United States Debt Default

Touche lol Minor detail - the debt expressed as a percentage of the GDP has experienced temporary decrease.Dam smoke ..In this scenario, it seems temporary increases in GDP attempt to give way to the illusion of a decrease in debt.Dam mirrors ..However, the actual debt itself remains steadily increasing, in fact never experiencing any actual decrease whatsoever.As an aside, we may do well to review numbers. When we allow a dollar to represent a second, 1 million dollars is roughly equivalent to 12 days. Proportionately, 1 billion dollars/seconds is equivalent to roughly 32 years.Now many people when you explain this to them, will then guess that 1 trillion seconds is equivalent to roughly 64 years or so, which effectively demonstrates how we can - at times, perceive numbers from an arbitrary view point.The fact is 1 trillion dollars is roughly equivalent to 31.7 thousand years - rather then a meager 64 years, when we allow a dollar to represent each second. 1 trillion seconds ago civilization did not exist, and we still have to multiply that by 14.3.We are considering a huge number - more stars than are in the milky way I hear.I'm not sure I'm ready to say it's insurmountable though One LoveEdited by Bailey, : grammar ..

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I'm not here to mock or condemn what you believe, tho my intentions are no less than to tickle your thinker.
If those in first century CE had known what these words mean ... 'I want and desire mercy, not sacrifice'
They surely would not have murdered the innocent; why trust what I say, when you can learn for yourself?
Think for yourself.Mercy Trumps Judgement,
Love Weary

No smoke and mirrors. A 1 million dollar debt for Bill Gates is a lot different than the same debt for Joe the Plumber. If we keep the current debt for 30 years and GDP catches up to it, then the debt has been effectively lowered. This is a very, very bad way to lower the debt, but it is a way to do it nonetheless. I am a microbiologist so I have a firm grasp on what large numbers of something look like. Strangely enough, 1 trillion bacteria is the number of bacteria in about 1 ml of culture media.

Straggler's not an American. Straggler's not an American. Straggler's not an American. Straggler's not an American.

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Love your enemies!

But right now, aren't the brackets just numbered with $$ amounts?I think it is a great idea to base taxes on poverty levels, but I don't see how changing the wording of the tax forms would help eliminate buzzword politics.Jon

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Love your enemies!

Jon writes:

quote:

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What would that do to the poor people who currently pay no taxes?

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Huh? Did the sales tax suddenly not become a tax? Payroll taxes suddenly stopped being taxes?The poor pay taxes. What they don't pay is income tax. This is why a "national sales tax" in lieu of an income tax is so stupid: Poor people will wind up paying more in taxes because their money is all spent on consumption (food, utilities, gasoline, etc.) which will now all be taxed at a higher rate.Let us not forget, we were running surpluses at the end of the millennium. The vast majority of our current debt can be contributed to two things: Bush's tax cuts and the wars in Afghanistan and Iraq. This is why there was that talk not too long ago about "doing nothing" with regard to the budget. Simply letting all that expire, going back to Clinton-era tax rates and military spending, we'd make huge dents in our debt.Personally? I say go back even further...repeal the Reagan tax cuts.

No one can eliminate buzz words, but it changes the perspective when $110,000 is expressed as 10 times the individual poverty level.

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Anyone so limited that they can only spell a word one way is severely handicapped!

I’m gonna split hairs a bit here, but after all we’re in a debate forum. In this scenario, the actual debt is not decreasing at all — it’s representation, as a percentage, is simply being modified in proportion with its surroundings. This is like when we get a hair cut and refer to it as ‘getting our ears lowered’. At first it can be a useful expression, until someone believes people’s ears are actually being lowered .. then its just confusing.Perhaps it would be unfair to call this smoke and mirrors. When the GDP rises and the national debt remains fixed, the result is a lesser percentage of debt against the GDP backdrop. However, the actual debt is obviously not lower, as it has remained fixed, which of course goes the same for Bill or Joe. When they take their surplus income and apply it toward their debt — not just on a chart, but in reality, their debt will be lower.After all, if Tom wins $13,700, he can’t then say his $58,000 tuition bill decreased. What he can do is apply money towards it (after taxes of course). Likewise, he could walk around with his winnings and brag to all the people he owes money to that he’s not going to pay them, but rather he’s decided to subsidize his GDP with his winnings (or their principal, depending how ya look at it) in order to better capitalize on his interest penalties You’re one of the lucky ones^* So the US national debt is roughly 7 ml and climbing when expressed as a culture media ..Ya learn something’ new everyday if ya ain’t careful One Love

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^* Person in general, not just microbiologist ..

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I'm not here to mock or condemn what you believe, tho my intentions are no less than to tickle your thinker.
If those in first century CE had known what these words mean ... 'I want and desire mercy, not sacrifice'
They surely would not have murdered the innocent; why trust what I say, when you can learn for yourself?
Think for yourself.Mercy Trumps Judgement,
Love Weary

I thought jar's mention of brackets made it clear we were talking about income tax. The graph from Message 15 would certainly seem to support that sentiment.Jon

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Love your enemies!

Never has Straggler agreed so much with Jon.

There is talk in the news today of a downgrade of the US credit rating from it's AAA status if something significant doesn't happen soon. Is this likely and if so what effect will it have?

IMHO that is very, very unlikely to happen unless Congress decides to really be *** (that is not impossible of course). There are members of the Tea Party (and they all do seem to be that ***) that simply say default is no big deal, screw the bond holders, but I really don't think they have enough votes to do that.As I pointed out in Message 3, the current revenue is more than sufficient to pay any interest and payments due on debt. That should be okay. The US credit rating should remain sound.The issue is the monies needed for government to actually do anything. If the debt ceiling does not get raised then a lot of the current non debt related commitments, Social Security retirement benefits, military salaries, government workers salaries, the Federal parts of unemployment insurance, the US postal service might not go out after August 3rd.

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Anyone so limited that they can only spell a word one way is severely handicapped!

The role of credit rating agencies in all this seems very strange. Who are they and why do they get to decide things that can have disastrous consequences for nations and individuals?I guess I am thinking as much of Greece and Portugal and Spain and the UK as I am the US with that question. But it does seem they have a bizzarre degree of power over people's lives and their position on this specific US issue could be key couldn't it?

I don't see much of an issue there. Credit rating is simply looking at the past behavior of either a nation, corporation, individual. It looks and asks, "Do they have a history of paying their debts?", and "Do they have the revenue or assets needed to pay current debt commitments?"

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Anyone so limited that they can only spell a word one way is severely handicapped!

This is what I am referring to: US debt talks deadlock edges ratings agencies toward downgradeNot an issue as far as you are concerned?

Remember, in 2007, 2008, 2009 S&P and Moody also said that they might lower Great Britain's credit rating from AAA, and this rhetoric has been repeated in 2010 as well.The problem is that no politicians want to address the issue.The solutions are really pretty simple, but it requires a long term commitment that neither government is set up to make.

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Anyone so limited that they can only spell a word one way is severely handicapped!