traderx

First, let me say that I give Obama high marks for leadership and communication. By contrast, it seems that Bush buried his head in the sand when it came to leadership. Obama has been front and center on so many issues. I do not agree with him on every issue. I hate the big government approach to fixing the economy for instance. But when the country is in the pits, we need a leader in the White House more than ever. It is FDR's enduring legacy to this day.

Obama announced that he wants to cut the deficit to $533 billion in four years. I researched some facts in order to form an opinion about the viability of such a goal. Receipts and expenditures were obtained at the Bureau of Economic Analysis website, bea.gov. While the Bureau has posted expenditures for 2008, it has not posted receipts so I had to work with 2007 numbers for receipts. Spending in 2008 was $4,997 trillion. Add the stimulus package and other spending and we should easily be at $6 trillion in 2009. I then increased spending by 6% annually over the next three years. Receipts in 2007 were $4.2 trillion and I increased this figure by 6% over the next four years. The result in 2012 is a total of $19.5 trillion in receipts over the four years and $26.2 trillion in expenditures over the same period. The four year deficit equals $6.7 trillion. Since Obama wants to reduce the deficit to $533 billion in four years, I subtracted that amount from the $6.7 trillion which means that the federal government needs to generate an additional $6.2 trillion over the next four years to accomplish Obama's goal. That equates to over $1.5 trillion per year.

The only chance I can see of accomplishing this goal is to limit increases in social entitlement programs with the big three being social security, Medicare and Medicaid. You can probably go ahead and fold SCHIP into the mix. Whenever the federal government creates a new program, the spending for it seems to get out of control in a hurry. It would take enormous political capital for Obama to cut the rate of growth in those programs. Will he spend the necessary political capital? There are some savings to be realized as we pull out of Iraq but we seem to be deploying many of those troops to Afghanistan so it is unclear what the savings will be. Besides, because of cost accounting principles, we will not realize the savings that many expect. Whether a soldier is in Iraq, Afghanistan or Ft. Bragg, his/her monthly pay is still the same minus combat pay premiums.

Maybe I am missing something? I hope Obama can accomplish his goal. It would be an incredible feat and would pay huge dividends to our country especially our children.

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"It is a mistake to try to look too far ahead. The chain of destiny can only be grasped one link at a time."

--Winston Churchill

TooFarTampa

A thoughtful and realistic post. Thank you.

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Lynnie

So, after 2013, we only have $13.5TR left to abate. Wahooo~~~~~~

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Who is Lynnie?? ~~~~~~~Signed, All Y'all

RDeMars

I saw this video, and I thought it was helpful in understanding the devaluing of our currency. I am not blaming any political party for this, but I find this to be very frightening. I am skeptical of the President's claim that he will reduce the deficit, but if he does, I would be elated. It seems that reducing deficits while dumping money in black holes such as G.M. are contradictory. I don't think that we can afford to throw money at G.M. forever as their current business model is not viable.

I am so afraid of this debt and deficit problem, that I would actually pay more taxes without protest, assuming it was going to these measures, rather than increasing entitlements for illegal immigrants, bailing out auto makers, etc...

30ashopper

..and I want to loose 20 pounds.

6thGen

I want a pony.

hnooe

What mind can conceive, man can achieve.

TooFarTampa

Which will be harder -- this or figuring out how to get to the moon and back?

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traderx

Undoubtedly this. Getting to the moon and back is all about mathematics, propulsion and timing. "This" includes tough decisions by a government that got into this mess by avoiding tough decisions.

__________________
"It is a mistake to try to look too far ahead. The chain of destiny can only be grasped one link at a time."

--Winston Churchill

BeachSiO2

This almost sounds like if you build it they will come, eerily familiar to what got us in this housing mess to begin with.
Posted via Mobile Device

scooterbug44

Sorry, but there is much worse news out there than a President who wants to reduce our deficit.

I would rather have someone who sets high goals, but doesn't quite meet them as my leader than someone w/ low standards who makes the problems worse.........or someone who just biatches and blames w/o trying to solve any problems.

Hell, if he only achieves 25% of his goal we're still better off.

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"I hate to break it to you, but this year (and probably the next few) was going to suck even if Jesus himself was president. These problems were not created overnight and they aren't going away overnight." -Jdarg

woodworker

I Glenn Beck,

30ashopper

Mission accomplished!

scooterbug44

And what are you doing to solve the problems, Snarky McGee?

Sitting around biatching accomplishes nothing - at least he's trying to find solutions and do something.

__________________
"I hate to break it to you, but this year (and probably the next few) was going to suck even if Jesus himself was president. These problems were not created overnight and they aren't going away overnight." -Jdarg

30ashopper

I'm accomplishing something alright, I'm shorting his stock market.

Miss Kitty

...now, that was funny. Come on scootyb...laugh!

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The mind is like a parachute, it works best when it is open.

scooterbug44

That was funny!

I am betting on economic recovery and being optimistic rather than hoping for Armageddon so I can make a quick buck, but to each their own.

__________________
"I hate to break it to you, but this year (and probably the next few) was going to suck even if Jesus himself was president. These problems were not created overnight and they aren't going away overnight." -Jdarg

Miss Kitty

...thanks to both of you for the hearty laugh! Y'all should take this on the road!

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The mind is like a parachute, it works best when it is open.

TooFarTampa

badump bump-ching!

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Margarita

Optimism and hope are wonderful things if based on reality.

"The problem in the subprime market seems likely to be contained"

Ben Bernake, March 2007

"All of the doom and gloom forecasts of a housing debacle are not only irresponsible, but also downright wrong"

David Lereah
National Association of Realtors, August 2005

traderx

Snarky McGee.......

__________________
"It is a mistake to try to look too far ahead. The chain of destiny can only be grasped one link at a time."

--Winston Churchill

scooterbug44

Well, my motto is to "hope for the best and plan for the worst" - I've done my planning, and I've certainly got a doom and gloom scenario, but I've also got enough faith in our current president and my fellow Americans that I don't think I'm being a complete idiot for thinking this too shall pass.

Time to cowboy up and quit whining. It isn't going to be easy, but nobody (whose opinion I respect anyway ) said it would be.

__________________
"I hate to break it to you, but this year (and probably the next few) was going to suck even if Jesus himself was president. These problems were not created overnight and they aren't going away overnight." -Jdarg

Margarita

I guess Phil Gramm had it right

In an interview with the Washington Times, McCain's top economic adviser Phil Gramm tells America to suck it up and stop complaining about the economy:

traderx

Let me explain......

Back in the day when Nixon was president, inflation was a problem. Nixon decided to fight inflation with buttons that read "WIN", an acronym for Whip Inflation Now. The problem is that he telegraphed his intent to implement wage price controls so what happened? Business raised prices immediately to avoid the controls thereby compounding price inflation.

Obama is not considering wage price controls but has talked the income tax increases to death. Yes, he said he would simply let the Bush tax cuts (sic) expire but meanwhile he is planning to limit deductions for high income earners. There are plenty of ways to raise taxes other than tax rates and Obama and his team will find more no doubt. Here's the problem and the Nixon comparison: people who make >$250,000 are giving themselves pay cuts to avoid the additonal taxes. This puts less money into a deflating economy, the exact opposite of what we need.

It leads me to this question: why did Obama telegraph his intentions? To assuage a certain continuency?

__________________
"It is a mistake to try to look too far ahead. The chain of destiny can only be grasped one link at a time."

--Winston Churchill

TooFarTampa

I can say without equivocation that scootyb had nothing to do with the Current Situation.

Can we say the same about Phil Gramm?

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scooterbug44

I think Obama is having fun messing with the minds of people who would decide to pay themselves less money to avoid taxes.

I am more than willing to pay more taxes on my income and profits .............. if he can fix the economy so that I actually have some!

Have no $ or make more $ but have to pay more taxes on it - that's a tough dilemma - NOT!

And sadly, part of the blame for the economic mess is mine too - I didn't do enough to make common sense and fiscal responsibility an epidemic!

__________________
"I hate to break it to you, but this year (and probably the next few) was going to suck even if Jesus himself was president. These problems were not created overnight and they aren't going away overnight." -Jdarg

Winnie

Really good one!

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George Will

traderx

We will never ever balance the budget with additional revenue; it has to come from spending cuts. Congress has proven time after time that it will spend every penny it gets and several hundred billion dollars more.

I have not worked much over the past few years and if Obama increases taxes dramatically, I will go ahead and retire. If the government tries to confiscate a portion of my assets - which I hereby predict - I will move to a foreign country. Hey, maybe Bermuda so I can watch over my Cuban cigar business.

__________________
"It is a mistake to try to look too far ahead. The chain of destiny can only be grasped one link at a time."

--Winston Churchill

Margarita

Touche

Miss Kitty

Insider tip from Cato boy...

watch 20/20 tonight (Friday) John Stossel will be interviewing a group of economists.

http://abcnews.go.com/Video/playerIndex?id=7043150

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traderx

I like Stossel. Thanks for the tip.

__________________
"It is a mistake to try to look too far ahead. The chain of destiny can only be grasped one link at a time."

--Winston Churchill

SWGB

Is he gonna use scuba gear?

Q: What do you call 10,000 economists at the bottom of the sea?

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BeachSiO2

I found this interesting... Not everyone agrees it seems

http://www.cato.org/special/stimulus...o_stimulus.pdf

Miss Kitty

Thanks! I saved a copy of this from the WSJ to frame for Cato Boy.

Thanks, also, for reminding me to go TiVo tonight's 20/20!

__________________
The mind is like a parachute, it works best when it is open.