We ought to move the tax payment date to 31 October, so that taxes come due just prior to elections.

Also, can we just admit that deficit spending is simply taxation without representation? face it, the generation that is going to get stuck with paying back the debt hasn't acquired the right to vote just yet. Presuming they've been born.

Also, can we just admit that deficit spending is simply taxation without representation?

If only we could get people to see it that way. People seem not to care about the deficit, perhaps due in part to our human psychological orientation toward the RIGHT NOW.

When the old couple with all the debt dies, all of their assets get sold to pay off debt and the lenders have to write off the remainder.

In the case of government borrowing, the debt can simply be passed on to the next generation.

I have lived in the same place for the last twenty years, and am on my fifth endocrinologist.

There is no doubt Obamacare has exacerbated the problem of finding and keeping a doctor, but doctors seem to rotate in and out of my medium sized town like they were in the military.

Primary care at the basic level is ever worse because it has mostly been turned over to PA's, and they are not qualified to handle much besides a referral to a specialist if you are sick.

Sorry last post was for the topic below.

Our esteemed hostess suggests that many people do not care about the deficit.

Not to disagree, but to build on the point - to say that people don't care about the deficit/debt sort-of implies that they are aware of it, but choose not to assign importance to it. I think it's more fundamental - most people aren't even aware of public deficits/debts in any real-existential sense.

The City of Detroit just went through bankruptcy, after racking up a budget deficit and accumulated debts that could never be cleared by any rational means. Spending beyond income had been a habit in the city for 50 years or more.

But to most of the citizens who were made to take a haircut (in benefits, incomes, pensions or services) the very concept of the deficit or the debt was simply foreign - the idea that the city's spending practices could have any impact on them, personally, was simply incomprehensible. And the fact that it was/is going to have an impact on them caused a mixture of equal parts outrage and bemusement.

The semi-criminal structuring of the bankruptcy didn't help, of course - people couldn't grasp how it is that the city gets to keep its multi-billion dollar publicly-owned art collection at the DIA, while retired sanitation workers and schoolteachers have to take cuts in pensions and benefits to balance the budget, reduce deficits and pay off the debt. I don't understand it, either - if I ever file for bankruptcy, I doubt very much whether the judge would let me keep my art collection as long as there are creditors to be satisfied.

llater,

llamas

llamas, also consider the case of people who had invested in Detroit munincipal bonds. Lots of people probably had some of those in their retirement accounts; back in the '80s and '90s, muni bonds were pushed as "safe" investments with tax advantages (the federal government cannot tax income earned on bonds issued by other levels of government). People are starting to find out now, the hard way, that munis aren't always as safe as they are made out to be.

@ Cousin Dave - oh, absolutely. I didn't touch on that because it doesn't speak to the initial point - whether people care about or even know about public deficits or debts - but you are absolutely right, the way in which Detroit municipal bondholders were (pardon my French, I'm not usually this crude) ass-raped during the bankruptcy process was simply mind-boggling. The prevailing opinion in Detroit at the time was that the majority of the senior debt was owned by banks, insurance companies and pension funds, so screw 'em, they can afford it. This is a very dangerous road to go down - to rank the creditors by popularity.

Mind you, I guess there was plenty of precedent, since the bond-holders of GM were ass-raped in virtually identical manner during that bankruptcy process, and for the same reasons. It seems that once a bankruptcy reaches a certain size, the plan of adjustment owes more to the wishes of politicians than it does to any concept of an orderly restructuring. I just don't understand how/why Federal bankruptcy judges can allow this to be done to them. Perhaps they think it's a good idea, in which case, shame on them.

Both GM and the city of Detroit should have been made to go through a conventional, standard bankruptcy, where all assets are realized, creditors paid to the best extent possible, and the carcass either reorganized or humanely despatched, according to the circumstances. Instead, we get these insane zombie bankruptcies, where the carcass is propped up and made to jiggle as though alive, all powered by vast amounts of money either pilfered form the public purse or straight-up stolen from the senior creditors. It's an abuse of the bankruptcy process that should have us all outraged.

I'll get down off my hobby horse now.

llater,

llamas

Llamas looks good on that hobby horse.

Which is a sentence I could never have imagined writing.

Also, echidna looks good on that tadpole.

LLamas, I think you'll like this.

Funny, I was born and raised in Detroit and worked at GM until 2008 and I said the same thing, sell everything they have and let the stakeholders sue the board (or city government) into personal bankruptcy and/or prosecute them for malfeasance and abuse of the public trust. Let GM's factories be sold to people who might know how to build cars at a profit that people might want to buy. Sell the DIA collection to museums that people might actually go to, cause lord knows nobody wants to trek to downtown Detroit to see much of anything.

Of course that could not be allowed because Unions are a huge voting block for Democrats. The UAW would no longer be allowed to extort car companies if there were half a dozen new little ones in Detroit. No more 200% increase in the cost of labor, no more padding the payroll with the sons, nephews, cousins and family friends of union bigwigs. No more cushy $30+ dollar an hours jobs moving a dozen parts per WEEK for high seniority ass-scratchers (I saw that one myself). No, better to loot the American people to keep the UAW and the rest in power and supporting Democrats.

Frankly, I cannot express the level of relief I feel not living in that shit-hole. I would rather starve in Montana than live like a King in Detroit, till they finally burn the city down, which I fear is coming sooner than most people think.

The people of Detroit have seen their services reduced for years prior to the bankruptcy. Some have stopped paying their taxes. Ordinarily, I would disagree with that. Given that they're not getting basic core services in a timely fashion (fire, police, EMS) and instead paying for the retired police, fire and EMS personnel I don't have a problem with them not paying their taxes.

People are starting to find out now, the hard way, that munis aren't always as safe as they are made out to be.

Muni's aren't safe, period. It's based on the notion that a government with taxing authority can always raise taxes, thus being able to pay on the loan.

Except that when a city/county/state becomes too expensive to live in, people move away and take their money with them. As I recall, San Bernadino, CA just recently told their bond holders to pound sand as they prefered to make a payment into CALPERS instead of their bond obligation.

Interesting find: cities and counties in bankruptcy and default.

The Federal government has the on option that the others don't: they can print legal tender, and thus inflate away their debt. The people who get screwed are the ones who save their money, only to see it decrease in value.

Your hated 'safety net' programs like welfare are only 11%.
And two statistics to be really alarmed about are not SS and Medicaire/Medicaid (we can fund Social Security by raising or removing the upper limit on SS taxed income), but Transportation Infrastructure at 3% and education at 1-2% (depending on whose chart you trust).

Transportation infrastructure would seem to be important. If we can't move goods, we can't sell them. If we can't move goods, we can't buy them.

And since we don't need to educate our kids (and adults), who cares?

Drcos, Medicaid and Medicare are two different programs with different funding. Medicaid is welfare, getting its money from federal and state taxes. People on Medicaid must meet eligibility criteria based on financial need; granted, it is possible to manipulate your finances to qualify. Medicare is,to the best of my knowledge, funded with Medicare withholding from pay checks.

So you clearly need to add Medicaid to you safety net figure of 11 cents. There are also many people getting Medicare that contributed little or nothing to the program effectively making it a form of welfare as well.

I forgot that Medicare does get premiums from some recipients

DrCos,

SS, medicaid and medicare are also welfare programs. So welfare counts for 70% of federal spending and interest is another 7%. Education is a state issue, not federal. Same for transportation. For most states education is ~50% of their budget with police and fire accounting for the other 50%.

As to removing the upper limit on SS taxes, are you going to count those contributions to those who pay them? If so SS is even more unsustainable. Either way it still won't stabilize the federal budget. Not enough money to make a difference. And honestly it probably won't bring in any more tax dollars. There is a reason Hauser's Law has lasted this long.

" We ought to move the tax payment date to 31 October, so that taxes come due just prior to elections."

Would probably backfire. Not only does a sizeable chunk of the electorate see filing tax returns as a handout, the government (read: Democrats) would push for bigger handouts to more people.

The 1% to 2% on education? That ought to be 0%. This is not the job of the federal government. Education is, and has always been the responsibility of the local community.

The federal government has not improved anything, but there sure are a lot more highly paid administrators and bureaucrats than there used to be.

A billion here, a billion there, and pretty soon you're talking about real money...

SS, Medicaire and Medicaid are broken out separately in the articles discussing the budget dollars.
And while Medicaid might be considered a welfare ('safety net') program, SS and Medicaire are not.

And countries whose federal governments spend more on education are eating our lunch.

"Medicaid might be considered a welfare ('safety net') program, SS and Medicaire are not".

Yes they are. In order not to be welfare, what you take out of them has to be limited to what you put in, plus a reasonable rate of return on your money, probably no more than six percent.

Social Security disability payments have largely replaced traditional welfare, to the detriment of all taxpayers.

I pretty much agree with everything you've brought up. Just a note, I'm am an online friend of one of your interviewees, Barbara Oakley, who is a hero of mine. Tony

SS and medicaid are welfare. These are transfer payment programs. Current beneficiaries are paid by current tax payers. There are no property rights and payments can be stopped or modified at congress's whim. For these to not be welfare there must be personal property rights.

And which governments are eating our lunch? Europe's? The US spends ~5% of GDP (or 17% of total taxes) on education. Given the negative correlation between education spending and education outcomes we are probably spending too much.

What we need is a 600-ship Navy and unlimited deficit spending.

I mean, we LIKE Reagan, right?

> What we need is a 600-ship Navy

One can readily imagine worse approaches to the 21st century.

(285, and thanks for asking.)

Her Majesty's Royal Navy of Britain has more admirals than ships, and is one-fourth the size of the Japan Maritime Self-Defense Force.

Which will have the larger influence on the outcomes of the onrushing century?

The Brits have a lot of nice books and costume dramas and TV shows about automobiles and stuff.

Um, wait a sec.

And yes, I like Reagan. In retrospect. Never voted for him. Saw him through a window at work once, as he was approaching an appearance. Approximately here.

OK, all I really saw was a brown suit in a limo.

But years later, I realized that he'd prepared my country for perhaps the closet intersection of safety and wealth we would ever know.

The 90's were GOOD.

Shit, just thinking about it makes me wanna call my old girlfriends, who really REALLY don't wanna be bothered. They have grandchildren and arthritis and stuff.