deficit

Don’t look now, but the federal budget deficit is at its lowest level since Obama took office

The Congressional Budget Office (CBO) announced on Monday that the federal government's  budget deficit will shrink this year to its lowest level since President Barack Obama took office.

The CBO says the deficit will be $468 billion for the budget year that ends in September 2015, slightly less than FY2014’s $483 billion deficit. As a share of the economy, CBO says this year’s deficit will be slightly below the historical average of the past 50 years.

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AUSTERITY 101: The Three Reasons Republican Deficit Hawks Are Wrong

Congress is heading into another big brawl over the federal budget deficit, the national debt, and the debt ceiling.

Republicans are already talking about holding Social Security and Medicare “hostage” during negotiations—hell-bent on getting cuts in exchange for a debt limit hike.

Days ago, U.S. Treasury Secretary Jacob Lew asked whether our nation would “muster the political will to avoid the self-inflicted wounds that come from a political stalemate.”

It’s a fair question. And there’s only one economically sound answer: Congress must raise the debt ceiling, end the sequester, put more people to work, and increase our investment in education and infrastructure.

Here are the three reasons why Republican deficit hawks are wrong. (Please watch and share our attached video.)

FIRST: Deficit and debt numbers are meaningless on their own. They have to be viewed as a percent of the national economy.

That ratio is critical. As long as the yearly deficit continues to drop as a percent of the national economy, as it’s been doing for several years now, we can more easily pay what we owe.

SECOND: America needs to run larger deficits when lots of people are unemployed or underemployed – as they still are today, when millions remain too discouraged to look for jobs and millions more are in part-time jobs and need full-time work.

As we’ve known for years – in every economic downturn and in every struggling recovery – more government spending helps create jobs – teachers, fire fighters, police officers, social workers, people to rebuild roads and bridges and parks. And the people in these jobs create far more jobs when they spend their paychecks. 

This kind of spending thereby grows the economy – thereby increasing tax revenues and allowing the deficit to shrink in proportion.

Doing the opposite – cutting back spending when a lot of people are still out of work – as Congress has done with the sequester, as much of Europe has done – causes economies to slow or even shrink, which makes the deficit larger in proportion. 

This is why austerity economics is a recipe for disaster, as it’s been in Greece. Creditors and institutions worried about Greece’s debt forced it to cut spending, the spending cuts led to a huge economic recession, which reduced tax revenues, and made the debt crisis there worse. 

THIRD AND FINALLY: Deficit spending on investments like education and infrastructure is different than other forms of spending, because this spending builds productivity and future economic growth.

It’s like a family borrowing money to send a kid to college or start a business. If the likely return on the investment exceeds the borrowing costs, it should be done.

Keep these three principles in mind and you won’t be fooled by scare tactics of the deficit hawks.

And you’ll understand why we have to raise the debt ceiling, end the sequester, put more people to work, and increase rather than decrease spending on vital public investments like education and infrastructure. 

U.S. debt headed toward Greek levels

The projection of US debt for the next 25 years looks a lot like Greece’s debt over the past 25.

From the Washington Examiner:

United States’ projected debt over the next 25 years looks a lot like Greece’s over the past 25.

With all the chaos unravelling in Greece, Congress would be wise to do what it takes to avoid reaching Greek debt levels. But it’s not a matter of sticking to the status quo and avoiding bad decisions that would put the budget on a Greek-like path, because the budget is on that path already.

A quarter-century ago, Greek debt levels were roughly 75 percent of Greece’s economy — about equal to what the U.S. has now. As of 2014, Greek debt levels are about 177 percent of national GDP. Now, the country is considering defaulting on its loans and uncertainty is gripping the economy.

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As we’ve said many times before, our spending levels are utterly unsustainable. There are simply not enough rich people to tax. The only possible chance we have of fixing our debt problem is to cut spending severely. And even then, it would be almost impossible to pay back our debt. Even still, you know a spending reduction of any kind isn’t going to happen, especially a substantial one. After all, remember how the infinitesimal-by-comparison sequester “cuts” (that weren’t actually cuts) were demonized by the big-government left? Grandma was going to die, planes were going to fall from the sky, even men were going to beat their wives, all because the spending increase from one year to the next was going to be slightly less than originally proposed. All this means is that Greece’s mess is coming here. Obviously there’s no way to predict when. But it’s coming, nonetheless.

Federal Budget Deficit Falls to Smallest Level Since 2008

“The federal budget deficit fell precipitously to $680 billion in the 2013 fiscal year from about $1.1 trillion the year before, the Treasury Department said Thursday. That is the smallest deficit since 2008, and marks the end of a five-year stretch when the country’s fiscal gap came in at more than a trillion dollars a year.”

Shrinking deficits are impossible for Conservatives to comprehend. They do not even know how to report on them.

If verbing a noun weirds language, what does nouning a verb do?

Our noun deficit comes from the Latin third-person singular indicative verb dēficit, meaning “it is lacking.” This word was adopted first into French as a noun and then into English, to express the meaning “an inadequacy, insufficiency, or impairment.”

There are many such English nouns that had their origins as Latin verbs. Some belong only to the technical jargon of a particular profession (lawyers may know what a mandamus is, but surely few laypeople do), but others have become a part of everyday English, though often retaining a touch of highfalutin formality. The Latin ignōrāmus, for instance, which literally means “we do not know,” came to English by way of the legal profession, originally denoting a form of grand jury decision, but now means “one who knows very little.” Nor is it only present-tense indicative verbs that have been changed into English nouns: placēbō is a future-tense indicative, meaning “I shall please”; recipe is an imperative form meaning “take” (as in “Take two cups of flour, a cup of sugar, and a stick of butter…”); and fiat and caveat are subjunctive forms meaning “let it be done” and “let him or her beware,” respectively.

Why, you may be wondering, are we giving many of these literal translations as three- or four-word sentences when in the Latin they are single words? The answer has to do with the difference between Latin grammar and English grammar. Latin has more or less the same parts of speech that English has: though it has no definite or indefinite articles, it does have nouns, verbs, adjectives, adverbs, prepositions, and so on. But Latin is a much more highly inflected language than English is—that is, it communicates much more of the meaning in a sentence by means of grammatical endings and stem changes.

In Latin verbs, for instance, the endings signal more clearly than in English whether the subject is the speaker, the one spoken to, or someone or something else altogether, as well as whether the subject is singular or plural. Most English present-tense indicative active verbs have only two forms: a form ending in –s or –es for the third-person singular (writes, walks, goes, etc.) and a plain form for all other combinations of person and number (write, walk, go, etc.). Because the Latin verb communicates so much information by itself, including the person and number of its subject, it is customary to provide the pronoun to indicate person and number when translating it into English.

Thank you for visiting the American Heritage Dictionary at ahdictionary.com!

Yes, Obamacare Is Cutting The Deficit

“… all the ‘deficit hawks’ out there who are deeply concerned about too much borrowing and the terrible choices our grandchildren will confront might want to write a letter of thanks to one Barack Hussein Obama…. The reasons for the slowdown [in the deficit] in Medicare spending are complicated. But a big part of it is — you guessed it — the Affordable Care Act. The ACA has found direct savings in Medicare with things like cuts to some provider payments…. Medicare is still the biggest driver of future deficits, but the next time you hear a conservative say we have to 'rein in entitlements,’ you can remind them that nothing any president has done to achieve that goal has been nearly as effective as the reforms contained within the hated Obamacare.” - Paul Waldman in the Washington Post

You will never hear a Republican/Conservative say thank-you. They are too caught up in a hate-spiral of name-calling and victim-blaming.