4 ms·

Funding the Government after August 2 - Running QE2 in Reverse

10 points by trotsky 15y ago

chubs 15y ago
I don't understand - why has it been such a big deal to raise the debt ceiling this time? I mean, didn't they do it 7 times in bush's 8 years, and 5 times in the last ~4 years of obama's presidency? If they've done it roughly once a year for the last 12 years, why the big deal this time?
- linuxhansl 15y ago
  Because the Republican party has been infiltrated by an ideological fraction that is impervious to arguments and unwilling to compromise. At least that's what it looks like to me. I think most people are not worried, because they believe that the responsible parties will raise the debt ceiling in time. I think those people underestimate the the reality distortion from which the tea party suffers. The other reason is that the US debt is reaching worrisome levels, and at some point needs to be curbed. That is not a political problem, though, that is a problem of society. People in the US want everything, but nobody wants to pay for it. The US debt here is just an extension of willingness to go into personal debt, which is much greater here than is most other western countries.
justin_vanw 15y ago
I don't understand why it matters one way or the other. If they raise it, great. If they don't, then spend less money government. The government does it's budgeting all fucked up. It makes a list of everything it wants, then sort of argues a little and writes a check for the total. Every other entity in the universe starts with how much money they have or want to spend, and then divides it up according to priorities. If the government switched to this method, they would just have less money to slice up. I was in the army, and I worked for defense contractors. 99% of federal government employees do no work. I mean literally don't do anything. They show up around 9 and leave around 4, and surf the internet in between. Every once and awhile they have meetings and plan things that don't get done, or figure out who is going to go on some trip. Meanwhile contractors are running around doing the little bit of work that is being done. The hilarious part is, 99% of that work doesn't matter. If it just stopped tomorrow, nobody would even be able to notice. So, if my calculations are correct, and they are only based on empirical observation over the course of 8 years, we could reduce the size of the government expenditures (excluding programs that just write checks, like medicare and social security, which we should keep) by 99.99% and nobody would care other than the government employees, but I don't feel sorry for people who's entire contribution to society is to be physically present at a specific location for 35 hours a week. Lets cut the budget but keep the programs that help old people and poor people.
URSpider94 15y ago
My imperfect understanding, from studying other sources, is that this is not correct at all. What the poster is describing is, in fact, what the government has been doing for several months -- using cash inflows to keep paying the bills, while rolling over expiring debts into new ones. August 2 is the date when we will no longer have enough cash on-hand to keep paying our obligations. In addition, a large raft of monthly Social Security checks are scheduled to go out at the end of next week, so even if the estimates are wrong and we can make it a few extra days, that singular large expense will be enough to push us over the brink.

10 points by trotsky 15y ago

chubs 15y ago

I don't understand - why has it been such a big deal to raise the debt ceiling this time? I mean, didn't they do it 7 times in bush's 8 years, and 5 times in the last ~4 years of obama's presidency? If they've done it roughly once a year for the last 12 years, why the big deal this time?

linuxhansl 15y ago
Because the Republican party has been infiltrated by an ideological fraction that is impervious to arguments and unwilling to compromise. At least that's what it looks like to me. I think most people are not worried, because they believe that the responsible parties will raise the debt ceiling in time. I think those people underestimate the the reality distortion from which the tea party suffers. The other reason is that the US debt is reaching worrisome levels, and at some point needs to be curbed. That is not a political problem, though, that is a problem of society. People in the US want everything, but nobody wants to pay for it. The US debt here is just an extension of willingness to go into personal debt, which is much greater here than is most other western countries.

justin_vanw 15y ago

I don't understand why it matters one way or the other. If they raise it, great. If they don't, then spend less money government. The government does it's budgeting all fucked up. It makes a list of everything it wants, then sort of argues a little and writes a check for the total. Every other entity in the universe starts with how much money they have or want to spend, and then divides it up according to priorities. If the government switched to this method, they would just have less money to slice up. I was in the army, and I worked for defense contractors. 99% of federal government employees do no work. I mean literally don't do anything. They show up around 9 and leave around 4, and surf the internet in between. Every once and awhile they have meetings and plan things that don't get done, or figure out who is going to go on some trip. Meanwhile contractors are running around doing the little bit of work that is being done. The hilarious part is, 99% of that work doesn't matter. If it just stopped tomorrow, nobody would even be able to notice. So, if my calculations are correct, and they are only based on empirical observation over the course of 8 years, we could reduce the size of the government expenditures (excluding programs that just write checks, like medicare and social security, which we should keep) by 99.99% and nobody would care other than the government employees, but I don't feel sorry for people who's entire contribution to society is to be physically present at a specific location for 35 hours a week. Lets cut the budget but keep the programs that help old people and poor people.

URSpider94 15y ago

My imperfect understanding, from studying other sources, is that this is not correct at all. What the poster is describing is, in fact, what the government has been doing for several months -- using cash inflows to keep paying the bills, while rolling over expiring debts into new ones. August 2 is the date when we will no longer have enough cash on-hand to keep paying our obligations. In addition, a large raft of monthly Social Security checks are scheduled to go out at the end of next week, so even if the estimates are wrong and we can make it a few extra days, that singular large expense will be enough to push us over the brink.