What are you ideas to help the country turn around

-The tax revenues collected by the federal government are highest levels they have been in decades.

Please provide a link

-The liberals (in Congress) demanding homeownership for every walking stiff gave us the banking mess
That was only part of it. The banks were willing partners. They bundled fraud upon the market. You forget the rating agencies gave a thumbs up to this toxic shit.

-Agreed. Cut spending across the board, including defense and entitlements. Originally Posted by Whirlaway

Well at least you agree to this important matter. Most folks do not want to cut their pet projects.

-The tax revenues collected by the federal government are highest levels they have been in decades. Originally Posted by Whirlaway

Tax revenues may be up, but that's nothing new. Well, it's a new phenomenon since George Bush came into office, but historically, it's only normal for revenues to increase. In the 36 years prior to Bush, they increased 34 times from one year to the next. Under Bush? I believe it was 4 (but it may have been 5) out of 8. So it's entirely normal (well, unless GWB is President) and therefore they're always going to be "at their highest levels in decades".

But the effective tax rates are at their lowest levels in decades - both in terms of GDP and personal effective rates. But let's cut taxes even more, because, gosh, it's working so well.

Whirlaway - punked again.

The liberals (in Congress) demanding homeownership for every walking stiff gave us the banking mess

I seem to remember in 2004, nearly every Republican speaker at the Republican Convention (including Dick Cheney) touting the high levels of home ownership achieved under the Bush administration. I'm sure they weren't touting the effectiveness of Democratic policies.

As the old adage goes, the first thing you need to do when you find yourself in a deep hole is to stop digging!

We were indeed in a deep hole in early 2009, but have spent the last couple of years digging a far deeper one.

George W. Bush presided over one of the most fiscally disastrous periods in history. Of course, as everyone knows, the Iraq war was very expensive, but that was only part of the problem. Tom DeLay's aggressively corrupt Republican majority porked up the budget to a then-unprecedented extent between 2003 and 2006. There was a bloated pharma industry-designed prescription drug entilement expansion in 2003 as well as bloated agriculture and transportation bills. It seems that anyone who bought a K Street lobbyist got a seat at the table and enjoyed healthy servings of pork.

And there's plenty of bloat in the defense budget. Why, for instance, do we still have almost 30,000 troops in South Korea? That's a rich nation now; it can provide for its own defense -- or at least pay us a lot of money to do it. Why do we need bases and troops in Europe? It's as though we're still worried about a Soviet tank invasion across the European plain.

Pentagon chiefs always seem to have their pet projects. The military-industrial complex (sometimes called the military-industrial-congressional complex) lives, breathes, and thrives. I never thought of Ike as a man who was weak on national defense, yet he warned us about this in his farewell speech 50 years ago.

In 2000-2001, the federal government was spending about $1.8 trillion annually. By the time George W. Bush left office, that had ballooned to about $2.9 trillion, or an approximately 60% increase in nominal dollars.

Therefore, it was incumbent upon Obama to act as a wise steward of federal dollars as soon as he took office. We needed to spend money more wisely, not just more liberally. But the first major piece of legislation he signed was that phony, politically-motivated $860 billion "stimulus" package. It was billed as a grand plan to build infrastructure and put people back to work, but once Nancy Pelosi's and David Obey's staffers got finished with it, it became just a big treasure chest of political payoffs for favored constituents.

Then instead of concentrating on fixing the financial system and the economy, Democrats crammed through a very expensive, confused mess that was billed as a health care "reform" plan.

Next there was the Dodd-Frank legislation, which does virtually nothing at all to prevent the next financial crisis. In fact, a few investment professionals I know believe that it virtually ensures that there will be one. It does nothing about TBTF. The biggest banks are still able to play "heads we win, tails taxpayers lose" games with other people's money and with little fear that their managements will be held to account. And not only that, they're even bigger than ever!

It would be almost impossible to cut the defense budget enough to take care of more than a small fraction of our $1.5 trillion deficit. The same goes for Medicare and Medicaid. People would start rioting in the streets, like in Greece. Adjustments can be made -- and in my opinion must be made -- but you can't just take a meat axe to those budgets. People like these programs and depend on them.

So it seems obvious that something sunstantial has to be done on the revenue side. Our tax system currently takes in only about 15% of GDP. That includes everything -- income taxes, payroll taxes, corporate taxes, capital gains taxes, etc. That's the lowest in modern history.

We obviously can't suddenly impose a tax structure that would eliminate or significantly reduce the deficit. That would cause a very severe recession or depression. But we do need to establish a credible glidepath toward fiscal sanity. If we don't, we'll eventually suffer a fiscal bust which will make the 2008 financial crisis look like a minor event by comparison.

To that end, Obama called for a deficit commission (Bowles-Simpson) to examine the problem and offer a set of recommendations. (Then, of course, he completely ignored them.)

We are going to have a lot of economic difficulties over the next five years or so. That's already baked into the pie. You can't just pummel the economy for eight or nine years with wave after wave of spending binges and other disastrous policy decisions and expect anything else.

The can can't be kicked down the road much further. We need to confront these issues and develop a glidepath toward fiscal sanity.

Washington, D.C. is adrift without serious leadership. I'm afraid we're about to see the unfolding of a very painful process.

To that end, Obama called for a deficit commission (Bowles-Simpson) to examine the problem and offer a set of recommendations. (Then, of course, he completely ignored them.)
. Originally Posted by CaptainMidnight

They say exactly what needs to be done and because of the way the system is set up, nobody can do anything for fear of getting kicked out of office!

Our present political system seems outdated.

I know many of you folks will cry about how smart the founding fathers were but they are long dead. This system does nothing in regards to long tewrm planning. That is where China is kicking our ass, not that they do not have problems .

Oliva....had banks that were to big to fail be allowed to do so, lending would fix itself. Originally Posted by WTF

Whew Wow Hoss, I wasn't for bailing out those banks. I was for going in firing everyone that made those decisions; inditing those that were criminals (which is a good portion of them) then, MAYBE help them out. I feel the banking crisis bailout is one of largest conns and crimes perpetrated on the American electorate since this country began. Not only did we borrow the money to bail out multi-millionaire crooks that can't run the business they are entrusted to run, but we let them keep their jobs AND PAID THEM A BONUS.

No, no me man. I wasn't for that crime.

And why, oh why after that hapless fool Bush started those wars and the Anointed One promised to get us out are WE STILL THERE!?

.............That is where China is kicking our ass, not that they do not have problems . Originally Posted by WTF

Ah, but China does have problems. One of this is that they can't sustain their rapid growth anymore than we could ours. The Chinese are coming, The Chinese are coming............until they're not. Until they have to deal with their own internal problems. Until they don't have any more markets to dump products on (Kinda like Japan). Their labor force is already demanding higher wages. Jobs are leaving China and going to the fertile labor fields of Vietnam and other nations. They have a serious population problem. One in terms of sheer numbers, and two, the have a huge female to male ratio problem now. The Chinese aren't our worst enemy; we are.

Whew Wow Hoss, I wasn't for bailing out those banks. I was for going in firing everyone that made those decisions; inditing those that were criminals (which is a good portion of them) then, MAYBE help them out. I feel the banking crisis bailout is one of largest conns and crimes perpetrated on the American electorate since this country began. Not only did we borrow the money to bail out multi-millionaire crooks that can't run the business they are entrusted to run, but we let them keep their jobs AND PAID THEM A BONUS.

No, no me man. I wasn't for that crime.

And why, oh why after that hapless fool Bush started those wars and the Anointed One promised to get us out are WE STILL THERE!? Originally Posted by OliviaHoward

I am sorry, I did not mean to imply that you did. You had just suggested ways to fix banking and I was just cutting to the heart of the problem.

Ah, but China does have problems. One of this is that they can't sustain their rapid growth anymore than we could ours. The Chinese are coming, The Chinese are coming............until they're not. Until they have to deal with their own internal problems. Until they don't have any more markets to dump products on (Kinda like Japan). Their labor force is already demanding higher wages. Jobs are leaving China and going to the fertile labor fields of Vietnam and other nations. They have a serious population problem. One in terms of sheer numbers, and two, the have a huge female to male ratio problem now. The Chinese aren't our worst enemy; we are. Originally Posted by OliviaHoward

It sounds like you are saying market based economies all fail at some point. I tend to agree with that. I tend to agree that all nations that do not live within there means will fail. That does seem to be the history lesson we never learn. It is the Tragedy of the Commons theory.

I am sorry, I did not mean to imply that you did. You had just suggested ways to fix banking and I was just cutting to the heart of the problem. Originally Posted by WTF

I honestly don't know how to fix common greed other than to regulate the behavior.

It sounds like you are saying market based economies all fail at some point. I tend to agree with that. I tend to agree that all nations that do not live within there means will fail. That does seem to be the history lesson we never learn. It is the Tragedy of the Commons theory. Originally Posted by WTF

Yep, all good things come to an end.

I honestly don't know how to fix common greed other than to regulate the behavior.



. Originally Posted by OliviaHoward

Even that does not work but it fights it off for the most part.

Maybe they should use the Man Vs Food mentality... ONE BITE AT A TIME! I thought Obama had a good goal when he challenged Congress to cut $360 million in 30 days last year... they settled on things like printing on both sides of the paper, buying cheaper ink pens, etc. I've done a few hours of research on tax and revenue history, and have come to the conclusion that it's a mucking fess! The Laffer Curve that everyone refers to is THEORETICAL, so applying a one-size-fits-all model to the US economy is an impossible task. Raising taxes on the richest seems to me like punishment for being successful, while lowering taxes on the poor seems to encourage stagnation (Observed that first hand after Katrina, when evacuees were given opportunities to work - most would rather sit and wait for FEMA $). The politicians need to stop playing favorites, dump Fannie and Freddie from the witless protection program, and revamp the government programs to help people take advantage of the opportunities they have instead of encouraging them to sit and wait for the next handout.

Disclaimer: I know not everyone on government assistance is undeserving or taking advantage of the system, but from what I've seen it happens often enough for an average person to notice!

I'm always amused when I read predictions that China will surpass us in aggregate GDP by something like 2025, based on comparisons of our current respective growth rates. Of course, that's not completely impossible -- especially if we keep killing ourselves with disastrous economic policies -- but people tend to suffer from what I call extrapolation bias.

The same thing happened back in the 1980s regarding Japan. Then look what happened in 1990. Oops! (And Japan still hasn't recovered.)

I'm not suggesting that something similar will happen to China, but they certainly do have problems and face risks. As Olivia noted, they have something of a restive labor force that wants a bigger share of the goods. They also have a worsening domestic inflation problem resulting largely from their practice of printing renminbi like there's no tomorrow in order to gain trade balance advantage by keeping their end of the dollar/yuan pair undervalued by perhaps 30-40%. The Chinese are in my opinion the biggest, most aggessive mercantilist power in world history.

For years it was said the the U.S. and China had sort of a symbiotic relationship based on their need to sell stuff to us, and our need to have them finance our fiscal deficits by buying U.S. Treasury notes and bonds. However, a lot of people don't realize that China is no longer buying much new Treasury issuance. In fact, they cannot buy that much any longer, at least compared to the size of our deficits.

In fact, for the last eight months the Federal Reserve has expanded its balance sheet and directly bought 7s and 10s from Treasury in the amount of about $75 billion per month (QE2). They can call it whatever they want, but it's really just outright debt monetization, and it's clearly not sustainable policy.

The only thing that bailed us out in 2010 (after the expiration of the original QE) was the occurrence of multiple foreign financial crises. That drove money into U.S. Treasury debt, still considered (relatively speaking!) the world's #1 safe haven. Most fixed-income managers seem to feel that more of the same will hold down bond yields at least for the rest of this year, if not beyond. And, of course, there's growing pessimism about the U.S. economy.

But what happens when the economy (global as well as domestic) begins to normalize? Eventually it must, or we're all in even more trouble than we realize.

Then the global bond markets would punish the fiscal authorities with a big "no confidence" vote.

That time is going to come if we don't begin taking steps to get our house in order, sooner rather than later.

I know; everyone keeps talking about raising the debt limit. If we don’t, we’ll sink. The Teabaggers are a bunch of loose nuts that want to stand on this issue. Bla, bla, bla I got into a heated debate with a friend of mine about this. He said it’s too dangerous to stand on. It has to be raised. My thought is stand on it now while we can actually borrow more money if we actually have to. But you watch. They’ll not stand on this issue; kick the can and then eventually we’ll be in a world of hurt.

I know; everyone keeps talking about raising the debt limit. If we don’t, we’ll sink. The Teabaggers are a bunch of loose nuts that want to stand on this issue. Bla, bla, bla I got into a heated debate with a friend of mine about this. He said it’s too dangerous to stand on. It has to be raised. My thought is stand on it now while we can actually borrow more money if we actually have to. But you watch. They’ll not stand on this issue; kick the can and then eventually we’ll be in a world of hurt. Originally Posted by OliviaHoward

It is imperative that the debt ceiling be passed otherwise, politicians resort to desperate measures in order to pay the bills (such as, stealing pension funds from govt employers). If we don't, technically, we default on the debt which makes people lose faith in the currency, which means it greatly loses it's value.

I'm always amused when I read predictions that China will surpass us in aggregate GDP by something like 2025, based on comparisons of our current respective growth rates. Of course, that's not completely impossible -- especially if we keep killing ourselves with disastrous economic policies -- but people tend to suffer from what I call extrapolation bias.

The same thing happened back in the 1980s regarding Japan. Then look what happened in 1990. Oops! (And Japan still hasn't recovered.)

I'm not suggesting that something similar will happen to China, but they certainly do have problems and face risks. As Olivia noted, they have something of a restive labor force that wants a bigger share of the goods. They also have a worsening domestic inflation problem resulting largely from their practice of printing renminbi like there's no tomorrow in order to gain trade balance advantage by keeping their end of the dollar/yuan pair undervalued by perhaps 30-40%. The Chinese are in my opinion the biggest, most aggessive mercantilist power in world history.

For years it was said the the U.S. and China had sort of a symbiotic relationship based on their need to sell stuff to us, and our need to have them finance our fiscal deficits by buying U.S. Treasury notes and bonds. However, a lot of people don't realize that China is no longer buying much new Treasury issuance. In fact, they cannot buy that much any longer, at least compared to the size of our deficits.

In fact, for the last eight months the Federal Reserve has expanded its balance sheet and directly bought 7s and 10s from Treasury in the amount of about $75 billion per month (QE2). They can call it whatever they want, but it's really just outright debt monetization, and it's clearly not sustainable policy.

The only thing that bailed us out in 2010 (after the expiration of the original QE) was the occurrence of multiple foreign financial crises. That drove money into U.S. Treasury debt, still considered (relatively speaking!) the world's #1 safe haven. Most fixed-income managers seem to feel that more of the same will hold down bond yields at least for the rest of this year, if not beyond. And, of course, there's growing pessimism about the U.S. economy.

But what happens when the economy (global as well as domestic) begins to normalize? Eventually it must, or we're all in even more trouble than we realize.

Then the global bond markets would punish the fiscal authorities with a big "no confidence" vote.

That time is going to come if we don't begin taking steps to get our house in order, sooner rather than later. Originally Posted by CaptainMidnight

What most people don't realize is that when the US had the stock market crisis of 2008, China, in order to keep up production of lost US exports, borrowed to the tune of $40 trillion yuan. This money went into construction and propping up current investments, and as proof, you can find the newly built ghost towns of China. 25-30% of the debt has defaulted, which means more interest with more loans to be repayed. So, they are not out of the woods yet. This week, they (China) has started to buy Euros instead of the dollar. To be continued...

All good stuff..........

1. Legalize and tax non-man made recreational drugs.

2. Replace income tax with federal sales tax.


3. Sell all federal assets not directly needed to fulfill only those functions specifically enumerated in the Constitution for the federal government. Use the proceeds to pay current commitments in SS and Medicare/

caide, and discontinue the programs.

4. End all foreign aid.

5. End all "humanitarian" missions for the US military outside the borders of the US.

6. Mothball six carrier battle groups. De-emphasize development and deployment of manned combat aircraft in favor of unmanned combat aircraft.

7. Publicly and officially proclaim our willingness to use both tactical and nuclear weapons to re-establish their deterence.

8. Face up to the fact that all world currencies, de facto, are on the petroleum standard and remove all unreasonable obstacles to becoming a next exporter of oil.

9. Return all armed forces from advance bases and re-task them to patrol our borders.

10. Impose import tariffs on all trading "partners" who do not open their markets to US goods and to those who use what is essentially slave labor.

11. Re-establish the republic by repeal of the 17th amendment.

12. Combine and streamline the command structure of the US military away from the separate branch system toward a unified defense force model.

13. Repeal Obamacare, eliminate HUD, DEA, Education Dept, BLM, BATF, Fannie, Freddie, and the Federal Reserve. Forcefully reacquaint EPA and FDA with their core missions. Originally Posted by Iaintliein