The Deficit and Weight
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In some ways, the deficit is analogous to being overweight. In the case of the deficit, we have too much debt that results either from too much spending or too little income (or both). In the case of being overweight, one has too much fat that results from consuming too much or exercising too little (or both).
As with being overweight, the deficit has a simple solution. In the case of being overweight, the simple solution is to intake fewer calories and expend more calories. Or, crudely put, eat less and exercise more. It is possible to do just one (eat less or exercise more), but this would be less effective.
In the case of the deficit, the simple solution is to intake more money or expend less (or both). Or, crudely put, tax more and spend less. Of course, it is possible to take just one approach: tax more or spend less. Of course, as with the matter of weight, this would presumably be less effective. It can, however, be argued that it is more desirable to take one approach rather than the other. For example, a stereotypical conservative might argue that spending should be cut without there being any increase in taxes. As another example, a stereotypical liberal might argue that there should be tax increases without any decrease in spending.
My view is that it makes excellent sense to approach the deficit by reducing spending and also increasing revenue. Just as with weight loss, this should be done in a sensible manner. In this case, by cutting excess spending and requiring people (and corporations are people) to bear a fair share of the burden of public services (such as fighting wars for the strategic interests of American businesses).
A Philosopher's Blog 
As a nation we have historically shown a great ability to exercise and no ability to diet. Some people would like to see at least a little dieting before redoubling our exercise regimen,
Plus we have been binge eating lately:
2008 $2.9 Trillion
2009 $3.1 Trillion
2010 $3.55 Trillion
2011 $3.82 Trillion
“as a nation are no longer in control of ourselves”
“. .. we have been binge eating lately::”
What time span does “lately” cover?? No need for the ^nonipartisan^ Tea Party before February 2009–a mere two months after BO took office ? Please remember the surplus Bush inherited from Clinton and the projected deficit he handed to Obama when you read the link below .
This from PolitiFact . And yes, I know PF won a Pulitzer. But I just want to tweak some noses and get a reaction of those out there –and they know who they are– who would reject a source if it won a Pulitzer or Nobel prize..They claim a few of the Pulitzer prize committees’ have made unwise choices (i.e. choices they didn’t agree with*). And so their logic tells them that if a few of the Pulitzer choices were questionable all of their choices must be unreliable, . . hmm?
http://www.politifact.com/truth-o-meter/statements/2010/jan/15/david-axelrod/axelrod-claims-bush-saddled-obama-big-deficit/
*pretty clearly a politically driven mode of thinking
frk, I think most Tea Partiers would agree that Bush was also a big spender. But the size of our deficits tripled from ~500B to ~1500B and this catalyzed the outrage.
Also, do you remember Ross Perot who received 25% of the vote in 1992 by warning about the deficit? Please don’t pretend that people only started caring about this issue when Obama became president.
Why only crazy people voted for Ross Perot…Didn’t you see the VP he picked…hardy-har-har, what a maroone…nothing like the man of letters and science, Algore. The choice was obvoius.
If wiki is correct, it was only 19%. Time and wishful thinking are like viagra for the memory, I guess. And you forgot to mention the number of electoral votes he received. I’ll remember for you: Zero. That’s one zero followed by a whole passel of zeroes.
I’m just saying that If thy had any real concern in ’92, it disappeared during the Clinton and Bush years and magically popped into full rebellious bloom in Obama’s second month in office. Maybe it went underground. did you attend the meetings? .What exactly happened during the first two months of BO’s term that was worse than what came recently before during Bush’s reign?
Also, see my 3:54pm below.
“And you forgot to mention the number of electoral votes he received. I’ll remember for you: Zero”
So by bringing this up do you mean to imply that because he won no electoral votes he had no impact on the election?
Ralph Nader won something like 2% of the vote in 2000 and yet he was blamed for costing Gore the election. BTW he received “Zero. That’s one zero followed by a whole passel of zeroes” electoral votes as well.
TJ:
Oh. You didn’t mention ^impact^ on the election. I merely brought up the electoral votes to add that convenient omission of yours to the incorrect information you supplied about the total votes he received. .We can always debate the ^impact^ of electoral college votes when a candidate has ^zero^ at a later date. . . Perhaps we’ll start with the 2000 election where Gore had a five electoral vote disadvantage but a plurality of the popular votes–about a half million.
So I’ll simply repeat what I said at 4:05 pm:
“I’m just saying that If they had any real concern in ’92, it disappeared during the Clinton and Bush years and magically popped into full rebellious bloom in Obama’s second month in office. Maybe it went underground. Did you attend the meetings? .What exactly happened during the first two months of BO’s term that was worse than what came recently before during Bush’s reign?”
Were the people who put Bush in office for 8 years just praying that the deficit would work out ok, despite his mismanagement of the economy with the two wars, during which he lowered taxes and his unfunded Medicare Part D? Oh and the non-existent deficit inherited from Clinton disappeared–with a vengance. Were those viable causes for serious concern? 8 yrs. vs 2 months.
Perhaps that would have been even clearer if I had repeated that last sentence. So here goes again:
What exactly happened during the first two months of BO’s term that was worse than what came recently before during Bush’s reign?” So? What did happen?
frk, as I suspected your comment on electoral votes was irrelevant. That’s fine. It is also fine if you blame everything on Bush. I never voted for Bush and I don’t even consider myself a Republican.
That said, I never thought the demonization of Bush was particularly rational.
But I have concluded that the Republicans will inflict less long term damage on the U.S. than the Democrats. The Democrats want to turn the U.S. into a Euro-style welfare state. Maybe this works in Sweden, but it will never work here.
And , you realize,whether you voted for Bush is irrelevant.. Nor are your thoughts on the “demonization of Bush”.
Y
ou’ll have to get tpgetjer with magus. Give him a serious talking to. On a recent blog he referenced Finland as a goal we should ami fo– “In my blog post on compromise, I posted a link that says the Fins cut gov spending by 100% in order to meet budgets.” July12, 2:28 pm “Compromse and the Deficit Ceiling.”. I had to inform him that they had
universal health care.
Your last paragraph is your opinion. If the poll from Quinnipiac (July 14, 3:54 pm below) is any sign, you’re opinion about who’s likely to inflict the most damage is a minority opinion. .
Finland’s corporate tax rate is 26%. The US is at 40% on the average with state and federal. Add in doing business in NY city and it probably nears 45-50%. Universal healthcare or not, we have a spending problem if our corporate tax rates are so high and it is still not enough. Canada has universal healthcare and their corporate tax rate is about 20%. China’s corporate tax rate is 25%. Government spending is around 25% of GDP and it has normally been around 19%. BTW, Congress was ruled by the Dems since 2006 I’m pretty sure they have something to do with spending too. Bush was no penny pincher for sure, and he made far too many compromises to get his war funded during this time. What do you expect from a guy though that learned economics from Yale?
Mike;
This is a great analogy and a great article. First, it is definitively true that to lose weight the best and probably the only healthy strategy is to eat less and exercise more. On top of that it is very important the quality of what you eat and the quality of your exercise. Good quality food is essential as well as a tailored exercise program, and they both have to be balanced. And for each stage of your weight loss program they vary; it is not a single solution fits everything and everybody. It is a tailored plan to fit the particular individual and its situation. For example, if the person is seriously overweight the amount of exercise he will be able to do is limited without risking significant injury. It is also true that an abrupt and significant reduction in food intake will create more health problems than benefits. Therefore the person is put through a gradual plan to slowly and consistently achieve its goals in the long run.
A very similar argument can be made for our debt reduction program, because it is not only about debt reduction; it is fundamentally about the health and fairness of our economy. So a well thought plan should take into account tax increases and spending cuts in a way that supports our long term interests as a country. Taxes are at their lower rates in our history; tax cuts worked in the 20’ or during JFK’s presidency because they were just too high. After 1945 they were high because we needed to pay for WWII. But then, the tax cuts begun to loose effect on the economy; they did not boost jobs as we saw during the Bush years, and the reason is because they were not the correct response to the economic problems at the time. Unfortunately, and as much as we hate it, we need tax increases and we need to do it in a way that favors our economy. And spending has to go significantly down. Contrary to the false claims that the current administration is the irresponsible spender, the size of the government has been going steadily down as it is demonstrated by the reduction in jobs in the federal government- a steady trend only interrupted by the census. But I believe it is not enough, we need to gain efficiency and most importantly integrity and expertise. To not sacrifice our future, I believe it is key to fund critical programs particularly in the areas of health, education and innovation as well as support our export business.
I understand that my views regarding the role of the government are different than many of other contributors to this blog. I respect them. But I believe that the correct and balanced mix between government and businesses is the best for the country.
Again, we have the highest corporate tax rates in the world. How much more do we need? There aren’t going to be more jobs or higher raises from taxing corporations more.
jjm,
The Dems can’t even stomach a 5% cut in spending.
http://online.wsj.com/article/SB10001424052702304911104576443863077227784.html?mod=rss_opinion_main
The Congressional Budget Office estimates federal spending at $46.1 trillion over the next 10 years, a dramatic escalation from projections before Mr. Obama took office. Mr. Boehner’s modest proposal was to trim that back 5.2% over the decade, but the president balked.
That’s exactly what I mean. They refuse to reduce spending. Obama is pretending to be the moderate voice of reason–he’s so damn good at pretending to be that, it’s scary–and he’s not. He will not lower spending. That is not compromise.
If you only raise taxes but do not lower spending you risk further damaging the economy AND increasing the deficit.
The Congressional Budget Office predicts that the US will run deficits until 2083. As far as I can see, they’re right. It’s such basic logic and there are so many easy cuts in our fat, bloated federal spending, and yet the Dems will continue to vote harvest and be like Mike: “If we cut spending, kids won’t go to school and we’ll lose our roads!”
I don’t think anybody here understands the problem. Debt in and of itself is neither a good thing nor a bad thing. For the most part the preference is to be out of debt, but if you have an opportunity to borrow money when there is opportunity to generate return that exceeds the cost of borrowing or in case of an emergency, you should do so. What is at risk is our ability to keep borrowing. When you borrow money, it obviously has to come from someone else. If that other party sees you as being solvent and able to repay that debt, they will loan you the money at a lower cost. If they see higher risk that you won’t pay it back, they will either expect a greater return on their money or not loan you the money at all. You can dream up all the philosophical BS you want, but if you can’t convince someone else to give you the money to build your pipe-dream, you ain’t getting the mooolah. As your debt grows, and if you spend it on low-return or a large number of unnecessary frills, it will be harder and harder to get access to that credit. Unless you understand this fact of life, you might as well be knitting sweaters for dead squirrels.
Let’s also remember that interest rates won’t stay low forever. When they rise the interest on our debt will become a larger and larger share of our budget.
At what point will the interest we pay to China surpass our defense budget?
The best analogy is the doubling down tactic in poker. Everytime you lose, you just bet twice the amount of money until you win back what you lost and more. It works perfectly if youhave an infinite amount of money. But in the real world you eventually run out of cash and can’t double down anymore.
Essentially this is just the disease of democracies. Look at what happened to Athens after Pericles died. Demogogues gained power and mob ruled. The masses grew fat and dumb until Sparta smacked their fat asses into oblivion.
In keeping with the spirit of this post, there is a classic book called “The Philosopher’s Diet” by Richard Watson. The basic idea of the book is that if you want to gain control of your life, you need to start by first gaining control over your own body, and specifically your weight.
The inability of the US to come to grips with its budget deficit is a red flag that we as a nation are no longer in control of ourselves and by extension anything else.
“. . .requiring people (and corporations are people) to bear a fair share of the burden of public services (such as fighting wars for the strategic interests of American businesses.)”
.
This Quinnipiac poll seems to me to provide a fair sense of how the majority of the public currently feels about George Bush’s role in this mess and about taxing the rich:
http://www.quinnipiac.edu/x1284.xml?ReleaseID=1624&What=&strArea=;&strTime=0
“The country is in a recession, 71 percent of American voters say, but by 54 – 27 percent they blame former President George W. Bush more than President Obama. . . . . .” Even poor dumbass independents blame the W.. Can’t they see the truth, the whole truth, the nothing but the truth as if darkly through the eyes of Grover Nordquist, Rush LImbaugh, Glenn Beck, and the rest of the conservative purists.? Is there not one among them who isn’t just trying to make a buck—Sarah Palin, for example?
“Voters will blame Republicans over Obama 48 – 34 percent if the debt limit is not raised;
Voters say 67 – 25 percent that an agreement to raise the debt ceiling should include tax hikes for the wealthy and corporations, not just spending cuts;
Voters say 45 – 37 percent that Obama’s proposals to raise revenues are “closing loopholes,” rather than “tax hikes”;
But voters say 57 – 30 percent that Obama’s proposals will impact the middle class, not just the wealthy.
“‘The American people aren’t very happy about their leaders, but President Barack Obama is viewed as the best of the worst, especially when it comes to the economy,'”
Oh, well. One unpleasant and sometimes dangerous aspect of a democracy is having the majority hold views that differ from ours, I guess. But , then, this is just a poll. And we know the true will of ^all^ the people is only expressed in elections. . . And we’re not living in a democracy. It’s a constitutional republic based on a representative democracy. Even if those misinformed lunatics in the large, unwashed (and ivory tower bound?) majority hold a view that opposes ours, we well-informed lunatics in the minority can still get our way, however we can.
Haven’t seen other recent polls. I’ll probably just go with Quinnipiac , because they agree with my view. That’s the way we roll around here ain’t it?
55% opoose a tax hike…
http://www.rasmussenreports.com/public_content/business/taxes/july_2011/55_oppose_tax_hike_in_debt_ceiling_deal
Here’s another poll to add to the one I provided below:
http://www.washingtonpost.com/politics/public-sees-big-consequences-from-debt-default/2011/07/19/gIQAmLnkOI_graphic.html
To the question “Overall, what is the best way to reduce the budget deficit” 62% of “All” responded: A “Combination” of “Cut spending ^and^ “Increase taxes” —Democrats 74%, Independents 64% and Republicans 46%. I can’t read into those figures that 55% oppose a tax hike.
“Overall, more than six in 10 Americans say a plan to reduce the deficit should include a combination of spending cuts and new taxes, rather than exclusively one or the other. Big majorities of Democrats and independents and nearly half of all Republicans support the mixed approach.”
Rasmussen has a rep. I’ll go with this WaPo/ABC and the Wall Street Journal/NBC below for now. But keep an eye on them. I’ll bet the figures will be changing often as the ^^^^Aug. Deadlilne^^^^^ approacheth.
I’m sure they would change depending on which tax effects whom. We already have almost half of the country paying next to nothing in income tax. It is pretty easy and cowardly to point and say, “Yeah, take his for me.” The problem is obviously too much spending and not the lack of taxes. Budget deficit of 1.6 trillion and a projected 10 year deficit of 13 trillion. http://www.npr.org/blogs/money/2011/07/15/137845220/-13-trillion-the-projected-10-year-deficit
The other problem is projected GDP growth with all of the numbers thrown out. With the running headline for the last (I lost count around 15) so many months of ‘Job numbers unexpectedly low’, you can bet the GDP growth they are also estimating is too high.
“pretty obviously. . .”.
Sorry. Not so obvious for the majority of the public. Or me. Or this guy at The Economist:
“Put simply, NO fiscal consolidation that the IMF has judged to be successful relied on public spending cuts for more than 83% of its impact. In successful fiscal consolidations, TAX RISES #* accounted for between 17% and 33% of deficit-reduction measures.” (again, caps mine so you don’t miss the point)
http://www.economist.com/blogs/freeexchange/2011/07/america%E2%80%99s-debt-ceiling
#*That would be tax increases, revenue increases, however you want to label the bottle. The opposite of tax increases is either no tax increases or tax reduction. TeaPrs are demanding 100% and zero, right? Not 83% and 17%. The two polls I’ve provided show the American people, by a solid majority, favoring something along the lines of, perhaps, 83%-17%
I’m for a 5 year period of withdrawal from the world by the US, for a couple of reasons. First, is the cost of having advisors, armies, navies and air assets in so many places. There is little reason to have bases in germany anymore. We’re helping the Euro economy more than our own. Billions of dollars in aid to countries that hate us. I’ve seen first hand that money will not make fundamentally different cultures like us.
Secondly, ther are places that in fact do need to take forms of American protectorates. And yet liberals in our own country don’t seem to realize the utter chaos that the threat of American intervention stops from ensuing. The world is not a nice place. There are several wars that would break out if there were no threat from America. America is not the cause of all world strife; it keeps a greta deal of strife from even happening. But the world is a spoiled brat and so are the whiny factions in America. So the world needs to miss a meal. It needs to be sent to bed without supper. It needs to remember what it’s like to again feel hunger.
In the meantime, we can heal our own country and regain the respect of the world. Too much of our own money is flung into a sneering world.
magus
Ah. . . a five-year “temporary llibertarian” 🙂
kernunos–your 7:38:
Ah,the shifting sands of public opinion as the debt ceiling crisis looms nearer:
“Of those polled, 58% said they SUPPORT Mr. Obama’s approach, a $4 trillion deficit-reduction PLAN over 10 years THAT WOULD cut federal spending, including on Medicare, and RAISE TAXES ON CORPORATIONS AND THE WEALTHY* In comparison, 36% said they backed the leading proposal among congressional Republicans, which would reduce the federal deficit by $2.5 trillion, also over 10 years, by cutting federal spending but holding the line on taxes.” (I’ve added caps just in case you missed the phrase
NBC/WSJ poll /Murdoch owned, conservative- leaning) July 16,2010
http://online.wsj.com/article/SB10001424052702304567604576456251136740010.html?mod=WSJ_hp_LEFTTopStories
*This would be a tax HIKE, right? 58% is a majority, right?
Regarding your 7:32pm:
You’ll can find a ton of interesting info on the chart in the article “Tax Rates Around the World” in Wikipedia.
I’m not certain what comparing our corporate tax rate with foreign countries accomplishes in this discussion. Especially when the argument comes from those who trumpet American exceptionalism. Do we want to be Finland? What do I care about Finland’s corporate tax rate? After all, if you point out to me that Finland has a corp. tx. rate of 26% and we don’t, I point out that they have health care and we don’t. If we want something to aim for, why not compare the US to Gibraltar (10% corp. rate) or Montenegro or Uzbekistan(both 9%)? For what it’s worth, have any of those three countries been carrying out 2 major wars over the last 10 years? What say we cut our defense budget to their levels? . .That’ll free up some money to balance the budget, eh?
On the chart I’ve recommended would it be right to assume that the corp. rate in the US being 35-0% fed, and 12-0% state means that some corporations can get away with payiing no taxes?# In Finland it’s 26%, straight up–no loopholes. In Brazil, one of the world’s fastest growing economies, it’s 34%–again apparently with no wiggle room for corporations to end up paying no taxes at the end of the year as in the exceptional US.
Some info on those corporate tax loopholes—–
http://www.businessinsider.com/corporate-tax-breaks-2011-2
#This assumption arises from the zero in 35-0%. Note Finland’s 26% isn’t accompanied by a zero.
And what did I expect of Bush? Very, very little indeed. I did expect the electorate to be too smart to elect him in 2000 and 2004. I was wrong. 😦
I agree if you are calling for a flat tax. Let’s lay it all out so there can be no fuzzy deals behind the scenes. I’m all for it and for that matter I do not feel there is some sacred cow that cannot be touched. I’m sure defense could use some trimming or some smarter spending. http://www.businessinsider.com/two-navy-ships-henry-eckford-benjamin-isherwood-scrapyard-2011-7
The governmant can be just plain wasteful. There is so much trimming to be done. I also say that social security money would be a better return over someone’s life in a basic savings account than letting the government muck with it.
http://www.heritage.org/Research/Reports/1998/01/Social-Securitys-Rate-of-Return
As for polls I like to look at their sampling. Adults as opposed to likely voters, political affiliation sampling..etc, etc .
I’m still not sure how higher corporate taxes help the job situation though, especially if the wealthy decide some business investments are just too risky and sit on their wealth.
“. . would be a better return over someone’s life in a basic savings account than letting the government muck with it.. . .”
You can ^think^ it. Can you ^prove^ it? If your timing is right, you may be able to beat SS putting money in the stock market, but in a savings account? Really? Tell me where you bank, and I’ll open a savings acct there right away.
http://www.csmonitor.com/2004/1227/p01s03-cogn.html
http://www.angrybearblog.com/2009/03/social-security-return-on-investment.html
“. . .if the wealthy decide some business investments are just too risky and sit on their wealth.
Aren’t the wealthy already sitting on their wealth ?
Defense: :”. . .some. . .” heh 🙂
This is pretty good.
This is good, too.
THE ANT AND THE GRASSHOPPER
TRADITIONAL VERSION
The ant works hard in the withering heat all summer long, building his house and laying up supplies for the winter.
The grasshopper thinks the ant is a fool and laughs and dances and plays the summer away.
Come winter, the ant is warm and well fed.
The grasshopper has no food or shelter, so he dies out in the cold.
MORAL OF THE STORY: Be responsible for yourself!
——————————————————————————
OBAMA-REID-PELOSI VERSION
The ant works hard in the withering heat and the rain all summer long, building his house and laying up supplies for the winter.
The grasshopper thinks the ant is a fool and laughs and dances and plays the summer away.
Come winter, the shivering grasshopper calls a press conference and demands to know why the ant should be allowed to be warm and well fed while he is cold and starving.
CBS, NBC, PBS, CNN, and ABC show up to provide pictures of the shivering grasshopper next to a video of the ant in his comfortable home with a table filled with food.
America is stunned by the sharp contrast.
How can this be, that in a country of such wealth, this poor grasshopper is allowed to suffer so?
Kermit the Frog appears on Oprah with the grasshopper and everybody cries when they sing, ‘It’s Not Easy Being Green.’
ACORN stages a demonstration in front of the ant’s house where the news stations film the group singing, “We shall overcome.” Then Rev. Jeremiah Wright has the group kneel down to pray to God for the grasshopper’s sake.
President Obama condemns the ant and blames capitalism for the grasshopper’s plight.
Nancy Pelosi & Harry Reid exclaim in an interview with Larry King that the ant has gotten rich off the back of the grasshopper, and both call for an immediate tax hike on the ant to make him pay his fair share.
Finally, the EEOC drafts the Economic Equity & Anti-Grasshopper Act retroactive to the beginning of the summer.
The ant is fined for failing to hire a proportionate number of green bugs and, having nothing left to pay his retroactive taxes, his home is confiscated by the Government Green Czar and given to the grasshopper.
The story ends as we see the grasshopper and his free-loading friends finishing up the last bits of the ant’s food while the government house he is in, which, as you recall, just happens to be the ant’s old house, crumbles around them because the grasshopper doesn’t maintain it.
The ant has disappeared in the snow, never to be seen again.
The grasshopper is found dead in a drug related incident, and the house, now abandoned, is taken over by a gang of spiders who terrorize the ramshackle, once prosperous and once peaceful, neighborhood.
The entire Nation collapses bringing the rest of the free world with it.
MORAL OF THE STORY: If you choose to become a parasite, don’t kill your victim.
http://danieljmitchell.wordpress.com/2010/02/17/the-fable-of-the-ant-and-the-grasshopper-the-pc-version/
I’m simply shocked by how the ants are thriving in this parasite-ridden environment! Perhaps that’s because,–to the surprise of some I’m sure–that to be fair and honest only a relative handful of all grasshoppers are drunken, drug-crazed, lazy, irresponsible, drooling louts.
Many, many# * actually work in the production of products that the ant couldn’t produce himself. And maintain the infrastructure that the ant needs too transport the goods the grasshoppers have produced for him.
But you’d never know that from your characterization of a struggle between the rich and everyone else.
In fact, I wouldn’t be surprised if there aren’t more than a few ants who are not industrious, honest, salt-of-the-earth patriots (by implication) depicted in your comment.
#*. . . Yes, “many, many” work even in this period of high unemployment where some ants are sitting on piles of money that could be used to help the job market expand. . .