According to Reuters, a majority of economists now think that U.S. credit will be downgraded.
The debt ceiling plans being proposed likely will not avoid a debt downgrade.
Indeed, as Zero Hedge notes, the cuts being proposed in the debt ceiling proposals would be offset by the costs of the downgrade:
The US downgrade alone, now virtually taken for granted by everyone, will offset any beneficial impact from any deficit reduction that will have to happen for the debt ceiling to be increased.
Indeed, many are starting to say that a downgrade is inevitable.
In truth and in fact, we could still avoid a downgrade ... but only if we immediately:
(1) End the imperial wars, which reduce - rather than strengthen - national security (and see this and this);
(2) End the never-ending bailouts for Wall Street;
(3) Prosecute fraud and claw back ill-gotten gains;
(4) End the Bush tax cuts, which Ronald Reagan's budget director David Stockman said were the worst fiscal mistake in history; and
(5) Slash pensions for public employees, at least when they are pegged to an artificially "spiked" final year's salary.
The talking heads will say that these actions are not politically feasible.
However, as I've previously noted, that phrase is just code for:
The powers-that-be don't want it, even if the people overwhelmingly and passionately support it.
i been saying these things for years....so happy to meet someone who knows what fiscal sanity is.
ReplyDeleteWashington has been doing exactly the opposite it should do and it all started with Bush/Cheney's wild spending!!! Whatever happened to those anti-Vietnam protesters/generation that stopped a war??? Americans are being trapped in current economic snares by their own leadership!
I agree wholeheartedly with you and have said these same things for years now as I watched
my generation flounder in its economic woes. I have consistently contacted leaders about issues,particularly those that affect Americans adversely: wild war spending,huge tax cuts for corporations and the rich,out of sight pensions,and blatant misuse/robbing of our economic system
I will be surprised if a default actually occurs, since the president can write a presidential order to pay the bills.
ReplyDeleteOK, I will comment. End all 3 wars today. We have 130 military bases Stationed around the world. Close them all, but add a dozen aircraft carriers to cruise the world, a few more nucular subs. We pay to have 50,000 troops in Germany. Close those places. Germany is a big boy now. The post office, needs to go private, the FAA need to be done by a private company, Congress's wages needs to be based on the average wages of the people they serve. Airport's need to do their own security, get rid of the TSA. Anyone working a federal job needs a 401K, no pensions. Get out of the IMF, and the United Nations. All federal lands need to be put up for sale. A private company would let me go to Yosemite for less than paying Ranger Rick a pension for 30 years. All forigen aid needs to stop. If a bad situation happens somewhere you could just donate your own money online but only if you chose. If the government needed money for a specific reason like, lets kill some terrorist or over throw a government. You could donate money to that. I would never put SSI on the table, However Medicade should be gone, Medicare needs to be based on what ever you and your employer put in to it over your lifetime plus interest. After that sorry dude, were going to have to pull the plug or does anyone still love you. I know that sound's very cold. However People paid into for this for many years. But they broke a hip at 78. The government fixes it then your dead at 80 anyway. Hard choices but things need to change. Over the next 3 generations I would like to see a manditory 401k plan to replace SSI. When you die the money goes to your kids or grand kids to add to their retirments. But this would only work if we got rid of the fed so they could not devalue the money anymore. Just my lengethy 2 cents, of what we need to do. It will never happen, however just putting it out there.
ReplyDeleteI can't see who wrote this so please tell them that their parents were NOT slobs. We need this.
ReplyDeleteI agree with all of your suggestions...except one. But I have a replacement for it as well.
ReplyDeleteI disagree with (4); the Bush tax rates should be kept for at least the next ten years, with only a flat tax as the replacement.
However, I would suggest the one thing that the Federal Reserve could be ordered to give that would help to reverse the situation, and that is a Debt Jubilee for mortgages. In this way, we have a simple way to allow people to keep their houses, and a simple way to resolve the robo-signed title situation. That is, whoever lives there and was attempting to pay the mortgage, gets the title, period.
The other advantage is that this may increase revenue more than erasing returning to Clinton tax rates would do.
The final thing I'd do is end the Federal Reserve so we can finally have economists with some grounding in reality for a change.
I agree with danightman, if the national debt is repudiated then allow private mortgage debt to be repudiated as well. Don't necessarily like it, but I think it provides a real chance to get this country up off the mat AND it destroys the iBanks at the same time.
ReplyDeleteHowever, I DO think fair corporate taxation is a must, they cannot escape the burden of taxation while shipping jobs overseas.
GW nailed it as usual with his clear eyed vision.
ReplyDeleteIt only takes 3% of the population to make the change from tyranny back to freedom and Democracy (government of, for and by the People). We will prevail but it is going to be a long and difficult struggle. It may take 100 years and much suffering and pain with the loss of millions of Americans lives.
These evil insane sociopathic criminals are at war with us and they will kill us all rather then capitulate. They have the mine set of Adolf Hitler and his philosophy, he is their hero and fascism is their game plan. It is futile to try and rationalize their mine set- they are insane!
The problem with Americans is that they live in our past Democracy and have never suffered real pain. Somehow, the suffering and death of the other people in the world brought on by the war criminals is removed from what the criminals have planned for Americans.
It all comes around to the banksters. They tried to overthrow President Roosevelt in a coup. They assassinated President Kennedy because he was in the process of doing away with the Federal Reserve and our Treasury was going to print our own money backed by gold.
9/11 was an inside job and in a mere 10 years the banksters have taken American democracy and the rule of law down. You are all witnesses to how it happened but are too brainwashed by their propaganda machine to realize what they have done. Now comes our pain. What is your threshold for pain? Do you think you can run and hide? For how long can you hide before they come for you debt slave? You and your family own them $176,000 (http://www.usdebtclock.org/) each and you know how the banksters are, they want their money.
It is your heritage to stand and fight for your freedom and democracy. Stand up now to save your family before the real pain sets in! Demand that the rule of law be reestablished and bring the criminals to Justice. Do not let the banksters rule with fear and terror!
If you have mortgage repudiation, what do people get who didn't get a house? Were they stupid for not getting a mortgage they couldn't afford? It's not just the Federal government holding some of these mortgages, there are private businesses that made these loans. What incentive is there to make loans if they don't get paid back with interest?
ReplyDeleteSadly, the above are not enough & I don't agree with ending the Bush tax cuts.
ReplyDeleteWen need to:
-Cut $1 out of every $3 now spent by the Federal Government. That means, EVERYTHING is on the table for cuts or elimination!
-Not just balance the budget NOW, but start to make significant reductions year after year in our deficit.
-Phase out, privatize or pass on back to the States Unconstitutional Federal retirement, welfare & health care plans. Those taxpayers that want to continue those programs can do so at the State level with higher taxes in those States. Unhappy voters can "vote with their feet" & move to a different, low tax, small government State, if they want.
-End the corrupt Federal Reserve.
-End Federal Reserve Notes & go back to a monetary system based on something of intrinsic value (like gold/silver) & not on a debt based system worth only the paper it's printed on.
-Close most of the bases we have in over 100 nations around the world & recall most of our troops. Stop being the "world's policeman".
We have a spending problem, not a tax shortage problem, which goes hand in hand with an out-of-control & Unconstitutional federal Government which our Founding Fathers would be very displeased with.
I agree with Frank. The Bush Tax Cuts have become popular but they are not at fault here. The issue is government spending. We do need to end the wars, end the bail outs and the public Sector unions but most importantly we need to End the FED.
ReplyDeleteRon Paul 2012!!!