GOP threaten govt shutdown over obamacare

[tazzietiger]

It seems the house doesn't have the republican votes to pass the senate deal on lifting that the ceiling until feb and govt reopened until January.

Also Fitch credit rating could downgrade their rating on the u.s debt.

Fitch could strip America of its prized "AAA" credit rating within weeks, the rating agency has warned, amid heightening fears that the world’s largest economy is headed for a default.
The ratings agency believes the country will raise its $16.7trn debt ceiling in time to ensure it can keep up with interest payments on its soveriegn debt, but said the ongoing political stand-off in Washington was “casting doubt over the full faith and credit of the US” regardless.
If the US does default, Fitch warned it would downgrade American bonds from AAA to B+, the highest rating it will award any security that defaults but is expected to make a “swift full or near recovery”.
American bonds are regarded as the safest government debt in the world, and are often used as an laternative to cash, so any downgrade of this kind would send shockwaves throughout the global system.

The prolonged negotiations risk “undermining confidence in the role of the US dollar as the preeminent global reserve currency, by casting doubt over the full faith and credit of the US,” Fitch said in a statement.
America has already been relying on “extraordinary” measures to pay its bills, so the drawn out negotiations also impact the country’s credit rating by reducing its “financing flexibility,” Fitch said.
“Although the Treasury would still have limited capacity to make payments after 17 October it would be exposed to volatile revenue and expenditure flows. The Treasury may be unable to prioritise debt service, and it is unclear whether it even has the legal authority to do so.”
“The US risks being forced to incur widespread delays of payments to suppliers and employees, as well as social security payments to citizens - all of which would damage the perception of US sovereign creditworthiness and the economy.”

http://www.telegraph.co.uk/finance/...ns-to-strip-America-of-AAA-credit-rating.html

 

[JRoo]

The US wont go below 4% let alone 3% of gdp. So savings are what? 1% of gdp? Fine do that but it wont solve the problem

Compare that however, to the massive increase in healthcare thanks in large part due to Obama.

Any rational person would say the Tea Party has a very compelling point

The facts speak for themselves.

The US wont go below 4% let alone 3% of gdp.

The US waste spending on defence is about 20% (approximatley $830 billion in 2014) of their entire budget spending and is almost 50% of the entire worlds defence expenditure. Obama has proposed to reduce defence spending down to about 2.5% by the end of this decade, but shock horror the Tea Party opposes any defence cuts!

Obama has proposed to reduce defence spending down to about 2.5% of GDP by the end of this decade, but shock horror the Tea Party opposes any defence cuts!

The US defence spending can be significantly cuts without reducing their military abilities; 500+ military bands, almost 1000 generals/admirals (which is about triple the required number) each with their own personnel jet & catering staff, the 234 worldwide military owned golf courses. You could cut the defence budget by about $150 billion per year with almost no drop in capabilities.

http://www.salon.com/2012/12/12/7_absurd_ways_the_military_wastes_taxpayer_dollars/

Hell the US could save significant money if it stopped wasting taxpayers money on defence equipment that didn't work;

http://www.forbes.com/sites/lorenth...aste-100-billion-weapons-that-didnt-work-out/
How To Waste $100 Billion: Weapons That Didn't Work Out

The Army has been the biggest offender in recent times, probably because it was awash in money appropriated for fighting ground wars in Asia. It walked away from a mobile cannon called Crusader in 2002 after spending $2 billion on developing it because Army leaders decided it was too heavy to fit with their plans for a more mobile force. Eight years later it canceled a potential successor system after spending $1.2 billion. In 2004 it killed the Comanche next-generation “armed reconnaissance” helicopter, squandering $7 billion in sunk costs, then a few years later it canceled the proposed replacement — incurring hundreds of millions of dollars in additional losses. It also has moved to terminate both of its next-generation air defense systems because threats “didn’t evolve as expected,” and now seems to be getting cold feet about its second try at buying a plane that can identify hostile radio emitters on the battlefield.

The Army’s biggest budgetary mis-step was a family of networked air and ground vehicles collectively called the Future Combat System. Although prime contractor Boeing managed to keep the program on schedule and on budget through a series of restructures, Secretary of Defense Robert Gates decided in 2009 that the project wasn’t ready for prime-time and canceled it after a staggering $19 billion had already been spent. Bloomberg Business News subsequently reported that the service had wasted $32 billion on doomed weapons projects since 1995.

Whilst we are at cutting wasteful US defence spending, the Tea Party should not only accept that their policy of increasing spending on defence is wrong, but they should also cut the $154 billion per year, over $1.5 Trillion over the decade in US government provided welfare to US businesses, as well as the over $1 trillion in US subsidies/assistance to it's farmers over the next decade.

http://www.taxpayer.net/library/article/farm-bill-101

Defence cuts per year: $150 billion;
Business assistance cuts per year: $154 billion;
US Farm Assistance/subsidies cut: $100 billion per year
Without even trying there is $400 billion per year in US government cuts that are easily made; less military gold course, bands, less generals and personnel jets, less waste on equipment that doesn't work, no picking winners with taxpayers money, no more providing subsidies/assistance to farmers.

 

[medusala]

Obama has proposed to reduce defence spending down to about 2.5% of GDP by the end of this decade, but shock horror the Tea Party opposes any defence cuts!

You really don't get this. They wont cut defence to less than 3%. At most you can save 2% of gdp and likely far less.

Health care will increase by multiples of that in the next 20 years.

Obamacare is a far, far bigger problem than defence spending.

So why blame the Tea Party for the problem? Irrational.

 

[clogged]

Well that was a fizzer. The Republicans made themselves out to be even bigger fools.

 

[kimp]

You really don't get this. They wont cut defence to less than 3%. At most you can save 2% of gdp and likely far less.

Health care will increase by multiples of that in the next 20 years.

Obamacare is a far, far bigger problem than defence spending.

So why blame the Tea Party for the problem? Irrational.

Meds your simplistic evaluation of this whole situation cannot be ignored. The price of healthcare in the US (and everywhere else) is going to multiply in the coming years that is not being disputed. However the way that the US manages its healthcare is ridiculous. They are already having to pay for a lot of those not insured through their emergency centres. This then causes those centres to function increasingly inefficiently. Preventative health not undertaken by the vast majorty of the population thereby increasing costs. And these are just a few of the issues.

Just like in Australia their whole budget needs to be examined and restructured. All those tax cuts that were pushed through in the Bush years are not (and really never were) economically sound. These discussions cannot succeed without having sensible discussions about the tax base.

The incredibly irresonsible actions by the Tea Party have crippled the growth that the US should be seeing now and would have seen in the coming years/months. That growth would have meant increased revenue for the government.

Then if you look at the long term this latest display means that the supremacy of the USD will fall sooner rather than later. The real repercussions aren't this year or next but the decades to come. And the really ridiculous thing is that the Tea Party are talking about protecting the future of the US. Their actions are cementing the fall of their country.

 

[tazzietiger]

The agreement passed the senate but will it pass the house and if it relays on the democrats mainly to pass it boehner's speakership could be at risk. At the end of the day all the agreement does is kick the can down the road to January and February before we have another crisis and a 11th hour deal.

 

[JRoo]

You really don't get this. They wont cut defence to less than 3%. At most you can save 2% of gdp and likely far less.

Health care will increase by multiples of that in the next 20 years.

Obamacare is a far, far bigger problem than defence spending.

So why blame the Tea Party for the problem? Irrational.

You really don't get this.

I fully get "this". The Tea Party is not against government spending, it is just against government spending in areas that don't comply with the Tea Parties policies.

They wont cut defence to less than 3%. At most you can save 2% of gdp and likely far less.

As per my previous post Obama has already budgeted to reduce defence spending down to 2.5% of GDP within a decade. Also who is this "they" you mention in regards to reducing defence expenditure; Obama, the Democrats, nope they have agreed to the reduction.

Health care will increase by multiples of that in the next 20 years.

As has and will defence expenditure (about $8+ trillion over the next decade), business welfare (about $1.5 trillion over the next decade) and assistance to farmers (about $500 billion over the next decade).

So why blame the Tea Party for the problem? Irrational

Because they are a petulant child who refuses to play because they don't get their way.

The Tea Party lost a vote in the House & in the Senate on Obamacare, lost a Supreme Court action that tested the Constitutional validity of Obamacare, as well as fighting an entire Presidential election campaign against it, they lost but refuse to accept this and have threatened to shut down the country unless everybody else agrees to comply with their party platform.

I and others might start to take the Tea Party serious in regards to cutting government spending if they announced they were against the $150 billion per year in business welfare, the $50 billion per year in farmers assistance, as well as the wasteful defence budget of $800 billion per year. Until then the Tea Party and their attached supporters will be considered hypocrites and nuts.

 

[DivideandMultiply]

The agreement passed the senate but will it pass the house and if it relays on the democrats mainly to pass it boehner's speakership could be at risk. At the end of the day all the agreement does is kick the can down the road to January and February before we have another crisis and a 11th hour deal.

So much damage caused by the GOP/TP, for so little gain.

This should be a big wake up call for Americans re the TP.

 

[tazzietiger]

So much damage caused by the GOP/TP, for so little gain.

This should be a big wake up call for Americans re the TP.

The shutdown cost their economy $24 Billion (.6% GDP growth) basically for no gain.
http://www.businessinsider.com.au/sp-cuts-us-growth-view-2013-10

The Republicans are stupid for following Cruz's tactic as it never going to achieve anything besides hurting them selves in the polls.

 

[DivideandMultiply]

The shutdown cost their economy $24 Billion (.6% GDP growth) basically for no gain.
http://www.businessinsider.com.au/sp-cuts-us-growth-view-2013-10

The Republicans are stupid for following Cruz's tactic as it never going to achieve anything besides hurting them selves in the polls.

...and hurting their constituents.

 

[medusala]

Meds your simplistic evaluation of this whole situation cannot be ignored. The price of healthcare in the US (and everywhere else) is going to multiply in the coming years that is not being disputed. However the way that the US manages its healthcare is ridiculous.

Yes it is and Obama has made it even worse.

All those tax cuts that were pushed through in the Bush years are not (and really never were) economically sound.

Sure they were, pre GFC nearly all the revenue had returned.

These discussions cannot succeed without having sensible discussions about the tax base.

The tax base is NOT the problem. It is the massive future liabilities associated with health care and social security.

The incredibly irresonsible actions by the Tea Party have crippled the growth that the US should be seeing now and would have seen in the coming years/months. That growth would have meant increased revenue for the government.

That simply isn't true. It may take a bit out of one quarters growth. Pseudo Keynesian pipe dream. Remember how the fiscal cliff was going to cause a recession?

And the really ridiculous thing is that the Tea Party are talking about protecting the future of the US. Their actions are cementing the fall of their country.

Again. Clearly incorrect. The US is doomed to default unless health care and social security is slashed dramatically.

As per my previous post Obama has already budgeted to reduce defence spending down to 2.5% of GDP within a decade. Also who is this "they" you mention in regards to reducing defence expenditure; Obama, the Democrats, nope they have agreed to the reduction

And Swan budgeted for a surplus. Wont happen. Too many Democrats have defence related spending in their electorates. Pipe dream. Just more snake oil from Obama.

 

[PACatter]

So much damage caused by the GOP/TP, for so little gain.

This should be a big wake up call for Americans re the TP.

The GOP and Tea Party are s**t, for sure, but the Democrats are just as bad. They just manage their image a bit better.

This will hopefully be more of a big wake up call for Americans regarding the issues with a two-party system. There is no way the country can keep going without a powerful third party.

 

[kimp]

The shutdown cost their economy $24 Billion (.6% GDP growth) basically for no gain.
http://www.businessinsider.com.au/sp-cuts-us-growth-view-2013-10

The Republicans are stupid for following Cruz's tactic as it never going to achieve anything besides hurting them selves in the polls.

Read a (depressing) article that pointed out that this TP action has cemented in the sequestration(?) which was supposed to be rescinded as part of this process. Instead it has now become the benchmark moving forward. So potentially the Republicans have been quite clever if that was their real aim.

 

[tazzietiger]

Read a (depressing) article that pointed out that this TP action has cemented in the sequestration(?) which was supposed to be rescinded as part of this process. Instead it has now become the benchmark moving forward. So potentially the Republicans have been quite clever if that was their real aim.

The sequestration cuts are from a previous failed super committee that was meant to sort out the budget after the 2011 debt ceiling saga. Round 2 of the automatic across the board cuts kick in early January from memory. The Republicans are never going to back the removing of the cuts. This entire shut down saga was Ted Cruz's strategy to repeal Obamacare but why the establishment backed it I have no idea. If they had shut down the government over budget spending they probably would of got more public support and got more spending concessions in any deal. Instead all they got was a public backlash and $2Billion for Mitch McConnell's(Republican senate minority leader) state.

 

[tazzietiger]

The nytimes has a graph that outlines the basic cuts each party is proposing.

http://www.nytimes.com/interactive/...s/budget-gaps-between-the-parties.html?ref=us

 

[Freo Big Fella]

If the Libertarians want any hope of influencing the economic agenda, they need to divest themselves of the bizarre theocrats and would-be confederate revivalists that now make up the majority of the Tea Party.

Guys who should be legitimate contenders like Rand Paul and Rubio are starting with a dead weight thanks to the Palin/Cruz/Bachman types - while the Dems look like dominating the growing demographics and becoming the dominant party of Government.

 

[clogged]

If the Libertarians want any hope of influencing the economic agenda, they need to divest themselves of the bizarre theocrats and would-be confederate revivalists that now make up the majority of the Tea Party.

Guys who should be legitimate contenders like Rand Paul and Rubio are starting with a dead weight thanks to the Palin/Cruz/Bachman types - while the Dems look like dominating the growing demographics and becoming the dominant party of Government.

Actually post-war they basically have had control of Congress for something like 75% of the time.

 

[Freo Big Fella]

Actually post-war they basically have had control of Congress for something like 75% of the time.

That's sort of what I mean - the new deal coalition post-roosevelt meant the Dems wrapped up workers, intellectuals, most minorities and progressives until the big bust-up over the war in '68. Even then they still managed to keep control of the house and senate until 94.

Post-Obama they look to be doing something similar with women, blacks, latinos and other growing minorities, while the republicans look increasingly like the party for old, white men.

 

[DardySingh360]

Oh Obama

 

[medusala]

Its getting comically inept now. Coverage down and premiums up

Yet the Tea Party are the problem. Yeah sure.

http://www.zerohedge.com/news/2013-11-18/guest-post-obamacare-final-nail-coffin-middle-class

According to the Wall Street Journal, so far 106,185 Americans have enrolled in Obamacare since October 1st. Most of those that have successfully enrolled have done so through the state insurance exchanges. So far, only 26,794 Americans have signed up for health insurance using the federally run exchanges on HealthCare.gov.

Meanwhile, during that same time frame, 4.02 million Americans have had their health insurance policies cancelled.

So that means that the number of Americans with health insurance has actually decreased by 3,918,205 since October 1st.

 

[tazzietiger]

They have finally came to a budget agreement.

The Bipartisan Budget Act of 2013 would set overall discretionary spending for the current fiscal year at $1.012 trillion—about halfway between the Senate budget level of $1.058 trillion and the House budget level of $967 billion. The agreement would provide $63 billion in sequester relief over two years, split evenly between defense and non-defense programs. In fiscal year 2014, defense discretionary spending would be set at $520.5 billion, and non-defense discretionary spending would be set at $491.8 billion.

The sequester relief is fully offset by savings elsewhere in the budget. The agreement includes dozens of specific deficit-reduction provisions, with mandatory savings and non-tax revenue totaling approximately $85 billion. The agreement would reduce the deficit by between $20 and $23 billion.

The House of Representatives is expected to take up the Bipartisan Budget Act first, followed by the Senate. If this bill is signed into law, the appropriations committees will then be able to work on spending bills at an agreed-upon level in advance of the January 15th deadline.

http://budget.house.gov/news/documentsingle.aspx?DocumentID=364030

 

[medusala]

Pretty shameful stuff. An increase in spending with "savings" put off in to the never never.

Paul Ryan just jumped the shark.

 

[tazzietiger]

Pretty shameful stuff. An increase in spending with "savings" put off in to the never never.

Paul Ryan just jumped the shark.

Going by that article the budget deal would reduce the deficit by 20-23 Billion. This year economists are predicting it to fall by 80 Billion. Paul Ryan might of got a deal but its actually worse then what the automatic cuts are currently achieving.

The November deficit — the gap between what the government takes in and what it spends — totaled $135.2 billion, the Treasury Department said Wednesday. That's 21.4 percent lower than November 2012. And through the first two months of the budget year the deficit totaled $226.8 billion, or 22.7 percent lower than the same period a year ago. The budget year begins on Oct. 1.
Higher tax rates and a better economy have boosted revenue. At the same time, spending has slowed. Those trends helped shrink the annual deficit last year to $680 billion, the lowest deficit in five years. Private economists predict the annual deficit this year will fall further, to around $600 billion.

Read more here: http://www.kansascity.com/2013/12/11/4686062/us-records-1352-billion-november.html#storylink=cpy​

http://www.kansascity.com/2013/12/11/4686062/us-records-1352-billion-november.html