The Fiscal Cliff

[Omaha 680]

I'm not sure if this is especially relevant given the US PPP/capita is about twice that of Greece.

Debt/GDP is a better comparison for this discussion. We just topped 100% while Greece is blowing bast 160%. It might not take long to catch them at our rate of borrowing though.

[Goatnapper'96]

In my opinion President Barack Obama went from a decent guy who I felt was a shitty President and a liberal idealogue to full blown wanker over this sequester. His hysterics were embarassing. The sequester is dumb, like he said. It will also hurt the economy. Cutting government spending can help the economy in many cases if government revenues are equal to government spending. In such cases I believe then private money will take the place of public money and usually the private sector is more effecient, if not ruthless and discriminatory. However, in our case where the government only collects 70% of what we spend, cuts will not be replaced. But they have to happen. Further, with our political system, special interests and parochial/territorial interests of elected leaders it has proven impossible to make specific cuts. Hence, a sequester is our only viable option so lets stop carrying on how stupid and dumb we are and recognize it for what it is. Much of these cuts are to defense spending so I don't get why Liberals are up in arms other than they are following the lead of their thin-skinned wanker leader who thinks anyone disagreeing with him is out to get him personally. But as he is finding out this sequester is a losing issue for him. But I think the adults are noticing that we might be finding a way to cut government spending. The public wants spending cuts but as Democrats are aware any specific spending cut is unpopular. Hence the Democrats want the Republicans to identify their specific cuts so that they can then crucify them in the court of public opinion, but sequester, as stupid as across the board cuts are, seems to be the solution because it provides political cover by hitting every special interest group. We all want cuts but no cuts to our goodies - this helps to solve this dilemma. I hope we have another one someday but I think we are going to see the most intense gridlock for the next 1.5 years as the President will continue campaigning for a Democrat majority in the House. If he gets it he can have his shangra-la but if he doesn't we will have intense gridlock for 3.5 years. I would like to see a deficit reduction deal that raises another $800 billion of revenues, reforms entitlements and cuts another $800 billion of discretionary spending over a decade but I just don't think it is feasible with the current situation in DC.

[Omaha 680]

But as he is finding out this sequester is a losing issue for him. But I think the adults are noticing that we might be finding a way to cut government spending. The public wants spending cuts but as Democrats are aware any specific spending cut is unpopular.

In the Krauthammer article I linked above, he points out that the anti-budget cuts crowd readily admit that the worst thing that could happen for them is these cuts happen and the sky doesn't fall. I think the President has painted himself into a corner with his rhetoric.

[Goatnapper'96]

In the Krauthammer article I linked above, he points out that the anti-budget cuts crowd readily admit that the worst thing that could happen for them is these cuts happen and the sky doesn't fall. I think the President has painted himself into a corner with his rhetoric.

It was really embarassing. If Cali is alive and kicking can he give me an ETA of when President Barack Obama is going to have that "adult" conversation he promised in November, 2008. I was really looking forward to it but perhaps I just missed it.

[byu71]

Additional taxes on the rich might sound good but it is truly what one calls a "slippery slope".

The democrats are consistent throughout the last 40 years. Give us tax increases and we will cut spending. Reagan got caught, poor ole George Bush 1 got caught and remember the press trying the gotcha question of $10 in cuts for $1 in revenue. How people couldn't see through that is beyond me.

Obama has shown his hand. Give me the revenue increases and spending cuts come later when the economy is better and we don't need government spending. The spending WON'T come down and eventually the definition of rich will have to get larger and larger. Once you have said 5% additional won't hurt the rich and a $400,000 income is rich, it becomes easier to ask for another 5% and lower the income level for the rich.

Here is the deal. Can you use the money better than the government to take care of you. Defense and infrastructure, yea they can. If the dems get the House in 2014 we will be locking in some entitlement spending that will eventually have us being forced to make some extremely tough decisions down the road.

[Goatnapper'96]

Additional taxes on the rich might sound good but it is truly what one calls a "slippery slope".

The democrats are consistent throughout the last 40 years. Give us tax increases and we will cut spending. Reagan got caught, poor ole George Bush 1 got caught and remember the press trying the gotcha question of $10 in cuts for $1 in revenue. How people couldn't see through that is beyond me.

Obama has shown his hand. Give me the revenue increases and spending cuts come later when the economy is better and we don't need government spending. The spending WON'T come down and eventually the definition of rich will have to get larger and larger. Once you have said 5% additional won't hurt the rich and a $400,000 income is rich, it becomes easier to ask for another 5% and lower the income level for the rich.

Here is the deal. Can you use the money better than the government to take care of you. Defense and infrastructure, yea they can. If the dems get the House in 2014 we will be locking in some entitlement spending that will eventually have us being forced to make some extremely tough decisions down the road.

How many Republicans in the House are from Districts that Obama carried?

My predictions are I think it more likely the R's pick up seats than the D's pick up seats but I doubt my powers of political prognostication are much respected in these parts. The reality is I am one of those Republicans that is really out of touch. But I am ok with it, I live in Power County, ID and that likely explains a lot.

[byu71]

How many Republicans in the House are from Districts that Obama carried?

My predictions are I think it more likely the R's pick up seats than the D's pick up seats but I doubt my powers of political prognostication are much respected in these parts. The reality is I am one of those Republicans that is really out of touch. But I am ok with it, I live in Power County, ID and that likely explains a lot.

I agree with you. I doubt very much the dems can convince enough republicans to switch to their side. If the repubs couldn't convince a district in Utah to switch from Matheson after having Obama as President for 4 years, I don't see how many at all ever get switched.

I just bemoan over and over, I know, the fact that a large number of the public do not educate themselves enough to go beyond spoon fed Obama love the general media hands out.

[venkman]

Good partisan-free article on the sequester report by the great Jamie Dupree.

http://blogs.ajc.com/jamie-dupree-wa...s-and-details/

So there are actual cuts to certain areas of the budget, but still an increase overall y/y as I understand it. So, yes, some departments will feel a little pain. I still subscribe to PJ O'Rourke's circumcision rule: you can always take 10% off the top!

[Uncle Ted]

I'm not sure if this is especially relevant given the US PPP/capita is about twice that of Greece.

Debt/GDP is a better comparison for this discussion. We just topped 100% while Greece is blowing bast 160%. It might not take long to catch them at our rate of borrowing though.

Yes, I agree that debt/GDP is a better measurement but GDP can quickly change especially when 170 million jobs being lost thanks to the sequester (if you believe what the dems are telling people).

[YOhio]

So now that furloughs are around the corner does anyone have sequester predictions? Neither party wants to get tagged with sequestration going into midterm elections so at some point this will have to be addressed.

[byu71]

I see where Patty Murray's budget has 1 trillion in new taxes over 10 years. Is that only 100 billion a year?

That is probably only a drop in the bucket when you add up the little extra the millionaires and billionaires will pay to cover it.

One thing that I hope Patty has taken into consideration. I now know two people who earn over a million a year who are taking steps to reduct their income to under $400,000. There are ways to do that without using any of the intended changes to what is deductible.

I imagine this will hurt the church too. Instead of over $100,000 a year in tithing, it will go down to $40,000.


P.S. Is there anyone on this board who has heard Patty talk for an extended period of time and thinks she knows her ass from a hole in the ground.

[cowboy]

Not quite sure how this is much different than what Cyprus is doing, but I'm not a Constitutional scholar, or even a lawyer. The Department of Interior has decided to deal with sequestration by not paying oil royalties due to states under federal law. How is this not a taking?

Governor Mead: Interior Cannot Meet Budget Reduction by Taking State’s Share of Mineral Revenues

CHEYENNE, Wyo. – Governor Matt Mead is evaluating a letter sent by Director Gregory J. Gould of the Department of Interior, Office of Natural Resources Revenue, to the State Treasurer’s Office. The correspondence is dated Friday, March 22 and was received on the afternoon of Monday, March 25 by the State Treasurer’s Office.

In his letter, Director Gould indicates that, beginning in March 2013 and continuing through July 2013, over $53 million dollars of mineral revenue payments payable to the State of Wyoming will be withheld under sequestration. The monthly amount withheld will be $10,616,442.00 with the possibility of more withholding in August and September. Under federal law, Wyoming is guaranteed 50% of the revenues from mineral leasing on federal lands in this state.

Governor Mead has sought advice from the Attorney General’s Office on recourse available to the State of Wyoming for this impending federal action. All options are being considered. “When the State reduced its budget by over 6% it did not achieve its reductions by withholding mineral revenue due under state leases. That would be taking someone else’s property. Similarly, the Department of Interior should not be able to meet its budget reduction by taking mineral revenues which belong to the states under the law,” Governor Mead said.

Governor Mead is also concerned about the timing of the March letter which addresses federal action set to begin immediately. He said, “This is no way to achieve adequate notice or give our State an opportunity to respond before the action is underway. As far as communications go, this method of passing along significant information that greatly impacts Wyoming gets a grade of F minus or worse. It is not acceptable.”

Governor Mead is consulting the Congressional delegation and neighboring states that are similarly affected, as well as Attorney General Greg Phillips.

[Pelado]

Not quite sure how this is much different than what Cyprus is doing, but I'm not a Constitutional scholar, or even a lawyer. The Department of Interior has decided to deal with sequestration by not paying oil royalties due to states under federal law. How is this not a taking?

Is the letter available publicly? What is the reasoning from the DOI?

[cowboy]

Is the letter available publicly? What is the reasoning from the DOI?

I don't see that it is available publicly. This from the Wyoming Business Report:

Wyoming state officials are up in arms after Department of Interior (DOI) Director Gregory J. Gould notified the state that the DOI planned on deducting $53 million dollars from the state's share of federal mineral royalties between now and July.

The letter announcing the move was received by Wyoming State Treasurer Mark Gordon on Monday afternoon. Under federal law, Wyoming is guaranteed 50 percent of the revenues from mineral leasing on federal lands in the state, which typically amounts to about $1 billion a year.

[Surfah]

I don't see that it is available publicly. This from the Wyoming Business Report:

I haven't seen this anywhere before your post. This seems like something that should be getting more traction.