The Fiscal Cliff

[Kurt.]

but will they have six shooters........papow papow papow papow papow papow !!!!!

*blows end of imaginary gun/finger

 

[orchard]

Yes, definitely... deficit spending is all modern neoclassical/Keynesian/callitwhatyouwill doctrine.. the assumption that you can "manage" the economy through active monetary and/or fiscal policies.

Unfortunately even if it worked (and there is plenty of evidence that it doesn't), they forget that it eventually has to be paid for, and so the game then becomes doing anything and everything to keeping the ball in the air to keep the show going, regardless of the damage that it is building up for the future.

Cheers mate, tend to associate Keynes with a more demonstrable economic for some reason, but yea, the state 'management' aspect connects

 

[Philw]

The US and all the Western economies are essentially insolvent.

The fiscal cliff deal is just an agreement to raise the debt ceiling in exchange for promises to raise taxes and reign in (future) spending. Of course it won't work out that way - when the future comes around they'll just negotiate another deal to push the cuts even further out and carry on raising the debt ceiling. That's how they've got their so deep into this mess in the first place.

It's all crazy Keynsian stuff, where spending borrowed money that you can never pay back is somehow counted as real growth and productivity.

One day they won't be able to push it off any further and on that day something very fundamental will happen - the West will have to live within their means, and the developing countries will no longer be subsidizing their excesses. It will happen - there's no way it can't happen, but it probably won't be next week.

What's the rough timeframe on this then?? <insert funny joke about what to do with my money>

 

[evilwebby]

What's the rough timeframe on this then?? <insert funny joke about what to do with my money>

"Cliff" is a bit of a sensationalist label that the meeja have pinned to this. The changes to tax and spending are due to come into effect 1st January. Separate from that is the debt ceiling limit which they are due to hit around February. Of course the two are just facets of the same problem, as they are all to do with overspending.

 

[roydo]

What's the rough timeframe on this then?? <insert funny joke about what to do with my money>

Ask China. They hold the cards now.

 

[evilwebby]

Any deal to avert the "cliff" is but a charade, given the sheer scale of the problem. It's like rearranging the deckchairs on the Titanic.

This is a good article:
http://www.policymic.com/articles/2...is-a-brilliant-politician-but-a-failed-leader



According to the non-partisan Congressional Budget Office, the federal government spends $9.7 billion a day. That adds up to $3.5 trillion a year. Last year we brought in a record $2.3 trillion in taxes (an all-time high, mind you) which still leaves a deficit of $1.2 trillion from our out of control spending levels – or about 4 months and 1 week's worth of spending. If we raise tax rates on those making over $250,000 back to the Clinton levels, that should bring in an extra $82.5 billion in revenue every year – which covers 1 week's worth of the deficit.

 

[Tennessee Blue Mike]

Any deal to avert the "cliff" is but a charade, given the sheer scale of the problem. It's like rearranging the deckchairs on the Titanic.

This is a good article:
http://www.policymic.com/articles/2...is-a-brilliant-politician-but-a-failed-leader



According to the non-partisan Congressional Budget Office, the federal government spends $9.7 billion a day. That adds up to $3.5 trillion a year. Last year we brought in a record $2.3 trillion in taxes (an all-time high, mind you) which still leaves a deficit of $1.2 trillion from our out of control spending levels – or about 4 months and 1 week's worth of spending. If we raise tax rates on those making over $250,000 back to the Clinton levels, that should bring in an extra $82.5 billion in revenue every year – which covers 1 week's worth of the deficit.

Excellent read. Smoke & Mirrors by our congressional leaders.

 

[Slavan]

politics?

 

[orchard]

Economics?

 

[Bluenose1995]

the worlds heading for dark days ahead financial collapse soon and inevitable social unrest/ wars over last droplets of moddle east black gold

 

[Slavan]

the worlds heading for dark days ahead financial collapse soon and inevitable social unrest/ wars over last droplets of moddle east black gold

or not

 

[pfim]

Ask China. They hold the cards now.

They need the US economy humming along more than anyone else.

 

[roydo]

They need the US economy humming along more than anyone else.

Indeed they do.

 

[pfim]

I understand it all but don't bother to follow the ups and downs of negotiations. It's all rather pointless as it will be resolved, no politician wants taxes to go up and spending to go down at the same time. Perhaps it should, but I live in this political reality.

All I know is my tax bill could go up $2500 in 2013 and I may not be able to file my taxes until the end of Q1 for 2012.

 

[Mrk]

How predictable, they've chickened out from making any kind of tangible spending cuts. They're happy to let the next generation suffer just because they haven't got the bottle to make difficult decisions. Cowards.