Why Democrats Are So Concerned About Deficits

As we approach the fiscal cliff everyone is trying to figure out what President Obama and the Democrats will do. Will they be hardline on tax increases for the wealthy ? Will they compromise and reform entitlements like Medicare and Social Security ? While deficit reduction is important cutting government spending in this fragile economy is not the way to go ? Why have Democrats become so concerned about deficit reduction at any cost to the point they rival Republicans on this issue ? The reasons are political and ideological responses to Reagan and the Conservative Movement.

Democrats won only one election between 1968 and 1988 and during the 1980s Reagan and the political right were able to portray Democrats as tax and spend liberals who couldn't balance government's budget. It worked well until the Democratic Party was largely taken over by moderates calling themselves New Democrats. Most of them organized around a group called the Democratic Leadership Council founded in 1985. All over the country from city halls to statehouses Democrtaic politicians built impressive records and reputations on fiscal management. By 1992 the New Democrats got one of their own elected President- Arkansas Governor Bill Clinton. Clinton wiped the Federal deficit and presided over a growing economy. His success along with other Democrats made it increasingly difficult to negatively define the party on fiscal matters.

While Barack Obama is more liberal than Clinton he and most liberal Democrats are less ambitious in their social goals and they doubt ability of goverment programs to do lots of things for lots of people. So you get healthcare reform where uiversal coverage relies on the market not a public program. More importantly the fiscal cliff came about in 2011 because Democrats in both houses of Congress went along with Conservative Republicans to end a budget impass which could have caused a government shutdown.

The Federal budget needs to be balanced, but not on the backs of the elderly or disabled. Democrats should focus on spending to stimulate growth making up for the lack of spending within the private sector. Austerity has not led to growth in the U.K. Greece, or Spain. It won't help here.

 

Austerity doesn't necessarily require deep cuts in social programs. We could save billions by ending farm subsidies and significantly limiting our interventionism.

 

The problem with modern day democrats is they only believe in republicans being accountable and responsible for today's problems. Never mind that people, foreign and domestic, have been abusing taxpayer funded entitlements on an exponential level since the FDR days.

 

Austerity isn't practiced as a method to grow the economy, its used when government doesn't have enough funds to pay for what it wants to spend. Mainly because it can't get people to loan money to it in the amount it needs. Here in the US we don't have the 2nd problem yet because the Fed is buying the majority of our treasuries (with fabricated money I might add) which leads to a whole other problem.

Everyone should be concerned about the deficit because our debt is over GDP. Studies show that debt to GDP ratios over 90% lead to significantly stunted growth. If we continue to grow our debt we continue to shrink future economic growth. Better to take the austerity now and pay down our debt as opposed to let it grow to the point where defaulting and worse economic realities are on the table.

Any politician or political party that wants to ignore deficits should be voted out of office or never voted in because their intellect is obviously lacking. Deficits especially at this point in the game have a large impact on every citizen.

 

America is $17 TRILLION IN DEBT!

What part of spending too much do libs not understand?

 

mac-7 +1

The only reason that liberals apparently cant understand our huge debt cant keep on is either they are too stupid or greedy to understand.

 

I guess dependence on government is an addiction that libs can never overcome.

They will keep borrowing and spending till the country falls apart and then riot in the street like the Greeks.

 

So given that situation, how can Republicans be so doctinaire about not increasing taxes? I agree that the Democrats are the bigger spenders of the two main political parties, but all those people screaming compromise on the right don't seem to realize that a real compromise would involve considerable spending cuts and some tax increases, with the crucial details being the result of extended negotiations (which we may not have time for since the deadline is coming up quickly).

If the Republicans truly cared for America instead of for the very rich, they would use a concession on taxes to get as much spending cuts as possible, and in the areas they want to see cut. I consider the chances of this happening to be about 100 to 1.

 

Because it is a losing game to raise taxes on one group while exempting everyone else.

Using that as the basis of a compromise, after the taxes go up libs can always renege on the deal and not cut spending to the government interest groups including the poor who vote the lib welfare state into power.

 

The things that need to be cut, SS, Medicare, and the military are all things republicans are unwilling to touch. In my life time republicans have been just as guilty as democrats on borrowing and spending so you can stop pretending like it is the liberals who are at fault.

 

I'm willing to cut the military as much as libs are willing to cut the welfare state.

The only practical way to cut government spending is to freeze growth of federal spending across the board in the first year and then reduce spending 1% across the board in each succeeding year till the budget is balanced.

 

inflation of wages and goods is needed, people said the same thing about billions in the past

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How did that work out for the Weimar Republic?

 

You like higher food prices and less security. I agree that we should cut the subsidies for ethanol but that would reduce the price of corn for animal feed.

Taking money out of the private sector can't help grow our economy and a growing economy is the best way to get out of debt. BH Obama asks for tax hikes on the rich and in the same breath he proposes to spend that money on social programs that he calls investments in the future.

I can assure you that if the progressives actually cut spending rather than promised to cut spending next year, the conservatives would be more likely to agree to more taxes on the capital that drives our private sector.

The liberal horde doesn't understand the economy in the first place so they are jealous of people who create things that increase the national wealth. Take the money from the rich and who do you think you will be able to borrow money from when you guy a new home , a car or need money to send your kids to college??

 

There are many things that can be cut but both sides need to start with the big ticket items first and work there way down.

 

It wont work.

If you do not cut everything then you will end up cutting nothing.

Don't try and balance the budget on the backs of the old folks and the military.

 

How about they just raise taxes on EVERYONE? Let everyone pay back what everyone had benefited from one way or another, the bubble deficit economy.

No that wont happen because essentially there is a major group that would rather raise taxes on others and not themselves in the trade for a vote. Also, these people just so happen to claim the ones who are trying to hold on to their own money as being greedy. Greed is a sneaky bastard that greed!

 

You can make cuts to everything but you will get nowhere if you don't make the biggest cuts on your biggest expences. You can cut PP all together but if you don't cut the groups with the highest total percentage of your expenses you will accomplish nothing as it relates to balancing the budget.

 

how did it work out in the past for America is the real question, obviously it worked great

 

Here is the problem with that. Government continues to spend more than they receive in revenues no matter how much is brought in. The only reason Clinton gets a pass on that is because of another bubble that he didn't see coming, which of course went away leaving everything as it was before.

Only in America is a reduction in the increase of spending called austerity but that is what Democrats call it. The US spent 27 trillion the previous 10 years and the Ryan budget spent 40 trillion the next 10. Democrats wanted to spend 47 trillion the next ten and called spending more under the Ryan budget "drastic cuts in spending".

During the Dem convention, Obama went on and on about "investments", code for more spending. The ACA is just another entitlement program that the taxpayers will be on the hook for and is projected to cost around 2 trillion more the next 10 years but these kind of projections for entitlement programs are historically so far off the mark that it is ridiculous to put any faith in them. The progressive democrat leadership in Congress have already stated they will not touch entitlements in any way so in effect and the Democrat led Senate has yet to bring a budget to the floor for a vote which means they would actually have to debate what needs to be done.

The next bubble is the debt bubble and it is worldwide. At some point it will also collapse and then we will see drastic changes in our lifestyles. Better to tackle it now but that will also require a change in our lifestyles, just less drastic than in the future.

 

Excuse me, but how can you actually say a HC law that requires $800+ billion in new taxes, requires massive federal & state bureaucracies to implement and relies heavily on the IRS for compliance is not a public program? The free market is not driving this, the federal government is.

Well, in case you missed it, the federal government has been spending massive amounts they claimed where focused on growth. The stimulus ring a bell? How about QE1, QE2 and QE3 (the forever stamp of QE's)? Then there are the loans to battery co's, solar co's, and green energy co's of all stripes. We've had bank bailouts, auto bailouts, foreclosure programs and even a cash for clunkers program! And all this (and more) in a span of 4 years ostensibly to stimulate growth!

So, instead of simply addressing the issue with "spend more", you should be asking yourself why, despite all this spending we are not seeing stable, forward moving growth. The reason is simple, it's because this WH and the democrat party are not impartially business friendly and especially concerning their energy policies. The administration has clearly targeted small and large business for tax hikes and business is now strapped with the ACA which is definitely not a pro-growth policy concerning business.

 

"Listen honey. I'm just saying we are putting too much on the credit cards. If we don't order in twice a week and if you'll just stop the 'shopping day' and 'spa day' every week and we use the money to pay down some principal on the cards within a year we'll be sitting pretty. Yes I know we agreed that this year all my bonus would be put against the cards but we've agreed to that for the last four years and when the money hits the bank there's always something else more important to spend it on. Last year it was Sarah's pony and the year before it was the down payment on the Escalade lease. Honey? Are you there?". This my friends is precisely what the country faces. One day sooner than anyone could imagine some Chinese man is going to show up at the Oval office door with a big pair of scissors. Then no welfare cheques. Fewer food stamps=urban riots across the country. Meanwhile Obama will be sitting with his bare feet on the Oval office desk watching his toenails grow with the lights turned down listening to A.F. Or the Chinese man will hand Obama a statement to read on MSNBC: "After do consideration my Government has decided to withdraw all military and financial support from the rouge island of Taiwan."

 

1. What $ 800 billion in new taxes is written into the law ?

2. Health & Human Services would oversee the implementation not any new agency.

3. States have leeway to create their own exchanges so it may not be as bureaucratic as you claim.

Lets consider stimulus spending

4. The stimulus bill should have been much larger and focussed on public sector job creation like infrastructure, rehabilitation of school buildings, and making public buildings more energy efficient. Instead only 10 to 14 % of the money went to this kind of job creation.

5. Obama should rethink how he uses government to encourage clean energy and certain technologies. There is a better way for government to help in this regard.

6. Most small businesses got a tax cut under the American Investment And Recovery Act

7. We need to help small business but I do not trust how Republicans define small business. Moreover healthcare costs under the status quo do more to hurt small business than people claim ACA will do. Think about how many self employed people lack coverage under the status quo not just the people who work for them.

8. Roosevelt stimulated the economy getting decreased unemployment and growth with programs like the WPA and CCC putting people to work. He also created jobs and provided affordable electric power through the Tennessee Valley Authority. The economy was in a slow rebound until he cut spending in 1937 leading to another downturn.

9. Ronald Reagan did not get the economy back on track with his tax breaks for the rich or cutting social spending. He ran up the debt and created jobs through increased millitary spending.

The right kinds of stimulus done on a major scale can restart the economy providing lower unemployment and growth allowing space for deficit reduction later. Moreover it does not have to come at the expense of the most vulnerable. The problem is Democrats have allowed the conservative right to define them and reality for Republican political gain.

 

That estimate is now at 1 trillion.

So, you don't think HHS will create any new departments or agencies under them? Well then your clueless.

Oh, so these exchanges have no heads, no staff or any red tape. That's good news.

I think I just covered that, but thanks.

Correct, he should, but it's unlikely since he has already said what he intends to do which will lead to higher energy costs.

And they are getting hosed under Obamacare.

True. I am self employed and have been many times. I've always opted to pay for insurance, although I seldom had need of medical care. It's not that the self employed can't get insurance, they just choose not to. And, under Obamacare many of them will opt out and pay the penalty because it's cheaper. So, what did Obamacare do again?

Obama has done nothing Roosevelt did. What's your point?

Oh, so it was only running up the debt that led to the huge Reagan boom. Tax cuts, cutting wasteful spending had nothing to with it. Got it.

Again, you couldn't be more out of touch. Dem's had the presidency and majorities in both houses for two years under Obama and what we got was Obamacare and a stimulus targeted largely at proping up unions and pension funds, not new employment. We got loan garentees to green co's many of whom are now out of business. We got bank bailouts and cash for clunckers.

Democrats own the Obama economy.

 

Thats super awesome and all but we gotta save more than a trillion.