U.S. loses AAA credit rating from S&P

reply to post by papuette


This is the same thing that happened to our great states, we are going the way of Atlantis, but will rise from the ashes as the mighty phoenix.

Restored.

Reborn.

reply to post by papuette


Your country is going through what we went through in the 90's, sadly it will not last.

Save your money, but use it to buy things that will aid in your survival. Learn to live frugally now and it won't be such a shock when it happens. Learn how to cook and preserve food also, it's a skill many Americans have lost.

I just watched a few minutes of CNBC and the futures for the US stocks dont look too good.

DOW futures -1.70%
S&P futures -1.80%
Nasdaq futures -1.80%

They are jumping around but mostly staying in -1.50 to -1.80%

Nevermind, Asia stocks are already open

reply to post by buni11687


Nikkei is down about 100 (1%) so far.
We'll see.

reply to post by OuttaTime


We'll see a dramatic drop for the entire week.

But if the U.S. authorities keep telling us that the U.S. jobs report is good, even though a 1% drop consists of people no longer counted who still don't have a job, then it might stabilize for now.

I can't remember some things. I said that Moody's would be the first to downgrade the U.S. I forgot that it was S&P.

reply to post by ren1999


This should be Front Page News... but isn't.

Ask yourself why..

reply to post by SaturnFX

Lets not forget the tax rate is the lowest its been since 1958

Because increasing taxes is the answer when the economy is in a down-turn.

Check this out...this is where our income tax dollars go..(social security is not here because social security is a seperate entity, which is removed also specifically for SS...this is FICA)

No, it's not.

useconomy.about.com...

Social Security - $761 billion
Medicare - $468 billion
Medicaid - $269 billion
TARP - $13 billion
All other mandatory programs - $598 billion. These programs include Food Stamps, Unemployment Compensation, Child Nutrition and Tax Credits, Supplemental Security for the Disabled and Student Loans.

(Source: OMB, Table S-3)

There's 1.2-ish Trillion dollars, right there when you take out Social Security.

Mandatory spending is 57% of total Federal spending. It almost three times as much as the military budget, and 1 1/2 times all discretionary spending. The mandatory budget is, as its name implies, mandated by Congress to be spent outside of the annual budgetary process. It cannot be changed without a change in the laws that set up the programs.(Source: OMB, Table S-4)

useconomy.about.com...

For FY 2012, the President requested $553 billion for the Department of Defense Base Budget. This was only $4 billion more than the $548.9 billion requested in FY 2011, and $20 billion more than the $533.7 billion requested in FY 2010.

However, total defense spending requested for FY 2012 was $881, less than the $895 billion requested in the FY 2011 budget. This was more than the $855 billion requested for FY 2010, and the Security and the War on Terror request of $782 billion in FY 2009. It includes Homeland Security, Veterans Affairs, Nuclear Administration and some State Department programs. Operations in Afghanistan and Iraq are are also funded outside the Department of Defense base budget, to the tune of $118 billion.(Source: OMB,FY 2012 Budget, Table S-3)

So, outside of DoD base spending, there's an additional 328 Billion dollars tacked on to defense spending. Ending operations in Iraq and Afghanistan would, theoretically, cut about 118 Billion from the budget. Which doesn't even begin to touch funding Medicaid. Our current deficit sits at about 1.4 Trillion dollars. You could cut the military, entirely. Every ounce of defense spending out there - to veteran/retiree benefits - and you'd still be about 600 Billion dollars short of a balanced budget. You'd have to nix Medicare and Medicaid with about 50 Billion in cuts to other entitlement programs.

But consider what that snippit said...
over 2 trillion dollars...about 25% of what it spends....so, how much exactly are we spending on military today (this was september 10th...a day before any emergency funding and raising...and before Bush increased over and over the spending limits...)

This was over the course of several years of accounting. Not a single year. Seriously, read your own damned sources.

No, the entitlement programs is the tiny scraps tossed off the tables of kings so the starving dog can nip at it...the feast will not somehow be saved if we decide to remove the scraps, it will only make the dogs become ravenous and the kings just a little bit fatter.

I'll put it to you pretty bluntly. The current spending policy in the U.S. federal government is unsustainable. Despite whatever illusions you may have, the problem resides in the concept of removing money from the hands of wealthy people and giving it to the poor via the tax system.

Entitlement spending accounts for the single greatest expenditure in the U.S. budget system - without including Social Security.

The system is unsustainable and I will not allow it to be forced upon my state - the lives of -millions- be damned. My decision has been made, and my resolve is clear, young Damocles. And I am not alone.

No longer will income be seen as a metric for social liability.

Your totally sold on propaganda that is given to the plebs in society to keep the focus off of the machine we are in. Same ole same ole...royalty blaming all the loss of wealth on witches, meanwhile they eat off of golden platters.

Why is it that you or I should concern ourselves with what plates another chooses to eat off of? You speak of being "lost in a machine," yet miss the obvious fuel driving that machine: jealousy, greed, and loathing. Rather than being thankful for what you do have - you merely loath when another has more than you.

Why do you not aspire to have your own golden platters? Why do you, instead, appoint yourself as judge and jury over one's rights to ownership and freedom in spending?

This world truly is brimming with greed and hatred. It is unfortunate that you have been so corrupted, and I somewhat doubt my words will have much of an effect. Simply be warned that a war is coming - a clash between greed/jealousy and individual freedom. The droves of hyenas will riot - regardless. There are simply too many to be supported by the system, and it will collapse under its own weight.

At which point, I really do hope you consider your position. Freedom cannot exist so long as the many see it as their right/responsibility to prey upon the few - or vice-versa. I seek to forge my own fortune - my own legacy - my own lasting impact upon this world. I will not allow myself or those I care about to be swallowed up in a system fixated on the wealth of others. I will do what it takes to survive and lead/support those of a similar objective.

I seek to give to the world. Not to take from it. However, I can only give that which is my own - I am an arrogant young man, and quite conceited - but even I would never be so arrogant as to presume I have the right to make another person give what is theirs.

reply to post by Aim64C

Entitlement spending accounts for the single greatest expenditure in the U.S. budget system - without including Social Security.

If you look at the Bush tax cuts as "entitlement spending"...sure

They are the largest single-policy contributor to the national debt...

Originally posted by MrXYZ
reply to post by Aim64C

 

Entitlement spending accounts for the single greatest expenditure in the U.S. budget system - without including Social Security.

If you look at the Bush tax cuts as "entitlement spending"...sure

They are the largest single-policy contributor to the national debt...

Hmmm... how can a tax cut be a debt? Nobody ever has managed to answer that simple question. Are you suggesting that money belongs to the Federal government rather than to the men & women who earned it? At what point do you embrace the concept of a man owning the fruit of his own labors? Why not just start taxing everyone at 100% of their earnings, then cutting down to whatever level sustains the government's assinine redistribution of wealth habit and then the only debt on their books will be whatever percentage the government graciously allows the citizenry to keep?

ITS NOT THE GOVERNMENT'S DAMN MONEY!

The G.D. income tax isn't even Constitutionally legal to begin with.

1. Restore complete independence of the United States
2. Return to gold-backed currency
3. Reduce size of Federal Government by at least 50%
4. Withdraw American troops everywhere except for Congressional declarations of war
5. Get Government out of areas not authorized by the U.S. Constitution

Let's do this thing, while we're young

reply to post by tommynoshirts


also, 6. Wave machetes wildly around in the air

most important

Originally posted by Aim64C
reply to post by David9176

 

And above all.....you were the one Supporting tea party Republicans who were threatening default just DAYS AGO...which would have lowered our credit rating as well. Remember..."It's all about values and principles?" That's what you you stated to me a few days ago or something to that effect.

A default would not have happened. The U.S. budget priorities require that revenues go toward paying back public debts before any other mandatory or discretionary spending.

A default is exactly what would have happened. Not sure whether Congress can dictate spending priorities to the President, but Obama very clearly stated that unless he got what he wanted, more money to spend, by August 2nd, the US would default. May be spending priorities are to be decided by the Congress as per the US Constitution, but Obama was in no mood to oblige that part of the Constitution if it exists.

Perhaps he was bluffing, but no one wanted to take that risk.

All it would have done is make us have to *gasp* spend no more than we take in. What a friggin' novel concept! I know... I'm crazy - we're all crazy for suggesting we spend within our means!

That means -huge- spending overhauls to medicare, cuts and overhauls to the military budget, and kicking the "income security" bull-crap out. It means really figuring out what we want our federal government to do rather than simply saying "Eh, just increase the debt ceiling - then everyone can have what they want."

It is a novel concept that a President who just a year before expanded the entitlements by creating the universal healthcare would reverse his stand and agree to cutting entitlements when his constituents believe he could continue with the entitlements by increasing taxes on the rich.

I don't think anyone there is foolish enough to believe this borrow and spend can continue indefinitely and most of them probably realise the game is very near the end. However, no one has the guts to come out and say they are not going to cut spending because they chose not to borrow and not raise taxes on the rich. So it will go on until it is proven that no one would lend the US government money, which is perhaps likely very soon.

He wanted tax increases...he caved...and compromised. It doesn't take a GD Obama supporter to see what happened.

You're obviously not very well informed. The -entire- U.S. budget (including social security - which is a completely separate institution from the Congressional Budget, even though it is included for some odd reason or another) was something like 4.2 billion dollars. The entire projected revenues for the year were in the range of 2.8 billion dollars. That's about 1.4 billion dollars in deficit spending - a 50% increase to the necessary revenue to handle the added spending.

You want to raise tax revenue to cover our deficit spending? You and WHAT army? We in the military pay federal income tax, as well - and have families that we'd rather not see taxed into oblivion. You're not getting a 50% increase in tax revenue out of the American population. Simply not going to happen. You'll have states filling for secession by the end of the week and ratifying it by the close of business that day.

Impact of any voluntary spending cuts would not be any less significant than those you envisage with a 50% hike in taxes. Precisely why everyone agreed to borrow.

Originally posted by SaturnFX

Originally posted by beezzer
reply to post by SaturnFX

 

To adopt a european model just won't work. (square peg/round hole) A fair tax, say 10% across the board would. No exceptions, no loopholes. If you make 10,000 or 10 million, you pay.
Then, and only then, would I even consider talking entitlements, funded or otherwise.

10%
you lost your mind...we could barely pave roads for that amount....much less support a standing military.

Now, a straight across the board I am not opposed to, but ya, kick it up to 30%.

However, if that was instituted, you know who would suffer the most? businesses...not because the rich are taxed though, hell, they can afford it...its because the middle and poor are also robbed of their spending power...which means they don't buy random crap, which means companys manufacture less and therefore sell less, firing people, etc.

I think You will find that if We did 10% the amount contributed by the wealthy would surprise You. As it stands now, many of Us peons contribute 25%, 30% or more, while the elite/corporations pay nothing.

Something is very wrong with that picture.

Originally posted by burdman30ott6

Hmmm... how can a tax cut be a debt? Nobody ever has managed to answer that simple question. Are you suggesting that money belongs to the Federal government rather than to the men & women who earned it? At what point do you embrace the concept of a man owning the fruit of his own labors? Why not just start taxing everyone at 100% of their earnings, then cutting down to whatever level sustains the government's assinine redistribution of wealth habit and then the only debt on their books will be whatever percentage the government graciously allows the citizenry to keep?

ITS NOT THE GOVERNMENT'S DAMN MONEY!

The G.D. income tax isn't even Constitutionally legal to begin with.

tax cuts require cuts in government spending or will result in debt. during the g.w.bush era taxes have been cut and government spending raised. simple question simple answer.
in this context it's worthwhile to remember the income and wealth gap in the united states. 1% of the population earns 25% of the total income and possesses 40% of the total wealth. The bush tax cut made a very few happier, while significantly worsening the governments balance statements.

Originally posted by burdman30ott6
ITS NOT THE GOVERNMENT'S DAMN MONEY!

What is borrowed is not the government's money either. One way or another governments spend money that is not theirs.

But I agree that it is quite a stretch to call a tax reduction a debt as if a certain percentage of wealth produced by individuals is mandated to the government by some divine sanction and anything less is "owed" to the government.

The G.D. income tax isn't even Constitutionally legal to begin with.

Not quite. The 16th amendment empowers the Congress to impose a federal income tax. However Congress never passed law regarding the matter. At the moment it is quasi-legal. The federal government is within its powers to impose an income tax on federal government employees, residents of the federally administered territories and foreigners residing in the US, without any sanction from the Congress. This is how the federal income tax is levied. However, the residents of the several states who are US citizens and not the employees of the federal government have no legal obligation to pay the federal income tax, except when they sign a paper with their employer authorising the employer to treat them as federal government employees for the purposes of computing and deducting federal income tax. So most Americans are paying the income tax voluntarily. The IRS is simply taking these voluntary contributions and passing them on to the treasury

If you are a self-employed person residing in one of the several states and a US citizen, you don't have to pay any income tax. But if you take that too seriously, you get dragged to a federal court by the IRS and there is a 99% chance the federal judge (who is obligated to pay the federal income tax) will simply lie that the Congress indeed passed such a law obligating all US citizens and residents to pay the federal income tax and if you still refuse may get thrown into a federal prison.

So yes, it is illegally collected, but only from a few who bother to challenge it. The rest are paying it voluntarily

But it can be made legal in a heartbeat, by the Congress passing a law obligating the citizens to pay the federal income tax to the IRS.

reply to post by brigand


It is the same reason that the London riots are being downplayed as a bunch of kids causing trouble everywhere. The media doesn't want to ignite an idea.

This is John Thomas of the Titor Project.

"1. Restore complete independence of the United States"

The U.S. will secede into a few territories. I can't go into specifics but California all the way to Vancouver. New England and Quebec, Toronto, etc. The U.S. South along traditional Civil War lines.

"2. Return to gold-backed currency"

There is no gold, son. The U.S. will revert to the LAND currency. Feudalism.

"3. Reduce size of Federal Government by at least 50%"

There won't be a federal government shortly.

"4. Withdraw American troops everywhere except for Congressional declarations of war"

They'll all be returning back to the U.S. shortly to join their territorial armies. Everybody will be defending themselves from each other. But you'll be happy to know that there will actually be no fighting.

"5. Get Government out of areas not authorized by the U.S. Constitution"

Just the opposite will happen. If you can walk, you'll be forced to join your territorial army.

"Let's do this thing, while we're young "

..any day now. I'm allowed to say so because nothing can reverse this. Watch the flash mobs. They're coming.

edited to say,
We must be very close to the end.
I'm also allowed to say that in the U.S. South, all people of color will flee to the northern territories. It is going to be Apartheid.

So what, the USA crumbles, who cares?! Let them crumble, I care as much about them as they do for their own, or they do for the Middle East and Africa.

Let the USA rot in its own demise, the world will still carry on without them.

Originally posted by brigand
reply to post by ren1999

 

This should be Front Page News... but isn't.

Ask yourself why..

Yet we have threads on the first page that discuss the implications of this on gun owners...makes perfect sense

The economy should be THE most important subject, sadly, at least on ATS, it clearly isn't. I guess it's more entertaining to chat about the evil Sharia-law Muslim terrorists "invading Europe"

reply to post by Observor

May be spending priorities are to be decided by the Congress as per the US Constitution, but Obama was in no mood to oblige that part of the Constitution if it exists.

Perhaps he was bluffing, but no one wanted to take that risk.

So... what you are saying is: "because our president just don't gaheet it, we should give him another credit card."

Brilliant!

That said - if Obama, somehow, made us default on our payments (how, I have no clue - I am just humoring your assertion) because we wouldn't extend his credit limit.... how is that our problem? Sure - 'we' elected the guy - and if he's going to behave irresponsibly in our presidential office, then he needs to be told to leave - post-haste.

Simple as that.

It is a novel concept that a President who just a year before expanded the entitlements by creating the universal healthcare would reverse his stand and agree to cutting entitlements when his constituents believe he could continue with the entitlements by increasing taxes on the rich.

You do realize that the bottom 60% of the income segment does not pay effective taxes, correct? By time you figure in the amount of benefits received from government spending and compare it to the amount of money paid in - only the top 40% of -wage earners- pay effective tax.

And you're wanting to shift even greater tax burden upon them. Why?

I don't think anyone there is foolish enough to believe this borrow and spend can continue indefinitely and most of them probably realise the game is very near the end. However, no one has the guts to come out and say they are not going to cut spending because they chose not to borrow and not raise taxes on the rich. So it will go on until it is proven that no one would lend the US government money, which is perhaps likely very soon.

Because, you know... when you start making money, it is my responsibility to come along and make sure you pay to feed people without a job.

Really - if this is your standpoint - we are at an ideological impasse. Let it be known that your attempts to force this type of system upon the nation are an overt attack on the Constitution and the freedoms it establishes. Failure to heed warning will result in your classification as a threat.

mpact of any voluntary spending cuts would not be any less significant than those you envisage with a 50% hike in taxes. Precisely why everyone agreed to borrow.

Government spending cuts on income subsidies would have little effect on the circulating economy. The largest impact would reside in the banking system where loans would become less frequent and fewer government subsidies were funneled straight into debt payments (where do most people put their income tax returns and designated large parts of their social security supplement checks?)

Taxing the bejesus out of the population to subsidize a 50% increase in government spending is absolutely ridiculous. States will secede and militias will incapacitate federal infrastructure in a heartbeat. You've simply no idea what kind of contingencies are in place.

reply to post by Amaterasu

I think You will find that if We did 10% the amount contributed by the wealthy would surprise You. As it stands now, many of Us peons contribute 25%, 30% or more, while the elite/corporations pay nothing.

You couldn't be more wrong.

ntu.org...

www.american.com...

2. What income group pays the most federal income taxes today?

The latest data show that a big portion of the federal income tax burden is shoul­dered by a small group of the very richest Americans. The wealthiest 1 percent of the population earn 19 per­cent of the income but pay 37 percent of the income tax. The top 10 percent pay 68 percent of the tab. Meanwhile, the bottom 50 percent—those below the median income level—now earn 13 percent of the income but pay just 3 percent of the taxes. These are proportions of the income tax alone and don’t include payroll taxes for Social Security and Medicare.

5. What has happened to tax rates in America over the last several decades?

They’ve fallen. In the early 1960s, the highest marginal income tax rate was a stunning 91 percent. That top rate fell to 70 percent after the Kennedy-Johnson tax cuts and remained there until 1981. Then Ronald Reagan slashed it to 50 percent and ultimately to 28 percent after the 1986 Tax Reform Act. Although the federal tax rate fell by more than half, total tax receipts in the 1980s doubled from $517 billion in 1981 to $1,030 billion in 1990. The top tax rate rose slightly under George H. W. Bush and then moved to 39.6 percent under Bill Clinton. But under George W. Bush it fell again to 35 percent. So what’s striking is that, even as tax rates have fallen by half over the past quarter-century, taxes paid by the wealthy have increased. Lower tax rates have made the tax system more progressive, not less so. In 1980, for example, the top 5 percent of income earners paid only 37 percent of all income taxes. Today, the top 1 percent pay that proportion, and the top 5 percent pay a whopping 57 percent.

7. Are lower tax rates responsi­ble for the big budget deficits of recent decades?

There is no correlation between tax rates and deficits in recent U.S. history. The spike in the federal deficit in the 1980s was caused by massive spending increases.

The Congressional Budget Office reports that, since the 2003 tax cuts, federal revenues have grown by $745 billion—the largest real increase in history over such a short time period. Individual and corporate income tax receipts have jumped by 30 percent in the two years since the tax cuts.

The problem is government spending, first. Not tax burden. The fact is that the top 25% of wage earners pretty much earn this country's keep in terms of paying the taxes. The second problem is the tax system based on income as opposed to exchanges. But that can be addressed at a later date (and should not be seen as a solution to the current deficit/debt problem).

However, I would imagine that we would find ourselves with much more revenue if we were to transition to a sales tax with a prebate system (think of it like your income tax return - only you get it at the beginning of the fiscal year to cover all of the sales taxes you would encounter in paying for food and necessities at the poverty level for your district). In this way - the 'poor' are not burdened by the tax, but the bracket system is done away with - a pay raise is a pay raise or working a few extra hours of overtime doesn't put you into the next tax bracket. Everyone pays the same tax. Tourists included (so start inviting the Chinese over every chance you get )

Of course - like I said - medicare and social security are two massive areas of spending that need to be addressed first.