America Debt Ceiling, a question.

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  • America Debt Ceiling, a question.
  • b r
    Member

    a far bigger risk is if other folk stop lending them money – then the 5h1t will really hit the fan

    Premier Icon scaredypants
    Subscriber

    toss-arsed brinkmanship raied to an art form

    Who’d have thought that a shitter governmental arrangement than ours could exist ? 😯

    Premier Icon woody2000
    Subscriber

    It’s just political brinksmanship, a dangerous game being played by Obama’s political opponents to reinforce their opinions of his reforms. Or something like that anyway

    http://en.wikipedia.org/wiki/United_States_debt-ceiling_crisis_of_2013

    Junkyard
    Member

    Basically the republicans and in particular the tea party cannot accept that they lost the election and that Obama and his care has some mandate and he wont back down re this

    Radio said there was over 40 votes on this in the US 😯

    the deadline is an extension of the deadline as is the latest one as there is a cap on the amount of debt the US can have IIRC.

    athgray
    Member

    I am aware how the politics has got the US to this position, however if midnight arrives an no consensus is agreed, just change the deadline surely? If the deadline is controlled by the someone else it must be in their interest to put it back also.

    A bad analogy would be if the entire World was populated by turkeys that ate each other at Christmas. If a dispute between two groups of turkeys over who pays for turkey hospital was unresolved by midnight then the next day would be Christmas day.

    Who would vote for that?

    Premier Icon MSP
    Subscriber

    Who would vote for that?

    The republican leadership.

    They are even losing the support of their own party their stance is so ridiculous.

    ninfan
    Member

    I am aware how the politics has got the US to this position, however if midnight arrives an no consensus is agreed, just change the deadline surely? If the deadline is controlled by the someone else it must be in their interest to put it back also.

    A bad analogy would be…

    A better analogy would be ‘I owe ten grand on my credit card, the minimum payment is due tomorrow evening, and If I can’t agree an extension on my current account overdraft with the bank, then I won’t be able to pay the credit card bill, and they’ll cancel my credit and demand ten grand immediately’

    the GOP are the bank, and they’re saying ‘but if we extend your overdraft again, its just pushing the problem down the road, you don’t earn enough to cover your monthly expenses, and unless you promise to cut back your spending, we’re not giving you anything!’

    athgray
    Member

    Far from being a economy expert perhaps someone can help.

    By all accounts we are heading towards global financial catastrophe if American politicians cannot come to a deal on raising the debt ceiling by midnight. Where did this deadline come from and why is it so rigid?
    Surely if the consequences for the World are economic meltdown then a bit of leeway could be incorporated into the deadline. It all seems farcical that we could head into the abyss because a few people could not reach consensus by midnight.

    I hope in this instance they are working through their lunch break. 🙂

    Premier Icon scaredypants
    Subscriber

    to be fair, a nice crisis might make my holiday dollars a bit cheaper next year – if the western world’s still standing

    athgray
    Member

    Fair enough ninfan, however it would not be in your credit card issuers best interests to see the overdraft talks fail so extend the deadline a bit. The credit card issuer would see no money otherwise.

    I don’t see how the consequences of postponing a deadline can be weighed up against the consequences of allowing NO resolution.

    ninfan
    Member

    Of course its possible that the credit card company will extend the deadline, in the hope that they are going to get their money in the future, maybe if I get a payrise or promotion at work…

    but if they do that, then it will affect my equifax credit rating, and then it will be a lot tougher to borrow money in the future, and they’ll charge me a higher interest rate.

    If I have to pay a higher rate, then in the short to medium term my financial mess just gets worse – in the longer term, if I don’t get the payrise, then I could well end up having to borrow from wonga to pay my credit card bill..

    athgray
    Member

    I can get that ninfan. Not extending the deadline seems like handing a pistol to a group of people to play russian roulette when all the participants know there is a bullet in every chamber.

    ninfan
    Member

    Yes, its a loaded gun – but sooner or later either the credit card company or my bank manager are going to say ‘enough’ because they’re worried that otherwise they’ll never get their money back.

    Premier Icon kimbers
    Subscriber

    Well booted down the road till the new year now

    The most its achieved is to almost garuantee bill Clinton gets to be first lady 😉

    I imagine that will upset the tea party as much as Obama has
    The republicans that genuinely wanted to limit spending, lower taxes cut welfare etc will have no chance with a democratic pres and senate

    Still they might actually end up with a slightly better healthcare system

    Junkyard
    Member

    ‘I owe ten grand on my credit card, the minimum payment is due tomorrow evening, and If I can’t agree an extension on my current account overdraft with the bank, then I won’t be able to pay the credit card bill

    comparing countries to people is flawed for many reasons not least the fact they can literally print money and you cannot really bankrupt them as such.
    However what would happen is the govt would stop paying wages rather than stop the debts. They do not have enough money to cover all out goings but they would view loans as essential and wages as non essential
    Either way it would be a mess to put it mildly.

    sooner or later either the credit card company or my bank manager are going to say ‘enough’ because they’re worried that otherwise they’ll never get their money back.

    I assume you mean the banks as the credit cards?- America would still be very highly rated so it is some way from banks not lending them money though the rates may be less favourable so better to say or else i will charge you more interest
    By bank manager I assume you mean Republicans who will threaten it and take it to the brink but they wont actually ever do this as they will get the sack and its MAD [ mutually assured destruction and Obama is going anyway so why would he care?]
    What a strange analogy we have used given govt finances are nothing like an individual and the IMF would bale them out anyway , with draconian penalties , not that it would ever come to that.

    Three_Fish
    Member

    [video]http://www.youtube.com/watch?v=0Jd-iaYLO1A[/video]

    Shutdown of US govt & ‘debt default’: Dress rehearsal for privatization of federal state system?

    The ‘shutdown’ of the US government and the financial climax associated with a deadline date, leading to a possible ‘debt default’ by the federal government, is a money-making undertaking for Wall Street.

    Several overlapping political and economic agendas are unfolding. Is the shutdown – implying the furloughing of tens of thousands of public employees – a dress rehearsal for the eventual privatization of important components of the federal state system?

    A staged default, bankruptcy and privatization is occurring in Detroit (with the active support of the Obama administration), whereby large corporations become the owners of municipal assets and infrastructure…

    (Full article)

    Premier Icon Northwind
    Subscriber

    ninfan – Member

    A better analogy would be ‘I owe ten grand on my credit card, the minimum payment is due tomorrow evening, and If I can’t agree an extension on my current account overdraft with the bank, then I won’t be able to pay the credit card bill, and they’ll cancel my credit and demand ten grand immediately’

    the GOP are the bank, and they’re saying ‘but if we extend your overdraft again, its just pushing the problem down the road, you don’t earn enough to cover your monthly expenses, and unless you promise to cut back your spending, we’re not giving you anything!’

    Except that this isn’t about spending cuts at all, it’s about healthcare reform, a healthcare reform which is predicted to cut the deficit to the tune of $210 billion.

    More specifically, it’s about being willing to cause immense damage to the US economy in an attempt to overrule by- let’s be honest- simple blackmail what has already been voted for by the people, the house and the senate and enacted into law.

    The reason it’s hard to understand the current shutdown is that it makes absolutely no sense.

    Premier Icon molgrips
    Subscriber

    the GOP are the bank, and they’re saying ‘but if we extend your overdraft again, its just pushing the problem down the road, you don’t earn enough to cover your monthly expenses, and unless you promise to cut back your spending, we’re not giving you anything!’

    Well.. possibly, but they are also using it to try and get concessions over Obamacare I think, but I’m not clear exactly how. I think they demanded changes to the Obamacare bill in return for signing off the debt extension.

    It sounds like Obama played a blinder tbh.

    Premier Icon kimbers
    Subscriber

    one of the nicest things the GOP wanted as part of a deal, was to deny obamacare to their own staff as that would save a bit of money (and deny their staff a small improvement in their access to healthcare)

    samuri
    Member

    vote for us or the world will die.

    That’s all there is to it.

    Premier Icon molgrips
    Subscriber

    Holy cow.

    This bloke on newsnight is saying that the greatest danger to the American economy and its people is Obamacare.

    For ****’s sake, how are you expected to take anyone seriously when they say stuff like that?

    Junkyard
    Member

    Are you some kind of commie Molgrips 😉

    Radio 4 did some lectures on US audiences on various philosophical issues. Their attitude to healthcare was quite an eye opener and the polar opposite of ours in general.

    Many of the pro obamacare were to the right of the Tory party

    ianfitz
    Member

    There’s a truly terrifying graphical representation of the current debt. It’s pretty shocking

    http://demonocracy.info/infographics/usa/us_debt/us_debt.html

    Premier Icon kimbers
    Subscriber

    its not really terrifying, its just stacks of cash or probably just lots of zeros on a computer somewhere

    and infact its just about the same size as US GDP

    this would actually be terrifying if it was real……

    ernie_lynch
    Member

    There’s a truly terrifying graphical representation of the current debt. It’s pretty shocking

    Except that it only visualizes in terms of the dimensions of a $100 bank note, a totally meaningless visualization.

    If they decided tomorrow to reduce the dimensions of $100 bank notes by 50%, which wouldn’t change the value of the notes, the “graphical representation” would suddenly be reduced by half.

    If you want a meaningful visualization of what the debt actually represents then you need to compare it with something which gives it some meaning, eg, the total tax revenue collected by the US government, the total income of the richest 1%, etc.

    ohnohesback
    Member

    Move along now! There’s nothing to see here! The can has been kicked further along the road…

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