clear - you pass new legislation and have it signed by the President. The process is not "refuse to do your job until the winners renegotiate the contract with you."

[billvon 2,384]

>That sounds much more responsible than overspending by 33% for essentially no new
>assets, just maintaining the status quo.

Agreed. However, the goal of Keynseian spending is similar to the investment made by the homeowner - the government spends money (higher spending/lower taxes) during bad economic times as an investment in the economy. This hastens the return to good economic times, which results in greater revenues, at which point the debt is paid back.

Works great in theory - and will even work in practice IF the government is willing to raise taxes and reduce spending during the economic recovery. The most recent economic recovery happened during 2003-2008; this is the time that taxes should have risen and spending decreased to build up a buffer against the next recession. (Of course this did not happen - taxes stayed relatively low and spending increased.)

Likewise as the economy recovers from the latest recession it will be critical to raise taxes and reduce spending. If the government does this, then deficit spending is not fiscally irresponsible; it's part of a plan intended to hasten economic recovery. Unfortunately, given their track record, I don't have very high hopes. The GOP will refuse to raise taxes and the Democrats will refuse to reduce spending.

[beowulf 1]

billvon

>Wow you failed to put in how much the government is spending per year next to the total revenue.

And you failed to mention how much the guy you would loan money to is spending.

But we can make some basic assumptions below.

>This year I think they are spending close to $800 billion more then revenue

OK let's run those numbers again.

US income: $2400 billion
US expenditure: $3200 billion
Percentage of overspending: 33%

Comparing that to our above guy:

Guy's income: $59,000
Guy's expenditure on that house the year he buys it: $410,000
Percentage of overspending: 690% (ignoring all his other expenses)

In this case looks like that homeowner who wants a loan is a lot more _irresponsible_ than the government.

(In both cases, of course, the issue is not how much debt they have or how much they are overspending - it is their ability to pay it back that counts.)

How the guy is spending the money goes back to the comparison with the US Gov. I know it's hard to understand.


You are the one who brought up this Mortgage as an analogy. It really doesn't fit and is shown by the 690% over spending. A better fit would be using a credit card analogy.

US income: $2400 billion
US expenditure: $3200 billion
Percentage of overspending: 33%

The over spending was put on the Governments Credit Card. Which pushes the Credit Card balance close to $17 Trillion. Which they are never paying down the principal and are only paying the interest and having to borrow more money on the credit card to pay it's interest.

Guy's income: $59,000
Guy's expenditures over the years pushes the credit card balance to: $410,000
Percentage of overspending this past year: 33%

So instead of getting a loan and buying a house. This guy has a super platinum credit card that he can increase the limit when he gets to it.

So to answer your question. NO, I would not lend money to someone in that situation and no bank would give them a credit card that he could raise the limit when he reached it.

You are wrong. The issue is the DEBT and the OVERSPENDING. Because the overspending created the massive debt and with out stopping the overspending it will be impossible to pay down the debt. The reason the size of the debt is a problem is because it generates interest payments that need to be paid and just because interest rates are currently low doesn't mean they will always be low.

Raising taxes will not solve the problem because raising taxes does not necessarily increase revenue. It can also decrease revenue. Raising taxes only works up to a point and then it becomes counter productive.

[beowulf 1]

kelpdiver

***
No, but he did claim the ACA is "settled law" and we should just accept it. Yet he does not follow that same advice on the 2nd.

Really not the same thing, no more than GOP proposals to prevent flag burning is an attempt to overturn the 1st amendment. Both parties propose laws that try to regulate/attack/moderate civil rights.

The ACA is enacted law, signed off on by the Supreme Court. If we want to modify it, the process is clear - you pass new legislation and have it signed by the President. The process is not "refuse to do your job until the winners renegotiate the contract with you."

It is well with in the House's right to pick and choose if they want to fund the ACA. Just because it's a law doesn't mean they have to fund it.