http://www.google.com/hostednews/af...ocId=CNG.dcd81b51497966fd4c6461748e63e3ee.921 WASHINGTON — The US budget deficit shot up 15.7 percent in the first six months of fiscal 2011, the Treasury Department said Wednesday as political knives were being sharpened for a new budget battle. The Treasury reported a deficit of $829 billion for the October-March period, compared with $717 billion a year earlier, as revenue rose a sluggish 6.9 percent as the economic recovery slowly gained pace. The Treasury argued that the pace of increase in the deficit was deceptive because of large one-off reductions in expenditures made during the first half of fiscal 2010, compared with previous and subsequent periods. Those included a $115 billion reduction in funds spent on the Troubled Asset Relief Program (TARP) -- the financial institution bailout program -- in March 2010. But 2011 so far has also seen significant increases in spending on defense, Social Security, health and debt service, while receipts have not grown as fast. "The jump in outlays mostly owed to a smaller estimated reduction in TARP outlays this year versus 2010," said Theresa Chen at Barclays Capital Research. However, she said, the trend shows that taxable income is rising at a 6.9 percent annual pace, and individual incomes taxes are up 20.6 percent, "consistent with general economic improvement."
Federal fiscal year is October to October. 20.6% increase in tax revenues is what govt. growth should be limited to. It outstrips the rate of inflation by plenty.
http://www.ft.com/cms/s/0/dc1aadea-652e-11e0-b150-00144feab49a.html#axzz1JPCCYxQs Please respect FT.com's ts&cs and copyright policy which allow you to: share links; copy content for personal use; & redistribute limited extracts. Email ftsales.support@ft.com to buy additional rights or use this link to reference the article - http://www.ft.com/cms/s/0/dc1aadea-652e-11e0-b150-00144feab49a.html#ixzz1JPCNfe00 The US lacks a “credible strategy” to stabilise its mounting public debt, posing a small but significant risk of a new global economic crisis, says the International Monetary Fund. In an unusually stern rebuke to its largest shareholder, the IMF said the US was the only advanced economy to be increasing its underlying budget deficit in 2011, at a time when its economy was growing fast enough to reduce borrowing. Please respect FT.com's ts&cs and copyright policy which allow you to: share links; copy content for personal use; & redistribute limited extracts. Email ftsales.support@ft.com to buy additional rights or use this link to reference the article - http://www.ft.com/cms/s/0/dc1aadea-652e-11e0-b150-00144feab49a.html#ixzz1JPCSBd2L To meet the 2010 pledge by the Group of 20 countries for all advanced economies – except Japan – to halve their deficits by 2013, the US would need to implement tougher austerity measures than in any two-year period since records began in 1960, the IMF said.
Clinton reversed the Reagan tax cut for the rich at the beginning of his term, winning by 1 vote against a unanimous Republican vote. By 4-5 years later the Democrats had the deficit problem all solved, the one that originated from the Reagan era. But then the Republicans said, "What's a giant surplus for, if not to give to the rich? Pay back the deficit like Clinton was doing? Yeah right." So they got a 10-year program of disastrous deficits going again. All through the Bush years they said that deficits don't matter. Voters reacted by electing Obama to reverse everything Bush had done. He kept delaying the vote till December so he could cave in. Since Democrats in Congress were playing hardball, he sneaked behind their backs and made a deal with Republicans to continue the giant tax cut and the resulting giant deficit. Democrats were mad at their Republican infiltrator leader, but stayed silent clones of the Republicans because a 2-party system would be divisive. A few months later, Republicans have just announced their latest fairy tale. Senator Paul Ryan plans to lower corporate taxes and decrease the top individual bracket from 35% to 25%. Republicans say this will decrease the deficit, just like it did in the 1980s and 2000s. What it will do is increase contributions to them from the rich, to whom they answer. That's why they've always been called the party representing the upper class, and Democrats the party representing the working class.
I'd submit that the Democrats represent the "I want and deserve a handout!" class, and that no one represents the "working, but not rich" class.
Republicans are the party of tax handouts to the rich. There is no bigger handout in history than the trillion dollar tax cut (to be paid out in only 2 years) that Obama gave the Republican rich in December. Only 4 months later, they want another handout as I described, decreasing the top rate by 10 percentage points.
So I guess we can all agree that the Republicans & Democrats give all our monies to their friends & political sponsors?
http://www.washingtontimes.com/news/2011/apr/13/obama-outlines-his-deficit-reduction-policy/ The president also called for undoing the Bush tax cuts for upper-income taxpayers, and for canceling other tax cuts many of them receive such as the mortgage interest deduction — which he called “spending reductions in the tax code.” Apparently the president believes all our money is his and whatever he is willing to let us keep is "spending" on his part.
I'd like to thank President Obama for letting me keep enough of his money to pay Little League fees for my two girls this spring. I think I'll send him an email thanking him for his benevolence.
The government never took in more than maybe $500B in all income taxes combined, even when GHW Bush (no new taxes) and then Clinton raised tax rates. While Clinton made speeches promising to balance the budget in 5 years or 7 years (depending on the day of the week), it was John Kasich who wrote those budgets that became balanced on the back of a stock market bubble. Capital gains taxes from the sale of stocks at a time the NASDAQ grew by 100% from Sept. of 1999 thru Jan. of 2000. It's false to assert that raising taxes by a few % will generate $1T in yearly revenues. That figure is BS in the first place, and the claim is that amount over TEN years, get it? Over those same ten years, the debt will grow by $16T.
Bottom line, you can't escape from Hauser's Law. In other words, you don't focus on tax collection but growing GDP.
If you want to credit one little Republican over the President, fine. Of course, you'll have to condemn all the other Republicans for reversing course in 2001, and spending money like drunken sailors. It was in all the papers before 9/11 that Bush had already blown the whole surplus, so stop blaming 9/11. Whether credit goes to Clinton with the Democrats, or Kasich vs. his own party, neither could have balanced the budget without the reasonable tax rates in place, which were voted in against unanimous Republican unity, and which Republicans reversed as soon as Bush became President. This shows that if you're going to credit Kasich, you sure shouldn't credit his party. You have a model to copy. Bring back Clinton to advise, and Kasich if you like, and do it again. To duplicate conditions of the late 1990s, you'll need to reverse everything that happened since 2000. It can be done, since the nation's survival is at stake. But it won't, because Republicans aren't serious about a surplus, just in leveraging their complaints to legislate causes they would want even if there were no deficit. A second reason is that with 80% of the wealth in the hands of the top 2% of the population, it's obvious that you can't get blood from an onion. But with Republicans continuing to control the agenda, cuts discussed will still be from the poor and old (SS and Medicare), in order to fund tax cuts to those holding 80% of the wealth to make it 85%. Since it's physically impossible to balance this budget on the backs of those holding the 20%, nothing will change. As I have posted before, it will be beyond controversy that this is a fatal problem by 2020, that a permanent Depression has set in by 2030, with a permanent WW2-style enforced austerity by 2040, and intelligence agencies using socialism to keep the country going by 2050, nationalizing the management class instead of subsidizing it. Today's young people will live through a lot of change.
There was still a surplus when 9/11 occurred, but there was also a meltdown in the tech sector that occurred on Clinton's watch in 2000. Add to that the decimation and bailout of the airline industry after 9/11 when people refused to fly, and Bush inherited a pretty crappy economy (as did Obama). I don't know anyone who's arguing that the Republicans didn't spend money like drunken sailors. They had their chance with control of the house, senate, and white house and blew it. Tax cuts aren't something the government funds. The government took in about $2T in 2000 and about $2.5T in 2008. The issue is clearly that they have a voracious appetite to spend more than the $500B bigger income, even with the tax cuts in place. $500B more per year on top of what government was spending on when Clinton left office is more than enough to pay for the $100B per year cost of the two wars, so kiss that red herring good bye. Exactly what did the republicans spend money on? Education (no child left behind), Medicare expansion (drug benefit program), infrastructure (they passed the biggest spending bill in history, prior to Obama's "emergency" stimulus bill, on highways), and other things lefties should love - like hydrogen fuel cell research, fighting AIDS in Africa, and the space program. People who argue that raising the upper tax rate by 3% will magically eliminate a $1.6T deficit are fools. The government takes in $2.5T, of which less than half comes from income taxes. Anyone with any intellectual honesty at all can see that if income taxes were 60% of revenue that the govt. would have to DOUBLE ABSOLUTELY EVERYONE'S taxes to make up the deficit. The new tax brackets would have to be: 10% on $0 through $16,750 => 20% 15% on $16,750 through $68,000 => 30% 25% on $68,000 through $137,300 => 50% 28% on $137,300 through $209,250 => 56% 33% on $209,250 through $373,650 => 66% 35% $373,650 and above => 70% (married filed jointly rates) Assuming that would actually double income tax revenues, the govt. would still be short $400B+. Note that the tax revenues are not 60% of the total. The country can keep going just fine, it's government that can't. You mentioned Social Security. It's a Ponzi Scheme doomed to failure and dooming us all to ponying up more and more over time just to keep it afloat. When it started, there were 30 workers paying in to cover 1 person's benefits. Today there's 2 or 3 paying in.
