There has been a mini firestorm in D.C this week about John Kyl's comments on Fox News Sunday.

WALLACE: We’re running out of time, so how are you going to pay $678 billion just on the tax cuts for people making more than $250,000 a year?

KYL: You should never raise taxes in order to cut taxes. Surely congress has the authority and it would be right, if we decide we want to cut taxes to spur the economy, not to have to raise taxes in order to offset those costs. You do need to offset the cost of increased spending. And that’s what republicans object to. But you should never have to offset cost of a deliberate decision to reduce tax rates on Americans.

Does anyone else feel that cutting taxes without cutting spending is every bit as irresponsible as what BHO does with his increasing spending with no regard to debt levels?

Kyl is a huge critic of the deficit, but seems to be rather clueless about it. If government spending is X dollars, cutting the revenue they take in by however many billions without cutting any spending is just as bad as knowing your revenue is X dollars and increasing spending by X billions of dollars over that number.

Both actions leave us with big deficits.

I thought the Tea Party was a symbol that Conservatives finally get it about government spending and debt, but if they plan is to retake Congress and the fall and just go back to Bush/Reagan economic starve the beast policies of cutting taxes while ignoring spending than we are doomed.

Liberals, not surprisingly, are pouncing all over it to exploit the tone deafness of Senator Kyl's comments.

“Here we have our Republican colleagues saying that, in the middle of this economic emergency, when people are hurting, we’re going to insist that we take money somewhere else out of the economy to pay for it,” Van Hollen said at an event held to pressure Senate Republicans to support the stalled unemployment extension bill.

“But when it comes to people who have no emergency at all, people who are doing just fine, people on Wall Street and the wealthiest Americans, let’s give them a tax break. They want the rest of America to foot the bill for the wealthiest Americans,” Van Hollen said.

http://www.politico.com/news/stories/0710/39734.html


How does everyone else feel? Should you have to cut expenditures commiserate with whatever revenue will be lost when cutting taxes, or should you just cut away and ignore the fact you are creating a deficit when doing so. The same goes for spending, should increased spending levels face mandatory offsets through either cuts elsewhere or increases in taxes?

Seems to me advocating anything else makes it impossible to ever get the debt under control.

It makes sense to me!

I'm in agreement with CenterBHSFan. I personally think the question should be, "Should there be a mandatory spending freeze on EVERYTHING?"... but I'm too lazy to start a new thread.

The bottom line is well the bottom line. Revenue that the feds take in is not just based on tax policy. It depends on a host of other things.

I have said before the only way to deal with the federal government's spending problem is a constitutional amendment requiring a balanced budget.. The amendment would include exemptions for wartime when congress declares war, and in national emergencies or unusual economic hardship when congress deems deficit spending essential with a 2/3 majority of both houses.

A balanced budget amendment would not make deficit spending possible, but more difficult, and less reckless. Under the system we have today Federal restraint when it comes to spending is literally impossible. No way congressmen in today's political climate will ever be able to exert this type of fiscal discipline. We need the force of constitutional law to trump this gross abuse of federal power. The states need to call a constitutional convention and reign in the feds before they suck us all down the financial shitter.

Under such an amendment, the pain of increased spending could not be deferred to future generations by having the government borrow money. The pain would have to be faced immediately via a tax increase or spending cuts by the present generation that holds power.

Either we pass a balanced budget amendment or we let this charlatans take us all into financial ruin. My guess it is the latter.

I'd say "whoa" or "eeeasy" on a Constitutional Amendment. I think it was President Clinton who balanced the budget in the 90's. But to what or who's detrement? The military's, no?

The last thing we need is a group (majority) of people in office that are amazingly anti-military and, in the letter of the law fashion, balance the budget. And do they ever. If you know what I mean.

Balanced budget? Will never happen again. Repudiate all public debts and start over.

The Rs in DC had no problem when W. wanted to start two wars and not provide any way to pay for them, even carrying the costs "off the books" so it wouldn't show on the budget. How irresponsible? His VP ( Cheney) went around charging that "deficits didn't matter" and the R Congress spent like drunken sailors . Tax cuts were given in disproportionment to the wealthy. Yet now millions & millions are unemployed with few jobs available and none that were produced of any value from the Rs tax cuts.

Changes are coming.

Yep. Change is coming -- and the Democrats won't be liking it much at all.

As for the topic...I have no problem with the concept of cutting spending if you're going to cut taxes. Whatever it takes to actually cut spending will be a welcome change to the spendthrifts running the country now.

Cutting taxes does indeed spur economic growth but doing so without also reigning in public spending is lunacy...and that is precisely why we're in the economic malaise we're currently "enjoying."

The Feds are absolutely unwilling to discipline themselves to take the draconian measures necessary to curb public spending. The entitlement mentality created by the big spenders on Capitol Hill not to mention the associated votes are formidable political forces.

but doing so without also reigning in public spending is lunacy

I agree. John Kyl is a supposed conservative and tea party advocate, and the fact he is basically saying it is OK to lop another $678 Billion on the national debt is just fine if it means extending the Bush tax cuts for the wealthy greatly concerns me.

I was under the impression that Conservatives had learned their lesson about cutting taxes without cutting spending. Comments like this indicate that is just clearly not the case.

I don't like the idea of raising taxes by letting tax cuts expire, but the reality is that they should not be extended without finding $678 billion dollars of spending cuts to offset the cost of lost revenue by making them permanent.

The Tea party is the country's last great hope to restore some sanity to government, but if they are going to embrace these types of economic philosophies than we are truly doomed.

Maybe it is time to make all incoming Congress people take a remedial math course so they can learn how to add and subtract. It is clearly a skill that is missing among the current group of politicians.

It should be mandatory that spending is cut across the board. We could eliminate 20% of our spending in a heartbeat and no one would know the difference. Anything short of that is poppycock.

All spending should be reduced when there is a deficit. Our government leaders both R and D are irresponsible and a joke, way to lead by example.

I honestly don't know what it will take for people to stop spending, because when you actually try to cut something, people get upset... "I don't want your gov't hands on my medicare"

derek bomar;424273 wrote:I honestly don't know what it will take for people to stop spending, because when you actually try to cut something, people get upset... "I don't want your gov't hands on my medicare"

That's because of stupidity of politicians. They want to make several cuts of one or two programs in order to bring yet another to fruition.
They let social programs already in existence fall into shambles and to "fix" or "reform" the problem, they want to add another one to do the same exact thing.

And it's the sheeple that fall for it every single damn time who vote for these shucksters that sit around and wonder why everybody else is bitching.

SMH

Thread title should be "should it be mandatory to cut spending".

majorspark;423869 wrote:The bottom line is well the bottom line. Revenue that the feds take in is not just based on tax policy. It depends on a host of other things.

I have said before the only way to deal with the federal government's spending problem is a constitutional amendment requiring a balanced budget.. The amendment would include exemptions for wartime when congress declares war, and in national emergencies or unusual economic hardship when congress deems deficit spending essential with a 2/3 majority of both houses.

A balanced budget amendment would not make deficit spending possible, but more difficult, and less reckless. Under the system we have today Federal restraint when it comes to spending is literally impossible. No way congressmen in today's political climate will ever be able to exert this type of fiscal discipline. We need the force of constitutional law to trump this gross abuse of federal power. The states need to call a constitutional convention and reign in the feds before they suck us all down the financial shitter.

Under such an amendment, the pain of increased spending could not be deferred to future generations by having the government borrow money. The pain would have to be faced immediately via a tax increase or spending cuts by the present generation that holds power.

Either we pass a balanced budget amendment or we let this charlatans take us all into financial ruin. My guess it is the latter.

Under your proposal, to the extent the feds participate in capital projects, would those have to be financed out of current income? Or could they issue bonds?

Many states have constitutional requirements that require a balanced budget, and these tend to result in boom-or-bust cycles, with massive waves of spending followed by very deep cuts. States then start trying to remedy this by pulling the "Illinois special"--issuing bonds, monetizing future income streams (toll roads, lottery), etc. They can balance their budget, but essentially they're just borrowing from the future to pay the present. Isn't that what we'd end up with anyway?

While I agree that we want to reign in spending, cutting spending during downturns and then spending big during upswings probably isn't a good idea--my understanding is that it would serve to amplify the highs and lows, rather than muting them.

I had a typo that maybe caused some confusion. It should have read like this..

A balanced budget amendment would not make deficit spending impossible, but more difficult, and less reckless.

I would note that my proposal is in general and not in detail. It would be impossible for me to cover every aspect of the federal budget in a few short lines. My point is the federal government to this point has failed the people in maintaining fiscal discipline. It is time the people and the states set up boundaries via an amendment.

fan_from_texas;424488 wrote:Under your proposal, to the extent the feds participate in capital projects, would those have to be financed out of current income? Or could they issue bonds?

I am not advocating a constitutional amendment forbidding debt or capital expenditures. Just a balanced budget. No deficit spending without 2/3 majority approval. Not impossible just not so easy.

Capital expenditures as well as payment of principal and interest on treasury bonds can be a part of that budget. Just like in my personal budget I set aside X amount of dollars to fund my capital expenditure on my home and property. To be honest with you I am not so sure I would not add another amendment requiring 2/3 majority on capital expenditures and the accumulation of debt. Even if the expenditures are balanced in a fiscal years budget.

The federal government has proven themselves under current constitutional law to be totally fiscally irresponsible. They are so irresponsible that they risk the long term financial ruin of our country. The status quo is no longer an answer.

fan_from_texas;424488 wrote:Many states have constitutional requirements that require a balanced budget, and these tend to result in boom-or-bust cycles, with massive waves of spending followed by very deep cuts. States then start trying to remedy this by pulling the "Illinois special"--issuing bonds, monetizing future income streams (toll roads, lottery), etc. They can balance their budget, but essentially they're just borrowing from the future to pay the present. Isn't that what we'd end up with anyway?

State governments have no power to print their own money like the feds. So they get creative in order to shirk the fiscal constraints their citizens have placed on them. All this proves one thing. Any constitutional amendment need be worded well to prevent this sort of action. More amendments, more regulation of the government. Isn't that what they tell us when the private sector does the same thing?

Governments demand more laws to regulate the private sector when it acts irresponsibly. I demand more regulation on government through the amendment process because they have acted irresponsibly.

fan_from_texas;424488 wrote:While I agree that we want to reign in spending, cutting spending during downturns and then spending big during upswings probably isn't a good idea--my understanding is that it would serve to amplify the highs and lows, rather than muting them.

You are trying to argue against taking measures to force fiscal responsibility with fiscal irresponsibility. The answer is not to maintain the status quo because government will find ways to be fiscally irresponsible. The answer is to add more reasonable regulation of government fiscal policy through the amendment process.

Take your case in point. There are ways to limit this type of fiscal irresponsibility. Say an amendment is passed requiring the federal government to set aside X% of federal revenue taken in. That percentage would be placed in an emergency fund. It could only be accessed with constitutionally defined rules through the amendment process. They could be whatever. Say we get hardcore and require a 3/4 majority and the presidents signature to release any funds.

I realize my ideas are an exercise in futility. The vast majority of politicians would never allow their power to disperse government money to be diminished in the least. They need unlimited government resources in order to promise the sun, moon and stars the their constituents. Regardless of the consequences on future generations.

I agree with you that we should bring back fiscal reason to politics. But I think that fiscal reason means being countercyclical--increasing spending when the economy is slowing, and running a surplus when the economy is humming along. It's impossible to do that if you require a balanced budget in any given year, even if the overall budget over a decade is balanced.

majorspark;424963 wrote:Take your case in point. There are ways to limit this type of fiscal irresponsibility. Say an amendment is passed requiring the federal government to set aside X% of federal revenue taken in. That percentage would be placed in an emergency fund. It could only be accessed with constitutionally defined rules through the amendment process. They could be whatever. Say we get hardcore and require a 3/4 majority and the presidents signature to release any funds.

Debt is fairly cheap. It's not a good use of taxpayer money to save up a rainy day fund--far better to rebate the surplus through reduced taxes, then take on low-interest debt. There's a reason virtually all companies are partially capitalized with debt: it's low cost and cheaper than equity. Though the parallel to taxpayers isn't exact, I think it's strong enough to rule out saving up a ton of cash as a rainy day fund.

Aare you saying, that as a business, if we are running a deficit, we must cut expenditures and reign in cost of doing business??? What a noble idea.

fan_from_texas;425512 wrote:I agree with you that we should bring back fiscal reason to politics. But I think that fiscal reason means being countercyclical--increasing spending when the economy is slowing, and running a surplus when the economy is humming along. It's impossible to do that if you require a balanced budget in any given year, even if the overall budget over a decade is balanced.



Debt is fairly cheap. It's not a good use of taxpayer money to save up a rainy day fund--far better to rebate the surplus through reduced taxes, then take on low-interest debt. There's a reason virtually all companies are partially capitalized with debt: it's low cost and cheaper than equity. Though the parallel to taxpayers isn't exact, I think it's strong enough to rule out saving up a ton of cash as a rainy day fund.

I don't think any American is all too concerned about a "rainy day fund" scenario. We are 13 trillion in debt, excluding future contractural obligations. When these are added in, then the real debt or financial obligations hit 55 to 60 trillion dollars. It is true that the interest on this mind numbing principal is tiny these days, that is result of a horrible economy more than anything else...

Wake me up whenever the government starts hoarding taxpayer money due to a surplus...LOL

Part of the irrational thinking regarding long term Keynesianist policies, is that national debts accrued would be paid back after a huge inflationary period...thus paying back with "cheaper dollars". As a fiscal conservative, this type of thinking is akin to Orwell's term "doublethink". Doublethink is a term describing a mental process whereby the A is always correct. Even if option B is available...and by each and every logical conclusion that your mind can calculate and conclude..... that B is in fact correct, you default back to thinking that A has to be right...because the state says it's so.

You can't guarantee revenue will match expenses. They're not tied together. You have no way to maintain income/estate/capital gains transactions that are eligible for taxation will meet the projected annual expenses.

Things are in the tank now because few jobs=less income tax, the one year gap in estate taxes add a small percentage, and for state budgets, sales tax requires people to spend the money they have, which they're not. The problem is when times were good instead of bankrolling this, we were giving out our surplus in the form of tax cuts and just hoping nothing bad would ever happen ever again.

Sykotyk

Sykotyk;425692 wrote:The problem is when times were good instead of bankrolling this, we were giving out our surplus in the form of tax cuts and just hoping nothing bad would ever happen ever again.

If the government has "surplus" income then taxes are too high. Therefore, tax cuts make sense. And it has been proved time and time again that tax cuts help the economy. If tax cuts help (and they do) then more people are employed and paying taxes into the system as opposed to collecting welfare checks, food stamps, etc.

Keep in mind that the taxes we pay is OUR money earned through OUR labor, not the government's. The government should only levy just enough of OUR income to efficiently run its affairs. If it's running surpluses it's literally robbing us of our rightful labor.

"Bankrolling" surplus tax dollars should be done in the form of giving back the taxpayer what is rightfully theirs so they can bankroll it themselves in things like - oh I dunno - personal health care, retirement, savings, etc. Or they spend it on goods & services that keep the economy chugging along.

Jason Bourne;423910 wrote:I'd say "whoa" or "eeeasy" on a Constitutional Amendment. I think it was President Clinton who balanced the budget in the 90's. But to what or who's detrement? The military's, no?

The last thing we need is a group (majority) of people in office that are amazingly anti-military and, in the letter of the law fashion, balance the budget. And do they ever. If you know what I mean.

Let's be fair, Clinton ran up the deficits his first couple years and then when the repubs took over the house and senate, only then did he call for a balanced budget.

Trust me, both parties have screwed this up in the last few decades, I'm just a little tired of the left wing "show stopper" "well Clinton balanced the budget" when in fact the congress holds the purse strings and that was the one time in recent memory that congress was controlled by the republicans.

Paladin;423958 wrote:The Rs in DC had no problem when W. wanted to start two wars and not provide any way to pay for them, even carrying the costs "off the books" so it wouldn't show on the budget. How irresponsible? His VP ( Cheney) went around charging that "deficits didn't matter" and the R Congress spent like drunken sailors . Tax cuts were given in disproportionment to the wealthy. Yet now millions & millions are unemployed with few jobs available and none that were produced of any value from the Rs tax cuts.

Changes are coming.

Did you quote that right from Keith Olberman from MSNBC? Could you at least give us a thought of your own?

jmog;425761 wrote:Let's be fair, Clinton ran up the deficits his first couple years and then when the repubs took over the house and senate, only then did he call for a balanced budget.

Trust me, both parties have screwed this up in the last few decades, I'm just a little tired of the left wing "show stopper" "well Clinton balanced the budget" when in fact the congress holds the purse strings and that was the one time in recent memory that congress was controlled by the republicans.

True...quite true.