Ka-BOOM!

[dude1394]

The truth just keeps pushing it's way into the the dream.

http://www.breitbart.com/news/2006/10/11/D8KMJBT81.html

Federal Deficit Now Lowest in 4 Years
Oct 11 2:20 PM US/Eastern

By MARTIN CRUTSINGER
AP Economics Writer

WASHINGTON
The federal deficit in the budget year that just ended fell to a four- year low of $247.7 billion _ a figure President Bush touted Wednesday as "proof that pro-growth policies work."

The deficit for the budget year that ended Sept. 30 was 22.3 percent lower than the $318.7 billion imbalance for 2005, handing Bush a welcome economic talking point as Republicans battle to hold onto control of Congress in the midterm elections.

Bush called the outcome for Fiscal 2006 a "dramatic reduction" that redeemed his 2004 campaign pledge to halve the deficit earlier than his original 2009 target date.

"These numbers show that we have now achieved our goal of cutting the federal deficit in half and we've done it three years ahead of schedule," Bush told reporters at a Rose Garden news conference.

The pledge to cut the deficit in half was based on the administration's forecast that the 2004 deficit would hit $521 billion, a figure that proved to be too pessimistic by more than $100 billion. However, the administration has continued to use the forecast number as its benchmark for deficit reduction.

Bush said he would continue to urge Congress to make permanent his first-term tax cuts, all of which are due to expire by the end of 2010.

[purplefrog]

It is difficult for me to get excited about the fact that we are still spending nearly $250 BILLION dollars more than our budget allows. Great news (note sarcasm) that it is not 300+ billion more than our budget, but give me a break this is still worrisome.

What is more worrisome is that our cumulative national debt is almost 9 trillion dollars and Congress keeps moving the debt ceiling. Maybe the "pro-growth" policies of Bush II are starting to work. I am willing to keep watch and see what happens (what else can we do!!) and praise this administration if we can end the spiral. But I am compelled to ask these questions:
1) Will we ever be able to make significant strides to actually reducing the cumulative debt?
2) Is there a "tipping point" for the cumulative debt that brings down the economy?
3) With the prospects of a long protracted and expensive war(s) should we really be celebrating minor victories in the economy like those stated by Bush in the article above???

I am not an economist so I cannot answer these questions. But my gut feeling is that we cannot continue our present course and a serious economic plan needs to be put in place to actually reverse the trend that we have had since the Reagan years.

[dude1394]

Originally Posted by purplefrog

It is difficult for me to get excited about the fact that we are still spending nearly $250 BILLION dollars more than our budget allows. Great news (note sarcasm) that it is not 300+ billion more than our budget, but give me a break this is still worrisome.

What is more worrisome is that our cumulative national debt is almost 9 trillion dollars and Congress keeps moving the debt ceiling. Maybe the "pro-growth" policies of Bush II are starting to work. I am willing to keep watch and see what happens (what else can we do!!) and praise this administration if we can end the spiral. But I am compelled to ask these questions:
1) Will we ever be able to make significant strides to actually reducing the cumulative debt?

Not imo until there is another gramm-rudman bill that across the board restrains spending. It would seem that an overall cap of something (1-2-4%) growth should be allowed. Anything over that doesn't get funded. There just is no incentive whatsoever for any american politician to cut spending, none. They get beat up by the other party, the news, the specific interest group and even their own local constituents. Either a crisis (tax raising) or a consensus to share the blame will have to occur.

2) Is there a "tipping point" for the cumulative debt that brings down the economy?

I don't know but at the current level no. 1.9% or so of GDP is not high.

3) With the prospects of a long protracted and expensive war(s) should we really be celebrating minor victories in the economy like those stated by Bush in the article above???

Why do we "celebrate" the 1000th fatality? First it's dubya doing what he said he would do (except 3 years faster) and it's politics. Why shouldn't he crow about it. To NOT crow about it would be unreasonable.

I am not an economist so I cannot answer these questions. But my gut feeling is that we cannot continue our present course and a serious economic plan needs to be put in place to actually reverse the trend that we have had since the Reagan years.

You blame the reagan years but I don't see it. I see it as a lack of resolve in cutting spending. Clinton didn't cut spending and he did the same thing that dubya's doing now, grew his way out of debt. No comprehensive plans to cut the pension funds, nothing really different.

Probably the only thing that will change this is a very deep recession unfortunately.

[purplefrog]

Dude, the fact is I really, really hope you are right. I want a strong economy regardless of how we get there and who claims the credit. When I see us with a balanced budget and a trend toward a reduced debt, then I will rest easier. As far as dubya crowing, let him crow if he wants. He is the Prez and he has had difficult issues to deal with. He deserves a break every now and then amongst the scrutiny that comes with the job. I just don't think the present numbers necessarily represent a "new trend". It is premature to declare we now have a handle on this problem. For me government should be about solving problems and not winning the partisan game of politics and it is disheartening when national issues are reduced to who gets the blame and who gets the credit. As far as me blaming Reagan for the debt. Sorry if I gave you that impression. The upturn in the trend towards an expanding debt became obvious during the Reagan years, but there is little doubt in my mind that the problems began before he took office. And yes, Congressional spending has alot to do with it, but I would like to see a President just say "No more" and mean it.

[dude1394]

Originally Posted by purplefrog

Dude, the fact is I really, really hope you are right. I want a strong economy regardless of how we get there and who claims the credit. When I see us with a balanced budget and a trend toward a reduced debt, then I will rest easier. As far as dubya crowing, let him crow if he wants. He is the Prez and he has had difficult issues to deal with. He deserves a break every now and then amongst the scrutiny that comes with the job. I just don't think the present numbers necessarily represent a "new trend". It is premature to declare we now have a handle on this problem. For me government should be about solving problems and not winning the partisan game of politics and it is disheartening when national issues are reduced to who gets the blame and who gets the credit. As far as me blaming Reagan for the debt. Sorry if I gave you that impression. The upturn in the trend towards an expanding debt became obvious during the Reagan years, but there is little doubt in my mind that the problems began before he took office. And yes, Congressional spending has alot to do with it, but I would like to see a President just say "No more" and mean it.

A president who said no more and meant it would have every orphan, stem-cell research, katrina victim sitting on his doorstep. Every opposition party member would be calling him, just like they did reagan as making old people eat dog food, starving children etc. The media would be right there with them. Who's food subsidies do you cut? Who's free this and that do you cut, they will be on the evening news in 5 seconds.

It's going to have to be either an groundswell from the public (which I do not see) or a situation that cannot be avoided.

As far as dubya crowing, he's actually doing more than that. He (and I) honestly feel that lower tax rates increases economic activity which generates tax revenue (not to mention keeping people working) and to keep those policies from being changed, he has a responsiblity to use actual data to prove his point.