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Bush is leaving a fiscal train wreck for the next president

  1. Jul 29, 2008 #1
    Maybe the US government has a "no-bad-news-allowed" policy just like the Enron execs had. Or maybe the Bush government is leaving a huge fiscal train wreck (I think that's actually a technical term) for the next president on purpose. I think everyone knows how partisan they are. Check it out:

    http://www.reuters.com/article/topNews/idUSN2847371220080728
     
  2. jcsd
  3. Jul 29, 2008 #2

    mgb_phys

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    But it's a lower proportion of the economy than the deficits in the 70s and 80s.
     
  4. Jul 29, 2008 #3

    Gokul43201

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    This is essentially the same premise that another recent thread was based upon, and is flawed for the same reason.

    How surprised are you going to be if McCain inherits this debt as the next President?
     
  5. Jul 29, 2008 #4
    I only said the next president would inherit a fiscal train wreck, which is what will happen anyway. Assuming they're doing it on purpose for partisan reasons then McCain will just get a smaller fiscal train wreck. I think they've got an Enron-style "no-bad-news-allowed" rule though.
     
  6. Jul 30, 2008 #5
    They certainly have a no bad war news rule. At least a no showing negative images of it rule, and no speaking of specific Iraqi civilian deaths rule, unless it is due to the actions of insurgencies or terrorists.

    I would think that they might, or should might have a policy of no real bad stock market news. The reason is that if everyone abandons the market in fear of losing their money, then the market would fall.
     
  7. Jul 31, 2008 #6
    The Christian Science Monitor must have thought this would be a good time to point out the US' enormous debt:

    http://www.csmonitor.com/2008/0801/p08s01-comv.html

    (I think it's the Congressional Budget Office that came up with the $53,000,000,000,000)
     
  8. Aug 1, 2008 #7

    mheslep

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    How convenient. Don't ask me, I'm just the BUDGET COMMITTEE CHAIRMAN, Conrad the Magnificent Bloviator.
     
  9. Aug 1, 2008 #8
    I don't get what you're upset about. Are you saying he will F up the budget on purpose?
     
  10. Aug 1, 2008 #9

    mheslep

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    Conrad, as Chairman, shares responsibility for the very thing for which he is pointing fingers, ala the recent rebate checks, the acceptance of responsibility for the several trillion in Fannie/Freddie debt, opposition to budget offsets for new spending, etc, etc, etc.
     
  11. Aug 1, 2008 #10
    He pointed fingers? Where?
     
  12. Aug 9, 2008 #11
    Meanwhile, China's budget surplus for the first half of this year is ~$172 billion! Makes me wonder what the US's excuse is:

    http://www.upi.com/Business_News/2008/08/08/China_first_half_fiscal_surplus_173B/UPI-33401218170203/
     
  13. Aug 9, 2008 #12
    Probably something along the lines of "we don't use slave prison labor" and "we value worker and consumer safety over profit".

    Although the first point isn't entirely accurate...
    http://www.wpi.edu/News/TechNews/010327/prisonlabor.shtml

    But it's still better than China.
     
  14. Aug 9, 2008 #13

    russ_watters

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    In addition to the no slave labor thing, there is also the lack of 12% annual GDP growth.
     
  15. Aug 11, 2008 #14
    Hmmm, maybe. There is a neocon theory that running up a huge deficit is good because it will later force the government to decease in size.
     
  16. Aug 20, 2008 #15
    Someone made a documentary called IOUSA which covers this exact subject. Looks like it will be worth a look:

    http://www.canadianbusiness.com/markets/headline_news/article.jsp?content=b0820194A
     
  17. Aug 20, 2008 #16
    Okay, but they are the ones who are increasing the government's size like never before.
     
  18. Aug 21, 2008 #17

    Astronuc

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    A look into mounting national debt

    http://marketplace.publicradio.org/display/web/2008/08/20/iousa

    Are we there yet?
     
  19. Aug 21, 2008 #18
    How is that figure even possible? What caused this astonishing number?
     
  20. Aug 21, 2008 #19

    mgb_phys

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    Goverments don't have to pay for things if they don't want to!

    A fair chunk of it isn't real. It's hard to measure GDP for modern economies with lots of service business.
    Imports tend to be accurately tracked becuase you pay tax on them. But exports, especially if a lot of what you export is things like movie rights and financial services, are a lot harder to track than shiploads of iron ore - so tend to get under reported.

    Then everything you import is added to the debt, all that oil, all those chinese DVD players. This isn't necessarily bad - it makes a lot more sense to have highly paid americans selling movies/software and have cheap chinese building the DVD player. But if you are carefull to add up all the DVD players coming in but hide the movie rights in clever accounting - it looks bad.

    Then there is the fact that the dollar is used as a safe currency. Every $5 bill that a 3rd world taxi driver is keeping under his mattress is part of this free loan to the USA.
     
    Last edited: Aug 21, 2008
  21. Aug 21, 2008 #20

    Gokul43201

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    To be clear that's the debt, not the deficit. The US debt is about two-thirds of the GDP, which is pretty bad, but not as scary as some other countries: http://en.wikipedia.org/wiki/List_of_countries_by_public_debt

    Also, this fraction today is a lot less than it used to be around the time of WWII: http://zfacts.com/metaPage/lib/National-Debt-GDP-L.gif

    How is it possible? Keep in mind that the Govt. spends about 3 trillion each year. A little bit of overspending and a little bit of under-earning can easily build up over the years (and don't forget to include interest).
     
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