Manchin is Bad At Math

[longview]

Some more bad math.

One version of the PACT toxic chems act increases spending by 200bn. So there goes any deficit reduction from this 'anti-inflation' bill's tax increases. The hypothetical revenue have already been spent on 10 different things.

I remember when they said Enron defrauded the banks because they borrowed money using the same collateral
for about seven different loans. I guess the same rules do not apply to the people who make the rules!

 

[iguanaman]

Same for GOP at this point. No one seems to actually try and reduce the deficit. Just keep taking and spending more.

Yet Obama cut the deficit left him in half and the one term mistake promptly doubled it again. If you are talking about Republican Presidents you are right. Not one of them left their successor a lower deficit than when they came in. Not a single one.

 

[iguanaman]

Sorry, it does not work that way if the total is expanding!
If the economy is increasing, you can cut the percentage, and maintain the same income.

But spending always increases as does our population. Not to mention that GDP growth is not guaranteed. Every tax cut the Republicans have made resulted in increasing the deficit.

 

[longview]

But spending always increases as does our population. Not to mention that GDP growth is not guaranteed. Every tax cut the Republicans have made resulted in increasing the deficit.

The deficit grows because the Government spends more money than they take in,
and the problem is not just a Republican problem.

 

[jonny5]

I remember when they said Enron defrauded the banks because they borrowed money using the same collateral
for about seven different loans. I guess the same rules do not apply to the people who make the rules!

To be fair, their collateral is the economy, which is generally solid. This is more an issue of political misinformation. Manchin is claiming this bill is anti inflation, doesnt raise taxes, reduces the deficit, doesnt cost anything, and prevents hair loss.

 

[multivita-man]

Chuck Schumer and Joe Manchin have a deal to raise taxes, cut the deficit, spend money on climate change

The slimmed-down version of Build Back Better reportedly hikes taxes by over $730 billion, with $300 billion of that money to e used for reducing the federal budget deficit.

reason.com

For evidence, he thinks raising taxes and spending 370bn on climate change will pay off 30 trillion in debt.

I highly doubt that's anywhere remotely close to his stated position or belief on the subject. That's just ludicrous.

Even if they got 700bn in revenue, 300bn after spending wouldnt do much to the trillion dollar deficit which doubles in the next 10 years under current law. He also wants to spend EVEN more on healthcare via subsidies. And all this during recession and inflation with ever shrinking labor force. Its insanity.

His bottom line is that it does something about climate change without attacking his state's fossil fuel interests, and it likely puts money in the pockets of people living on fixed incomes.

 

[jonny5]

I highly doubt that's anywhere remotely close to his stated position or belief on the subject. That's just ludicrous.



His bottom line is that it does something about climate change without attacking his state's fossil fuel interests, and it likely puts money in the pockets of people living on fixed incomes.

"The Inflation Reduction Act of 2022 will address record inflation by paying down our national debt, lowering energy costs and lowering healthcare costs."
"“It is past time for America to begin paying down our $30 trillion national debt"

Manchin Supports Inflation Reduction Act of 2022 | U.S. Senator Joe Manchin of West Virginia

The Official U.S. Senate website of Senator Joe Manchin of West Virginia

www.manchin.senate.gov

Literally his stated position.

 

[multivita-man]

The deficit grows because the Government spends more money than they take in,
and the problem is not just a Republican problem.

In and of itself, that's not a problem - that's the way our system was designed, in fact.

Generally, deficits and debts become a problem when people who buy bonds that enable us to spend beyond our revenues begin to lose faith in our willingness to keep up with payments. That hasn't happened yet, but I agree with you that neither party has done a particularly great job in demonstrating the ability to deal with growing deficits, particularly given our ticking demographic timebomb.

If there's a difference it's that Democrats have historically been more willing to pay for budget increases, whereas Republicans have done completely the opposite.

 

[multivita-man]

"The Inflation Reduction Act of 2022 will address record inflation by paying down our national debt, lowering energy costs and lowering healthcare costs."
"“It is past time for America to begin paying down our $30 trillion national debt"

Manchin Supports Inflation Reduction Act of 2022 | U.S. Senator Joe Manchin of West Virginia

The Official U.S. Senate website of Senator Joe Manchin of West Virginia

www.manchin.senate.gov

Literally his stated position.

All of it?

That was not his stated position, and it's ridiculous to take what he did say so literally.

 

[longview]

In and of itself, that's not a problem - that's the way our system was designed, in fact.

Generally, deficits and debts become a problem when people who buy bonds that enable us to spend beyond our revenues begin to lose faith in our willingness to keep up with payments. That hasn't happened yet, but I agree with you that neither party has done a particularly great job in demonstrating the ability to deal with growing deficits, particularly given our ticking demographic timebomb.

If there's a difference it's that Democrats have historically been more willing to pay for budget increases, whereas Republicans have done completely the opposite.

If that is the design, then it is a poor one, because it assumes continued growth,
and we are just barely replacing ourselves. I suspect without immigration,
we would be much worse off. I wish ether party would spend the peoples money efficiently.

 

[jonny5]

All of it?

That was not his stated position, and it's ridiculous to take what he did say so literally.

You're right. Hes lying.

 

[multivita-man]

If that is the design, then it is a poor one, because it assumes continued growth,
and we are just barely replacing ourselves. I suspect without immigration,
we would be much worse off. I wish ether party would spend the peoples money efficiently.

Too much public debt is bad - no disagreement. That's especially true if one political party is committed to fiscal fantasyland by cutting taxes on the biggest sources of revenue and spending it on two foreign wars, and cutting taxes for the elite yet again 10-15 years later with no real mechanism to pay for it. However, we can take on economic debts and even take on excessive debts in the short-term provided we are intent on paying them back down in the longer term (see 1934 - 1950s). In fact periods of budget discipline have coincided with or immediately preceded some of periods of longer economic expansion.

But borrowing and taking on debt was in fact built into the system to encourage economic growth, and growth is part and parcel of modern economics. The one time in our nation's history we attempted to achieve what some of the Ron Paul libertarians advocate was during Andrew Jackson's term, which was promptly followed by one of the worst 5-7 year economic cycles we've ever had.

If you want to suggest alternatives, I'm open to suggestions - I don't necessarily believe that we've achieved the peak of economic evolution with our current model. But it has to work, whatever it is.

 

[longview]

Too much public debt is bad - no disagreement. That's especially true if one political party is committed to fiscal fantasyland by cutting taxes on the biggest sources of revenue and spending it on two foreign wars, and cutting taxes for the elite yet again 10-15 years later with no real mechanism to pay for it. However, we can take on economic debts and even take on excessive debts in the short-term provided we are intent on paying them back down in the longer term (see 1934 - 1950s). In fact periods of budget discipline have coincided with or immediately preceded some of periods of longer economic expansion.

But borrowing and taking on debt was in fact built into the system to encourage economic growth, and growth is part and parcel of modern economics. The one time in our nation's history we attempted to achieve what some of the Ron Paul libertarians advocate was during Andrew Jackson's term, which was promptly followed by one of the worst 5-7 year economic cycles we've ever had.

If you want to suggest alternatives, I'm open to suggestions - I don't necessarily believe that we've achieved the peak of economic evolution with our current model. But it has to work, whatever it is.

I understand Alexander Hamilton"s idea of giving the people with money(who bought up all the soldier's scripts)
a vested interest in seeing the new nation survive.

 

[multivita-man]

In case anyone's wondering, economists seem to be optimistic about what the bill can do for inflation:

The Manchin-backed Inflation Reduction Act is likely to live up to its name, Moody's economists say

The IRA won't have a massive cooling effect on inflation, but it will slow price growth somewhat and boost the US economy, Moody's said.

www.businessinsider.com

That focus on fiscal restraint will have the most immediate impact on inflation, Moody's said. Taxes on corporations will slow growth, in turn cooling the economic activity that's helped push price growth to 40-year highs.

The extension of pandemic-era ACA credits will also help quickly ease inflation, the team said. Health insurance costs were poised to climb next year for millions of Americans buying insurance on Obamacare exchanges had Congress not prolonged the credits.

Shifting the package's focus was key to winning Manchin's crucial support. The West Virginia senator backed the measure only after other senators and former Treasury Secretary Larry Summers convinced him it wouldn't worsen inflation, and that a slimmer version of the bill could actually counter the country's months-long price surge.

Larry Summers, by the way, is a lifelong centrist/moderate left democrat but is not afraid to call out Democrats when he thinks they've pissed in the bed, and he did so in 2021 when he was one of the few Democratic-leaning economists to publicly challenge the Fed and Biden administration's calls on 'transitory' inflation - Mohammed El Erian (though not American) was another who trashed the Fed and Biden's positions on inflation.

Point being, Summers is pretty fair, and he has a track record of being right, particularly with regard to inflation. So when he says the bill might actually be anti-inflation, I'll take his word over some talking head at Fox News or some Republican senator, who in all likelihood, voted in 2017 to blow the budget deficit wide open with their irresponsible tax cut bill.

 

[jonny5]

Too much public debt is bad - no disagreement. That's especially true if one political party is committed to fiscal fantasyland by cutting taxes on the biggest sources of revenue and spending it on two foreign wars, and cutting taxes for the elite yet again 10-15 years later with no real mechanism to pay for it.

Pay for what? The wars? They were paid for 10 times over. Total direct cost maybe a trillion? The govt collected 14 trillion income tax during that time.

 

[jonny5]

BIll contains

-3 billion to help people figure out how to pay taxes - taxpayer services
-45 billion to help the govt punish you when you cant - enforcement
-25bn for operations
-4 bn for new computers
-15m for EFILE
-100m for 'promugating regulation'
-153m for tax court
-50m for treasury dept oversight

THats about 100bn in taxes just to collect taxes.

 

[multivita-man]

Pay for what? The wars? They were paid for 10 times over. Total direct cost maybe a trillion? The govt collected 14 trillion income tax during that time.

Then explain to me how that debt grew.

Oh wait, I forgot that to "conservatives", that's government's only job and the only thing a federal budget it used for - to spend money on shittily planned wars based on manufactured intelligence and that are intended to primarily benefit big oil companies, private wealth management funds, and defense contractors while the plebes who sign up for the armies that fight them get screwed out of VA benefits.

Ok.

 

[jonny5]

Then explain to me how that debt grew.

The same way it always does. Mandatory spending on social programs.
2000-2009
8 trillion collected in payroll tax. That funds 8 trillion in SS and Medicare A.
14 trillion in income tax. That funds 9 trillion in defense and non defense discretionary spending, and 2 trillion interest on the debt

Still leaves 3 trillion leftover, which all went to mandatory social spending, and then some, about 5 trillion.

 

[multivita-man]

The same way it always does. Mandatory spending on social programs.
2000-2009
8 trillion collected in payroll tax. That funds 8 trillion in SS and Medicare A.
14 trillion in income tax. That funds 9 trillion in defense and non defense discretionary spending, and 2 trillion interest on the debt

Still leaves 3 trillion leftover, which all went to mandatory social spending, and then some, about 5 trillion.

Okay, so hike taxes to pay for it - oh wait, we can't do that. We gotta pay for wars that hopefully benefit K Street and Wall Street and make sure that the "job creators" get to set up tax shelters abroad using secret bank accounts in Switzerland and Cyprus.

 

[jonny5]

Okay, so hike taxes to pay for it - oh wait, we can't do that. We gotta pay for wars that hopefully benefit K Street and Wall Street and make sure that the "job creators" get to set up tax shelters abroad using secret bank accounts in Switzerland and Cyprus.

The wars are paid for. And we have more than enough income tax thanks to K/Wall Street/Job Creators who pay almost all of it. So much so that the surplus pays for most of the mandatory spending deficit too.

So your options are

1. cut social spending
2. raise payroll tax on everyone to actually pay for social spending

 

[multivita-man]

The wars are paid for. And we have more than enough income tax thanks to K/Wall Street/Job Creators who pay almost all of it. So much so that the surplus pays for most of the mandatory spending deficit too.

So your options are

1. cut social spending
2. raise payroll tax on everyone to actually pay for social spending

The wars are not paid for any more than any of the transfer payments that we make or the interest on the debt. When you fill out your taxes, there's no transfer payment account number or national defense account number to route your payments to. We raise revenue, we spend it - period.

 

[jonny5]

The wars are not paid for any more than any of the transfer payments that we make or the interest on the debt. When you fill out your taxes, there's no transfer payment account number or national defense account number to route your payments to. We raise revenue, we spend it - period.

Then healthcare isnt paid for. Yet I dont hear you complaining about that. Only defense for some reason. The fact remains our debt is driven by unfunded social spending.

In CBO and JCT’s projections, net federal subsidies in 2022 for insured people under age 65 are $997 billion. In 2032, that annual amount is projected to reach $1.6 trillion.

 

[MTAtech]

Chuck Schumer and Joe Manchin have a deal to raise taxes, cut the deficit, spend money on climate change

The slimmed-down version of Build Back Better reportedly hikes taxes by over $730 billion, with $300 billion of that money to e used for reducing the federal budget deficit.

reason.com

For evidence, he thinks raising taxes and spending 370bn on climate change will pay off 30 trillion in debt. Even if they got 700bn in revenue, 300bn after spending wouldnt do much to the trillion dollar deficit which doubles in the next 10 years under current law. He also wants to spend EVEN more on healthcare via subsidies. And all this during recession and inflation with ever shrinking labor force. Its insanity.

You clearly don't know the difference between the debt and the deficit. Manchin didn't claim the funds would help pay off the debt. He said the deficit, which is the annual amount in which the federal government expends funds in excess of receipts. One never has to pay off the debt. If government can keep deficits below GDP growth, as a p% of GDP, the debt will become irrelevant -- the same as the World War II debt became irrelevant. In case you aren't familiar with that, at the end of WWII, the federal debt was a "massive" 220 billion dollars, or 120% of GDP. Because of economic growth, that $220 billion is a shadow compared to a +20 trillion dollar GDP -- even though not a penny was paid off. The point is, control deficits and you control the debt, even without running surpluses.

 

[multivita-man]

Then healthcare isnt paid for. Yet I dont hear you complaining about that. Only defense for some reason. The fact remains our debt is driven by unfunded social spending.

The US will always carry debt, so nothing is ever completely paid for. That is something 'conservatives' seem never to comprehend - governments aren't businesses or households. They can carry debt - that's built into the system of most modern economies. If you can't understand that, then there's no point in carrying on a conversation about this with you.

Governments can carry debts into perpetuity. They can borrow and spend -- to a point. Basically, until we begin to have problems or otherwise show an unwillingness to pay the minimum required amounts to keep the government running. At that point, lenders understandably begin to question whether or not they'll get paid or ever see their money again. But that only happens if the debt/GDP ratio sharply falls because of some sort of crisis, or more than likely, because policymakers stop taking the issue of debts seriously and begin to use the economy as a political tool and ignore the laws of macroeconomics.

One party in particular over the last 10-20 years has shown a complete disregard for basic macroeconomic fundamentals despite all their protestations about how much they care about deficits and debt. The fact is Republicans' actions speak louder than their words: absolutely no problem blowing the deficit out of the water when they are in charge of government, and will turn right around and blame democrats the first year they get voted out, leaving Democrats to clean up the shit on the carpet.

 

[jonny5]

The US will always carry debt, so nothing is ever completely paid for. That is something 'conservatives' seem never to comprehend - governments aren't businesses or households. They can carry debt - that's built into the system of most modern economies. If you can't understand that, then there's no point in carrying on a conversation about this with you.

ok