I want to understand the deficit issue better

[Anonymous]

Anonymous wrote:

Anonymous wrote:Anyone who relies on SS and Medicare needs to wake up now. These new R tax proposals aren’t about helping out poor people. They’re about starving the government of more revenue to cause a crisis and force cuts to entitlements.

All the grants, federal employees, foreign aid - those are beans compares to the entitlements. Federal spending is already increasing under Trump. Because of the entitlements and interest on the debt!

It took Rs 25 years to “starve the beast” but now they are turbocharging the project. MAGA is so dumb though that they’re falling for it.

Social Security could be made solvent for decades by raising the contribution cap.

We "could" do lots of things, but no one does. This could really be the end of US dominance. It's fixable and yet we won't fix it.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Anyone who relies on SS and Medicare needs to wake up now. These new R tax proposals aren’t about helping out poor people. They’re about starving the government of more revenue to cause a crisis and force cuts to entitlements.

All the grants, federal employees, foreign aid - those are beans compares to the entitlements. Federal spending is already increasing under Trump. Because of the entitlements and interest on the debt!

It took Rs 25 years to “starve the beast” but now they are turbocharging the project. MAGA is so dumb though that they’re falling for it.

Social Security could be made solvent for decades by raising the contribution cap.

Keep up. Republicans are not proposing to raise the contribution cap to shore up SS. But they are giving even more tax cuts to the wealthy.

US govt is already tapping the trust fund. This is terrible time speed up the revenue loss to the federal
Govt. But republicans know that and they are doubling down on it.

[Anonymous]

We could wipe it out if the government stopped giving huge corporations 3 billion per day.
Yet, it does keep giving it.

[Anonymous]

Anonymous wrote:We could wipe it out if the government stopped giving huge corporations 3 billion per day.
Yet, it does keep giving it.

Exactly. Now they won’t even consider capping corporate SALT. Remember how maga “owned the libs” by capping SALT for homeowners and sold it as punishing blue states for high tax rates.

But not a peep about limiting SALT for corporations - who got a permanent tax cut in 2017!

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Anyone who relies on SS and Medicare needs to wake up now. These new R tax proposals aren’t about helping out poor people. They’re about starving the government of more revenue to cause a crisis and force cuts to entitlements.

All the grants, federal employees, foreign aid - those are beans compares to the entitlements. Federal spending is already increasing under Trump. Because of the entitlements and interest on the debt!

It took Rs 25 years to “starve the beast” but now they are turbocharging the project. MAGA is so dumb though that they’re falling for it.

Social Security could be made solvent for decades by raising the contribution cap.

Keep up. Republicans are not proposing to raise the contribution cap to shore up SS. But they are giving even more tax cuts to the wealthy.

US govt is already tapping the trust fund. This is terrible time speed up the revenue loss to the federal
Govt. But republicans know that and they are doubling down on it.

That's a long standing myth.
Disbursements from those funds (there are two) can only go to program benefits and administration. The rest, by law, is used to buy treasury bonds.

There are many ways to look at this. Spending as a % of GDP since 1930 was highest in 1944-1945, 200 probably took until the 1970s for the costs incurred during WW2 to have been completely zeroed out (not thinking in terms of specific debt instruments, just the cost and federal spending and debt service). In 2024 it was also less than 1 percentage point higher than during Reagan's first term. Since 1960, total tax revenues have been between 15% and 20% and in 2024 a little over 16%.

> 65 population currently around 17% and will go to around 22% of population by 2050.

I think we are far enough away from a debit cliff to fix it. Interest rates for the past 20 years have been lower than they were from Nixon to the beginning of GW, so we've had a grace period. But we have to fix our political system, and that does NOT mean using Trump, DOGE, and craven republicans in Congress to do it.

[Anonymous]

Anonymous wrote:We could wipe it out if the government stopped giving huge corporations 3 billion per day.
Yet, it does keep giving it.

I am totally for eliminating subsidies. Tariffs are fine, subsidies are not.

[Anonymous]

Anonymous wrote:

And most households don’t have bonds that every international investor usually wants to hold. If households could borrow a lot of cheap money, they probably would. The problem is that Trump is scaring everyone off and the investors want higher interest rates.

This is another way the analogy breaks down. Carried interest doesn't work for the US government. EG if we have a low interest loan, we can't invest in a high return investment and make money. EG we can't use excess from student loans or thirty-year mortgages to take out high yield CDs or put it in a 401K and make money on the cheap loans. There is no net benefit to cheap loans for the government. It's just throwing money down the drain.

[Anonymous]

Anonymous wrote:

Anonymous wrote:OK, so we need to raise taxes on the wealthy to pay for the spending. But the wealthy are in power so that probably won’t happen. I’m a moderate and just want a sustainable country that works. It’s all so bleak.

Well you need a growing economy which requires consumers making enough money to buy products/services from the private sector. This administration's offanswer to the deficit is to do mass layoffs across the country, raise the price on most goods, cut taxes on billionaires, increase government spending, and abolish free trade. You s don't understand the deficit because it's just a chant Republicans bring up whenever there's a Democrat in office

With all these layoffs why was the jobs report so good this past week? Why has the S&P 500 gone up the past 9 days?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

And most households don’t have bonds that every international investor usually wants to hold. If households could borrow a lot of cheap money, they probably would. The problem is that Trump is scaring everyone off and the investors want higher interest rates.

This is another way the analogy breaks down. Carried interest doesn't work for the US government. EG if we have a low interest loan, we can't invest in a high return investment and make money. EG we can't use excess from student loans or thirty-year mortgages to take out high yield CDs or put it in a 401K and make money on the cheap loans. There is no net benefit to cheap loans for the government. It's just throwing money down the drain.

The arguement from the borrow cheap money crowd is that the government can invest in things that build productivity - education, infrastructure etc.. of course Congress is not disciplined and you just end up with more spending on everything.

But a huge reason we have $37 trillion in debt is tied to the very low interest rates we’ve enjoyed because of safety US securities.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

And most households don’t have bonds that every international investor usually wants to hold. If households could borrow a lot of cheap money, they probably would. The problem is that Trump is scaring everyone off and the investors want higher interest rates.

This is another way the analogy breaks down. Carried interest doesn't work for the US government. EG if we have a low interest loan, we can't invest in a high return investment and make money. EG we can't use excess from student loans or thirty-year mortgages to take out high yield CDs or put it in a 401K and make money on the cheap loans. There is no net benefit to cheap loans for the government. It's just throwing money down the drain.

The arguement from the borrow cheap money crowd is that the government can invest in things that build productivity - education, infrastructure etc.. of course Congress is not disciplined and you just end up with more spending on everything.

But a huge reason we have $37 trillion in debt is tied to the very low interest rates we’ve enjoyed because of safety US securities.

And education is nominally beneficial, definitely not enough to get people in a high enough tax bracket to recoup the costs. Businesses might make more money, but they have nominal tax rates, barely accounting for 7% of the total income. Most people can barely pay off the loans. Then they bring a bunch of poor people or skilled immigrants, not paying taxes but using services. The "skilled" immigrants in most cases do the "skilled" work for less wages so actually make the income investment worse. I could see if people came out of college with high earning degrees, but most of the people that the government invests in don't command all that great of a wage after matriculating, eg poor people are still poor after they have degrees.