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Politics : Sharks in the Septic Tank -- Ignore unavailable to you. Want to Upgrade?

To: cosmicforce who wrote (3622)	1/27/2001 1:37:16 PM
From: hobo	Respond to of 82486

1. Tax cut 2. Status quo on most spending 3. Increase in military budget Net effect will be delay on paying down deficit. my opinion: # 1 Capital gains reduced. Death tax eliminated, income tax... hmmmm i am not sure... probably left alone or minimally reduced. # 2 i am not sure that they will have the discipline. it seems to me that AG has gathered momentum and they seem to be listening to him in re: tax cuts. this means they will control themselves to an extent. we'll see. (remember that if tax cuts go through, they have to accordingly watch the spending side. yes, i do realize that there is a surplus. this would quickly disappear if spending is not watched. particularly if there is a recession that would considerably reduce the tax revenue. (on top of the tax cut). here you have to consider Social Security future liabilities as well, and i am not entirely knowledgeable how the detail of how accounting is done. Social Security must be part of some long-range plan as well. # 3 hmmm i hope they come to their senses... i want to disagree, but i am not sure i can, given the powerful lobbying they will present. in stead i would like to see increased spending in children's education... but i think that is wishful thinking as for paying down the deficits... here are some good arguments against paying ALL of it: I am against retiring the debt. I can agree with paying down SOME of it but not most of it and certainly not all of it. I believe I've launched into a rant on this board before about the whole phoniness of this 'paying down the national debt' nonsense. I will reiterate my position, which is as follows: A few words on the Treasury's buyback and its longterm intentions.... Clinton has been trying to woo America with his plan (which even several naive Republicans have embraced) to completely wipe out the national debt within two decades. As we know, the national debt consists primarily of the entire float of U.S. government debt (t-bills/notes/bonds). We're talking several trillion dollars here. So what would the world be like without any U.S. government debt? For one, it is my opinion that the dollar would slowly crash. Foreigners own about half of all U.S. government debt, and their constant purchases are quite important to the dollar's stability and the balance of payments. Japan alone owns over 10% of all U.S. government debt. So, foreign countries would have to look elsewhere for their investment needs, probably to the sovereign debt of EMU countries. Banks and insurance companies would have to finance their ops abroad or buy loads of mortgage and corporate debt, which is not as high in quality as government debt which would mean higher borrowing costs. Lastly the U.S. would lose its position as the center of finance and the dollar would remain weak as countries holding dollars in their reserves switch 'em into Euro and Yen. I am very strongly against this insane idea to retire the national debt for any and all of the above reasons. I see no problem with retiring outstanding high-interest bonds yielding over 12% as issued two decades ago, but I think that if the government ceased issuance of new debt the money markets would grind to a halt and we would become a pedestrian nation, losing our financial center status. To quote Alexander Hamilton, the father of Wall Street and founder of the Bank of New York - "A national debt is a national blessing." Message 15122499