Obama, The Debt Menace
You can find the full text of Obama's speech on "reducing" the debt and deficits here.
While our esteemed contributors are busy writing up their well thought out responses to the speech, you can find a few instant reactions from the Ricochet community here:
@jamespoulos Obama's consistent conflation of the merely rich with the superrich elite speaks volumes about our strange era
@freddoso Obama proposes tax simplification. Wow, what a great idea -- no one's ever thought of that one before.
@DavidLimbaugh Ok, will GOP say, "the president made some good points today. He acknowledged we have mounting debt?" Or will they say "He's a debt menace?"
@ClaireBerlinski Well, at least Obama made no mention of "strong and dark propaganda" or "coup-plotters." Let's give him that!
@TheKennedySmith $1 trillion deficit reduction is his proposed 2012 budget? What?
@jimmiebjr Congratulations Paul Ryan. It took you one whole week to turn Barack Obama into Nancy Pelosi.
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Aug '10
Re: Obama, The Debt Menace
We can never protect people from themselves. Like Charlie Sheen and Lyndsey Lohan, if American voters want to scramble their brains with 'progressive' Utopian delusions and deranged beliefs about "rights" and entitlements, we'll just have to let them drink the bitter dregs and bottom out.
In the next 24 hours we'll see if the American body politic wakes up and gives a big fat raspberry to Obummer and his minions. If they don't, it's all Kabuki theater from here on out.
I'm not holding my breath waiting for the wakeup.
Re: Obama, The Debt Menace
River: We can never protect people from themselves. Like Charlie Sheen and Lyndsey Lohan, if American voters want to scramble their brains with 'progressive' Utopian delusions and deranged beliefs about "rights" and entitlements, we'll just have to let them drink the bitter dregs and bottom out.
In the next 24 hours we'll see if the American body politic wakes up and gives a big fat raspberry to Obummer and his minions. If they don't, it's all Kabuki theater from here on out.
I'm not holding my breath waiting for the wakeup. · Apr 13 at 11:42am
No, we can't afford this pessimistic fatalism. We must demand that the GOP step up and present a clear narrative to the American people. We have the better case, but our people in Washington aren't making it.
As Pat Caddell said on the latest podcast, the GOP desperately needs to step up to the plate and start making the rock solid case over the next year why exactly we need to cut spending so dramatically.
Apr '11
Re: Obama, The Debt Menace
So, from what I read, I can gather this:
Free markets are cool and all, but really what makes us great is Government programs.
The deficit is all Pres. Bush's fault. We were fine until he bollixed the works.
Cuts? Well we can't do a lot to Social Security, Medicare, Medicaid, or education. All that is necessary. We'll reform them a bit here and there in ways we'll tell you about later. It's no good talking about cutting anything else because that's too small a part of the budget.
Tax hikes for the wealthy! Huzzah! (We won't tell you how much income the tax code considers "wealthy", we'll just let you assume we're finally going to stick it to all those proverbial Mr. Burns.)
Republicans? They want to steal your health care and grandma's health care and her retirement. Don't trust them! Evil! (Then he makes the sign of the cross or something.)
Jul '10
Re: Obama, The Debt Menace
@TheKennedySmith $1 trillion deficit reduction is his proposed 2012 budget? What?
For those who haven't read or heard it this is from the speech:
It's an approach that borrows from the recommendations of the bipartisan Fiscal Commission I appointed last year, and builds on the roughly $1 trillion in deficit reduction I already proposed in my 2012 budget.
Thing is, I don't have any idea what the President's talking about, either. Anybody?
May '10
Re: Obama, The Debt Menace
You can tell I'm on the B-team. Only one with a typo.
Also, from Mickey Kaus - "Obama: The all powerful Independent Payment Advisory Board will save us."
This refers to his projected Medicare savings, where he said but don't worry even if [!!!] we don't achieve those savings, the Indpedent Payment Advisory Board will step in with more recommendations.
He gives smoke and mirrors a bad rep.
May '10
Re: Obama, The Debt Menace
That anyone on the Right feels compelled to listen to President Obama's speech, let alone respond to it, is enough to depress me for the rest of the day.
Obama's words are irrelevant. Even his actions are irrelevant to the case Republicans must make to the public. There will be no genuine debate between Republicans and Democrats. Responding to Democrats only helps them control public focus and put Republicans on the defensive. Ignore them.
Republicans need to make their case directly to voters with no reference to the Left. Democrats have abandoned serious discussion. As long as Republicans continue to respond to their manipulative accusations and distortions, the Right's message will be sidetracked and muddled.
The debate has to be about the numbers, not the players. That's the only way enough voters will see this as a true crisis and not just another struggle for power between bureaucrats.
Re: Obama, The Debt Menace
Joe Biden falling asleep during the speech should underscore the irrelevance of Obama. (Apologies for the annoying commercials that precede the video)
Feb '11
Re: Obama, The Debt Menace
You know you're in dangerous territory when everybody agrees that something is true but nobody can explain why.
At the risk of being shouted down for questioning the obvious… could someone please explain how cutting government spending is going to lower unemployment and help the economy.
Aug '10
Re: Obama, The Debt Menace
Diane Ellis, Ed.
River: We can never protect people from themselves. Like Charlie Sheen and Lyndsey Lohan, if American voters want to scramble their brains with 'progressive' Utopian delusions and deranged beliefs about "rights" and entitlements, we'll just have to let them drink the bitter dregs and bottom out.
I'm not holding my breath waiting for the wakeup. · Apr 13 at 11:42am
...we can't afford this pessimistic fatalism. We must demand that the GOP step up and present a clear narrative to the American people. We have the better case, but our people in Washington aren't making it.
As Pat Caddell said on the latest podcast, the GOP desperately needs to step up to the plate and start making the rock solid case over the next year why exactly we need to cut spending so dramatically. · Apr 13 at 11:47am
Ah, the optimism of youth! I truly hope I'm wrong Diane, and that you're right. But I'm way older than you and this is about the fifteenth major, craven, and profound betrayal of American principles and values I've lived through. You've inspired me to hope for a miracle. Thanks!
Re: Obama, The Debt Menace
GoyoMarquez: You know you're in dangerous territory when everybody agrees that something is true but nobody can explain why.
At the risk of being shouted down for questioning the obvious… could someone please explain how cutting government spending is going to lower unemployment and help the economy. · Apr 13 at 1:38pm
Cutting spending isn't some quick trick to help the economy in the short term, it's an emergency measure to avoid a major scale catastrophe in the medium to long term. Our debts and deficits are quite simply unsustainable. Folks on the left never seem to grasp the term "unsustainable" unless the topic is carbon particles in the air. But at some point, we owe too much, our creditors stop lending, and my generation and the one that will succeed mine will be in a much, much worse situation than we're in now. Old liberal folks don't seem to care about us youngsters. Their quixotic pyramid scheme is motivated by pure greed, it seems.
May '10
Re: Obama, The Debt Menace
Actually, GoyoMarquez, I am happy to do so. Government spending as an economic enhancer was a simplistic construct of Lord Keynes promulgated in the 1930's because it looked logical (and still does to many surface-level economists who wish it were true).
The problem, as Hayek and many others explained in disagreement, was that there is no free lunch- government spending involves opportunity cost. There is a specific limit to accessible capital, and when the available capital is sucked out of the economy by government, whether by taxation or borrowing, it is not available for investment in the most productive ventures.
The central authority only occasionally hits the optimal investment by accident compared with the millions of individual decisions made by many people (the wisdom of crowds) in capital markets; Hayek called this "the knowledge problem"- no central authority is as smart as all of us out here put together.
Keynes posited a "multiplier effect" for government spending- essentially he simply decreed that every buck in government spending moved through the economy from one place to the next and built more than that same dollar would have produced if left in private investing hands.
May '10
Re: Obama, The Debt Menace
Now, it is almost impossible to measure these things objectively by analysis; Keynes and Hayek argued this for years inconclusively, and Keynes was aided at the time by using economic growth statistics from then USSR that we now know to have been wildly fraudulent. Christie Rohmer had no idea about this either when she was told to justify Obama's "stimulus", ARRA- so she basically picked a multiplier number out of the air as 1.5.
But if this is true, why aren't we better off if we spend three trillion fast, since it will soon be 4.5 trillion, and we will be RICH! Spend more! Of course, that is Obama's goal.
The data at country levels simply don't support that. The countries for whom we have good data tend to show that lower government expenditures compared to the overall national economy yield better growth rates if you control for demographics, etc. (con't)
Feb '11
Re: Obama, The Debt Menace
@ Diane Ellis:
You say "Our debts and deficits are quite simply unsustainable."
What is it that we owe? Do we owe first born children, cars, gold bars? It's my understanding that what we owe are dollars and that the monopoly producer of dollars is the United States Government and the cost of producing dollars is essentially nothing.
Isn't it true that the Federal Government could pay off all its debts by simply minting a few trillion dollar coins? If that's true then how can the debt and the deficit be unsustainable?
I think you're making the common mistake of analogizing the federal government's debt to household or business debt. But the federal government can no more have unsustainable dollar debt than Microsoft could have unsustainable debt denominated in copies of Windows 7. If Microsoft's debt is denominated in copies of Widows 7 it can pay off the debt any time it wants for virtually nothing. The same is true of the Federal government's debt, isn't it?
Thank you for being honest enough to admit that cutting government spending will do nothing about unemployment.
May '10
Re: Obama, The Debt Menace
The best way to understand that is to ask where jobs and growth come from? Microsoft and Apple (Henry Ford, for that matter) didn't arise from government planning, they were responses to latent market desires. If the government takes all the cash, where does the "risk capital"- the money to start the most promising new ventures that employ tomorrow's citizens- come from?
Historically, the early stages have come from "angel investors"- people who have enough money that they are willing to risk a bunch of it on things that may never pan out. This article (from my hometown lefty paper) describes the current problems we have with this, because the economy is simply too risky right now to invest in, and the WSJ explains further.
I can tell you that this is true- I was in a medical start-up that had solid IP and an opportunity to reduce health care costs, but died for lack of follow-on capital. My present job sees these issues all the time. Investors invest, start-ups hire, and tax money flows back to the treasury- but not if the Treasury takes it all before it can go to the start-up.
Re: Obama, The Debt Menace
GoyoMarquez: @ Diane Ellis:
You say "Our debts and deficits are quite simply unsustainable."
Isn't it true that the Federal Government could pay off all its debts by simply minting a few trillion dollar coins? If that's true then how can the debt and the deficit be unsustainable?
Is this a joke? That's the same thing as defaulting on debt. If we were to simply mint a few trillion dollar coins, we'd be Weimar 2.0 and I'd have to wheel a barrow full of cash down to the store to buy a loaf of bread.
Feb '11
Re: Obama, The Debt Menace
Uhhh… what currency is it that you think the Federal Government is going to use to pay off it's debt? Aren't they going to use dollars? Where do these dollars come from? Doesn't each and every dollar come from the Federal Government? Is there somebody else out there printing up dollars?
So then the issues isn't unsustainable debt it's inflation, right? So what you wish to do is cut government spending in order or avoid inflation? Is that what you're saying?
Re: Obama, The Debt Menace
GoyoMarquez
Uhhh… what currency is it that you think the Federal Government is going to use to pay off it's debt? Aren't they going to use dollars? Where do these dollars come from? Doesn't each and every dollar come from the Federal Government? Is there somebody else out there printing up dollars?
Your proposed solution (printing trillions of more dollars) would lead to hyperinflation. The more money the Fed prints, the less valuable it becomes. I don't understand your confusion on this matter.
Re: Obama, The Debt Menace
GoyoMarquez
So then the issues isn't unsustainable debt it's inflation, right? So what you wish to do is cut government spending in order or avoid inflation? Is that what you're saying? · Apr 13 at 4:13pm
No. The issue is unsustainable debt. I was simply pointing out that printing trillions of dollars is an untenable solution because it would lead to hyperinflation.
The only solution I see is a painful and drastic cut in govt. expenditures.
Re: Obama, The Debt Menace
Goyo, my friend, take it from one who knows. You are up against some big dogs here. These folks really know their economics. I think you might benefit from a review of some basics before you try to engage with the likes of Diane and Duane. Everyone here is honorable enough to trade ideas with you if you propose something reasonable. It happens on many comment threads -- divergence of opinion leads to learning by all. You might even convince some people of your side if you are backed by real history and real facts and real economics. Your belligerence -- or what seems to be belligerence (maybe I'm misreading you?) -- won't help your case.
Jul '10
Re: Obama, The Debt Menace
If You are employed in the private sector, would You show up to work if the federal government confiscated 100% of Yer pay?