The U.S. government is set to borrow nearly $1 trillion this year, an 84 percent jump from last year

Discussion in 'Politics, Religion, Social Issues' started by Mac'nCheese, Jun 3, 2018.

  1. Mac'nCheese macrumors 68040

    Mac'nCheese

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    #1
    Sorry if this was discussed back in feb when it happened but apparently:

    “ The federal government is on track to borrow nearly $1 trillion this fiscal year — Trump's first full year in charge of the budget.

    That's almost double what the government borrowed in fiscal 2017.”

    Correct if I’m wrong but didn’t Trump and probably most of the GOP in Congress run on fisical responsibility? How are the tax cuts responsible if this is part of the budget? It’s like spending more on your credit cards when you already in massive debt and your boss just said you are loosing all that overtime you are used to getting.



    https://www.google.com/amp/s/www.wa...is-set-to-borrow-nearly-1-trillion-this-year/
     
  2. Zombie Acorn macrumors 65816

    Zombie Acorn

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    #2
    After getting off of Obama's massive spending spree I don't think the left has much room for talking.

    We will see what the total debt is after his first 4 years and compare then.
     
  3. Krayzkat macrumors 6502a

    Krayzkat

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  4. obeygiant macrumors 68040

    obeygiant

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    #4
    Yeah I know! So glad she isn't president!.. You and me both!
     
  5. Bug-Creator macrumors 6502

    Bug-Creator

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    #5

    So the recipe for getting of a "spending spree" is to double down with tax cuts and extra military spending while the economy is doing o.k.

    I'd never thought of that.
     
  6. SoggyCheese Suspended

    SoggyCheese

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    #6
    The US will be bankrupted by then, just like Trump’s businesses normally are.

    Or are you still deluding yourself that Trump is a successful billionaire businessman? Haha hahaha!! HAHAHAHAHAHA!!
     
  7. samcraig macrumors P6

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    #7
    You and Trump must share the same logic :/

    Really - you're going to defend this?
     
  8. VulchR macrumors 68020

    VulchR

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    #8
    Just as long as we control for GDP growth in the comparison. ;)

    Anyway, I do not want to hear anything from the GOP about them being the party of responsible spending after this. Not ever.
     
  9. RichardMZhlubb Contributor

    RichardMZhlubb

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    #9
    The federal government spent more in 2017 than in any year of the Obama presidency and is expected to spend even more in 2018.
     
  10. Falhófnir macrumors 68030

    Falhófnir

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    #10
    In fairness, the US is possibly the only major western nation where ‘borrow to invest’ is actually a reasonably sound strategy. With solid 3% economic growth and significant population growth (which you have the room to accommodate) constantly working to trivialise the debt pile, as long as you don’t go completely stupid then it’s not a huge issue. By contrast most European countries have sclerotic growth, and stagnant or falling populations. Where populations are still growing, the bulk is coming from unskilled migration bringing very little economic benefit.
     
  11. Mac'nCheese thread starter macrumors 68040

    Mac'nCheese

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    #11
    So you have no response to the original question about the current borrowing? I’m not trying to get into an argument, I’m curious to hear what people who support the GOP/Trump really feel about this.
     
  12. MarkusL macrumors 6502

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    #12
    For the benefit of those like me, who are a bit behind in our studies of reaganomics... is it possible to summarize in a few key points how a growth of 3% in the economy keeps up with a growth of 84% in the deficit?
     
  13. Zombie Acorn macrumors 65816

    Zombie Acorn

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    #13
    • FY 2009 - Even though the budget had been approved, Congress added emergency funding to stop the Great Recession. It added the first year's worth of spending from Obama's Economic Stimulus Act to the FY 2009 budget. That $253 billion accrues to Obama.
    • FY 2010 - Obama's first budget created a $1.294 trillion deficit.
    • FY 2011 - This budget contributed $1.3 trillion to the debt.
    • FY 2012 - The deficit was $1.087 trillion.
    • FY 2013 - This was the first Obama budget where the deficit, $679 billion, was less than $1 trillion. Thank sequestration, which forced a 10 percent cut in spending.
    • FY 2014 - The deficit was $485 billion.
    • FY 2015 - The deficit fell further to $438 billion.
    • FY 2016 - The deficit rose to $585 billion
    • FY 2017 - The deficit was $666 billion.
    --- Post Merged, Jun 3, 2018 ---
    Probably taking a page out of Obama's book so he can say he's cutting deficits the rest of his term by spending big out of the gate.
     
  14. MarkusL macrumors 6502

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    #14
    Three reasons to love the deficit:
    • It’s yuge
    • It annoys the liberals
    • Mexico is going to pay for it
     
  15. Falhófnir, Jun 3, 2018
    Last edited: Jun 3, 2018

    Falhófnir macrumors 68030

    Falhófnir

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    #15
    3% growth of a $19T economy means $0.57T growth per year, combined with a larger workforce means more people, earning more money as a tax base makes it easier to pay back the future deficit. This happens every year. A one off increase in borrowing to ~$1T sounds disproportionate, but won’t be a long term trend. It will drop back to structural levels once any infrastructure projects have been completed. The real challenge is getting the real spending back in the black, so only borrowing is to invest. To do this you either need a larger, richer tax base, or to cut spending. As many European countries have found out, if you cut spending too much, you shrink economic growth, or in extreme cases, the economy itself, and end up chasing your tail in a spiral of a smaller, poorer tax base providing less revenue, meaning more cuts to further erode the tax base.
     
  16. juanm macrumors 65816

    juanm

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    #16
    Yeah,... about that......
     
  17. RichardMZhlubb Contributor

    RichardMZhlubb

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    #17
    None of which contradicts what I said.
     
  18. Sydde macrumors 68020

    Sydde

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    #18
    Oh, you will. Plenty. They will tout their cred on this and other matters, such as family values/morality/decency, law-and-order and helping the working man.

    It helps if you understand that you are not their target audience.
     
  19. mudslag macrumors regular

    mudslag

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    #19

    When you cut taxes but don't cut spending

    [​IMG]
     
  20. MarkusL macrumors 6502

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    #20
    This reasoning is based on two assumptions that seem to contradict reality:
    • The borrowed money should be used for investments in infrastructure instead of military spending and tax cuts for the rich
    • The increase in borrowing should be an isolated incident and not a part of a long-term trend
     
  21. Sydde macrumors 68020

    Sydde

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    #21
    You need to be extremely careful when taking this tack. Yes, some portion of military spending goes into the nebulous M3 cloud of abstract money that exists solely as numbers on ledgers, but a fair amount of it cycles directly into the working economy. I know of at least one city near me that would be devastated by even a moderate curtailment of the revenue going to its nearby military base and would probably collapse into a fancy ghetto if the base were closed. There are communities all around the country that are heavily dependent on the MIC.

    If you want to advocate for cutting military spending, you really, really need to have a robust plan in place to deal with the economic costs of doing that. Otherwise, you end up with a situation that can rapidly become unstable. Simple solutions, be they cutting taxes or cutting the military or whatever, are dangerous without some form of mitigation, preferably in place beforehand.
     

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