Diagnosing the debt

We know the problem – too much spending. Now undergo a cure

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We support President Obama's proposal for a "debt commission" to rein in federal spending. It's out of control, and it's clear Congress is either incapable or unwilling to stop the overspending.

The Financial Times of London says, "The U.S. must fix its growing debt problems or risk a new financial crisis," quoting a Federal Reserve official in Kansas City.

The thing is, Obama has been a chief proponent of deficit spending -- and to the extent presidents are able to, he's become the biggest spender in American history.

Imagine for a moment a multi-panel editorial cartoon in which Obama starts eating. With each panel, he keeps eating and keeps growing fatter. In the final panel, a morbidly obese president is sitting on a doctor's examination table saying, "Doc, find out what's wrong with me."

That's pretty much what he's doing in setting up a debt commission. It's no mystery what the problem is -- and he's been helping cause it. Neither the disease nor the cure requires an expert to diagnose and prescribe!

But OK, we accept the sad state of affairs in Washington: Our elected officials as a group do not have the wherewithal to stop the obscene spending, which is threatening the viability of this republic. They need help.

An executive-branch debt commission is better than none. But it's the legislative branch -- Congress -- that holds the purse strings. Too bad Congress can't admit its impotence in this matter and agree to set up a debt commission of its own, which would prescribe spending discipline (especially in Social Security, Medicare and Medicaid), which the House and Senate would then be required to vote up or down on without tearing it apart in debate.

Some believe the president's desire for a debt commission is little more than a vehicle to raise taxes. Indeed, the president recently acknowledged he is "agnostic" about raising taxes on the middle class -- amazingly, since the cornerstone of his campaign in 2008 was no new taxes of any kind for anyone making under $200,000 or so. We hope the skeptics are wrong. This is no time for new taxes; Americans are getting crushed by them already.

It's also important whom the president puts on the commission, and what the members' predilictions and philosophies are. We're rather skeptical the group will be overly laden with free-market, low-tax advocates.

But let's see what they come up with. If the panel's recommendations are worthy, Congress can always adopt them.

Our fiscal future may depend on it.

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Nat the Cat
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Nat the Cat 02/22/10 - 01:01 am
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I understand that the "debt

I understand that the "debt commission" is going to consist of 10 shopaholics from unsuccessful Interventions.

johnston.cliff
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johnston.cliff 02/22/10 - 02:35 am
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As a nation, we've said

As a nation, we've said "Okay, let's see what this young socialist with no leadership experience has to offer" and we've said "Okay, let's assume the leftist media has been telling the truth for the past four years" and we've said "Okay, let's see what this Obamacare bill is going to look like" and we've said "Okay, let's see what Obama's version of bipartisanship looks like" and we've said "Okay, let's see how Obama's stimulus works" and then finally, Virginia, New Jersey and New York said "Okay, that's far enough" and Massachusetts said "Enough!" Now, you feel "...let's see what they come up with...?" After two years with a Dem congress and another year with a Dem filibuster-proof majority and Obama at the helm, it's time to seriously look at the The Cloward/Piven Strategy of Economic Recovery and ask ourselves if the president is ACCIDENTALLY following this strategy .... to the letter? Is the proposed "debt commission" going to be anything more than another accountability cover? Has this social experiment gone so horribly wrong that America will soon be unable to recover?

Riverman1
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Riverman1 02/22/10 - 05:39 am
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To show you how the

To show you how the commission is stacked, one of the "Republican" members is former Senator Alan Simpson who said he doesn't believe cutting taxes to stimulate business and investing will increase revenue. In other words, he and the rest of the commission will recommend higher taxes for most, including the middle class. Obama will be able to break his promise of no new taxes saying the "bipartisan" commission declared it was necessary. Sort of like the Mayor saying the law department said he had to.

Brad Owens
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Brad Owens 02/22/10 - 07:26 am
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RM1, good posting. The fact

RM1, good posting. The fact is only one thing will slow this down, the ballot box in the Fall. We must elect folks that UNDERSTAND the problem and will swear to stop the run away spending.

Too bad it won't happen till a 'currency crisis' hits us.

Brad

grouse
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grouse 02/22/10 - 08:29 am
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Chronicle, deficit spending
Unpublished

Chronicle, deficit spending has been cited by economists to get the economy moving. It's not wasted money like Bush's invasion.

willienelson
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willienelson 02/22/10 - 09:39 am
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More like wasted money as in

More like wasted money as in Obama's continuation of the war in Iraq and increase in troops for his war in Iran.

dichotomy
31988
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dichotomy 02/22/10 - 09:44 am
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Let's see. It was announced

Let's see. It was announced this morning that Obama wants to put a member of the SCIU on the debt commission. Why would you put the union on the debt commission? They have driven the automakers to bankruptcy and their only punishment for that was that Obama gave them part of the company. They have driven most of the states to bankruptcy and now our state taxes will have to go up to pay their pensions and health insurance. Oh yeh, let's get some union leadership on our federal deficit. How about let's find someone who has cut spending and saved some money? That is what we need on the debt commisson. Not the SCIU.

randeg
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randeg 02/22/10 - 09:58 am
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This post goes to show there

This post goes to show there is some support for the hard work the Obama administration is putting on the economy. Of course, nothing is perfect and that is why he is asking for input. But don't do it in such a way that what you say is just a downright criticism. We have to be careful what we say for people will just believe and then there won't be any work done.

Evelyn Guzman
http://www.debtchallenges.com

Chillen
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Chillen 02/22/10 - 11:09 am
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How about a debt commission

How about a debt commission panel made up of real people and people actually experienced in reducing debt & controlling spending? Dave Ramsey, Suze Orman, a successful small business person, a regular "Joe" who has always lived within his means.

Why do these panels always have to be made up of a bunch of politicians who have no idea about the real world?

This debt commission is a joke. It is nothing more than political posturing from an administration who just wants to "look" good. Nothing of any substance will come from it.

scott_p
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scott_p 02/22/10 - 01:14 pm
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It seems there is never a

It seems there is never a lack of people who are ignorant about basic economics. Econ 101 people...you dont cut spending when the fed has interest rates effectively at 0%. Why you ask? With banks getting free money, basically, they are not going to be lending money which is risky as opposed to safer bets. This cuts off credit and forces layoffs (which is already begun). When people are afraid of losing their job, they don't spend money. So, business is not spending (no credit). Consumers are not spending (fear). The government is the spender of last resort to get the economy moving so the other two entities can start to lend/spend again. Tax cuts dont work because people will hoard the cash they save or just use it to pay down debt which does nothing to stimulate the economy. Unlike the Bush years of wasteful spending, the spending currently is on infrastructure and other "shovel ready" projects which give tax payers a sizable yield back. This has also kept many people employed who otherwise would have been laid off. The best way to cut the deficit is to establish good growth which increases tax revenues. The deficit is a long term problem, but we are dealing in the short term. Its easy to take on the "cut the deficit" mantra...its sounds good to people who dont know any better...including whoever wrote this piece

Chillen
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Chillen 02/22/10 - 01:43 pm
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scott Economics 101. If you

scott Economics 101. If you continue to spend more than you make or bring in, you will eventually run out of money and go bankrupt.

Here's the real problem. Too many social entitlements (food stamps, public housing & welfare), too many overpaid govt employees, too many bailouts, too much completely wasteful spending on stupid programs like the nesting habits of sand gnats, too many threats to increase taxes on the successful & productive, way too liberal pension plans for government employees, govt employee unions, the mismanaged ponzi scheme called social security, global warming crisis spending, excessive foreign aid, Bush's prescription medicare benefits. This list is seemingly endless.

Add in the fact that almost 50% of Americans pay zero taxes, thus allowing them to vote into office whoever promises them more goodies. Then you have a real crisis.

Too Much Government Period. That is the problem.

johnston.cliff
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johnston.cliff 02/22/10 - 04:28 pm
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scott, maybe you should have

scott, maybe you should have had someone more competent explain economics to you. Your idea of recovering from debt is too much like the government solution.

southernguy08
499
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southernguy08 02/22/10 - 05:09 pm
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Congress having to live
Unpublished

Congress having to live within its means? What a joke...almost as big a joke as congress passing a balanced budget amendment. Neither will ever happen, no matter what party or president is in power! Congress doesn't like us little taxpayers telling them how they can spend our money. Get that and learn it, cause it sure won't "change."

Ken
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Ken 02/22/10 - 07:22 pm
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Most economists say that a

Most economists say that a budget deficit of more than 3 per cent of gross domestic product is unsustainable over the long term. This year’s deficit is projected in the budget to reach nearly 11 per cent. Congress, where the budget will receive a rocky reception, must approve it after lengthy debate before the financial year beginning on October 1 for it to take effect. Good luck to Congress and our one term wonder president who will leave this spending spree debris to the next Republican President. I wonder if the new Pres will keep blaming the Obama Administration for his or her woes?

scott_p
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scott_p 02/22/10 - 09:25 pm
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Ok Chillen...once you move

Ok Chillen...once you move past your talking points memo, yes you are right. Live within our means LONG TERM, but who is giving up what? You'd still be driving on a dirt road if it was left to the free market to pave your roads. Long term deficits are not ideal, but I am talking about NOW. The government has to make up the difference. I said the debt has to be addressed LONG TERM, but in the here and now, the economy needs to be kick started. Yes it is a government solution. Thats why we have one. Its not the evil empire to hear the way you guys think of it. Also, lets look at facts. Large deficits began under Reagan when he reduced the upper most tax bracket from 70% to 28% (down to 28% in the last 13months of his (Reagan's) term). Deficits went 700 billion to 3 trillion over that time.
Johnston.cliff...since I'm so wrong, why didn't you present any facts as to WHY I am wrong...answer...you dont have any.
Ken...deficits as %of GDP are indeed high and LONG TERM would be unsustainable. No one wants these deficits to run long term, but short term they are incredibly necessary. The reason (one of many) that the Great Depression happened was that Hoover refused to infuse capitol into the markets until it was too late...he cut spending and the financial sector collapsed...sound familiar. You people have no clue how close we came to that very scenario. Honestly people...government is not nearly the evil enemy that the right wing anarchists would like you to believe.
There are some things that the free market cant (or wont) do...believe it or not. Yes we need to keep the government honest, but I think avoiding financial collapse falls into the protection of "life, liberty, and property".

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