7 ms·

Yep. "Don't buy things if you can't pay for then." sounds reasonable, but some other countries seem to disagree. Not surprised that those countries suffer from

Yep. "Don't buy things if you can't pay for then." sounds reasonable, but some other countries seem to disagree. Not surprised that those countries suffer from government shutdowns over how much the debt ceiling is raised.

thesimon 10y ago
>suffer from government shutdowns over how much the debt ceiling is raised On the other hand: The government shutdown because of the debt ceiling seems just like "Stop hitting yourself" on the playground. And Germany's budget is far from balanced.
- buro9 10y ago
  The myth of the balanced budget. The article speaks of consumer debt, I spoke of consumer debt. Government debt is a different thing, and a government without any debt doesn't sound like a wise thing if it is even possible in such a highly integrated and globalised world.
- nailuj 10y ago
  > And Germany's budget is far from balanced. Hmm? http://www.bloomberg.com/news/articles/2016-08-17/germany-plans-to-cut-2017-debt-sales-amid-balanced-budget-push http://www.bloomberg.com/news/articles/2016-08-17/germany-pl...
- mpweiher 10y ago
  >And Germany's budget is far from balanced. "Germany recorded a Government Budget surplus equal to 0.70 percent of the country's Gross Domestic Product in 2015. " While it's true that the budget is not balanced, a 0.7%/GDP surplus is pretty darn close. http://www.tradingeconomics.com/germany/government-budget http://www.tradingeconomics.com/germany/government-budget
- kriro 10y ago
  Nominally Germany has a balanced budget. I agree it isn't really balanced and the big zero is just achieved via some shifting around of things. However the fact that the government jumps through all sorts of hoops to be able to say the budget is balanced is at least an interesting indicator that it does seem to matter to enough people.
  - premium-concern 10y ago
    Even government budgets have to adhere to some standardized schemes of reporting. See also rating firms. Otherwise even the US would have a balanced budget and no debts. (Ignoring the fact that the US is the main force behind trying to change the account rules to make them look less bad.)
0xcde4c3db 10y ago
In the US, at least, the shutdowns don't have much to do with our actual spending/borrowing habits. It's a structural quirk of government operation that provides a handy perennial disaster to use for political brinkmanship and finger-pointing. Basically "if you don't start being reasonable by caving to my demands, then you're going to cause a government shutdown".
- premium-concern 10y ago
  > political brinkmanship and finger-pointing The difference is that parties that try to pull that in Germany not only loose elections, but are punished so hard by voters that they can't even get over the necessary 5% requirement in the next election. Have a look what happened to the FDP after they pushed through lower taxes for hotels.
  - DasIch 10y ago
    In Germany not passing a new budget wouldn't let to a government shutdown. So it's not an option anyway.
    - premium-concern 10y ago
      Even if it did, it wouldn't matter, because people would vote those politicians that tried this shit and their party out of office.
webkike 10y ago
Using credit cards does not preclude being able to afford the thing you are paying for. I regularly use my credit card for every day purchases despite having ample money in my checking account. The regular payments allow me to develop a good credit history without much worry.
- josefresco 10y ago
  Bingo. Unfortunately the common assumption is that you're not paying it off monthly and paying high interest.
  - fwn 10y ago
    Which, by the way, sounds like an awful concept of how creditworthiness is created. Signing into some unnecessary additional financial product with comically obsolete interest rates, just to manually repay it in the random timeframe in which the (still unnecessary) credit is free sounds like a bad idea. It's probably only there to nudge people into paying interest on money they already have.
    - josefresco 10y ago
      Credit history is just a history of making payments on-time. You can build a history by making student loan payments, car payments, health care payments etc. Obviously it's only one factor in someone's credit worthiness, however it's not a bad metric. If you pay your bills on-time, it makes sense that a lender would value you higher/safer than someone who does not.
    - hx87 10y ago
      > the random timeframe in which the (still unnecessary) credit is free Are you talking about the 0% APR period, or the monthly revolving cycle? The latter is absolutely predictable, and if you dislike manual payments you can always set up automatic ones.
- kriro 10y ago
  Why can't you use a debit card for that? Isn't having enough money in your checking account to reasonably afford all stuff you need to live basically proof of a good credit history? Isn't the best credit history one where you never need credit in the first place?
maxsilver 10y ago
Disagree might not be the right word, "force" is probably more accurate. In many countries, it would be effectively impossible for most regular people to get basic living needs (like housing and transportation) if they couldn't buy them using some amount of credit. Obviously it shouldn't be this way, it should be possible to save and buy these things outright. But since it effectively isn't (for many people, in many places) I wouldn't fault people for taking on debt to do things like put a roof over their head or get to work on time reliably.
snowwrestler 10y ago
I can pay for my house--over time. Which is fine because I'm also living in my house over time.
gozur88 10y ago
Government shutdowns in the US are largely theater. The last time they only halted 15% of expenditures.

thesimon 10y ago

>suffer from government shutdowns over how much the debt ceiling is raised On the other hand: The government shutdown because of the debt ceiling seems just like "Stop hitting yourself" on the playground. And Germany's budget is far from balanced.

buro9 10y ago
The myth of the balanced budget. The article speaks of consumer debt, I spoke of consumer debt. Government debt is a different thing, and a government without any debt doesn't sound like a wise thing if it is even possible in such a highly integrated and globalised world.
nailuj 10y ago
> And Germany's budget is far from balanced. Hmm? http://www.bloomberg.com/news/articles/2016-08-17/germany-plans-to-cut-2017-debt-sales-amid-balanced-budget-push http://www.bloomberg.com/news/articles/2016-08-17/germany-pl...
mpweiher 10y ago
>And Germany's budget is far from balanced. "Germany recorded a Government Budget surplus equal to 0.70 percent of the country's Gross Domestic Product in 2015. " While it's true that the budget is not balanced, a 0.7%/GDP surplus is pretty darn close. http://www.tradingeconomics.com/germany/government-budget http://www.tradingeconomics.com/germany/government-budget
kriro 10y ago
Nominally Germany has a balanced budget. I agree it isn't really balanced and the big zero is just achieved via some shifting around of things. However the fact that the government jumps through all sorts of hoops to be able to say the budget is balanced is at least an interesting indicator that it does seem to matter to enough people.
- premium-concern 10y ago
  Even government budgets have to adhere to some standardized schemes of reporting. See also rating firms. Otherwise even the US would have a balanced budget and no debts. (Ignoring the fact that the US is the main force behind trying to change the account rules to make them look less bad.)

0xcde4c3db 10y ago

In the US, at least, the shutdowns don't have much to do with our actual spending/borrowing habits. It's a structural quirk of government operation that provides a handy perennial disaster to use for political brinkmanship and finger-pointing. Basically "if you don't start being reasonable by caving to my demands, then you're going to cause a government shutdown".

premium-concern 10y ago
> political brinkmanship and finger-pointing The difference is that parties that try to pull that in Germany not only loose elections, but are punished so hard by voters that they can't even get over the necessary 5% requirement in the next election. Have a look what happened to the FDP after they pushed through lower taxes for hotels.
- DasIch 10y ago
  In Germany not passing a new budget wouldn't let to a government shutdown. So it's not an option anyway.
  - premium-concern 10y ago
    Even if it did, it wouldn't matter, because people would vote those politicians that tried this shit and their party out of office.

webkike 10y ago

Using credit cards does not preclude being able to afford the thing you are paying for. I regularly use my credit card for every day purchases despite having ample money in my checking account. The regular payments allow me to develop a good credit history without much worry.

josefresco 10y ago
Bingo. Unfortunately the common assumption is that you're not paying it off monthly and paying high interest.
- fwn 10y ago
  Which, by the way, sounds like an awful concept of how creditworthiness is created. Signing into some unnecessary additional financial product with comically obsolete interest rates, just to manually repay it in the random timeframe in which the (still unnecessary) credit is free sounds like a bad idea. It's probably only there to nudge people into paying interest on money they already have.
  - josefresco 10y ago
    Credit history is just a history of making payments on-time. You can build a history by making student loan payments, car payments, health care payments etc. Obviously it's only one factor in someone's credit worthiness, however it's not a bad metric. If you pay your bills on-time, it makes sense that a lender would value you higher/safer than someone who does not.
  - hx87 10y ago
    > the random timeframe in which the (still unnecessary) credit is free Are you talking about the 0% APR period, or the monthly revolving cycle? The latter is absolutely predictable, and if you dislike manual payments you can always set up automatic ones.
kriro 10y ago
Why can't you use a debit card for that? Isn't having enough money in your checking account to reasonably afford all stuff you need to live basically proof of a good credit history? Isn't the best credit history one where you never need credit in the first place?

maxsilver 10y ago

Disagree might not be the right word, "force" is probably more accurate. In many countries, it would be effectively impossible for most regular people to get basic living needs (like housing and transportation) if they couldn't buy them using some amount of credit. Obviously it shouldn't be this way, it should be possible to save and buy these things outright. But since it effectively isn't (for many people, in many places) I wouldn't fault people for taking on debt to do things like put a roof over their head or get to work on time reliably.

snowwrestler 10y ago

I can pay for my house--over time. Which is fine because I'm also living in my house over time.

gozur88 10y ago

Government shutdowns in the US are largely theater. The last time they only halted 15% of expenditures.