Category Archives: the national debt

Is This What You Really, Really Want?

 
 
 

The Republicans have become little old stingy men in the nation’s pantry counting the rice grains and reporting back that the cupboards are bare. They chant the word “debt” and the word “deficit” as if these were the only important words in America. They do not accept the reasoning that judicious spending could stimulate the economy and that this would make the “debt” and the “deficit” loom less large. They do not accept that we could all be in this together. We the people have become the enemy.

Republicans are saying that corporations were chased away by greedy workers (in unions) and by too many regulations, both environmental and financial. I guess they don’t live next door to one of the dirtiest lakes in America, full of heavy metal waste from industries like Solvay Process, Allied Chemical and Honeywell like I do. I guess we are to blame for getting upset when corporations dirtied our air, our ground, and our water. We aren’t even supposed to notice this or complain about it because that’s the kind of stuff that made industry leave us. We are supposed to believe what the oil industry says about global climate change because we all know what liars scientists are.

It is unfortunate that the next new thing; that new invention or innovation that will require us to flood factories with workers, has not been invented yet. If we perfect more and more robotics to do the work people used to do we may never see the day when factories will once again cover America and employ Americans? We may have to pay people not to work the way we pay farmers not to grow crops or raise cattle or chickens?

I get the point of the Conservatives and Libertarians. They do not want to support people who don’t work. Everyone is not suited to be an entrepreneur however. We could use more plumbers, more electricians, more computers repair people, although we often don’t bother with repairs anymore. We could use more people who understand computer coding and programming. And we could certainly use more people who can secure our computers, which apparently leak data like sieves. We still need farmers, and grocers and truck drivers. Medical workers are always in demand from lightly trained workers to extremely well-educated practitioners. Some training money might help make more people employable.

I don’t know if people really understand that Republicans are already cutting the federal government through the sequester and by refusing to pass any laws, even appropriation laws. They are serious about ending safety net programs and they are just moving ahead with cuts with or without our permission. Remember all those poor factories workers who lost their pensions when their factories closed. Soon that will be all of us. The GOP already separated funding for food stamps from the Farm Bill and they intend to pass the Farm Bill without the traditional funding for food stamps. They intend to get rid of the SNAP program and to let hungry Americans rely on churches and charities. They have voted 40 times to repeal health care and now they may listen to a few extreme voices in their party who want to refuse to raise the debt ceiling or pay America’s debts until Obama agrees to kill health care. They would like to kill all federal health care.

Do you really want to get a voucher for school for your children and a voucher for health care? What if schooling and health care costs more than the amount of your voucher? What if the costs keep going up? Do we want to trust private companies to educate our children? Our schools are far from perfect but are we sure this is the way we want to go? Once we lose all our safety nets how easy will it be to get these programs back if we need them, when we need them? I wouldn’t want to have to hold my breath while I waited for another Great Society. How poor will we all get?

The Republicans want to end birth control and abortion. There will be more of us. How long will it take before we are at each other’s throats? Have you stockpiled some weapons in case we need to have a revolution? I hear that Republicans have lots of guns stashed away. Will you end up on the poor side or the well-off side? The odds of ending up poor are getting better and better.

I really think you ought to give this all some thought because the GOP is already succeeding in pulling the rug out from under us. There are millions of us who should be standing on the rug anchoring it in place. If we were all paying attention that rug could not be yanked away even though the floor beneath it is slippery. You better jump on the rug soon or that warm rug we all paid for will disappear and you and I will be on that cold, slick floor until the economic cycle turns everything topsy-turvy once more (which could take a very long time.)

The Democrats have not exactly been towers of strength, but we had better vote for them in 2014 and in 2016 because at least they don’t blame us for everything and they don’t want to privatize everything. I think we can trust that the Democrats will not pull the rug out from under us. By the time all of us wake up in the empty pantry without the rug and wishing we could smell the coffee, it may be too late.

This blog post is also available at www.brissioni.com
 

 

Breakdown of US Debt

Last week or the week before that, almost buried in the reporting about the final form of the “debt deal” and the drops in the stock market and the downgrading of America’s credit by S & P, CNN reported on a “a quick and fascinating breakdown by total amount held and percentage of total US debt, according to Business Insider.” The list they published is as follows (except I reversed the order):
1.       Social Security Trust Fund, $2.67 trillion (19 percent)
2.       The US Treasury, $1.63 trillion (11.3 percent)
3.       China, 1.16 trillion (8 percent)
4.       US Households, $954.4 billion (6.6 percent)
5.       Japan, $912.4 billion (6.4 percent)
6.       State and Local Governments, $506.1 billion (3.5 percent)
7.       Private Pension Funds, $504.76 (3.5 percent)
8.       United Kingdom, $346.5 billion (2.4 percent)
9.       Money Market Mutual Funds, $337.7 billion (2.4 percent)
10.   State, Local and Federal Retirement Funds, $320.9 billion (2.2 percent)
11.   Commercial Banks, $301.8 billion (2.1 percent)
12.   Mutual Funds, $300.5 billion (2 percent)
13.   Oil Exporting Countries, $229.8 billion (1.6 percent)
14.   Brazil, $211.4 billion (1.5 percent)
15.   Taiwan, $153.4 billion (1.1 percent)
16.   Caribbean Banking Centers, $148.3 billion (1 percent)
17.   Hong Kong, $121.9 billion (0.9 percent)
America owes foreigners about $4.5 trillion.
America owes America $9.6 trillion.
What do these numbers mean? I assume that when the US borrowed from Social Security they gave the agency treasury bonds equal to the debt? I assume that as these bonds mature, the Federal government is supposed to pay back Social Security. Would Social Security be solvent for much longer if the government did not borrow these funds? I would like to know the answer to that. I assume the same arrangement is true with State and Local Governments, with Private Pension Funds, with Money Market Mutual Funds, State, Local and Federal Retirement Funds, Commercial Banks, and Mutual Funds – these groups “bought” bonds and the government got cash and these bonds will mature (hopefully not all at the same time) and will have to be redeemed by the US Government. We must hope that our government is good for it, as they say they are, and we must keep the faith.
As far as the forms our foreign debt takes, I do not know. Perhaps we also traded treasury (US) bonds for cash in these cases. Will we have to give up our social security in all its forms if everyone happens to call in their debt at the same time? How much of this debt represents actual cash debt and how much represents debt in the form of US Bonds or securities? What are the interest payments on these debts and how do those get paid? What percent of the budget do these interest payments represent? There is obviously a lot more to learn about this debt.
What kinds of debts do other governments have? What percent of their national budgets do their debts consume? Are we way out of line in terms of the amount of debt held by nations at this time? If Americans can generously send money to suffering groups around the world, could we buy our way out of debt by contributing emergency funds to our own government (on a strictly voluntary basis)? Actually the answer to that is no. 9.5 trillion dollars divided by 190 million American workers comes out to about $50,000 in debt per working American. 9.5 trillion dollars divided by 307 million Americans represents $31,000 in debt for each American, babies and all. It is, however, doubtful that we would be called upon to pay all of our debt at once and immediately.
I would rather pay a bit more in taxes than lose Social Security right now. Medicare, in a country with health care costs as high as ours, is problematic. I find my myself nervous about how often I go to the doctor and I also find myself trying to cost my government as little as possible, but I know I will not always be able to get away with minimal medical care. Medicaid also could use some fixes. Of the three programs, the one I would like to keep basically unchanged is Social Security.
Enough conjecture, I need to go on a fact-finding mission.
(The Brissioni Blog has a Facebook page.)

This Again

Three hundred plus people recently received pink slips from the city school district. This is just one school district. Every school district in the area is losing teachers and staff. New York State has decided to tax Social Security Benefits, although I thought they already did. When I hear things like this I just have to try to express, once again, exactly how wrong all this seems. Maybe I keep thinking that if we all keep talking about this someone will finally listen and ask wealthier Americans to do what is right and pay their fair share. Our recent American financial reverses have been illuminating. The bottom fell out so fast. I guess that is how a recession/depression always feels. After the 1930’s depression, people pulled together and supported each other. Even the government was on the side of the people and thought of ways for peoples’ lives and the economy’s life to improve at the same time.

Thankfully our recession was not as deep as the Great Depression but the pulling together part has not been so great either. Even the rich were affected by the Great Depression; this recession, not so much. Instead we have been polarized, have fought each other and some very mean things have been said. Apparently poor people (and by poor people I mean people who are not rich) have been a burden on the rich for some time. Apparently the rich want their taxes to pay only for their own needs. Apparently we are seeing selfishness on a scale not seen for well over a century.

I really don’t care about our huge debt or our need to balance the budget. I don’t feel responsible for this situation. I feel the Republicans were actually in charge of America when these financial difficulties were spawned and that their policies gave birth to these conditions. I very much resent that everyone who is poor, young, old, or unemployed is now being asked to bear the blame for the financial shenanigans of our government, our banks, and our corporations. I very much fear that the former groups will bear the brunt of the cost of any recovery, and that it will not be enough because we really have precious little to spare. I had not been too scared of old age because I felt I could make it, not whoop it up, but have a peaceful, acceptable existence. Now I am not so sure.

I live with the shock that our government wants and plans to take from the poor for the sins of the rich. Corporations and banks are very powerful and vindictive, as we have recently seen. If we try to hold their feet to the fire they will find ways to make us pay for our actions. When we bailed them out but tried to make some rules they raised everyone’s interest rates to usurious levels. Perhaps our government fears the repercussions if it tries to tax the wealthy. I no longer believe we can remedy this situation or stop it. We can’t elect our way out of it, we won’t revolt our way out of it, although if we get more frightened and angry we might see more demonstrations. Our corporations already shrugged us off. Our banks are treating us like pariahs, inspire of campaigns to get us to consume, consume, consume. Our government is now “punishing” us and keeping the money people happy. They will win back the economy for the rich by cutting loose the poor who the rich feel are holding their ankles, dragging them down.

This is a debt made by the rich and the rich should take care of it and leave us, the poor struggling masses, alone. Why didn’t our government close the very glaring loopholes in Medicaid and Medicare long before this? Entitlements did not get us into this difficulty. Solving the problems with entitlements is really a separate problem from paying off out debts because the debts came from out of control spending by the Bush government and from lack of regulation of the financial sector.

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