Obama's deficit Reduction PLAN

[88Comrade2000]

Obama is supposed to present his own deficit reduction plan in a speech Wednesday.

http://content.usatoday.com/communities/theoval/post/2011/04/obama-prepares-to-revive-tax-cut-debate/1

Supposed to include tax hikes.

I think any realistic plan has to do the following:

1. Eliminate the debt, currently at 14 trillion, by FY 2020. Preferably sooner but definitely by the end of this decade. FY 2020 begins Oct. 2019.

2. Include a mixture of tax reform: tax cuts in some areas but also tax increases in other areas and spending cuts. The government spending needs to be reduced. The size of government needs to be reduced- only have a government at the federal level doing what can't be done at the state or local level. Any increase in revenue that goes beyond the government we have decided isn't going to go for further tax cuts or further increases in spending. Any increases in taxes will only be to have revenue to eliminate the 14trillion dollar debt.[/u]

Will be interested to see what Obama proposes.

[Teller]

I PLAN to skip this speech for the Caps game.

[SnyderShrugged]

The feds have continually proven that they are awful at maanaging our nations money yet so many feel the best path to healing is to give them even more to mismanage.

Any budget that dOesnt balance in less than 7 years is a joke and just window dressing.

[mardi gras skin]

I'm looking forward to it! I'd like to see a combination of about 70% spending cuts to about 30% in tax increases to make up the shortfall.

edit: Ugh. I don't understand President Obama at all...what is his roll in this government?

http://www.washingtonpost.com/business/economy/obama-turns-to-his-bipartisan-deficit-commissions-blueprint-for-reducing-debt/2011/04/11/AF7azCND_story.html

Obama will not blaze a fresh path when he delivers a much-anticipated speech Wednesday afternoon at George Washington University. Instead, he is expected to offer support for the commission’s work and a related effort underway in the Senate to develop a strategy for curbing borrowing. Obama will frame the approach as a responsible alternative to the 2012 plan unveiled last week by House Republicans, according to people briefed by the White House.

Letting others take the lead on complex problems has become a hallmark of the Obama presidency. On health care, last year’s tax deal and the recent battle over 2011 spending cuts, Obama has repeatedly waited as others set the parameters of the debate, swooping in late to cut a deal. The tactic has produced significant victories but exposed Obama to criticism that he has shown a lack of leadership.

So his plan is to support the commission results he ignored months ago. Great. Thanks for getting around to that.

[Thiebear]

They lied about the 38 billion with gimmicks in there using left over census money and calling that a cut.

Bonus: The 72hour rule allows the watchdog groups to go in and shine a light on what was previously passed and them we were told what it meant.

I hope we use this as a battering ram on them about fixing the programs we have. Dropping the Tax cuts for a couple years wouldn't kill us.

Though President Obama is about to break every pledge in Bush1 type grandeur.

Boehner should be kicked back into membership only, he's proven to be weird and innefective.

[DRSmith]

Paying off 14 trillion in 8 years will not happen, go with 28 years and make it law that way you do not get another president who decides the government running surpluses is immoral and squanders it ends up paying no debt off.

Taxes on the rich have to go up and some middle class tax cuts have to go, like mortgage interest. Defense spending needs to be cut.

And Obama needs to hold the line let the Republicans threaten and threaten about raising taxes, they can not let the economy crash or their rich owners will pull the plug on them fast.

[SnyderShrugged]

Paying off 14 trillion in 8 years will not happen, go with 28 years and make it law that way you do not get another president who decides the government running surpluses is immoral and squanders it ends up paying no debt off.

Taxes on the rich have to go up and some middle class tax cuts have to go, like mortgage interest. Defense spending needs to be cut.

And Obama needs to hold the line let the Republicans threaten and threaten about raising taxes, they can not let the economy crash or their rich owners will pull the plug on them fast.

You begin with an errant pemise that "Paying off 14 trillion in 8 years will not happen". You seem to feel that its impossible when it really is not. Now if you are saying that there isnt the political will to do it, then I'd agree. But it can and should happen and there should be no tax increases until all non-essential spending is halted in its tracks, all redundant and duplicative programs are removed 100% and ALL programs and projects are reviewed for waste, starting with all overseas bases and operations, medicare/medicaid, and SSI. Then move onto removing corporate, foreign, and Sate welfare.

I'm perfectly comfortable that if we need to fund entitlements for a few more years with a plan to phase out reasonable so as to not leave anyone in a sudden lurch, then to do so after all so called "wars" are ended and the vast majority of bases either closed or funded by the nations that want our presence there as security.

Once ALL of the above is addressed, then lets talk about raising taxes

[TimmySmith]

I would suspect there will be significant defense cutting.

[gbear]

SS,

Why do we want to pay it all off?

Yes, we pay interest. Some of our tax dollars go to paying for needed projects and wasteful projects of previous generations. So in some sense, we lose out ability to buy or pruchase some goods or services now.

However, for as long as the dollar is the common currency of trade, do we not gain some benefit as well? Are not the prices we pay for many imports lower because everything is traded/bought in dollars? To some extent our debt keeps inflation lower relative to other countries. As a result, our debt both reduces our dollars available to purchase and makes our dollars more valuable allowing fewer dollars to purchase more good and services. I would have expected our dollar to soar when the Fed pumped money in trying to lower the debt and halt possible deflation, but it didn't happen. None of our trading partners wanted to devalue the dollars/debt they currently hold.

[SnyderShrugged]

SS,

Why do we want to pay it all off?

Yes, we pay interest. Some of our tax dollars go to paying for needed projects and wasteful projects of previous generations. So in some sense, we lose out ability to buy or pruchase some goods or services now.

However, for as long as the dollar is the common currency of trade, do we not gain some benefit as well? Are not the prices we pay for many imports lower because everything is traded/bought in dollars? To some extent our debt keeps inflation lower relative to other countries. As a result, our debt both reduces our dollars available to purchase and makes our dollars more valuable allowing fewer dollars to purchase more good and services. I would have expected our dollar to soar when the Fed pumped money in trying to lower the debt and halt possible deflation, but it didn't happen. None of our trading partners wanted to devalue the dollars/debt they currently hold.

Why would any effective or efficient party wish to rely on money they dont have to pay bills that arent essential?

Of course the desire should be to pay it all off and work only within our actual means.

Why do you assume that the dollar will remain the "common currency of trade?" when we literally owe trillions to other nations?

[SonnySide]

obama rhetoric about deficit reduction is like an arsonist bragging about how he threw a cup of water on a fire he started......

[Burgold]

obama rhetoric about deficit reduction is like an arsonist bragging about how he threw a cup of water on a fire he started......

Started?

How many times in the history of this nation has it not been in debt?

[BRAVEONAWARPATH]

obama rhetoric about deficit reduction is like an arsonist bragging about how he threw a cup of water on a fire he started......

While it's true that President Obama has added to the deficit, he certainly didn't "start the fire."

[DieselPwr44]

Don't mind cutting defense spending, in fact it's needed. But if you're going to do that, how bout bringing the service people home from Iraq,Afghan., and Libya first?

[SonnySide]

obama has created a deficit higher than ANY President in history, yet he LIES by trying to paint himself as fiscally responsible when he "cuts" a million or two here from the budget.....

The past doesn't excuse his present-day incompetence.

---------- Post added April-13th-2011 at 08:17 AM ----------

Any defense of obama as a competent President may be attributed to many things, none of which are "sanity" or "honesty"....the obama experiment is an utter FAILURE....

[TimmySmith]

Don't mind cutting defense spending, in fact it's needed. But if you're going to do that, how bout bringing the service people home from Iraq,Afghan., and Libya first?

Obama has followed the Bush timetable for troop recall so far, and if he continues to do so, it will result in the troops out of Afghanistan by the end of this year. This is the perfect time to cut defense if he is ever going to do it. I am not holding my breath.

[SonnySide]

Obama has followed the Bush timetable for troop recall so far, and if he continues to do so, it will result in the troops out of Afghanistan by the end of this year. This is the perfect time to cut defense if he is ever going to do it. I am not holding my breath.

If you hold your breath waiting on obama to keep a promise, you won't be around for very long....

[MattFancy]

Don't mind cutting defense spending, in fact it's needed. But if you're going to do that, how bout bringing the service people home from Iraq,Afghan., and Libya first?

I agree with this. I have a hard time cutting defense spending when we're still fighting 2 wars. Yes the Iraq one is almost done, but you still have all those soliders in Afghanistan. I find it hard to say thanks for your hard work, but we're taking your money away.

[BRAVEONAWARPATH]

If you hold your breath waiting on obama to keep a promise, you won't be around for very long....

http://www.politifact.com/truth-o-meter/promises/obameter/

[gbear]

Why would any effective or efficient party wish to rely on money they dont have to pay bills that arent essential?

Of course the desire should be to pay it all off and work only within our actual means.

Why do you assume that the dollar will remain the "common currency of trade?" when we literally owe trillions to other nations?

You answered your second question with the third question. It has retained its value in large part because those holding it still want more and they want what they currently have to retain value.

When you talk of paying it all off, the implication is other countries will lose some or all of their stake in the dollars high value. Without other countries and currencies keeping our dollar at a more or less constant value, I would expect more rapid changes in the dollars value leaving us more open to both rapid deflation and rapid inflation as our economy goes on it's normal up and down ride. Yes, we pay too much in interest payments. So there is a value in lowering the debt and thus the debt payments, but I wouldn't want to forgo the protection offered to our dollars value by having debt held by many. I like it when it's in everybody's interest to see me/us do well.

[SkinsHokieFan]

What a dissapointment? Come on President Obama, INSPIRE THIS COUNTRY with something bold and fresh, not the same old stale stuff.

How about this to start. We get back to FY 2008 projected deficit levels first of in the 400-500 billion dollar range. With the wars ending and the spending from the financial crises behind us, there is no reason we should be projecting a 1.6 trillion dollar deficit. That is simply irresponsible on his part.

[mjah]

You begin with an errant pemise that "Paying off 14 trillion in 8 years will not happen". You seem to feel that its impossible when it really is not. Now if you are saying that there isnt the political will to do it, then I'd agree.

Politics dictates that it's impossible. But reality ALSO dictates that it's impossible. This is the rare case where the two agree.

You're talking about balancing our existing annual budget and then paying down an additional $1.75 trillion per year. Based on this year's budget and some very optimistic assumptions down the line, that leaves something like $850 billion to run the entire Federal government. For comparison, Defense alone is currently $703 billion and it's not even the biggest line item on the budget (although it's close).

If we literally get rid of all pension guarantees, Social Security, Medicare, all other health related expenditures of any kind, Transportation, TSA, Education, Commerce, social services, all international affairs, Justice, Natural Resources, Energy, Agriculture, and EVERYTHING ELSE the government does, but keep defense and vets' benefits, then the ensuing national collapse will just barely allow you to pay down the debt in 8 years. Of course, that assumes that government revenues remain constant (to say nothing of improving) after the nation's largest employer fires well over 90% of its civilian employees, thereby putting millions and millions of others out of work too and plunging tens of millions of elderly/poor people into complete destitution.

Better add a few hundred billion to your budget, so you can fight the nationwide rebellion you've caused. Meh, we didn't need veterans' benefits anyway.

But wait, why should defense go untouched? Let's just give everything in government a 78% cut across the board, including defense. Note that I'm NOT saying it gets cut by 22%. I'm saying there's 22% LEFT when you're done.

Cuckoo. Cuckoo. But surely it's just a matter of "politics!"

I have yet to meet a person who successfully paid off a jumbo mortgage in 8 years by matching spending to expenditures and THEN diverting 2/3 of his net income to paying off his house. Somehow that ends up not working.

"Honey, that's enough about all this "owning a car so I can get to work" nonsense -- think about how quickly we'll be debt-free under my plan!"

[SnyderShrugged]

Politics dictates that it's impossible. But reality ALSO dictates that it's impossible. This is the rare case where the two agree.

You're talking about balancing our existing annual budget and then paying down an additional $1.75 trillion per year. Based on this year's budget and some very optimistic assumptions down the line, that leaves something like $850 billion to run the entire Federal government. For comparison, Defense alone is currently $703 billion and it's not even the biggest line item on the budget (although it's close).

If we literally get rid of all pension guarantees, Social Security, Medicare, all other health related expenditures of any kind, Transportation, TSA, Education, Commerce, social services, all international affairs, Justice, Natural Resources, Energy, Agriculture, and EVERYTHING ELSE the government does, but keep defense and vets' benefits, then the ensuing national collapse will just barely allow you to pay down the debt in 8 years. Of course, that assumes that government revenues remain constant (to say nothing of improving) after the nation's largest employer fires well over 90% of its civilian employees, thereby putting millions and millions of others out of work too and plunging tens of millions of elderly/poor people into complete destitution.

Better add a few hundred billion to your budget, so you can fight the nationwide rebellion you've caused. Meh, we didn't need veterans' benefits anyway.

But wait, why should defense go untouched? Let's just give everything in government a 78% cut across the board, including defense. Note that I'm NOT saying it gets cut by 22%. I'm saying there's 22% LEFT when you're done.

Cuckoo. Cuckoo. But surely it's just a matter of "politics!"

I have yet to meet a person who successfully paid off a jumbo mortgage in 8 years by matching spending to expenditures and THEN diverting 2/3 of his net income to paying off his house. Somehow that ends up not working.

"Honey, that's enough about all this "owning a car so I can get to work" nonsense -- think about how quickly we'll be debt-free under my plan!"

Rand Pauls budget proposal balaced the budget in 5 years. The current proposal that the Replublican study committee does it in 7.

people pay off mortgages and other debt way early all the time, they just work hard to do so and make sacrifices to get there. It's anything but "impossible"

To claim impossibility is to give up. It is certainly possible and not even that difficult. Change sucks, but often it must occur to succeed. We must abandon this keynesian mess that has brought us to this spot.

[DieselPwr44]

[Bang]

I PLAN to skip this speech for the Caps game.

I'm with you.

~Bang