What We Learned from the Fiscal Cliff
(Human, 14,358
Points)
on 1/16/13 at 7:30am
There was a lot of hysteria about the fiscal cliff last month, and partisan hyperbole pretty much ruled the news cycle. So you can imagine my relief to find some actual rational analysis that fleshes out what we actually learned from the exercise. Here Planet Money's Adam Davidson breaks it down for us and it's well worth the watch. Best quote: "Talk about [the economy] like what it is: not an existential crisis, not some battle between two fundamentally different religious views, but a math problem, a really solvable math problem."
Comments
I hate when people equate
I hate when people equate economics with math, like when Obama says "it's simple arithmetic". It's not. Our fastest supercomputers can't figure it out.
Uh oh, a clip from an NPR
Uh oh, a clip from an NPR guy. Commence countdown to Obama whinefest overreaction by all the original thinking "free market" WSO republicans...3...2...1....
pretty good find Eddie, I
pretty good find Eddie, I like TED for a good evening of thought provoking entertainment by the most lazy means possible. The gentleman certainly made some good points, it's good to know each side are not the heartless jerks that the others make them seem.
I was disappointed though that there were few numbers about the actual 'solvable math problem' that is the national budget, and that graph showing our Debt as a %of GDP approaching that of Greece in a decade is downright frightening. My question to any bond-raiders out there is, at what Debt to % of GDP ratio does it become a problem and the bond markets start turning against us?
HedgeHog: Uh oh, a clip from
Uh oh, a clip from an NPR guy. Commence countdown to Obama whinefest overreaction by all the original thinking "free market" WSO republicans...3...2...1....
How about you explain to us, which you never did in another thread, how stock prices equate to a healthy economy. I am still waiting for your brilliant analysis.
The reason why economic and budget issues have religious hatred level contention is because there are two ways to do things, one requiring more contribution from people and another requiring less benefit to people. I think government should be smaller and people have property rights. Therefore increasing taxes before decreasing spending makes me sick.
Which is the correct philosophy.
Democrats think government is there to benefit XYZ people and we can simply increase revenue from those who are deemed to have too much. Unfortunately, people always want more and you can always go back to the well which eventually leads to less tax revenue and more schemes to get money from the citizens.
So while the budget and economics are relatively cut and dry, the fact that two possible ways to achieve any one outcome causes the contention.
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I wish every hyperpartisan
I wish every hyperpartisan bloviator out there would watch this.
Great post Eddie.
"Social cohesion and puritanical morality place roughly on my list of concerns between whether I'll pick up jock itch at the gym this week (not likely, since I don't go the gym) and whether it'll rain in Christchurch, New Zealand next Tuesday."
-Eddie
You're the one trying to make
You're the one trying to make an economic debate. Show me where I said anything about the economy. And since you care so much, my take is the economy will be fine...not great, but okay. But if I lose my job, or my kids can't find one right away, I'd like to think that this country will provide healthcare for us. That if my kid decides she loves women that she can get married like everyone else. That if she wants to be a teacher or any other government worker you hate so much that she can actually make a living wage. And I'm sorry if I think that millionaires and billionaires need to pay more than they currently do (ACTUAL payments are nowhere near their "bracket"). We do need entitlement reform but republicans aren't going to do it, they just want the rich to get richer and cut the poorest out of the loop. Republicans left alone would destroy the country, but luckily their extremist policies are making them more and more irrelevant. The only reason they have the house is shady redistricting, and they may well lose the house in 2yrs anyway the way things are headed.
Thanks for the post Eddie.
Thanks for the post Eddie. This information should be part of a public service announcement. Or would it kill the media to run this, just a couple of times?
what Debt to % of GDP ratio does it become a problem and the bond markets start turning against us?
When the gov't can't pay its obligations. The ratio is irrelevant.
Democrats think government is there to benefit XYZ people
...and the GOP thinks it's there to benefit ABC people. Pick a side. No one's aiming for the center anymore...
Commence countdown to Obama whinefest overreaction by all the original thinking "free market" WSO republicans...3...2...1....
Funny, and not too far off, but .....are you a troll? I'd like to think that the purpose of this forum is finance first and politics definitely second. Or am I mistaken?
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Edmundo Braverman: "Talk
"Talk about [the economy] like what it is: not an existential crisis, not some battle between two fundamentally different religious views, but a math problem, a really solvable math problem."
OP, I disagree with how you've interpreted this statement and I think you've misunderstood the speaker. From where I'm sitting, he said:
"Talk about [the fiscal problems facing the country] like what it is: not an existential crisis, not some battle between two fundamentally different religious views, but a math problem, a really solvable math problem."
Which, given the overall tone of his talk, is far more likely.
"My caddie's chauffeur informs me that a bank is a place where people put money that isn't properly invested."
HedgeHog: You're the one
You're the one trying to make an economic debate. Show me where I said anything about the economy. And since you care so much, my take is the economy will be fine...not great, but okay. But if I lose my job, or my kids can't find one right away, I'd like to think that this country will provide healthcare for us. That if my kid decides she loves women that she can get married like everyone else. That if she wants to be a teacher or any other government worker you hate so much that she can actually make a living wage. And I'm sorry if I think that millionaires and billionaires need to pay more than they currently do (ACTUAL payments are nowhere near their "bracket"). We do need entitlement reform but republicans aren't going to do it, they just want the rich to get richer and cut the poorest out of the loop. Republicans left alone would destroy the country, but luckily their extremist policies are making them more and more irrelevant. The only reason they have the house is shady redistricting, and they may well lose the house in 2yrs anyway the way things are headed.
Well said. Too many knee-jerk reactions on these pages that obfuscate what this is really about. And I think it's a damn shame most of the media and forum posters keep acting like the grinding gridlock is caused by both parties. It lies largely on the shoulders of a very vocal faction of one party. Venture a guess?
His points are great and all,
His points are great and all, but as long as we have limitless money in politics, extreme gerrymandering of congressional districts, media conglomerates that focus on ratings over non-partisan reporting, and a populace that is either too apathetic or too moronic to care, nothing will change.
I think that having more objectively created congressional districts would go a long way towards leading to compromises.
Instead, we're stuck with a bunch of intransigent babies, many of which are on the far right (but not all, some Dems are disgraceful in all of this), who are incapable of compromise and making the actual decisions we need to fix our long-term problems.
What a complete disgrace.
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Love those guys over at
Love those guys over at planet money... one of the few news sources out there that applies rational thought to their reporting.
Can't wait to watch this tonight.
Don't know if anyone listens to their podcast, but their mini-series on creating a presidential candidate based off of conclusions that well regarded economist from all ends of the spectrum was refreshing. Listening to all that populist crap about "47%" and "you didn't build that" back in the fall was turning my mind to jelly. Discussing the fact that the mortgage interest rate deduction is one of the most regressive features of our tax system and it should be eliminated (in the long term) as an objective fact was refreshingly rational.
I’m standing on the edge of some crazy cliff. What I have to do, I have to catch everybody if they start to go over the cliff—I mean if they’re running and they don’t look where they’re going I have to come out from somewhere and catch them.
HedgeHog: But if I lose my
But if I lose my job, or my kids can't find one right away, I'd like to think that this country will provide healthcare for us. That if my kid decides she loves women that she can get married like everyone else.
I agree with most of the sentiment you're relating, but I don't think a debate about healthcare reform or gay marriage is germane to this conversation.
That if she wants to be a teacher or any other government worker you hate so much that she can actually make a living wage.
Frankly, if you're worried about teachers not making a "living wage", you haven't been reading the news for the past ten years. Public school teachers make considerably more on average than their peers in the private market, they receive more benefits, have consistent power over their employers, and have been negotiating wage increases with frequency. More importantly, tenure practices have the effect of keeping underperforming teachers in the classroom.
And I'm sorry if I think that millionaires and billionaires need to pay more than they currently do (ACTUAL payments are nowhere near their "bracket"). We do need entitlement reform but republicans aren't going to do it, they just want the rich to get richer and cut the poorest out of the loop. Republicans left alone would destroy the country, but luckily their extremist policies are making them more and more irrelevant. The only reason they have the house is shady redistricting, and they may well lose the house in 2yrs anyway the way things are headed.
On the contrary, although I am certainly not a Republican, I believe that the Republican party is also fighting to increase the tax burdens on our wealthiest individuals by closing loopholes. The difference is in methodology. You make the very valid point in your post here that "ACTUAL payments are nowhere near their 'bracket'". If that is the case, what makes you think that raising the tax rate on their "bracket" will make any progress towards changing the status quo? Indeed, the most effective way of increasing tax burdens in a fair and rational way that promotes efficient economic behavior is to simplify the tax code and eliminate complex deductions and loopholes that cause high-income earners to pay effective rates far below their statutory rate.
Additionally, I have a fundamental issue with labeling high-income individuals as "the wealthy" or "millionaires and billionaires", but that's an entirely different issue.
HedgeHog: You're the one
You're the one trying to make an economic debate. Show me where I said anything about the economy. And since you care so much, my take is the economy will be fine...not great, but okay. But if I lose my job, or my kids can't find one right away, I'd like to think that this country will provide healthcare for us. That if my kid decides she loves women that she can get married like everyone else. That if she wants to be a teacher or any other government worker you hate so much that she can actually make a living wage. And I'm sorry if I think that millionaires and billionaires need to pay more than they currently do (ACTUAL payments are nowhere near their "bracket"). We do need entitlement reform but republicans aren't going to do it, they just want the rich to get richer and cut the poorest out of the loop. Republicans left alone would destroy the country, but luckily their extremist policies are making them more and more irrelevant. The only reason they have the house is shady redistricting, and they may well lose the house in 2yrs anyway the way things are headed.
Wonderful Democrat talking points. Glad to know we are piping MSNBC onto WSO right now.
Increasing taxes on people who have more than an arbitrary amount isn't going to balance the budget at all, let alone reduce our deficit. It is a political maneuver. And national healthcare sounds real nice until you realize 1) someone has to pay for it and 2) costs continue to increase at dramatic rates.
Public workers make far more than just a living wage and if you equate unions to anything other than a power and money grab you aren't paying attention.
And I am not the one trying to make this an economic debate. You chime in with your attack on Republicans without offering any content, much like you did in the other post you created "bragging" about how the market is doing great and how we should thank Obama. All without touching on other things which inflate an equities market or how even if Obama helped the stock market increase, it isn't a reflection on the overall economy.
We need spending cuts. Absolutely fact. It is not the governments role to play Robin Hood or redistribute wealth under some 3 year old's concept of fairness. We have ample opportunity in this country for someone to educate themselves, work and raise themselves up. Only thing holding people back is an overly expansive government, one that runs up soon to be over $20T in debt (that will eventually be paid through higher taxes or inflation) and a government that continually thinks it has first dibs on the money that we EARN, instead of coming to its citizens, hat in hand, humbling asking us to give it only the barest minimum it needs.
Life, Liberty and Property. As it was intended and should have been. Probably one of the only failings of Ben Franklin.
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And lets not forget,
And lets not forget, Republicans compromised and tax rates have increased. Now it is time for Obama to compromise and cut entitlement spending.
Which is a disgusting name in and of itself since no one is entitled to anything.
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HedgeHog: That if my kid
That if my kid decides she loves women that she can get married like everyone else.
So there are laws preventing lesbians from marrying men?
So, make a prediction my
HedgeHog: So, make a
HedgeHog: So, make a
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I don't care what either
YOU JUST GOT TROLLED
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inkybinky: HedgeHog: That
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Gay marriage ... here are the
TheKing: inkybinky: Hedge
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HedgeHog: Gay marriage ...
Since government got involved
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inkybinky: HedgeHog: Gay
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TNA: Since government got
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TheKing: TNA: Since
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I died laughing at
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HedgeHog: Gay marriage ...
TheKing: TNA: Since
As long as we're on the
Oh dude, I'm totally against
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NorthSider: As long as we're
"My caddie's chauffeur informs me that a bank is a place where people put money that isn't properly invested."
TNA: TheKing: inkybinky:
YOU JUST GOT TROLLED
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TheKing: Let the baby boomer
"My caddie's chauffeur informs me that a bank is a place where people put money that isn't properly invested."
mikesswimn: NorthSider: As
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inkybinky: TheKing: inkyb
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NorthSider: This argument,
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inkybinky: It doesn't matter
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inkybinky: TheKing: inkyb
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inkybinky: TheKing: inkyb
TheKing: ...every reputable
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And speaking of engineered
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UFOinsider: TheKing: ...eve
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TheKing: People get divorced,
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NorthSider: Please, present