

Funding the Government after August 2 - Running QE2 in Reverse - trotsky
http://www.rhsmith.umd.edu/opinion/morici/2011/071811.aspx

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justin_vanw
I don't understand why it matters one way or the other. If they raise it,
great. If they don't, then spend less money government.

The government does it's budgeting all fucked up. It makes a list of
everything it wants, then sort of argues a little and writes a check for the
total.

Every other entity in the universe starts with how much money they have or
want to spend, and then divides it up according to priorities. If the
government switched to this method, they would just have less money to slice
up.

I was in the army, and I worked for defense contractors. 99% of federal
government employees do no work. I mean literally don't do anything. They show
up around 9 and leave around 4, and surf the internet in between. Every once
and awhile they have meetings and plan things that don't get done, or figure
out who is going to go on some trip. Meanwhile contractors are running around
doing the little bit of work that is being done. The hilarious part is, 99% of
that work doesn't matter. If it just stopped tomorrow, nobody would even be
able to notice.

So, if my calculations are correct, and they are only based on empirical
observation over the course of 8 years, we could reduce the size of the
government expenditures (excluding programs that just write checks, like
medicare and social security, which we should keep) by 99.99% and nobody would
care other than the government employees, but I don't feel sorry for people
who's entire contribution to society is to be physically present at a specific
location for 35 hours a week. Lets cut the budget but keep the programs that
help old people and poor people.

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chubs
I don't understand - why has it been such a big deal to raise the debt ceiling
this time? I mean, didn't they do it 7 times in bush's 8 years, and 5 times in
the last ~4 years of obama's presidency? If they've done it roughly once a
year for the last 12 years, why the big deal this time?

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linuxhansl
Because the Republican party has been infiltrated by an ideological fraction
that is impervious to arguments and unwilling to compromise. At least that's
what it looks like to me.

I think most people are not worried, because they believe that the responsible
parties will raise the debt ceiling in time. I think those people
underestimate the the reality distortion from which the tea party suffers.

The other reason is that the US debt is reaching worrisome levels, and at some
point needs to be curbed. That is not a political problem, though, that is a
problem of society. People in the US want everything, but nobody wants to pay
for it. The US debt here is just an extension of willingness to go into
personal debt, which is much greater here than is most other western
countries.

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URSpider94
My imperfect understanding, from studying other sources, is that this is not
correct at all. What the poster is describing is, in fact, what the government
has been doing for several months -- using cash inflows to keep paying the
bills, while rolling over expiring debts into new ones. August 2 is the date
when we will no longer have enough cash on-hand to keep paying our
obligations.

In addition, a large raft of monthly Social Security checks are scheduled to
go out at the end of next week, so even if the estimates are wrong and we can
make it a few extra days, that singular large expense will be enough to push
us over the brink.

