A Booming Surplus

[Cynical]

This is an amazingly disingenuous thread. Just pure bullshit.

No single party's actions alone are ever going to result in a surplus, that is neither how the economy function nor how politicians get themselves elected. The economy is complex and in the modern age subject to wild bubbles then resulting pops usually harming everyone. And politicians get themselves elected damn near entirely on treasury promises. Less contribution to in taxes, more spending, or some terrible combination of the two. Even the concept of the rich "paying their fair share" is a distortion of the facts and belongs on bumper stickers and Facebook memes.

The harsh truth is a combination of factors lead to the only surplus in the modern era, and very little having to do with any single party's actions.

The first Congress when during Clinton's first term did raise taxes, but it was on its own not that extraordinary nor all that revenue impacting on its own. Clinton lost the first midterms and Congress remained under Republican control for the remainder of Clinton's time in office. No one really got everything they wanted, harsh deals were struck for what they did get, and ultimately spending growth year on year did not see much jump. Revenues on the other hand did but not because of tax changes, but a booming economy neither party can claim full responsibility for. For a brief period of time we stopped issuing 30 year notes and it was an awkward time for bond investments. On paper we had a few years of surplus, but because of a combination of factors.

It was not "fiscal responsibility" and it was not some action of Republicans or Democrats all by themselves. That is all a lie.

For one, there is no real reason to aim for a surplus *unless* a similar combination of factors allows it to happen. All modern economics suggests restraint during economic good times and infusion during economic bad times, resources and market function was always the target. There are so many economic factors to consider when applying fiscal and monetary policy that it becomes absurd to wedge in political fights on who causes the most debt. The guilty party is bipartisan, the conditions for debt addition are far more important to discuss. (i.e. debt from infrastructure and improvements vs. debt from our longest and most useless war.)

Secondly, there will never be a real interest in the politics of "balanced budgets." No matter if you like it, agree with it, or otherwise we are a fiat money system and our currency competes on the international stage against a basket of currencies from other nations and alliances of (think the EU.) How and why debt is issued has become an even more important aspect of investment and until someone threatens to do something for political purposes we do not default.

Lastly, never... and I repeat never... will bumper sticker rhetoric ever force a federal balanced budget. Get over it already, there is no serious or even applicable way to align yourselves to forced surpluses. The economy is too complex, government interaction with the economy is too complex (yes, we are a mixed model of economics... deal with it,) and fiscal and/or monetary intentions are amazingly complex.

Now can we dispense with the nonsense of some party out there being the "responsible" ones leading us to a surplus? It does not exist, no one can even define correctly what is fiscal responsibility (in economic terms, not basic household math which the government is clearly not a household.)

Best post in this thread!

 

[Dayton3]

People forget that the surpluses under Clinton were mainly a fluke. Clinton never planned to run a federal budget surplus but...

1) Clinton kept the Republican majority in Congress from passing any new tax cuts.
2) The Republican majority in Congress wouldn't pass any new domestic spending.
3) U.S. defense spending was cut in real terms after inflation by a large amount.
4) A growing economy fueled in part by the tech book caused new revenue to pour into the federal govt. .

None of that was long run sustainable.

 

[Felis Leo]

Republicans will never allow a surplus; they will just cut taxes more and then justify it by saying "a surplus is an overpayment of taxes."

Democrats will only have a surplus if their presidency coincides with a booming economy (and it helps if they have a divided Congress, so they don't spend it all). It's possible we could be on track for a surplus in the next couple years.

I am of the opinion that our government needs to actively seek surpluses and use them to pay down the principal of our National Debt. But that is just me I suppose.

 

[Gatsby]

I am of the opinion that our government needs to actively seek surpluses and use them to pay down the principal of our National Debt. But that is just me I suppose.

I'm not much of a deficit hawk most of the time, but with the economy currently running hot and inflation getting a bit too high, I am inclined to agree. For now.

 

[Ishm]

Simple answer is neither Dems nor GOP will create a surplus in todays world due to most voters ignoring fiscal responsibility as an election issue. Promises of spending today gets more votes than promises of a better long term future for kids and grandkids. Trump for instance never even presented a detailed covid adjusted fiscal plan at the last election. It just wasn't deemed an issue that voters would choose on.

You need to live in a few countries outside the US to understand how different that can work. My classic example from my time living in New Zealand is how elections are won and lost on the different parties proving, in detail, how they will fund their election promises while creating/maintaining a govt surplus. Lie about that, or get your calculations wrong and the opposition, plus the public, will treat you as idiots. There, spending promises mean nothing until the voters believe your overall budget is fiscally responsible and sustainable. The public in general is far more conscious of their countries finances. It's eye opening. On the other side of that, issues like gun control, abortion etc which so divide the US and so impact elections, are not predominantly political issues in NZ. Even immigration policy is not hard linked to either main party. That means the main focus of NZ voters is about who will create the strongest and fairest economy. They aren't electing a govt to control other parts of their lives so much. NZ also makes use of public referendums on non economic issues that may well get driven as political divides in the US. The last couple I remember were legalising euthanasia, and legalising cannabis. The public got to directly choose their new laws tather than doing it via electing politicians to support their view. I think it is a much better system that mostly eliminates direct political lobbying.

The only way to get anything approaching fiscal responibility in todays US is to have the executive office and Congress under split control. Then suddenly one or the other will quote fiscal responsibility as their excuse to try and prevent the other party from achieving any spending goals that might improve their support.

The best split for spending control seems to be a Dem president and GOP controlled Congress. The GOP is shameless in switching from easy spending approval for a republican president, to massive focus on govt deficits where there is a Dem president. The Dems in congress seem generally more likely to negotiate 'you spend/we spend' style deals with a Republican president, so not as much spending control with that split.

On the other side of the equation (income) you have mostly 'short term 'sugar hit' style (tax cuts etc) economic policies from the GOP vs promises of long term economic gains from Dem social policies. Reality seems to be today that the Dem policies may get undone by the next GOP controlled govt, so the money might get spent initially without achieving the long term gains. That's the mess the current political sitiation creates.

Personally I believe that some of the Dems policies could create a stronger economy if implemented well, but don't have a lot of faith that the implementation will match the ideals. As for the rather singular 'cut taxes' GOP approach, I have even less faith in that as a long term solution because evidence to date from Reagan onwards is that the positive impacts are short term, leaving an even bigger mess/deficit/debt in the long term.

The underlying reality is that you won't get a truly fiscally responsible govt until the voters tell the politicians that that is the most important issue. That probably won't occur until the fiscal economy collapses leading to a major, historic recession. Meanwhile the parties will continue to focus on the social issues that get them votes so long as they think they can defer the fiscal impacts beyond their term in govt. Only the voters can change that.

 

[Stinger]

Revisionist history

ROFL that was the reporting AT THE TIME look at the sources.

 

[Stinger]

I don't know why you feel the need to keep showing everyone that you don't know how bills become law. Everyone already knows this.

ROFL says the person who believes when Congress passes a bill they can send it to an ex-president and he signs it and it becomes law........................just hilarious.

 

[Stinger]

People forget that the surpluses under Clinton were mainly a fluke. Clinton never planned to run a federal budget surplus but...

1) Clinton kept the Republican majority in Congress from passing any new tax cuts.
2) The Republican majority in Congress wouldn't pass any new domestic spending.
3) U.S. defense spending was cut in real terms after inflation by a large amount.
4) A growing economy fueled in part by the tech book caused new revenue to pour into the federal govt. .

None of that was long run sustainable.

They weren't flukes, they were Gingrich and Kasich and a Republican Congress and his about to lose reelection and they past several tax cuts including the capgains which got the economy back on track after Clinton's tax increased had slowed the booming recovery he inherited.

 

[Stinger]

The best split for spending control seems to be a Dem president and GOP controlled Congress.

I challenge you to look at Bush43 and a Republican Congress 2001-2007.

 

[Ishm]

I challenge you to look at Bush43 and a Republican Congress 2001-2007.

From 2000 pre Bush, to 2007 the deficit increased by $400B. Bush jnr deficits jumped back from Clinton era surplusses to higher than even under Reagan and Bush Snr.

 

[bave]

From 2000 pre Bush, to 2007 the deficit increased by $400B. Bush jnr deficits jumped back from Clinton era surplusses to higher than even under Reagan and Bush Snr.

One word:

Demographics.

Clinton had the perfect storm. A bulge in an age group at peak earnings with minimal draws.

 

[rahl]

ROFL says the person who believes when Congress passes a bill they can send it to an ex-president and he signs it and it becomes law........................just hilarious.

why do you refuse to read a 6th grade civics textbook? lol

 

[Exquisitor]

One word:

Demographics.

Clinton had the perfect storm. A bulge in an age group at peak earnings with minimal draws.

Bush screwed up and Trump did the same thing.

Al Gore would have continued the Clinton boom and surplus, avoiding all this trouble.

 

[bave]

Bush screwed up and Trump did the same thing.

Al Gore would have continued the Clinton boom and surplus, avoiding all this trouble.

Wow. That's remarkably insightful and thought out.

If I rolled my eyes any harder I would fall out of my chair.

 

[Exquisitor]

Wow. That's remarkably insightful and thought out.

If I rolled my eyes any harder I would fall out of my chair.

Kind of makes you feel like you're in,... Hell, doesn't it?

 

[Exquisitor]

Wow. That's remarkably insightful and thought out.

If I rolled my eyes any harder I would fall out of my chair.

That's OK, everything isn't supposed to go perfect anyway.

This way we have them guilty, and cause for shutting them out, instead of just doing it for the Great Depression of 1929.

 

[Lord Tammerlain]

Democratic President Republican congress

The Republicans will block any spending the Democratic President wants

 

[Exquisitor]

Democratic President Republican congress

The Republicans will block any spending the Democratic President wants

Sure, Trump will run and they'll overturn the election.

I'm not going for it.

Let them spend, hopefully it will be a last stimulus (the BBB).

 

[Stinger]

have you still not learned how a bill becomes law?

yes or no

Are you still claiming Bush could have and should have vetoed the Democrats 2009 budget which resulted in a massive $1,400B deficit?

yes or no

 

[rahl]

Are you still claiming Bush could have and should have vetoed the Democrats 2009 budget which resulted in a massive $1,400B deficit?

yes or no

So does this mean you still don't know how a bill becomes a law?

 

[cpwill]

A Booming Surplus:

What do you think kids, who will lead us to a booming surplus?

We had it under Clinton, we were on that road with Obama, and now we're on it with Biden, coming out of the pandemic and we're twenty years and thirty-trillion dollars behind.

It's the only thing that works, it's the only thing that matters; go Democrats.

The major driver of our deficits is rising spending.

Both parties love big spending, so, neither will create surplus, and both will continue to accelerate as we approach a fiscal cliff.

 

[Exquisitor]

The major driver of our deficits is rising spending.

Both parties love big spending, so, neither will create surplus, and both will continue to accelerate as we approach a fiscal cliff.

I believe the Democrats will steer clear of the cliff.

Driver of the deficit is: Clinton handed over a booming surplus and Bush cut revenue then handed over the great recession, upon which the Republicans behaved so and again cut revenue, so we get Biden who's going to put a last few things on the credit card before we go into repayment.

Better keep it Democrat.

 

[Exquisitor]

The major driver of our deficits is rising spending.

Both parties love big spending, so, neither will create surplus, and both will continue to accelerate as we approach a fiscal cliff.

Again, don't put my Democrats in the same boat as your Republicans.

Democrats have the proven track record of reducing deficits and handing over growing economies.

 

[Ishm]

Super funny thread! Government responsible with tax payer money?
Where?

There are countries in this world where you almost can't get elected unless you show how you will produce surplusses and pay down debt. Don't confuse the disfunctional US attitude to debt and spending promises with how other countries can work.

 

[cpwill]

I believe the Democrats will steer clear of the cliff.

Mathematically, that will require cuts to social security and Medicare, along with freezing most the growth in other government spending. What is your evidence that Democrats have any interest whatsoever in doing so?