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By Joe Mama

Turns out our friends to the north can teach us a thing or two about budget surpluses and paying off debt. Canada has lowered its national debt from 67% to 29% of GDP since 1993 and run a budget surplus every year between 1997-2008. How? By cutting spending on many gov’t programs in absolute dollar terms (as opposed to cutting just the rate of spending growth). Specifically, about 85 cents of every dollar of deficit reduction was achieved with spending cuts. Did those spending cuts hurt the Canadian economy? David Henderson, author of the study, says no:

As the government cut its spending on programs from 14.9 percent of GDP in fiscal year 1996 to 12.1 percent in fiscal year 2000, more resources were available for people to use productively in the private sector. From 1997 to 2000, when government spending as a percent of GDP fell, Canada’s economy experienced a high rate of real growth of between four and five percent per year.

The Canadian experience appears to belie most Democrats’ view that cutting gov’t spending during an economic slowdown is bad, showing instead that cutting spending during low-growth years is good for the economy.

On a slightly different topic, did Canada’s single-payer health care system help, hinder, or play no part in this fiscal 180-degree turn?

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Comments on "What’s This Aboot Fiscal Reform?"

36 Responses to “What’s This Aboot Fiscal Reform?”

  1. Brendan Loy Says:

    The British experience, in which austerity measures have triggered a double-dip recession, would seem to disagree. Also, was there a recession from 1996-2000? The quoted paragraph doesn’t actually seem to “belie most Democrats’ [and mainstream economists'] view that cutting gov’t spending during an economic slowdown is bad,” unless I’m missing something.

  2. Alasdair Says:

    Brendan – given that “about 85 cents of every dollar of deficit reduction was achieved with spending cuts” by Canada, how about we aim to do a less ambitious 50-60 cents of every dollar of deficit reduction with spending cuts ?

    As opposed to the current proposal from the Dem Senators – {sounds of crickets chirping *very* softly} …

  3. AMLTrojan Says:

    I haven’t read the linked item, but I’ll address a few potential points of contention:

    Specifically, about 85 cents of every dollar of deficit reduction was achieved with spending cuts.

    This implies that there were still some tax increases — probably not a talking point favorable to a conservative POV.

    As the government cut its spending on programs from 14.9 percent of GDP in fiscal year 1996 to 12.1 percent in fiscal year 2000, more resources were available for people to use productively in the private sector. From 1997 to 2000, when government spending as a percent of GDP fell, Canada’s economy experienced a high rate of real growth of between four and five percent per year.

    I am strongly inclined to suspect that economic conditions in Canada during this time period were strongly correlated to the economic conditions of the US at the time — namely, that there were huge, one-time Information Age productivity increases in that five-year span that fueled major GDP growth with relatively low inflation and unemployment. Given that macroeconomic context, we should not be surprised whatsoever that Canadian government spending fell as a percentage of GDP and the economy was simultaneously booming, as this is exactly what was happening in the American economy. Remember that at that time, the Republican Congress was also passing balanced budgets and spending was dropping as a percentage of GDP, and while fiscal temperance played a role, macroeconomic conditions completely outside the control of government (i.e. the dot-com boom and stable interest rates) were a much bigger factor.

    The Canadian experience appears to belie most Democrats’ view that cutting gov’t spending during an economic slowdown is bad, showing instead that cutting spending during low-growth years is good for the economy.

    I do not see the connection between the examples cited above and the conclusion you are drawing here. In fact, the major example cited was the large GDP growth from 1996-2000, so this hardly lends support to whether or not “cutting [government] spending during an economic slowdown is bad”, as this was an example of cutting spending during economic growth. In any case, I think a good Keynesian would argue that, absolutely, debt as a percentage of GDP ought to be reduced even in low-growth years, and only increased during zero- or negative-growth years.

    In general, nothing you cite here does much for or against the supply-side or limited government cause. European governments like in Germany and Scandinavia have more than proved that you can have fiscal balance and democratic-socialist policies (single-payer healthcare, welfare state policies, and so on). The trade-off is low growth and a lack of economic dynamism, but for Germany, economic (and fiscal) stability is more important than e.g. solving persistent 10% unemployment. It also presumes near-zero immigration, which is a perennial hot subject of debate in European policy circles. Meanwhile, in places like Spain, Italy, and Greece, they’re all for democratic-socialist policies, but haven’t much cared for balanced budgets, and they’re now experiencing the consequences of that. So yes, Europe has both sides of the coin.

    The problem we have here in America is that, unlike what we see in Europe, where there is a preference for low-growth, high-stability economic and fiscal policy, both sides here (Democratic and Republican) argue that we need to grow our way out of the problem. However we hit the shoals because each side’s approach is diametrically opposed to the other’s: the Left wants to ramp up government size and spending in a Keynesian stimulus manner, and the Right wants to cut taxes and regulation to leave more capital in the private sector and stir economic growth. The inevitable middle path leaves government growing and revenue shrinking, pushing the problem down the road until at last our muddling of policies fails to promote sufficient economic growth (i.e. exactly where we are at today). At that point, we are at a moment of reckoning where the budget must be balanced and debt must be reduced, and so one side will have to give: either government must be massively scaled back, or the private sector pays up. And still nothing is resolved because the Left thinks cutting government spending will devastate the economy and push granny into the street, while the Right is certain that the economy will nosedive under the tax hikes necessary to bring revenues into alignment with spending.

    In the end, it doesn’t matter whether we have a really limited government as conservatives want, or a large welfare state as liberals want — the budget must be balanced either way. So no, the Canadian and European examples are not of any help to us in deciding which approach — cutting spending or raising taxes — is the right answer. The empirical data and corresponding arguments to resolve that debate must originate from elsewhere.

    As for your question about Canada’s single-payer healthcare system, it’s largely irrelevant to the discussion because Canada had this system before they embarked on debt reduction, it was the system in place during the time span in question (1993-2008), and it continues to be the same system afterward. The single-payer model has been a constant in all three stages (pre-, post-, and during), therefore it cannot be measured as an independent variable.

  4. dcl Says:

    AML, I thank you for your really sound and well reasoned not necessarily rebuttal, but rather a statement of fact that attempts to encompass all the competing variables.

    Ultimately, the solution for the US is not either or but both and: tax increases and spending cuts. And we need to fix both the general fund and the entitlement system. I see these as two distinct problems that each needs to be addressed on their own and without raiding the budget of the other. Entitlements face a serious problem from the impending baby boom retirement and out of control medical costs (including treatments of limited or no efficacy). As for the general fund, we seem to try to do too much while simultaneously accomplishing too little. And we have a Military that seems to be designed to fight WWII again on 3 fronts, but not the quasi police action insurgencies that we really face. Being simultaneously over equipped and ill equipped.

    The problems are solvable, but nobody will be happy with the solution. The problems are everywhere and it isn’t just with waist, it goes to the heart of how we do a lot of things in this country. From how we write the tax code, to how we provide government subsidies, and how regulatory agencies function. To a military that has lots of big hardware but really needs agility. The changes we need are not small, and they are not the Ryan plan that pecks at the surface and doesn’t make much of a dent. The changes we need are deep and systemic. They involve changing the way government works at it’s very root level, and re-writting and throwing out huge swaths of existing legislation. And they are not going to happen because they are politically untenable.

  5. AMLTrojan Says:

    Ultimately, the solution for the US is not either or but both and: tax increases and spending cuts.

    I think most agree that this what the political compromise will need to be, but that does not address the underlying question of which is the more viable approach economically.

    And we have a Military that seems to be designed to fight WWII again on 3 fronts, but not the quasi police action insurgencies that we really face. Being simultaneously over equipped and ill equipped. …To a military that has lots of big hardware but really needs agility.

    I fund your perspective amusing. The stated policy goal is to have a military that is able to fight two fronts; it’s never to my knowledge been three. And Donald Rumsfeld came into the SecDef position with this exact mindset — to move from a Big War military to an light, flexible, agile, quasi-police action military. This turned out to be the right priority at the wrong time, as the wars after 9/11 demanded lots of troops vs. light and flexible. The irony is, I’m guessing Don Rumsfeld was one of your least favorite SecDefs of all time.

    In any case, while the defense acquisition process is fundamentally screwed up, the real cost drivers today at the DOD are not weapons systems but compensation and particularly healthcare. So mothballing aircraft carriers and weapons programs as you are wont to do does not address the actual source of the emergent spending problem. We can afford to trim around the edges on weapons systems to save money (in fact this has been a continual method of cost management at DOD since WWII), but cutting even deeper only to have those savings replaced by personnel costs would be asinine and counterproductive.

    The changes we need are not small, and they are not the Ryan plan that pecks at the surface and doesn’t make much of a dent. The changes we need are deep and systemic. They involve changing the way government works at it’s very root level, and re-writting and throwing out huge swaths of existing legislation.

    Actually, insofar as by the Ryan plan you are referring to his Medicare approach, his solution does “make… a dent” and fundamentally alters the trajectory of entitlement spending in Medicare; it’s absolutely a “deep and systemic” change that affects “the way government works at it’s very root level”. Changing Medicare from a fee-for-service approach to an insurance subsidy is a wholesale shift that caps government liability for Medicare cost growth and reorders the healthcare system to respond to market pressures.

  6. Joe Mama Says:

    Fair points. Reading the paper more closely (I had read only the article and just skimmed the underlying paper, which is why I qualified my observation), Henderson attempts to draw the connection thusly:

    It’s true, as noted above, that the Canadian economy was booming in part because the U.S. economy next door was booming. But with a cut in federal government spending on programs of 4.7 percent of GDP over seven years and a cut in overall federal spending (program spending plus interest on the debt) of 6.1 percent of GDP, one would expect, according to the Keynesian model, that the Canadian economy would have slowed somewhat. It didn’t. This reinforces the lesson from the far more extreme U.S. experience after World War II: Between FY 1945 and FY 1947, federal government spending was cut by 61 percent. This was a 27-percentage-point drop from 41.9 percent of GDP to 14.7 percent of GDP. Yet the unemployment rate over that same time rose from 1.9 percent to only 3.6 percent. The postwar bust that so many Keynesians expected to happen never did.

    The author may be trying to steal a base arguing that because the Canadian economy didn’t slow as a result of spending cuts during a boom, that means cutting spending even during low-growth years is good.

    As to Canada still raising taxes somewhat, that doesn’t rankle this conservative so much. Taxes were increased by about one dollar for every 6-7 dollars of spending cuts, but individual income tax rates weren’t raised. The tax increases came mostly in the form of certain deductions being reduced and certain exemptions being eliminated, and raising the gasoline tax. I don’t subscribe to the absolutist view that taxes should never be raised. Some revenue enhancements may need to be part of a budget solution, just a much smaller part than Democrats are willing to admit.

  7. AMLTrojan Says:

    But with a cut in federal government spending on programs of 4.7 percent of GDP over seven years and a cut in overall federal spending (program spending plus interest on the debt) of 6.1 percent of GDP, one would expect, according to the Keynesian model, that the Canadian economy would have slowed somewhat. It didn’t.

    It’s not clear to me from that example whether Canadian federal spending fell in absolute [Canadian] dollar terms (adjusted for inflation, of course), or whether growth in GDP so far outstripped spending restraint that spending as a percentage of GDP fell as a result.

  8. dcl Says:

    I think we went about Afghanistan and subsequently Iraq the wrong way. If Rummy was arguing for a light agile special forces and drones style military I think that the right call. And I think that was the right approach to both Afghanistan and Iraq and that he should have pushed harder for it. Given we are currently fighting on three fronts our present military is at least capable of handling such an action, but we should have been out of Afghanistan years ago. And we should never have gone into Iraq, and we probably shouldn’t be involved in Libya (much as it might feel like the “right” thing to do). Personnel, pensions, and healthcare for the military is surely a big part of the budget. But continuing to buy stuff that requires a mammoth personnel load to operate perpetuates the issue. An Aircraft Carrier cost billions to make, billions more to maintain over it’s service life, billions more to staff and so forth. Given the massive fight over each BRAC cycle making even deeper more functional cuts to the military is nearly impossible, but it needs to be done.

    As for moving Medicare to a health insurance subsidy, I think that ultimately makes the problems worse. But that’s a whole other kettle of fish. Again, we have massive provider side problems in this country with medicine. And the simple fact is most people are not and likely cannot be properly informed consumers and your life is literally on the line with these decisions. When your wife or your kid or your husband or your dad or whomever is miserably sick you do what you gotta do. But lack of informed consumers mean that standard market pressures simply do not work. A small example of messed up medical markets.

  9. AMLTrojan Says:

    dcl, we shuffled along in Iraq with minimal success until the surge. That was plainly successful — so much so that Obama agreed we needed to do the same for Afghanistan. The Rumsfeld method discounted the need for boots on the ground and prolonged the pain for us in both Iraq and Afghanistan.

    What is the third front on which you think we are fighting? We are hardly doing anything in Libya (certainly nothing that requires boots on the ground), leaving that to the Europeans.

    In any case, your perceptions of what drives DOD costs is so contrary to everything I run into in my field of work, I hardly know where to begin in countering them except to advise you to spend some time actually reading up on the facts rather than spouting decades-old leftist ideology about having bake sales to pay for aircraft carriers instead of schools.

  10. gahrie Says:

    An Aircraft Carrier cost billions to make, billions more to maintain over it’s service life, billions more to staff and so forth

    You do realize that the United States is effectively an island nation don’t you?

    Our carriers protect the world’s sea lanes, which are vital to our economy. Do you want to live in a world in which Iran is able to blockade the Straits of Hormuz?

    Our carriers allow us to project our power to every corner of the Earth. Without them we are essential a frigate navy, just like every other navy on Earth. There is a reason why India, China and Russia have/are trying to create a carrier force for their navy.

    Our carriers allow us to provide humanitarian aid to every corner of the earth. They provide electricity, clean water, food and medical care when and where it is needed most.

    Given work up rates, travel time, maintenance downtime and an ever complex world, we barely have enough carriers now…we should actually be building more. There is an argument to be made that we need smaller fleet carriers rather than more supercarriers, but he idea that we need to cut the number of carriers is simply a non-starter.

  11. dcl Says:

    Really G, having more carriers than the rest of the world combined is not enough carriers?

    AML, I’m not talking about bake sales for carriers. I’m talking about asking the question how much hardware and how many troops do we need? And, for that matter what kind of hardware and what kind of troops. We have various military systems across the Navy, Army, and Air Force that, due to their technologically advanced nature, are functionally redundant. They have different approaches to solve the same problem, but they are all fully capable of accomplishing the same task.

    As to the surge. The question revolves around what the objective should have been. I would argue we had the wrong objective in Afghanistan. Actually I think our key problem with Afghanistan is that the objective is rather opaque. Iraq was pointless so it’s not a good example.

  12. gahrie Says:

    No.

    We have 11 active carriers (The Enterprise and the ten Nimitz class carriers) and are building one more (The Ford). There are plans to build two more of the Ford class. The Ford class carriers are expected to replace the Enterprise and the two oldest Nimitz carriers.

    These 11 carriers have to protect our interests all over the world. At any time, some of them are being serviced, some of them are working up their crews for deployment, some of them are deployed, and some of them are in transition between those states.

    Our enemies and rivals are trying to develop their carrier forces for a reason. Even the Brits are starting to re-think their lack of carriers.

  13. dcl Says:

    G, no other nation has more than 2 carriers. No other nation has anything that would be classified as a supper carrier. All 11 US carriers are classified as super carriers.

    Nations that have carriers: Brazil (1), France (1), India (1), Italy (2), Russia (1), Spain (2), Thailand (1), UK (1). For a grand total of 10. Of those 10, France, Italy, Spain, Brazil, and UK are very firm allies of the US, so that’s 7 of those 10 that are in no way a threat to us. The US also enjoys a fairly good relationship with India according to our state department, so 8. Thailand is in an unstable region, but we have a bilateral treaty with them, and they are listed by the State Department as a Major Non-NATO Ally. So, 9. Which leaves Russia with whom our relations are strained but is not considered a foe of the US by State and their 1 carrier as a possible threat to the world combined 20 other carriers.

    What you are attempting to tell me is that we need 11 super carriers to deal with the threat posed by 1 carrier, well technically heavy aircraft carrying missile cruiser? Bull shit.

    Nations known to be working on carriers: China (kind of), France, India, Russia (maybe kinda sorta), Japan, UK, and US. Again, the only even remote threats there are China and Russia, and they aren’t really acting much on their plans.

    So G, where are these “enemies” that are building carriers by the score? Again, bull shit.

    Sorry mate we just don’t need 11 carriers (and associated groups). AML mentioned ongoing personnel costs as a major factor in military spending. Do you realize how much it costs to staff, train, pension, provide health care etc. for 11 carrier groups? Even if we took it as fact that we need one group for every ocean, plus one in dry dock, plus 1 for the med and 1 for the gulf that is still only 10 groups. Given our allies and their locations. Strategically and tactically, we might need 5 groups. Eliminating the recruitment of and long term recurring costs of the staff for 6 carrier groups is a hell of a lot of money. To say nothing of the maintenance costs of the ships themselves. And we probably don’t even really need 5.

    It’s kind of like this, I’d love to have 11 cars each with it’s own chauffeur. But you know what, I can’t afford it. I certainly can’t afford the chauffeurs. And it would be irresponsible to try and afford the cars, especially when I don’t need them, it is, after all, just me and my wife. Instead, we have 1 car. Which is occasionally inconvenient, but we manage to make it work quite well most of the time. And I can say with certitude that it hasn’t caused an epic disaster.

    Sure, you can knock little things off a budget until you are blue in the face trying to make ends meet. But if you really want to get on sound financial footing, you need to downsize your life to a level you can comfortably afford to pay for. House, car, boat, Smart Phone, and the like. These are the kinds of big juicy targets you need to be taking a long hard look at. Store brand TP versus Quilted Northern isn’t going to get it done. This little dink and dunk stuff is the only thing the Republicans seem to want to put on the table. And it’s not going to get it done.

  14. gahrie Says:

    If we zeroed out the defense budget, it wouldn’t even pay for the increase in spending since President Obama took office. How about we repeal all the new spending first, before we cripple our ability to defend ourselves and protect our interests?

  15. dcl Says:

    Over what time scale? Or are you comparing apples to oranges. Because it sounds like you are trying to compare the projected increase in spending over the next 10 years to the defense budget for one year. Which is, at a minimum, dumb. But more likely an out right lie.

  16. AMLTrojan Says:

    Regarding carriers, gahrie is right: they are a necessity so long as we are the de facto world’s policeman. As soon as Brazil, India, or a democratic China become reliable partners willing to pony up resources to ensure their spheres of influence are safe for international commerce, we can reduce our carrier footprint.

    We have various military systems across the Navy, Army, and Air Force that, due to their technologically advanced nature, are functionally redundant. They have different approaches to solve the same problem, but they are all fully capable of accomplishing the same task.

    This line of thinking is what drove the JSF competition, which was intended to replace the F-15 (USAF), F/A-18 (Navy), and the AV-8B (Marines). Now that the F-35 is wildly overrunning its cost projections, that one-size-fits-all approach is not looking so hot. In fact, many experts think we should buy more F-22s (the replacement for the F-15, F-16, and F-117) and modify some of them to fill F-15 roles, then but the reality is you’d probably get the same effect for cheaper mixing a squadrons of F-22s with updated F-15s (the proposed “Silent Eagle”) or futuristic pilotless fighter-bomber drones. As for the Navy, there is a good case there for replacing the F/A-18 with a more stealthy plane — the F-35 could’ve been just that for far cheaper if they weren’t trying to do a one-size-fits-all plane. Meanwhile, DOD perhaps should have looked at dropping the STOVL requirement for the F-35 and looking to fill the Marines’ requirement through other mechanisms.

    Actually I think our key problem with Afghanistan is that the objective is rather opaque. Iraq was pointless so it’s not a good example.

    I agree that defining success in Afghanistan is much harder than in Iraq, however the idea that Iraq was “pointless” is laughable. Iraq is now the Arab world’s sole functional democracy, vs. still having to “contain” Saddam Hussein.

  17. AMLTrojan Says:

    dcl, again, you’re way off base about carriers. The need for carriers has nothing to do with countering other carriers. The point of an aircraft carrier is to project power. All of those other nations you listed have a limited need to project power anywhere distant from where they already have conventional air capabilities. Russia strategically probably wants 2-4 carriers in the Pacific, 1-2 in the Indian, and 2-3 in the North Atlantic. They probably can afford a fraction of that, but they could get by strategically with one in each ocean — yet they still can’t afford it. The Chinese have little pretense of being a global power; every nation they care about influencing militarily is within a few hundred miles of their border, so they have little need for a carrier except for a couple to keep the US and its Pacific interests (Hawaii, Guam) at bay, as well as the Indians. The US, however, absolutely has a requirement to project power anywhere else in the world. That requires a fleet of carriers, each of which is enormously expensive to build, operate, supply, and defend (with an attached fleet of ships and subs). To abandon carriers is to unilaterally abandon our ability to project power over approximately 2/3rds of the globe. I don’t see how giving up that strategic ability is worth saving ~$75B a year (the Navy budget is roughly $150B, so that’s a very generous reading of the savings you’d get by mothballing the two carrier groups).

  18. Alasdair Says:

    dcl – I suspect that gahrie’s arithmetic is based upon

    2011 – $964.8B Defense – $1645.1B Deficit … Obama
    2010 – $847.2B Defense – $1293.5B Deficit … Obama
    2009 – $794.0B Defense – $1412.7B Deficit … Obama
    2008 – $729.6B Defense – $458.6B Deficit … Bush II
    2007 – $652.6B Defense – $161.0B Deficit … Bush II
    2006 – $621.2B Defense – $248.6B Deficit … Bush II

    (from here )

  19. Alasdair Says:

    AMLTrojan – folk over here didn’t grow up with the knowledge of how important, globally, an effective Navy can be (and is) … it is part of the “Good fences make good neighbours” understanding of Real Life … it keeps other countries more honest than they would otherwise be inclined to be – and it allows the US to rpovide effective humanitarian aid where it is most needed at short notice during disasters – like the Haiti earthquake …

    It is not implausible to posit that US Carriers are an important ‘donation’ for humanitarian purposes, and have been for decades …

  20. dcl Says:

    All right AML, how would you make substantive cuts to military spending while still projecting power in the manner you seem to deem necessary?

    I will concede that strategically the US does need an effective Navy. However, we don’t need a Navy substantially larger than what is effective. Granted we are far beyond the time when six heavy frigates are sufficient for our needs. But we don’t need to be all things to the entire globe. I’m not sure how a 150 B navy budget goes with a 964 B DOD budget. By those numbers the Navy would be underfunded. And Army Air Force over funded.

    The key thing is an armed forces that can respond effectively to the specific tactical situations that we face. It almost seems like you are trying to argue that although Super Carries don’t necessarily fit with our specific tactical challenges they are, none the less, strategically imperative. Now this might be true. But it certainly seems logically flawed.

    If providing aid to disasters is what we want to do with carriers perhaps we should refit one or two of them specifically to that task? They then would not really require the entire associated group. Obviously with subs, you need no more than are tactically sufficient as they are not a visible projection of power.

    Al, do you know if those numbers include supplemental for Iraq and Afghanistan? At least under Bush those were not included under the DOD budget. And the calculator seems un-clear on the matter. I believe the Obama administration was trying to move that number into the DOD budget. I don’t recall if they were successful.

  21. B. Minich Says:

    The British Empire had a decent system for figuring this out: they should be spending about what the combined spending of the next two (or three, perhaps) biggest countries put together spent on defense. We’re way above that mark. I agree: our defense budget should get some cuts.

  22. AMLTrojan Says:

    dcl, my $150B figure was based on the 2009 budget; it’s quite possible that the latest budget has mushroomed by the 20% that the overall DOD budget has in that time frame, but I strongly suspect most of those increases are elsewhere and are war-driven. You are correct that Obama did fold the war spending into the DOD budget process, vs. keeping it separate as was the case under Bush, so my guess is the DOD spending baseline is fairly unchanged — the growth in the last 2-3 years is simply accounting for the war effort in the DOD budget vs. separately.

    I accept the line of thinking which calculates that we should be spending about 4% of GDP on defense; if we could get Europe to up their spending to an average of 3% and take more of an international role in global security rather than just coasting under our security umbrella, we could probably afford to drop to 3-3.5%. IMO we are spending the right amount on our military (insofar as active operations in Afghanistan eat up a good 10-20% of that budget), we just need to improve efficiencies in procurement and better manage personnel costs.

    The key thing is an armed forces that can respond effectively to the specific tactical situations that we face. It almost seems like you are trying to argue that although Super Carries don’t necessarily fit with our specific tactical challenges they are, none the less, strategically imperative.

    I don’t know where i said that carriers don’t have a strong tactical role. We count on them heavily for operations in Afghanistan and Iraq, and we tend to get China’s notice quickly when they are misbehaving simply by sending a carrier or two into the East China Sea (not to mention keep North Korea in line). I don’t know where all of the carriers are at any given moment, but typically a few of them are in port, en route to port, or en route from port, and the rest are actively supporting engagements in some manner. They absolutely have strategic value, and they absolutely play a strong tactical role, both militarily and humanitarian.

  23. dcl Says:

    AML, that’s nice and all but we can’t afford it. Granted some of our current deficit problems are structural and other are economic. Clinton demonstrated that it is, indeed, possible during good economic times to get the nation moving towards a strong fiscal footing. But we aren’t in good economic times and we have some serious fiscal problems.

    Taking care of waist, cleaning up corruption, improving efficiency, these things are only going to take us so far.

    We are trying to fight two wars without raising taxes the last time a country tried to do that the Roman empire collapsed. We re either going to have to raise taxes or we are going to have to stop the wars and take a sizable chunk out of military spending.

  24. AMLTrojan Says:

    Sorry dcl, I’d rather shitcan Obamacare, Medicare, Medicaid, Social Security, and a bunch of other misguided federally funded programs than cut much more from the defense budget. You can’t have your welfare state and defend it too, so there you have it.

  25. Alasdair Says:

    dcl #23 – “We are trying to fight two wars without raising taxes the last time a country tried to do that the Roman empire collapsed. “ – by any chance, do you have a cite for that ?

    You do raise an interesting potential, however … is it possible that someone has ‘donated’ pewter goblets/cups with a high lead content to Democrats ? That *would* explain a whole lot of things that the Dems get up to …

  26. dcl Says:

    AML, if you don’t cut the military you don’t balance the budget. It really is that simple. You can argue we should rob people all you want, it won’t fix the problem.

    Al, your understanding of Roman history seems to be lacking. Standing armies made up of a military class are detrimental to the health of Republics. Failing to pay for it is catastrophic.

  27. Alasdair Says:

    dcl #26 – you are becoming more davidkian in your old age … your understanding of the word “cite” seems to be lacking …

    You also seem, yet, again, to be missing AML’s point – the defense budget could be zeroed out – and the federal budget deficit would *still* be greater than it was during Bush II …

  28. dcl Says:

    In which case, Al, you seem to be arguing for significant tax increases.

  29. Sully Says:

    so apparently DOD & tax revenues are now the only 2 items in the US federal budget.

  30. dcl Says:

    no, there are other things in the budget. But if zeroing defense spending wont get it done, we could more or less zero just about all spending and still not balance the budget.

  31. gahrie Says:

    we could more or less zero just about all spending and still not balance the budget.

    If we zeroed all spending we wouldn’t have a budget.

    But how about we first zero out all the increases since President Obama has been in office. The country was running just fine (in fact much better) before he made them. Eliminating a trillion dollars and more of new debt every year would go a long way to solving the problem.

    Then I propose a “super” grand jury be created, with one person chosen at random from each state. This grand jury goes through each agency’s budget in turn, line by line and decides if the program is (still) necessary and proper. All new spending provisions have 10 year sunset clauses so that all future spending also has to be reviewed.

  32. dcl Says:

    Spending increases doesn’t necessarily mean exactly what you seem to think depending on inflation levels and other factors.

    How about we get rid of all the increases under Bush II also… or from every president since Washington. Your logic there just isn’t logical.

    If cutting the military completely won’t balance the budget, then cutting everything else and not the military also won’t balance the budget. Perhaps I should have been more clear.

    Regardless, it looks like the Republicans are deftly going to shove the country into a massive depression and probably cause a massive financial panic through refusing to pay the bills… So we are all pretty much fucked at this point regardless.

  33. gahrie Says:

    Spending increases doesn’t necessarily mean exactly what you seem to think depending on inflation levels and other factors.

    Really? That is the best you can do?

    We are talking about over one trillion dollars worth of new spending. Per year. I think it means exactly what I seem to think it means.

    How about we get rid of all the increases under Bush II also…

    You picked the wrong person here. I am perfectly willing to go back to Clinton era budgets..or even Reagan era budgets.

    Your logic there just isn’t logical </i.

    You are the one using logical fallacies.

    Regardless, it looks like the Republicans are deftly going to shove the country into a massive depression and probably cause a massive financial panic through refusing to pay the bills

    The Republicans offered a clean bill to simply raise the debt ceiling with none of the cuts the Republicans want. Guess what? Almost all of the Democrats voted against it.

    You know what would cause a financial panic to me? Congress breaking the law and not passing any budget for two years in a row.

  34. gahrie Says:

    If you listen to Treasury Secretary Timothy Geithner and the rest of Obama administration, failure to raise the debt ceiling by Aug. 2 risks “catastrophic economic and market consequences of a default crisis.”

    Funny, the Chinese government — holder of $1.1 trillion in U.S. government debt — doesn’t seem to think so. I recently returned from a fact-finding mission to the Middle Kingdom. And my big takeaway is that Beijing isn’t too bothered by the Washington back-and-forth over raising the debt ceiling — provided the result is a long-term budget fix. For that, even a delayed interest payment might be acceptable. But brinkmanship in Congress that only punts the issue, and shirks from meaningful reform, would quickly turn investors in Beijing and elsewhere off

    http://blogs.reuters.com/james-pethokoukis/2011/06/06/china-to-us-forget-debt-ceiling-cut-spending/

  35. Alasdair Says:

    dcl #28 – it seems that your attention span is also davidkian …

    One of the biggest problem in the Dem/d-list/davidkian ‘budget is a zero-sum game’ belief system is that it keeps leading to the loser philosophy that one must cut spending or raise tax rates …

    Some of us prefer to deal with Life by working on ways to increase tax *revenues* rather than increasing tax rates … one of the best ways to do that is to make the business climate less business-hostile …

    Possibly one of the most irritating traits of the current Dems is their dog in the manger attitude to many things … (warning; loads slowly) … they don’t want nuclear electricity generation, so they don’t want to let others do it … they don’t want more dometic oil/gas drilling, so they don’t want others to drill for more domestic oil/gas …

    The current Administation would help if it would stop getting in the way of more domestic oil/gas/nuclear production … a private sector with increasing jobs in production of domestic oil/gas/nuclear will generate more tax revenues without a need to increase tax rates … by itself, not enough to make the difference, and yet, when combined with a moritorium on new federal programs, it would go a good ways to helping reverse our current demonomics … (after giving it a bunch of thought, I have realised that it’s not Obamanomics … it’s demonomics – democrat-onomics – an economics of envy and control, fundamentally) …

  36. Alasdair Says:

    (sigh) I apologise for the unbalanced ‘italics’ tag !



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