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Frankly, My Dear, I Don't Give a Dime [Federal Budget]
ElJeffe
Registered User, ClubPA regular
Registered User, ClubPA regular
The federal government spends, like, money and stuff. First, they budget for it, or something.
Trump is going to be submitting some kind of budget thing. It will surely be a thing of beauty. Then Congress will propose something, and yea the angels will sing as all the nation's woes are taken care of.
This thread for discussing all of that. I pray that one thread can contain such majesty.
Trump is going to be submitting some kind of budget thing. It will surely be a thing of beauty. Then Congress will propose something, and yea the angels will sing as all the nation's woes are taken care of.
This thread for discussing all of that. I pray that one thread can contain such majesty.
I submitted an entry to Lego Ideas, and if 10,000 people support me, it'll be turned into an actual Lego set!If you'd like to see and support my submission, follow this link.
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It's all over the map, basically.
-Indiana Solo, runner of blades
National Institute of Health, which tends to do the country's health research work (unless it's a communicable disease, some of that goes to Center for Disease Control).
The DoD programs are important because they are earmarked, so you know exactly how much funding you're getting for each disease.
It's just an object lesson in the complexity of the federal budget. All money is not created equal.
The thing I'm most worried about with the budget is a bunch of departments and agencies getting shut down permanently. If we ever get sane government again, the disruption in service will make recreating those organizations even harder, and a lot of people will suffer in the mean time.
That said "a lot of people will suffer in the mean time" seems to be the running theme for this administration.
It's their fucking mission statement.
I'm expecting Trump's pass at a budget to be a nonsensical scythe-like slash across every conservative bugaboo in existence. I call like 50% odds that at least one entire organization just completely ceases to exist.
What's obnoxious is I've found three places talking about this, period. The Guardian, the Pittsburgh Post-Gazette, and Jim Harbaugh's twitter feed (which is naturally where I saw it). It's a big deal that even the liberal blogs haven't seem to have noticed in the general fuckery of the week.
Yeah, I have a few acquaintances who will be out of work if this goes through, but only 1 of them seems to realize it
Applying for VAWA grants now feels a bit like an exercise in futility, as it's possible the budget just eliminates that whole department, which would be shocking but par for the course. and result in a rise in murders of women in this country.
Of course PBS is right out. That expensive arts program is really dragging the budget down.
It's funny too since we were finally making headway solving the runoff problems we were facing.
Keep the pressure on your members of Congress basically, the GOP doesn't have the votes to ram anything through.
He's going to be cutting or eliminating so much, there will be so many fronts to fight on that I'm worried folks will be spread thin and we won't be able to save even most of what needs saving.
People will scream about VAWA grant elimination, but do they have the energy to scream about 100 other grant programs that are also very important and will be going down the drain without intense public pressure....I don't know.
I'm discouraged.
With Reconciliation, the Republicans actually do have all they votes they need to ram anything through.
You can't do much with Reconciliation.
I'm not sure what you mean there. They can't increase the deficit, but they can pass a budget.
That was me.
So far I'm yet to read anything that would convince me that this is a bad comparison despite best efforts.
The important shit is the appropriations.
In the household budget metaphor, government spending is the same as personal spending, and government income (tax receipts) is the same as personal income (salary from your job). Government debt is the same as personal debt (credit cards, loans).
The argument goes that if we spend more than we make personally, we go into debt and eventually can't make the payments so we go bankrupt; and the same applies to the government, so we should cut spending to live within our means.
But no matter how much I spend personally on food and Xboxes, my income will never go up as a result. The same is not true for the government, which can spend money and grow the economy, increasing tax receipts. Likewise, governments can take on a lot more debt comfortably, and America even more so because our wealth makes us a source of stability in the global market.
So if the government is like a household budget, that household is the rich person who employs much of his small town, and who doesn't have to worry about debt because the local banker would go under if he defaulted, and whose neighbors will go buy more of his widgets if he hires them on as his servants.
So the government budget is like a household's budget: specifically, this guy's budget:
Does Mr. Burns need to cut down on his spending? No, he needs to invest in Springfield and nuclear power and doomsday devices so he can continue to grow his wealth.
Biggest difference is we generally pay money back for less than we borrowed it because we're the reserve currency. If the GOP fucks that up for us suddenly the debt becomes a lot closer to actually being a crisis.
Another important way that government debt can be different than personal debt is that government debt can be really, really cheap. If you have a credit card, you're typically paying at least 18% interest on it. If you have a line of credit, you're lucky to get 5%. If you have a mortgage, 2.5% is a really, really good number for most people. But a government can set its own interest rates. For example, they could easily offer a two year bond for 1% interest. Or less than that. Some countries are experimenting with negative interest rates.
Regardless of the exact number, the important thing is that governments are able to set their interest rates lower than the rate of inflation. In practical terms, as long as there's no deflation, it means that governments are able to pay back less than they borrow. That tells you something important about why people buy government debt - they're not trying to make a profit, they want to park their money in a secure place and are willing to pay a slight fee to do so.
Further, government debt on the federal level in America, Canada, Great Britain, China, and every other country with its own currency, is typically owed in their own currency. That has another really important implication: it's impossible for the government that owes debt in its own currency to default on its debts unless it really, really wants to. If the entire US national debt came due tomorrow, the US could quite literally pay down every last cent of it and be debt-free by the weekend.
However, it really, really, really shouldn't. Because remember what I said about people parking money in government debt? Yeah, their investment would be worthless. The impact to the world economy would be enormous, unprecedented in negative scope. Inflation would go mad. Stock markets would melt down. It'd be bad.
So, the US (and Canada, Great Britain, China, etc) will continue to carry national debt, because people are literally paying them to hold their money, and because the bonds that they sell are a vital organ in the global economy. If it helps, try not to think of the household debt analogy - instead think of it as a bunch of friends asking you to hold $100 for them and expecting $98 back.
Edit: Threw the quote in a spoiler for size.
Seems like a lose-lose situation for any administration to start directly slashing jobs.
NEA seems doomed
QEDMF xbl: PantsB G+
And you generally don't leave debt until, at best, you approach retirement in order to live off your accrued savings (ie the debt society effectively owe you). But governments just keep going so they should keep borrowing money at extremely low interest rates because not only does inflation make it easier to pay off in the future, but money invested today is almost always worth more than money invested tomorrow
QEDMF xbl: PantsB G+
We, as a culture, have a very poor understanding of debt, which is then compounded by moralizing that structures debt payment as moral obligation.
We, as a culture, have a poor understanding of most numbers. For example, trying to explain a progressive income tax to most people is far, far more difficult than it should be.
That's the utility of single-issue activists. They can seem overspecialized (and sometimes are annoying as hell to talk to about, anything), but you know that they're 100% behind defending their cause when it comes up. The Legal Aid activists get the Legal Counsel Fund, the domestic violence folks get up in arms about VAWA.
It does feel overwhelming if you're taking a more big-picture viewpoint.
House and Senate seem to be approving that cancer research fund i mentioned. Raised it by $10 million from last year, too.
A couple people have said this and while that has been effectively true recently that is definitely not the normal case. Bond yield net of inflation is typically positive
However, people will be willing to park money in a safe investment for a small return and governments can make use of the money for a better return
If someone ever puts together a concise concrete explanation I will tattoo it on my body to save time arguing with people. I hate how often I have to correct people that are not only smarter than me, they also make a lot more money.
It is a simple integral over a piecewise function. Each bracket starts at the same $ owing that the previous one ends at
I know this, how do I explain it to my uncle in law...who literally works in finance...and says shit about being screwed by getting into the next bracket. Although given he works in finance he might just be trying to steal money.
Just do the calculations in a table: https://www.irs.com/articles/2016-federal-tax-rates-personal-exemptions-and-standard-deductions
$0—$9,275 10%
$9,276—$37,650 $927.50 plus 15% of the amount over $9,275
$37,651—$91,150 $5,183.75 plus 25% of the amount over $37,650
$91,151—$190,150 $18,558.75 plus 28% of the amount over $91,150
$190,151—$ 413,350 $46,278.75 plus 33% of the amount over $190,150
$413,351—$415,050 $119,934.75 plus 35% of the amount over $413,350
$415,051 or more $120,529.75 plus 39.6% of the amount over $415,050
$9275: $972.50, next bracket $972.50 + ...
37650: 927.50 + (37650 - 9275) * 15% = 5183.75, next bracket 5183.75 + ...
And so on. Or do it as a graph. Income - tax for each $
There should still be a threshold of debt in terms of percentage GDP that a government can support (or will be able to raise I guess if there is no interest paid to the investors) without increasing taxes.
Given that, how is government debt any different to personal debt, aside the interest rate?
I hope somebody takes one of those budget pie charts and pastes in next to it the cuts and increases from Trump's proposal (eg a tiny fraction of a sliver cut for arts, a massive wedge added for defense, etc.) so that people can see the total amount being "saved" relative to last year.
Preferably with a bit that also illustrates how much those cuts impact their areas.
Personal debt can be and is defaulted on, people lose jobs, get sick, governmental debt is only defaulted on in a truly major nationwide (or global) crisis
Personal debt typically only lasts for the lifetime of the person, governments are effectively immortal
Personal debt is typically held for only a short period of time and must be paid back with earned income, governmental debt is often paid for by issuing more bonds
Personal debt is limited, eventually people will stop giving you money. Governmental debt is effectively unlimited, but eventually people will want a higher rate. This is related to the power to create and destroy currency
Technically, yes there is an upper limit but it is pretty high. As long as people are willing to buy your low interest debt you are fine
There is debate about what the threshold is, if it exists, etc. Japan's debt is around 200% of it's GDP but their borrowing rates are still tiny. It helps that their central bank owns somewhere around 30% percent of their government's debt though.