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Old 11-10-2010, 11:24 AM   #1 (permalink)
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U.S. Debt Proposal

Quote:
A presidential commission’s leaders proposed a $3.8 trillion deficit-cutting plan that would cut Social Security and Medicare, reduce income-tax rates and eliminate tax breaks including the mortgage-interest deduction
Story here

Sounds like a starting point to discuss thing. Points I don't like- removes the mortgage interest tax break, think that will hurt the middle class more then anyone else. And it doesn't appear to address any military spending cuts. Points I like- increase the retirement age for SS and cuts earning on holdings. Though I think we need to start doing this way before the dates they've supplied.

Thoughts?
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Old 11-10-2010, 11:54 AM   #2 (permalink)
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The bloated military budget is the elephant in the room.


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Old 11-10-2010, 12:11 PM   #3 (permalink)
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I have no idea how you can have any realistic discussion regarding debt reduction without including the military budget.
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Old 11-10-2010, 12:14 PM   #4 (permalink)
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Could we scale back military spending by something like 70%? What would that look like?
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Old 11-10-2010, 12:19 PM   #5 (permalink)
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It would look like a lot more unemployed people I fear.

I'm all for reducing the military and cutting some of these high cost projects. But people work on them and it does add to the economy, greatly.

There's needs to be a shift from military spending to domestic spending- infrastructure, education etc.. Sadly the right will have none of that.
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Old 11-10-2010, 12:26 PM   #6 (permalink)
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Quote:
Originally Posted by Tully Mars View Post
Story here

Sounds like a starting point to discuss thing. Points I don't like- removes the mortgage interest tax break, think that will hurt the middle class more then anyone else. And it doesn't appear to address any military spending cuts. Points I like- increase the retirement age for SS and cuts earning on holdings. Though I think we need to start doing this way before the dates they've supplied.

Thoughts?
I'd be interested in the thresholds for the three percentages. I'd like to see a flat tax but three percentages and eliminating deductions is a start. Raising the age for Social Security full eligibility isn't a big deal and probably makes sense anyway with longer life expectancy. There's room to cut excesses in military spending just as there's room to cut other entitlement programs.
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Old 11-10-2010, 12:28 PM   #7 (permalink)
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One of my best friends in the world is in Afghanistan right now. I know for a fact that he would make an outstanding public school music teacher (he and I were in the drum corps together). Another friend of mine, who I think is in Germany, would be an honest and hard working foreman in construction.

If we could reallocate some of the funds from the defense budget into education or infrastructure, we could create the very jobs returning troops would need to support themselves and their families.
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Old 11-10-2010, 12:43 PM   #8 (permalink)
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The flat tax is nothing more then shifting even more of the tax burden to the middle class and poor. The middle class has been hit hard enough and we have plenty of poor and working poor already in my opinion.
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Old 11-10-2010, 12:59 PM   #9 (permalink)
 
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context is good:

Quote:
There is no report from the fiscal commission
By Ezra Klein

Here is the most important fact about the proposal released by the co-chairmen of the National Commission on Fiscal Responsibility and Reform: It is not the commission's report. And here is the second most important fact to remember: The commission itself does not have any actual power. So what we're looking at is a discussion draft of a proposal to balance the budget authored by two people who don't have a vote in either the House or the Senate. In a town thick with proposals for balancing the budget but thin on votes for actually passing such proposals, it's not clear what the purpose of this one is.

It's worth taking a moment to consider how we got here: The fiscal commission we have is not the fiscal commission we were supposed to have. The fiscal commission we were supposed to have was the brainchild of Kent Conrad and Judd Gregg, the two senior members of the Senate Budget Committee. "The inability of the regular legislative process to meaningfully act on [the deficit] couldn't be clearer," they wrote. Their proposal would have set up a commission dominated by members of Congress and able to fast-track its consensus recommendations through the congressional process -- no delays, no amendments. But that proposal was filibustered in the Senate, mainly by Republicans who worried it would end in tax increases.

So the president stepped in and created a fiscal commission of his own. Like the Conrad-Gregg commission, it had 18 members, though fewer of them were members of Congress. Like the Conrad-Gregg commission, it would need 14 of its 18 participants to agree to report out its recommendations. But unlike the Conrad-Gregg commission, it had no actual power in Congress. If 14 members agreed on the recommendations, all that meant was that ... 14 members agreed on the recommendations. They could still be filibustered, amended -- whatever. The political logic of this seemed rather peculiar: If the fiscal commission itself could not pass Congress, how would the recommendations from an executive-branch fiscal commission pass Congress? The recommendations, after all, are where the hard stuff is.

Increasingly, the concern looks to be moot: The National Commission on Fiscal Responsibility and Reform will not get agreement from 14 of its members. It might not even get a majority. Today's release, unexpectedly, is a draft proposal from the co-chairs, and that might be as close as the commission comes to a comprehensive product. "This is not a proposal I could support," said Rep. Jan Schakowsky, one of the members. Rep. Jeb Hensarling, another participant, was less definitive, but nowhere near supportive. "Some of it I like," he said. "Some of it disturbs me. And some of it I've got to study." The full commission is expected to debate the proposal over the next week.

Reading the report makes clear why the members of Congress are so ambivalent: It cuts Social Security benefits and raises taxes. It slashes discretionary spending without sparing defense. It eliminates the employer-tax exclusion for health care and the mortgage-interest deduction, and does nothing in particular to deal with the resulting chaos in the employer-based health-insurance market or the housing market. A "yea" on this package would not be an easy vote to cast.

Substantively, my impression of the report mirrors Hensarling's: Some of it I like, some of it I don't like, and some of it I need to think more about. But the report doesn't fulfill its basic purpose, which was demonstrating enough consensus among congressional representatives of both parties to convince the public and the political system that Congress is ready to make these choices. The reality is, we don't have a congressional fiscal commission, we don't have a report from the White House's fiscal commission, and we don't have a consensus on fiscal issues between the two parties. The co-chairmen have some interesting policy ideas for how to balance the budget, but as of yet, they've not made any discernible progress on the political deadlock preventing us from balancing the budget. And it's the deadlock, not the policy questions, that they were asked to solve.
Ezra Klein - There is no report from the fiscal commission

there is no commission,
there is no report.
there is a pseudo-commission.
there is a rehearsal of conservative talking points.

good-o.
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Old 11-11-2010, 08:49 AM   #10 (permalink)
 
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so apparently this fake commission was funded by several of the usual suspects in rightwing circles who are actively interested in protecting military funding by pretending that the way to deal with the "problem" of "the deficit" is to "cut entitlements."

Quote:
Many deficit commission staffers paid by outside groups

By Dan Eggen
Washington Post Staff Writer
Wednesday, November 10, 2010; 8:12 PM

The leaders of President Obama's deficit commission sparked criticism from both sides of the political aisle Wednesday for proposing broad cuts to federal programs.

But the National Commission on Fiscal Responsibility and Reform has also come under attack for its unusual approach to staffing: Many of its employees aren't employed by the panel at all.

Instead, about one in four commission staffers is paid by outside entities, many of which have strong ideological points of view about how to tackle the deficit.

For example, the salaries of two senior staffers, Marc Goldwein and Ed Lorenzen, are paid by private groups that have previously advocated cuts to entitlement programs. Lorenzen is paid by the Peter G. Peterson Foundation, while Goldwein is paid by the Committee for a Responsible Federal Budget, which is also partly funded by the Peterson group.

The outsourcing has come under sharp criticism from seniors' organizations and liberal activists, who say the strategy is part of a broader conservative bias favoring painful entitlement cuts over other solutions. The fears of some liberal groups appeared to come true on Wednesday, when the commission's two leaders recommended significant reductions for Social Security and other social-welfare programs.

Bruce Reed, the panel's executive director, defended the staffing arrangement as fiscally responsible and said the staff includes a broad range of views. Other staffers paid by outside entities include an analyst from the liberal-leaning Economic Policy Institute and a Clinton administration official who now teaches at Johns Hopkins University, he said.

"We've got wonks from across the spectrum who have been working on this issue for years," Reed said. "Every possible voice from left, right or center has a voice on the commission."

But Barbara B. Kennelly, a former Democratic House member from Connecticut who heads the National Committee to Preserve Social Security and Medicare, said the commission's staffing structure is "unprecedented" and casts further doubt on its fairness.

"Taxpayers fund the commission and they should work independently of Washington lobbyists and power brokers," Kennelly said. "This is the type of shenanigans that average Americans are so upset about right now - that money talks and everyone else is left out."

The debate comes as the bipartisan commission nears a Dec. 1 deadline to recommend a plan for lowering the deficit. The panel's two co-chairmen, former Bill Clinton adviser Erskine Bowles and former senator Alan Simpson (R-Wyo.), issued their own recommendations on Wednesday calling for a reduction in Social Security benefits and broad spending cuts for many federal operations.

From the beginning, liberals have complained that the Obama-created commission is tilted in a conservative direction, meaning that it is likely to favor cuts to social programs. (Many conservatives disagree, arguing that Bowles-Simpson proposals to close tax loopholes would result in major tax increases.)

Simpson didn't help relations with liberal groups when he sent an e-mail this summer complaining that the government is "like a milk cow with 310 million tits!" He later apologized for the remark amid demands for his resignation.

Kennelly and other liberal-leaning critics say they are particularly troubled by the influence of Peterson, a billionaire and former investment banker who began a $6 million campaign this week urging lawmakers to cut the deficit. Peterson, co-founder of the Blackstone Group investment fund, paid for a series of town hall meetings this year that included participation by deficit commission members. He also funds the Fiscal Times, a digital news organization that focuses on federal debt issues.

Peterson representatives say the views and goals of his organizations have been distorted. Spokesman Patrick Dorton also said that Lorenzen, a former staffer of Rep. Steny H. Hoyer (D-Md.), is recused from any Peterson business while serving at the commission.

"We're a nonpartisan foundation," Dorton said. "We're committed to creating a dialogue on fiscal issues that includes a broad set of voices."

The Economic Policy Institute, the economics think tank, contributed staffer Ethan Pollack to the commission in hopes of bringing "a more progressive perspective" to the debate, said John Irons, the group's research policy director.

But Irons added that Wednesday's budget-cut proposals also show that staffers have a limited effect on commission policies. "Our view is basically that the commission has gone off the rails," he said.

Reed said about half a dozen panel employees are paid by outside entities rather than the commission, which has a budget of about $500,000. He said the arrangement, while unusual, is a smart way to limit costs by a panel devoted to the same goal.

"We have a very small budget, so we begged everyone we could find in both parties across the spectrum to sign up and help," said Reed, who is on leave as president of the centrist Democratic Leadership Council. "Part of our job is not to add to the problem ourselves."
Many deficit commission staffers paid by outside groups

so if you have enough money, you can buy yourself a nice little "presidential commission" and it's "report" regardless of whether it exists or not can bob to the surface for a news cycle or two and even if the "presidential commission" gets revealed as the fraud it is, the "report" still bobs around for a news cycle or two and this crackpot notion of "deficit reduction" meaning "don't cut the obscene levels of military expenditure but rather punish the poor" gets a little more traction for a few minutes.

ain't american capitalism fucking grand?
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Old 11-11-2010, 10:18 AM   #11 (permalink)
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Quote:
Originally Posted by roachboy View Post
so apparently this fake commission was funded by several of the usual suspects in rightwing circles who are actively interested in protecting military funding by pretending that the way to deal with the "problem" of "the deficit" is to "cut entitlements."



Many deficit commission staffers paid by outside groups

so if you have enough money, you can buy yourself a nice little "presidential commission" and it's "report" regardless of whether it exists or not can bob to the surface for a news cycle or two and even if the "presidential commission" gets revealed as the fraud it is, the "report" still bobs around for a news cycle or two and this crackpot notion of "deficit reduction" meaning "don't cut the obscene levels of military expenditure but rather punish the poor" gets a little more traction for a few minutes.

ain't american capitalism fucking grand?
A couple commentaries I read say this isn't going much of anywhere, but that's not just the fault of conservatives.

I read thru the PDF that was released http://msnbcmedia.msn.com/i/MSNBC/Se...hair_Draft.pdf which quite clearly includes proposals for cutting military spending as well as discretionary spending and entitlements. Specifically pages 19 and 20 of this PDF.

If we are going to fix the debt problem, everybody gets to sacrifice, including the lower income people since every group helped contribute to the problem. Specifically, lower income groups maxing out their credit cards buying junk they didn't need and signing up for mortgages they had no business signing up for in the first place.

I've read some rather interesting news reports in the last few weeks about how first France and now the UK are cutting entitlement spending. Maybe Europeans are beginning to realize entitlement programs aren't really affordable after all.

So what entitlement programs are you willing to cut?
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Old 11-11-2010, 10:25 AM   #12 (permalink)
 
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what makes you think the debt is a problem? there's an entire school of economics that's got a far better actual track record that the monetarist nonsense that you subscribe to that doesn't see debt as a particular issue. so there's no pressing need to "address" it. so there's no rationale for cuts, particularly not in a situation of transition/crisis.

it's the same hoodoo that got us here in the first place. it didn't work, it won't work, it can't work.

so why should anyone listen to what conservatives have to say about this topic?
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Old 11-11-2010, 02:24 PM   #13 (permalink)
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I think if Obama proposed cutting the military budget, he would be pretty much writing his own death warrant. Seriously. My impression of Americans is that they are a military obsessed society. America is a right wing conservative country and they love things that go boom. I don't see this changing any time soon. Even if Obama had the balls to cut US military spending, the cuts would be token at best.

I believe that the US spends about 700 Billion officially on its military every year. I am very sceptical of that number. I betcha it's much more than that. I remember reading somewhere the cost of operating the missile silos come out of the Department of the Interior's budget (or at least, not the Pentagon). Also, the cost of the wars is not included in the annual military budget, or the cost of Corporate Welfare that goes to Defence Contractors.

Anyway, suffice it to say that it's a lot of money and a lot of powerful people don't want to give up that money (read their money) any time soon. If Obama ever proposed cutting the military say in half (which would still leave a massive military) I fear he would end up shot.

As Eisenhower once said, "Beware the Industrial Military Complex"

---------- Post added at 05:24 PM ---------- Previous post was at 05:21 PM ----------

Quote:
Originally Posted by roachboy View Post
what makes you think the debt is a problem? there's an entire school of economics that's got a far better actual track record that the monetarist nonsense that you subscribe to that doesn't see debt as a particular issue. so there's no pressing need to "address" it. so there's no rationale for cuts, particularly not in a situation of transition/crisis.

it's the same hoodoo that got us here in the first place. it didn't work, it won't work, it can't work.

so why should anyone listen to what conservatives have to say about this topic?
Yes, they are known as the "Free Lunch Society"

Most Americans are big believers in the Free Lunch. They want all the goodies government should provide, they want to pay no tax, and they think that it all makes perfect sense.
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Old 11-11-2010, 03:30 PM   #14 (permalink)
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Quote:
Originally Posted by roachboy View Post
what makes you think the debt is a problem? there's an entire school of economics that's got a far better actual track record that the monetarist nonsense that you subscribe to that doesn't see debt as a particular issue. so there's no pressing need to "address" it. so there's no rationale for cuts, particularly not in a situation of transition/crisis.

it's the same hoodoo that got us here in the first place. it didn't work, it won't work, it can't work.

so why should anyone listen to what conservatives have to say about this topic?
I'm sure that in some fantasy land somewhere, debt really doesn't matter and those economists might have a point.

However, in reality, recent events in Greece, where out of control debt projected at 120% of GDP in 2010 resulted in fears of default by the Greek government another bailout by the EU.

Regardless what these economists think, one of the major issues in this election was deficit reduction, i.e. debt reduction. The US government isn't going to be able to accomplish much at all if interest on the federal debt reaches the level of tax revenue as has been projected a few times.

That issue resulted in a bunch of Democrats getting sent home. If the Democrats want to ignore the issue, then more will be going home in 2012 including Obama.

If you think the public is going to stand for reducing military spending only to increase entitlements, you're dreaming.
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Old 11-11-2010, 03:38 PM   #15 (permalink)
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Ignoring the debt and the deficits isn't a Dem only problem. If it were the Bush years would not have lead to records of both. The right wants to extend the tax cut for the top 25, but they have no plan to pay for it.

How the economy responds will dictate how the next election goes.
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Old 11-11-2010, 03:49 PM   #16 (permalink)
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The Dems have to prove they are willing to reduce spending. I think this will be the case, considering things such as the stimulus spending was to be temporary anyway. Clinton is the only president in recent history that I can think of who has proven that budgets can be balanced and deficits can be reduced. The timing was bad for Obama with the economy, so of course you're not going to balance a budget very easily when your economy is melting down.

The Republicans are going to have to prove they are serious about reducing the deficit by focusing on reducing spending and forgetting about tax cuts. You don't cut your income when you aren't making ends meet. It doesn't make sense. If the deficit is so bad that you're saying everything except the sky is falling, then why not reduce spending and leave taxes as they are, or, better yet, increase tax revenues somehow? (Tax revenues as a percentage of GDP are relatively low.) You know, something rational as opposed to cutting taxes at a time like this.
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Last edited by Baraka_Guru; 11-11-2010 at 03:53 PM..
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Old 11-12-2010, 03:27 PM   #17 (permalink)
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If this proposal goes any further and Pelosi has any sense of strategy, she'll call for a vote on this with no amendments and get the universal opposition from the 111th congress that it deserves. Then when the 112th comes in, the Democrats can fight derivative shitty proposals by attacking their opponents for supporting the proposal to raise the retirement age to 69, eliminate the Earned Income Credit, eliminate funding to the Corporation for Public Broadcasting, increase Medicare patient costs, eliminating taxes on outsourced jobs, and all the other bullshit. But that won't happen because the past few years have shown us that the Democrats' idea of compromise is to lube themselves up before bending over and taking it from the Republicans.

That's not to say there aren't decent ideas in here. They're not proposing eliminating the mortgage interest tax break for everyone, only for second homes, home equity loans, and mortgages over $500,000. It would also be a good move to tax capital gains as income.
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Old 11-12-2010, 11:19 PM   #18 (permalink)
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All I know is that this has been dealt with using political means (resisting a debt commission that could do anything, unifying behind certain things that wouldn't hurt them, and trying to push for tax cut extensions that aren't paid for until 2012.)

Europe has other problems, a big one is competing in a world with cheap labor and cheap goods. But Ireland which was lauded as having low corporate taxes in 2008 is now in fiscal trouble as well. And having low tax rates may have meant that businesses moved from other places and took away tax revenue from their former country.
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