Geithner urges Congress to raise debt limit

[Skybird]

http://www.nytimes.com/2011/01/07/bu...my/07debt.html

As a foreigner, once could really become angry. Is this the ultima ratio of American fiscal policy? Not to show any care fopr debts at all, drawing no serious consequences from one's inabiliuty to produce the money by oneself that oen needs for all the wonderful super-goodies and claims one wants to buy, and if money becomes short again - just print more or making more debts? Let's add some Greek statistics, and everything is fine again...?

Especially parents raising kids in America should stand up against this madness. It is, amongst many foreign parties, their kids that will be confronted with the messy consequences. It is them who will need to clean the kitchen once the party is over.

Not only the US but practically all Wetsern states were unable to run by the financial incomes they had even in boom yedars of the past, after the war. Now thew arguzment is one would pay back these debts once the economy has sprung to life again. But that is self-deception. The economic environment has chnaged far more hostile, due to new competitors, and outsourcing and relocation of national industries in the West. The circumstances are more difficult than in the past, and it is unlikely that it will ever be again like it was back then. So if the budgets were wasted and the money was not enough even at the best time of economic pasts, how much more insufficient will it ever be in the future that even when the current crisis should be overcome will never be as bright again as it has been, long time ago?

The simple truth is: America plans to never ever pay back its debts, nor do any other Western debtors seriously plan for that.

[Tchocky]

Well, the debt/GDP ratio was quite a bit higher during WWII, but it was paid off.

[GoldenRivet]

As a U.S. Citizen... the debt ceiling needs to stay right where it is.

We need to get our house in order, and some tough times are in store for those who are not ready to do that... but thats just the way life goes.

[Skybird]

Originally Posted by Tchocky

Well, the debt/GDP ratio was quite a bit higher during WWII, but it was paid off.

The economic conditions were much better than they are now and in the future.

Also, the total debts neither at the end of WWI or WWII had blown that much out of proportion, as they are now.

In the years from 1917 to 1919, the US total debt grew from 3.6 billion to 27.5 billion.

In the years from 1941 to 1946, the US total debt grew from 43 billion to 226.5 billion.

When the Gold-Dollar-link was given up in 1971, the US total debts reached 424 billion.

At the end of the millenia, the US total debt was around 5.6 trillion.

Currently the US debts are > US debt clocks < (around 14 trillion). Debt clock shows the US debts almost equals gross domestic product.

A general trend for expoloding national debts can be seen in Germany, too.



Not ethat the graph ends 2008. German debts at the end of 2010 had jumped from 1.5 trillion to 1.8 trillion. And the future, due to the Euro, holds grim perspectives.

When states need to make new debts just to pay interests for existing debts, then their total debts necessarily are constantly climbing. No pirvate business company with a sense for reality and responsibility would do that, because it knows that total bancruptcy lies at the end of the road - inevitably.


Der Tagesspiegel

[Armistead]

The sad thing is that money went somewhere, maybe that's why 1% of the rich in the US own 40% of all wealth.

Add to those figures another 70 trillion we now owe out in medicare and SS alone as of now.

Congress keeps doing these things. They know they've ruined a great nation, but if they admit the real facts and stop spending chaos will be norm. They'll keep getting richer and drive the US off the cliff and hide in their castles until the dust settles.

This subject is certainly misunderstood by many. When the congress votes to raise the debt ceiling it is not forward looking as it would be for an indivudual, or a household. In a place like D.C. where many things are backward and cloaked in political speak, raising the debt limit actually covers what has happened in the past. The spending, if you can call it that, has already occured. The vote to raise the limit only covers those debts.


Beyond that, there is much hyprocracy on the subject. Today the Obama Administration wants to raise the ceiling, but in 2006........

The fact that we are here today to debate raising America’s debt limit is a sign of leadership failure. It is a sign that the U.S. Government can’t pay its own bills. It is a sign that we now depend on ongoing financial assistance from foreign countries to finance our Government’s reckless fiscal policies. … Increasing America’s debt weakens us domestically and internationally. Leadership means that “the buck stops here.” Instead, Washington is shifting the burden of bad choices today onto the backs of our children and grandchildren. America has a debt problem and a failure of leadership. Americans deserve better. - Barack Obama (Senator, IL)

The fact that raising the limit is so easily accomplished is the problem. If we have always done it why not keep doing it, ISO stopping the spending.

[TorpX]

I Agree.

It has been all too easy to borrow and spend. What's more, the congressmen and senators never have to face the consequences of their actions. The ones who created the Gov't departments, entitlements, and big spending schemes, are dead now. They all figure, they can pass whatever spending bills they can ram through, and by the time the bills come due, they will be out of office. Personally, I think many of them should be prosecuted for criminal malpractice, but I don't see any hope of that.

[Skybird]

In the end, the Reps will make a deal that serves them best, and all Congress then will wave it through. Like the past 75 times (I read that) when a raise of debt ceilings had been proposed - it was done every time. Shouldn'T be like that, but it is like that.