Is the Budget deficit almost closed?

No, friend. You have this wrong. If no deal had been reached all the Bush curs would have expired and we would have a had a deficit that is 4 trillion dollars smaller than the projection based on this "fix."

Of course they don't.

I think they will allow the sequester cuts because nobody wants them, and they can be pegged to Obama.

 

But why aren't they going to cut the entire sequestration amount, Mobius? If spending cuts are such an important ingredient, and I believe that they are, why in the world are they going to eliminate them? I thought the Republicans were for spending cuts but they are not fighting for spending cuts. They get in front of microphones and say they are for spending cuts but when it comes right down to it, they take a pass.

I am a little confused by the first part of your post so I will refrain from commenting until you have the chance to clarify what you mean by 1.9 being added to the baseline. As far as the 200 billion in sequestration, the article said that because of reduced interest payments that spending cuts would bring, we could make 1.2 trillion in cuts and actually achieve 1.4 trillion in cuts because of the interest we would save resulting in an additional 200 billion in savings.

I think we are going to be surprised at how close we are to closing the budget deficit. It doesn't make for exciting political theater but we are closer than most think. It will not be immediate because we still have to wind down Afghanistan.

 

Yes, and you guys would be screaming that the President raised taxes on you and that he is such a bad guy for doing so and the economy is sure to tank because of him and his policies.

Agreed.

You mean the way they, and you, are trying to pin 4 trillion in additional debt on him? Okay, I see.

 

I never said it was the right thing to do. I just said the political reality is that they aren't going to make 100% of those cuts.

If you look at the CBO projections that your original link was based on, they incorporate certain assumptions. One is that the tax rates expire as per the law in November. They didn't exprie, we extended them for most taxpayers. I guessed that added a couple of trillion over ten years and one of you guys came up with 1.9 trillion. So that's basically another 1.9 trillion we have to cut to get the debt to gdp ratio to remain fixed. Here are those November 2012 projections

http://www.cbo.gov/sites/default/files/cbofiles/attachments/43692-DeficitReduction_print.pdf

The november CBO projections assumed those cuts started in January. Because they didn't, we have another 200 billion to contend with.

You do realize that this article makes no contention about closing the budget deficit right? Even in their rosy viewpoint that has already proved unrealistic and needing to be adjusted, we never get to a balanced budget. They are discussing maintaining a constant debt to gdp ratio. Unfortunately that ratio is at it's highest point since World War 2. We need to be reducing this number not holding it constant. Also, 73% does not include intergovernmental debt which I doubt we had in WWII er and that will become more of an issue as SS shortfalls continue to grow.

To sum up, your article says we are short 1.2 trillion over ten years to maintain a constant debt to gdp ratio. Since those projections, we have racked up another 1.9 trillion in tax cuts and another $200 billion in spending cuts that didn't happen. This doesn't factor in anything from March on from the spending side. So if we continue to put off spending, we will just increase that number. As of today, we would need to cut 3.3 trillion, sequestration cuts would need to go into affect in March, and that only gets us to remain constant on a shitty debt to gdp number. Also, this is assuming we get to a ridiculous $79 billion deficit in 2018. Not happening. This is hardly closing the deficit.

 

Because his policies are terrible. More taxes for more spending, not deficit reduction. He isn't even a good Keynesian.

How is anyone else accountable? He signed the fucking thing. It is his policy that created an additional 4 trillion in debt over 10 years. If the fix was shit he should have rejected it.

 

Mobius, I don't know what article you read but the article that I posted was very clear on several topics:

1 - Between the 2011 Budget Control Act that cut 1.5 trillion dollars in appropriations from the budget over the next decade, the 1.9 trillion in additional revenue generated from the American Taxpayer Relief Act, or the "fiscal cliff" deal as it is better known, and the pending cuts of 1.2 trillion that will come from either the sequestration or from lawmakers reaching a new deal to replace the sequestration will culminate in a deficit reduction package that should total in the neighborhood of 3.7 trillion dollars over the next decade. There are portions of the each of these packages that overlap and that is why the grand total is 3.7 trillion instead of 4.6 trillion.

2 - When they say "stabilizing" the debt to gdp ratio, that is a fancy way of saying balancing the budget. If our debt to gdp ration is stabilized then we are no longer adding to the nation debt and therefore it should begin to go down.

3 - As economic growth picks up our debt to gdp ration will fall even further because the as the debt stabilizes and the gdp grows, our debt becomes less and less.

4 - Combined, these three components that I described above will be as large as the 1990 deficit reduction package passed during the administration of the first George Bush and larger than the one passed in 1993 during the Clinton administration.

I will say it again: It's not popular television and it really shoots a hole in the Republican talking points that the President is an out of control spender but we are on the verge of getting this thing under control again. Yes, if ALL of the Bush tax cuts had expired and we made draconian cuts to the budget we could make things look better on paper but the consequences on our economy would make none of us "feel" better and would inhibit economic growth for years to come.

 

I just think its funny.

Bush tax cuts + spending got us into this mess.

Though now they are needed.


Good shit man. Sometimes the easy way out isn't the best path.

 

Wrong, Wrong, Wrong. You have your facts all wrong and this is further proof that you are little more than a Fox News hack, Supa. If you look at the FACTS, his policies are working and they are working quite well. I just outlined in my last post to Mobius all the reasons why his economic policies are working. Perfect? Nope, didn't say that. Working? Yes.

I know you are a pretty smart guy so I just don't buy the fact that no other elected official is accountable for the function of our government.

If you really believe that he created an additional 4 trillion in debt over the next 10 years then you do not have a good enough understanding of basic mathematics, and maybe that is the problem altogether.

 

Stay classy Tiger.

 

what are you talking about Pride?