Who makes all of that interest?
Why do Republicans always seem to favor deficit spending?
Well as I remember it, around 40% of the debt the govt owes to itself in one way or another, probably largely due to social security. That money that the social securty admin loans the fed earns interest for the social securty fund. Unfortunately retirees are taking in more money in SS than they ever put in, even after interest.
Most of the rest of the debt is foreign financed; that used to be the reason our currency was so over valued. Once social security outlays catch up with inputs into the system the fed will no longer be able to borrow from that fund. Since they will also be paying back the SS administration, that debt will just be reissued in new bonds, and this time we can only hope that foreigners will be there to continue to pick up the slack, because our savings rates are dismal.
As for republicans favoring deficit spending, I don't find that to be a fair statement, as no one has really run much of a surplus since before WW2. Those few green blips on the map are too short lived for anyone to take much credit. The most recent surplus we kinda almost had can certainly not be credited to Clinton. If his healthcare plan had been implemented we would have never seen that money. More credit goes to the GOP who, back then in those ages past, actually showed some fiscal conservatism.
You knew all that already I'm sure, but I was bored so there it is again!
So in my opinion a more accurate question would be:
Why do US citizens favor deficit spending? Loads of personal, business and governmental debt, everywhere. If we were in a time of high inflation that might be understandable.
But we haven't been.
If inflation were high, the government would NOT want to run up large deficits. It would make inflation worse. How were those 4 straight years of surpluses not Clinton's doing? Clinton cut government spending and raised taxes (which he should have done) to create the surplus.
Inflation is bad, but its a lot less bad to debtors than those who hold a lot of equity. I was talking in general about the US public, who are certainly more inclined to spend if they feel their money is losing value, regardless of whether it is the right thing to do.
As for clinton, you are wrong about him cutting spending. He is not capable of doing any such thing. This power is granted to Congress, who was mostly republican. Clinton's budgets did not pass without great changes. If he had implemented his healthcare changes, you would not have seen that surplus.
What is also true, however, is that he didn't fight this fiscal policy. I think it is fair to call him an economic centrist. It is not fair to give him or the democrats - or maybe even the republicans - credit for the surplus.
More on the debt (not just the obvious, but the hidden debt like SS and medicare) HERE.
I agree except that I won't even give the Republicans credit for the surplus under Clinton. Yes, its true, if they'd have allowed national healthcare to go through, there would have been no surplus, but the surplus wouldn't have existed anyway had it not been for the internet boom - which the government had virtually nothing to do with.
And the answer is: people really don't care about their children.
As for your characterization, Ivan, the way I see it, Republicans want a government that doesn't do much but spends a lot more than it needs to and Democrats want a government that does a lot but spends a lot less than it can. Neither is realistic.
That's an excellent point too. It's worth remembering that these surpluses were insignificant compared to GDP, and that the government's "bookkeeping," if you can call it that, has a great affect on it. Some estimates show four years of surpluses; a different analysis suggests as little as one.
And with that thread on "the looming economic disaster," I'm more inclined to say there never was a surplus.
There is another deficit costing us hundreds of billions a year (and growing) that most people (democrats and older people especially) choose to ignore.
Actually China owns most of the US Federal debt, and will receive most of the debt service. And they benefit because by doing so they keep interest rates low and encourage consumer spending to buy the products China offers for sale in the US.
According to the Economist, trade, counting both exports and imports, is 75% of China's GDP. Only of a quarter of their economy is making stuff and services that they sell to Chinese. And the great majority of their trade is with the US.
China! Interesting. I have seen something about this before and I am pretty sure that the Queen of England is a large creditor. I know that some notable private individuals are involved. I found this -
but I was hoping to find a list.
So China is not only raking in our jobs, they're also pocketing the interest from our debt.
They're making out pretty good. So how much does each one of us owe the Chinese?
Considering the amount of chinese food I eat, I should be exempt.
Actually, it is Japan who owes most of the debt.
There is no need to worry that foreigners will continue indefinitely to work day and night to produce cheap goods in exchange for promises. Nor it there a need to worry about thoses promises, the US will not be able to repay what it owes it citizens and will certainly not repay the work of foreigners. So in the end, there will be enough declining imports, hard work, expensive goods and cut benefits to satisfy all.
How long will that take?
Also, I am worried: Every time I pay my taxes.
So why do Republicans argue for deficit spending again? I know they have a really good theory.
If it makes you feel any better, the average chinese citizen isn't profiting much from it. The chinese government has worked the currencies to its advantage in trade, but this hurts the people's quality of life.
I recently read an article on the polution in china; it was frightening. It said there are small rural towns where death by stomach cancer (and not in old age) is the primary cause of death. I haven't done a great deal of research to prove that true, but if it is even hlaf real then things are terrible there for many human beings.
Locrian: it's true. Stomach cancer is about 10 fold of the western average. Main course though is the bad food; preserved vegetables, spicy hot pots and things like that. Pollution is a disaster. Shanghai, as the pioneer city of China, is trying hard to (literally) clean up it's act, but even here it's terrible. Cars, buildings and everything you put outside is covered with a layer of soot. Chinese don't seem to care, they throw out garbage from their cars on the roads wherever it suits them. I have never seen any governement campaign to change their disgusting habits in my 6 years in China. Bush has a point there: China should be included in the Kyoto agreements. He should show real leadership though and ratify Kyoto. Then talk to the Chinese, now he has no leg to stand on.
China has its own version of job loss. Industry has flourished along the coastal areas, but now the standard of living has increased for these areas enough to justify moving to cheaper labor inland. So now the coastal populations are objecting.
There is mind boggling levels of construction taking place in the north. Miles and miles of new fabrication facilities are springing up alongside virtually new cities filled with high rise housing. Composite materials for aircraft construction is a real focal point - such as for the 777E and Airbus. The next generation of commercial aircraft will be composite materials and made in China.
That aside, there are specific parties claiming profits from our debt. Personally, I would like to know who they are and who they know. For example, if the Chinese people aren't profiting from this, who is, and what role do they play in our affairs? Considering the significance of this to all americans, I think people should be interested in knowing who their creditors are.
I am pretty sure that the Queen of England is still a major creditor.
From the link
I'm not blaming foreigners for our debt; I'm blaming Republicans. They are the great advocates of deficit spending.
Well, its about the same as the theory that if you commit your kids to pay for it, it really isn't a deficit (Democrats, re: Social Security).
The debt that Republicans create/advocate is peanuts compared to the debt that Democrats create/advocate.
Yes, lets go start some more wars for Halliburton and the Carlyle Group,
and forget about social security.
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