Robert Winner

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Should the USA again raise the debt ceiling?

The United States will reach its debit limit by October 18 and could default by Nov 5. As the national debit races toward 17 Trillion (see us debit clock.org) the US continues to outspend its congressional mandated limits as well as exceeding the GDP. It is increasingly harder to even pay the interest on the loans the US is making.

In a poll by NBC news and wall street journal the citizens have voted 44% to 22% to not raise the debit limits ... again.

At some point Congress and the Administration need to be held accountable for mismanagement and gross incompetence.

Default carries some consequences ... the question is are those consequences greater than the financial collapse of the government.

How could this be resolved .. avoided.

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    Sep 18 2013: In order to stand tall we must either raise the ceiling (debt) or lower the floor (expenditures). Let's lower the floor by an immediate layoff of 50% of federal, state, and municipal workers. Institute a Sunset Law which eliminates any government program which cannot justify its existence. Restore industry by imposing high tariffs on imports (this will provide jobs for all the laid-off government workers). Fiscally penalize those who "buy" things without having the money. Make it an act of treason for any elected official who acts as an impediment to balancing the budget within 5 years, and keeping it balanced. Do not raise the debt ceiling!
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      Sep 18 2013: I like it ... and all leaves are cancelled until morale improves ....

      Bush started a web site called you deserve a better government it listed all of the programs that were worthless and a burden on taxpayers ... Obama cancelled it.

      However, GSA does list programs that operate at high expense without apparent results and forwards that list to Congress each year.

      On Sept 13 Dan Tangherlini (chief of GSA) went before Congress with cost cutting proposals. www.gsa.gov › Home › Newsroom › News Releases or under GSA Announces Reforms and Savings at Senate Hearings.

      Interesting read.

      Thanx Bob.
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    Sep 17 2013: The entire idea of a debt ceiling is completely ridiculous. It's a policy designed to produce self-inflicted wounds. I would argue that a debt ceiling is more likely to promote dysfunctional budget policy than not, and probably equal likely to lead greater or reduced deficit spending (because any deal to change the debt ceiling can have one of two outcomes - taxes raised/spending reduced, which is pain for both parties, or taxes lowered/spending increased, which are jollies for both parties).

    This doesn't mean that there are no mechanisms to impose discipline on the budget process. In the 1990s, we had pay as you go, which meant that every dollar of additional spending (or tax reduction) needed to be funded from something else. Admittedly, this could get flabby because the "smoething else" could be something weak like greater projected growth, but by and large this system improved discipline without creating any ridiculous crisis scenarios, and contributed to the elimnation of the budget deficit in the '90s.

    If either side were serious, it would seem a reasonable trade to make would be elimination of the debt ceiling in exchange for reenactment of a more sensible disciplining policy of this vein.
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      Sep 18 2013: Do you max-out all your credit cards and then apply for new ones to pay those? Do you use your credit to buy anything and everything possible? Do you have any self-imposed limits for your personal expenditures? Fighting drug addiction by increasing drug use is a doomed strategy, good only for the suppliers/pushers. Who are the suppliers/pushers of credit/debt?. . .
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    Sep 17 2013: NO
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    Sep 16 2013: national SEP field activated
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      Sep 16 2013: Do you mean SEP (Somebody Else's Problem)? We were promised a transparent government and got the exact opposite ... to hide it in plain sight is not the way of the media ... their philosophy is to hide it period. Our laws are the will of the leadership through Executive Orders ... not Congress. And on and on ....

      However, I think you submit this as sarcasm ... good one. Comes from the Hitchhikers guide to the Universe. LOL.
  • Sep 16 2013: First, Congress sets a debt limit. Then Congress passes laws that authorize spending in excess of tax revenues, that will inevitably require borrowing beyond the debt limit. Then Congress threatens to shut down the government by not increasing the debt limit. Congress cannot be held accountable because their actions demonstrate that Congress is not rational.

    If Congress could somehow raise itself up out of the political muck for a few days, and address their responsibilities as adults, Congress would abolish the debt limit. (I would miss the political theater, but the country would be better off.)
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      Sep 16 2013: I think we all need budgets / limits. It would really help if we went back to a Constitutional Government. Much of this crap would disappear. I think it would also eliminate the elitists egoists that we are dealing with now.
      • Sep 16 2013: I think we agree. The limit should be in the Constitution, and should be a percentage of the gross domestic product, not an arbitrary dollar amount that has no purpose other than political posturing.
  • Sep 15 2013: Y E S
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      Sep 15 2013: Why? Isn't there any obligation to "live" within the budget allocated? We, the citizens, are expected to live within our means and if not there are consequences. For the government there are no consequences ... if they screw up we the people suffer ... shouldn't they be held accountable?
      • Sep 16 2013: I believe we are looking at the wrong numbers. We should mainly stop lowering our wages. Like Deming in Out of the Crisis I believe like in manufacturing we are looking at the wrong numbers.
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          Sep 16 2013: George, Are you saying that a government is neither responsible or should be held accountable, and should have a blank check?

          Wages, jobs, bonuses, stocks, etc .. are all a result of the success of the company.

          The more interference from the government the harder it is to succeed. The perfect example is the Obamacare mandate that 30 hours is the work week. Companies immediately crunched the numbers and found that it would cost them millions that they could ill afford and maintain a profit margin (stay in business). By adding more people for less hours ... and the problem is solved. That was not a greed decision ... that was survival.

          Most Marxists / socialists / communists / and all unions believe that the value of the product is in the craftsmen and that owners and management steal from the workers. That philosophy holds no water. When tested it failed to launch.

          However, the free market system has proven to be effective. The idea of Keynesian economics and the desire for big government, which in return demands big taxes and micromanagement, continue to drive jobs overseas and weaken the economy.

          Yeah your right we are looking in the wrong direction. Hold governments responsible ... reduce the size of the government .... only implement programs that are funded and can be sustained .... go back to a Constitutional government .... I could go on but for what purpose. History has proven this to be the correct path ... but no one is heeding the historical indicators of impending disaster.

          Thanks for the reply. Bob.
      • Sep 17 2013: No - I am saying that the wge structure should not have been permitted to collapse. Traditionally
        1. We have had higher tariffs.
        2. We have had more control or less immigration .
        3. We used to believe in anti-trust law.
        4. We used to have small business.
        5. orporations like the British East India Company were not as revered as they are now.
        6. We used to make things and well. and
        7. We have strenghtened patent law, Average Weekly wages have been a disaster for over forty years in America.