Why the S&P downgraded the US

[Fenris]

The Gainesville Tea Party did something clever. They took the US economic numbers and cut off 8 zeroes, so that people's eyes wouldn't glaze over when they looked at them. Pretend it's your household budget:

Annual family income: $21,700
Money the family spent: $38,200
New debt on the credit card: $16,500
Outstanding balance on the credit card: $142,710
Budget cuts: $385

[watchinginawe]

The Gainesville Tea Party did something clever. They took the US economic numbers and cut off 8 zeroes, so that people's eyes wouldn't glaze over when they looked at them. Pretend it's your household budget:

Annual family income: $21,700
Money the family spent: $38,200
New debt on the credit card: $16,500
Outstanding balance on the credit card: $142,710
Budget cuts: $385

Well, the answer is obvious. The government needs to do what any other family would do, give themselves a raise...

[danield]

Good post fenris. I just don't see any way to reconcile the debt. People will have to eat and pay their debts, and the government can only tax so much. If you only have $22,000 income and your total debt is $142,000, you can’t make the payments even if you are the most responsible person on the planet.

Let’s say that the federal government can tax you 50%. This is $11,000 gross income. The government has other obligations that will take at least 75% of the revenue. So this leaves $2,750 to pay the debt. This is a 51 year payout with no interest on the debt.

The tax rate is in the mid 30’s now instead of 50%, and the government spends much more than 75% of its budget on necessary items. Also, politicians are the most irresponsible people on the planet. This is a train wreck fixing to happen. There just has to be inflation to cover the gaps.

[Reynolds357]

The Gainesville Tea Party did something clever. They took the US economic numbers and cut off 8 zeroes, so that people's eyes wouldn't glaze over when they looked at them. Pretend it's your household budget:

Annual family income: $21,700
Money the family spent: $38,200
New debt on the credit card: $16,500
Outstanding balance on the credit card: $142,710
Budget cuts: $385

According to Obama, we should spend more.

[Reynolds357]

Good post fenris. I just don't see any way to reconcile the debt. People will have to eat and pay their debts, and the government can only tax so much. If you only have $22,000 income and your total debt is $142,000, you can’t make the payments even if you are the most responsible person on the planet.

Let’s say that the federal government can tax you 50%. This is $11,000 gross income. The government has other obligations that will take at least 75% of the revenue. So this leaves $2,750 to pay the debt. This is a 51 year payout with no interest on the debt.

The tax rate is in the mid 30’s now instead of 50%, and the government spends much more than 75% of its budget on necessary items. Also, politicians are the most irresponsible people on the planet. This is a train wreck fixing to happen. There just has to be inflation to cover the gaps.

We could return to founding principles. Mainly, if you do not work, you do not eat. We could also do what Russia had to do at the end of the Cold war. We could scale up our nuclear weapons and gut the rest of the military. Put the world on notice, as Russia did, that our conventional forces are weak and if you mess with us; you get nuked.

[Liquid Tension]

If your out-go exceeds your income,
Your upkeep will be your downfall.


Quite simple if you ask me.......but what do I know.