America is thriving, how about the other part of the world?

[Hawk256]

Despite this massive defense budget, USA thinks that it can’t afford universal healthcare.

The US is in debt and continues to go into more debt by raising the debt ceiling. Technically the US can't afford to pay it's current debt much less take on more. A person or family trying to emulate US government spending would be bankrupt from day one.

https://www.usdebtclock.org/

 

[Nimbus]

The US is in debt and continues to go into more debt by raising the debt ceiling. Technically the US can't afford to pay it's current debt much less take on more. A person or family trying to emulate US government spending would be bankrupt from day one.

https://www.usdebtclock.org/

A person or a family doesn’t print U.S. dollars.

The debt is largely due to the several trillion dollars in stimulus money spent to prevent economic collapse due to the pandemic. It’s one of the reasons of the inflation.

Big defense spending is another contributor to the debt. Congress regularly buys more equipment than what’s requested by the military. The military industrial complex has a huge influence. On top of that, the two wars that lasted two decades used up $6.5 trillion.

Another thing that doesn’t help: tax cuts for corporations and the rich by the previous administration. It costs roughly a trillion dollars a year in lost revenue. This is why I have no respect for Republicans. During Obama’s administration they insisted that any legislation has to be revenue-neutral (not a bad idea), but when they won the presidency they easily passed a tax cut law that creates a huge, lasting deficit. They don’t actually believe in fiscal responsibility, they are just using it as an excuse for obstructionism.

How much do private insurance and individuals spend a year for health care? About $1.6 trillion (in 2019). If we stop bombing people into democracy and stop giving rich people tax cuts, we’d have enough money to fund universal healthcare.

 

[Hawk256]

The debt is largely due to the several trillion dollars in stimulus money spent to prevent economic collapse due to the pandemic.

The debt existed a long time before that. A very small percentage of the debt is related to stimulus payouts. If it's so easy just to print money and cover everything why do need a budget or spending cap at all? Maybe you should check with other countries that have done just that in the past and see how it worked out for them.

Why can't we just print more money, since it really isn't representative of anything of value?

www.econ.iastate.edu

 

[Nimbus]

The debt existed a long time before that. A very small percentage of the debt is related to stimulus payouts. If it's so easy just to print money and cover everything why do need a budget or spending cap at all? Maybe you should check with other countries that have done just that in the past and see how it worked out for them.

Why can't we just print more money, since it really isn't representative of anything of value?

www.econ.iastate.edu

Statements like “a very small percentage” is worthless without numbers. The current debt is at $28.5 trillion. The stimulus programs cost $6 trillion, that’s 21%. I’m quite sure “very small” doesn’t describe 21%. The previous debt ceiling was $22 trillion, which is $6.5 trillion less.

The stimulus costs $6 trillion while the increase is $6.5 trillion. I wonder if they’re related.

USA is not Zimbabwe or Venezuela. The Federal Reserve routinely increases its assets by trillions of dollars, but they know what they’re doing. To tackle the 2008 recession, they added $4 trillion to the money supply by 2014. I was here in 2014, it was no Zimbabwe.

 

[Hawk256]

Here is a simple picture that explains the situation better than I ever could.

 

[R Cameron]

Here is a simple picture that explains the situation better than I ever could.

1) The US Treasury can not be compared to a household, it's not just apples and oranges, it's apples and jumbo-jets.

2) The debt-ceiling issue is purely a political drama which should be eliminated. The congress and President have already approved all the spending through legislation. If they actually declined to pay for the things approved and spent it would be disastrous for the US economy. No serious US politician wants this or thinks it will happen, they are only using the process to try and score a few political points and TV interviews before the inevitable happens.

 

[Nimbus]

Here is a simple picture that explains the situation better than I ever could.

I mean, why would people need economic analysis on how to run the largest economy on earth, if they can just use an internet meme?

Everybody is ok with cutting spending, until it’s applied to a program they like.

 

[Hawk256]

I mean, why would people need economic analysis on how to run the largest economy on earth, if they can just use an internet meme?

That's a good question. If keeping it simple gets the message across and serves the purpose, why does it need to be any more complicated than that? Whether you are talking about a small budget or a large budget the same principles apply. You shouldn't spend what you don't have. Printing more money will only cause inflation. There is a sane and simple way to control spending but no body wants that. That want everything free. As we all well know, nothing is free, someone at some point will be paying for it. Just keep passing it on and let the next generation deal with. That seems to be the most popular answer. Just don't be the one stuck holding the bill.

 

[Nimbus]

That's a good question. If keeping it simple gets the message across and serves the purpose, why does it need to be any more complicated than that? Whether you are talking about a small budget or a large budget the same principles apply. You shouldn't spend what you don't have. Printing more money will only cause inflation. There is a sane and simple way to control spending but no body wants that. That want everything free. As we all well know, nothing is free, someone at some point will be paying for it. Just keep passing it on and let the next generation deal with. That seems to be the most popular answer. Just don't be the one stuck holding the bill.

It needs to be more complicated than that because decisions in the scale of a country have serious consequences. If staying within the budget means letting tens of millions of people become homeless due to an unavoidable pandemic, then that government will not stand for long.

 

[HappyMan]

That's a good question. If keeping it simple gets the message across and serves the purpose, why does it need to be any more complicated than that? Whether you are talking about a small budget or a large budget the same principles apply. You shouldn't spend what you don't have. Printing more money will only cause inflation. There is a sane and simple way to control spending but no body wants that. That want everything free. As we all well know, nothing is free, someone at some point will be paying for it. Just keep passing it on and let the next generation deal with. That seems to be the most popular answer. Just don't be the one stuck holding the bill.

https://www.npr.org/player/embed/958854717/958927220

Actually, the stimulus packages and coinciding printing of money in recent years have not had the long predicted effects of scaring off bond purchasers and creating spiraling inflation. Economists were so surprised by the results that a new theory was developed to explain them, Modern Monetary Theory. I feel like I heard another podcast on this somewhere else as well, but it's probably not worth searching my podcast history for it.

If anyone wants to tell me how to embed the audio, I'd appreciate it.


*Edit: The Fed don't necessarily print money when they create more of it. They just purchase securities or create reserves in banks. No greenbacks needed.

 

[ChrisTex]

I mean, why would people need economic analysis on how to run the largest economy on earth, if they can just use an internet meme?

Everybody is ok with cutting spending, until it’s applied to a program they like.

On a side note, isn't just about every country in debt to someone? I want to say it was in 2010/2011 that I saw a program on this on one of the UK channels(BBC or ITV). They used Spain and Italy as the main two examples with how they both have debts with each other and other countries.

 

[Balifrog]

USA still has the largest GDP by far, enabling it to do many things that Luxembourg can’t, like keeping a military budget larger than the next 11 countries combined

Hahaha.....
And that is something to be proud of ?

 

[Hawk256]

On a side note, isn't just about every country in debt to someone?

Carrying debt isn't a problem as long as you have the ability to cover that debt. The problem (at least to many economists) is when the external debt to GDP ratio is at or more than 100%.

 

[Nimbus]

On a side note, isn't just about every country in debt to someone? I want to say it was in 2010/2011 that I saw a program on this on one of the UK channels(BBC or ITV). They used Spain and Italy as the main two examples with how they both have debts with each other and other countries.

Yes, just like basically every large business is in debt to another, like its vendors and suppliers.

 

[Missnaughty]

A million people would probably put a dent on the labor shortage. Too bad.

Local businesses around here have been offering $15 an hour, which is about double the federal minimum wage, and they still can’t find enough people. This is a medium town in a midwest state, so $15 an hour minimum pay was unthinkable just a couple of years ago.

I have lived in USA for a couple of decades, dealing intimately with its immigration law. The idea that “the gates will be wide opened” is laughable. The Republican party has been taken over by white supremacists, and they excite their base by claiming that Democrats will open the border wide. Meanwhile the Democrats want to protect their unions and working class black constituents. Obama still holds the record as the president with the highest number of deportations, and Biden was his VP.

Immigration is such a difficult problem because both extremes don’t work in America. Open borders don’t work because the economic disparity with the neighboring country is too large. Close the border and labor shortage ensues. If manufacturers can’t find workers, they’ll have no choice but to increase automation and move the work abroad. Many companies already set up production facilities across the border in Mexico. If they can’t bring the Mexicans to work here, they’ll bring the work to Mexico. If the factory is in Mexico, then Mexico gets the taxes while the workers spend all their salary there instead of here.

Good concern trolling though, but your history and lack of subtlety blew it.

What white supremacist dear? I have been here since 2002.. well almost 2 decades. I lived in Alabama and now Texas. I don’t see white supremacist here. Maybe a couple red neck with guns… I suppose we see what we want to see.. as we are both coloured, work and live here.. but we see different thing..

 

[Missnaughty]

Wow. That's thriving?

The shop queue and labour shortage. I thought since it is pandemic.. people should buy less and everyone needs job?

 

[Nimbus]

What white supremacist dear? I have been here since 2002.. well almost 2 decades. I lived in Alabama and now Texas. I don’t see white supremacist here. Maybe a couple red neck with guns… I suppose we see what we want to see.. as we are both coloured, work and live here.. but we see different thing..

I have lived here for more than two decades, and lived in Alabama as well as Georgia. That’s ok Miss N, there are Indonesian Americans who support Trump and Republicans. I’m most certainly not one of them.

If you say you don’t see them, then no amount of explanation would suffice.

 

[Missnaughty]

I have lived here for more than two decades, and lived in Alabama as well as Georgia. That’s ok Miss N, there are Indonesian Americans who support Trump and Republicans. I’m most certainly not one of them.

If you say you don’t see them, then no amount of explanation would suffice.

I dont support Trump. I was Hillary’s supporters. Not Biden’s thou. Here again how easy people stereotype others. “If you are not this, you must be that.” )

 

[dafluff]

The US is in debt and continues to go into more debt by raising the debt ceiling.

You clearly don't understand what the debt limit is. This is not unusual, and politicians count on people not to understand what it is in order to trick them into supporting having a debt limit.

The debt limit does not restrict the government from going into debt, it restricts the government from paying parties it already owes money to. Debt is incurred when Congress approves budgets with deficits. Hitting the debt limit just means Congress doesn't approve the payment of said debt. If you want less debt, then Congress needs to start passing surplus budgets (which is generally bad).

Here is a short video explaining the debt limit:

 

[Nimbus]

I dont support Trump. I was Hillary’s supporters. Not Biden’s thou. Here again how easy people stereotype others. “If you are not this, you must be that.” )

Good for you, then I apologize because you’re one of the exceptions.

White supremacy is not always visible like those people wearing white bedsheets in public, in most cases it is disguised by certain languages and behavior. The political term is “dog whistle”. When trump said “shithole countries”, the implication is very clear that he means countries not populated by white people. I’m not saying all Republicans are closet racists, and I can even say that not all trumpers are racists. However, a lot of them are; the people Hillary called ‘deplorables’. She came to regret that remark, but ironically she was accurate.