Las Vegas Sun

July 29, 2014

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Letter to the editor:

The government is not a household

Regarding Michael O. Kreps’ letter, “We can’t afford not to cut waste”:

This is another case where someone tries to equate the federal budget to a household budget and asks the question about how long it would be before bankruptcy?

Do people have printing presses in their kitchens for $100 bills? The federal government has a press. It’s called the Bureau of Engraving and Printing. So, comparing a household to the government is a false equivalency.

Also, taxes do need to be raised on corporations by eliminating loopholes and raised on the 1 percent by eliminating capital gains. Why is money earned by sweat somehow beneath money earned by money?

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  1. Families have printing presses for printing money just like the Federal Government has. They are called credit cards. Like the Federal Government, when families spend more than they earn [aka revenue] and are unable to repay, they get more in debt with mounting unpaid interest. Over time, the unpaid debt and unpaid interest on the debt overwhelm them. The Federal Government and families become insolvent and eventually declare bankrupt. Several countries in Europe are prime examples.

    Carmine D

  2. It's dangerous that there are Americans who hold the attitude of this letter writer. If you take this attitude to its 'logical' conclusion, why bother with budgets at all? Just decide what to spend, check what revenue comes in and use the Bureau of Engraving and Printing to make up the difference. Oh my, that's essentially what we are doing now!

    If this is such a great idea, why hasn't it been used all over the world? Because eventually you devalue your own currency and end up looking like the Weimar Republic in Germany that preceded Adolph Hitler.

    This is one area where I am Conservative. I didn't like Reagan in this area. I didn't like Bush and I don't like Obama. Clinton did a better job but he was aided by a relatively quiet and peaceful world and a dot com boom that greatly boosted the economy, only to collapse just as he left office.

    Michael

  3. Skowronski,

    You are incorrect in most of your assumptions and all of your assertions. Moreover, you exhibited an illogical & elementary understanding of the fiscal, monetary and political issues.

    Please review your logic and reasoning and try again in a few years; of course, we may not have a few years until virtual bankruptcy, and as such, you may desire to accelerate your education.

    Purgatory

  4. This author's attitude is held by both the Obama administration and millions of irresponsible citizens,and is exactly why the U.S. is headed for a financial train wreck. Can you believe this logic?Really?And many of us wonder what's wrong with theis country. Well,here's the answer right before our eyes.

  5. While the cassandras of the austerity pity party continue their weeping and gnashing of teeth, the arbiter of these issues, the free market, continues to express confidence in the US economy. T-bills continue to sell briskly with interest rates below the stated rate of inflation; markets continue to gain; despite rapid improvements in productivity and technology, employment gains are real and, apparently, lasting.

  6. Bob Jack is right. Obama came into office with a national debt of $9.9 Trillion. It's grown to $18 Trillon by 2013. In 5 years Obama added more national debt than Bush did in 2 terms. At the current rate of growth, the national U.S. debt is estimated to be $20 Trillion by 2016. print baby print.

    The Congressional Budget Office and this Administration have Keynesian convictions, just like their economic prophet Dr. Paul Krugman [since former NJ Democratic Governor Jon S. Corsine lost the position]. The same economic nonsense that did and are doing the governments of the countries in Europe in.

    Carmine D

  7. wharfrat,

    Your analysis is even more elementary than Skowronski's. I doubt you are a simpleton -- don't act like one.

    LastThroes,

    Obama is an elitist white guy. Sorry, I don't like elitist white guys. Pick another argument.

    Purgatory

  8. Purgatory....apparently you are not a believer in the power and prescience of free markets. What then is you preferred means of analysis and prediction? Tea leaves? Psychics? Goat droppings? Republican pundits? Pretty much all the same!

  9. wharfrat,

    I am a HUGE believer in the free markets for all asset classes, especially of money. I am a philosophical student of Adam Smith and a practical student of Milton Friedman.

    Don't bother with trying to convince me that any existing markets are "free" and that they are not manipulated by the Fed, large banks & other large financial institutions, and of course, by our Federal Government. Save your energy.

    All is well with the markets until it isn't anymore. It would seem to be self-evident to anyone who has paid attention and/or been negatively affected over the past several decades.

    And Chapline, you are correct -- I live in purgatory between the ignorant and the elitists.

    Purgatory

  10. CarmineD - "Obama came into office with a national debt of $9.9 Trillion. It's grown to $18 Trillon by 2013."

    How much of that debt was due to ten year programs initiated by the Bush admin?

    On January 20, 2009, the day Mr. Obama took office, the debt stood at $10.626 trillion, it is now $16.687 trillion. Under Bush the debt soared by $5 trillion, under Obama it's $6 trillion.

    Again, corporations are running our economy and debt while hanging American citizens out to dry. Until voters realize that is the situation they will always be on the hook for fat cats and corporations avoiding taxes including bailing them out when they fail.

  11. I think there is plenty of blame to go around,we hear it all the time.What we don't hear is new idea's on how to fix the problem that we are currently in, which is the deficit. Time to put politics aside and find a way for both parties to work together and turn the tide on our huge debt. Unfortunately things being what they are this will never happen, both parties working together for the betterment of our country.

  12. Mr. Skowronski, paper money has no intrinsic value beyond the faith that it represents value. Faith can erode quickly. Austrian Economist Ludwig Von Misses said that when money is printed to excess, at some point every unit printed debases the currency and results in hyper-inflation. History has seen numerous examples, the results of which were catastrophic. When does that happen? No one knows for sure. What happens when it does? One cannot own enough printed currency to sustain one's lifestyle. Currency based holdings become worthless. You also say that U.S. corporate income taxes (among the highest in the world) should be raised. When that occurs, global corporations move their Headquarters offshore to avoid paying taxes. Wouldn't it make more sense to lower corporate income tax rates to encourage more global companies to relocate and pay taxes in the U.S.? It would increase treasury revenues exponentially.

  13. This letter is typical of the trend in 21st Century America. There's the right thing to do (control our expenses), but it's hard. There's an easy alternative (print money), and the consequences aren't immediate or obvious, so let's do that. We should ditch the stars and stripes and replace them with a foot kicking a can down the road.

  14. So..."Skip" what are all those companies selling you gold accepting in exchange for that gold? Would that be paper dollars?

  15. "How much of that debt was due to ten year programs initiated by the Bush admin?"

    Federal budgets are annual as in yearly. CBO economic scoring and predictions are limited to 5 and only 5 years, for obvious reasons. Sitting presidents are not bound in any way, shape, or form by the fiscal policies of their predecessors. Appropriations funding government activities, with very limited exceptions, are for one fiscal year only. That's why Presidents send their own budgets to Congress every fiscal year in the first week of February. Except Obama. 2009 was the only year he did a valid budget of the 5 years so far. Recall the CBO couldn't even score Obama's 2013 budget because it said it was not a valid budget, just talking points.

    Carmine D

  16. So, if you like using your numbers, in 4 years Obama's national debt went up $6 Trillion. That's the equivalent of Bush's debt in 8 years [2 terms]. Right?

    Carmine D

  17. Recall the democratic Senate voted against Obama's budget 99-0. Not one in favor.

    Read it and weep.

    http://www.forbes.com/sites/paulroderick...

    Obama talks a good game about leaving a legacy to our children. But he is tone deaf to leaving them and their children saddled with massive debt. It is reprehensible.

    Carmine D

  18. Teamster, it seems clear that a strong union movement could benefit a lot of people. Yet union participation in the private sector is dwindling to almost nothing. Your reason is that Republicans and business people are greedy, and I won't disagree with you there. But complaining about what you can't control is not helping much. A second explanation is that the union movement is, despite decades of declining membership, mentally stuck in the glory days of the middle of the last century. If you think that real working Americans are the ones who sweat and do the heavy lifting, you might want to try a visit to the present and expand your definition a bit. How do you plan to organize today's workers whose job does not involve sweating and heavy lifting if you don't even consider them real working Americans?