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Thread: Geithner's Testimony to House Ways and Means Panel

  1. #1
    Havakasha is offline
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    Geithner's Testimony to House Ways and Means Panel

    Tim Geithner:

    Tue Feb 15, 2011 1:12pm EST
    If the debt were to continue to grow as a share of the economy, an
    ever-increasing share of revenues would have to be devoted just to paying the
    interest on the national debt, so that in 2020 interest payments would be
    nearly as large as all defense spending. Such escalating interest payments
    would create an unsustainable cycle that would eventually force dramatic
    adjustments. Without appropriate reforms, this path would have consequential
    effects on the U.S. economy.
    While it is apparent that adjustments are necessary, we need to choose our path
    wisely. Cutting services and programs too much, too soon would jeopardize the
    recovery and destroy tens of thousands of jobs. Cutting the deficit today
    without making a long-term commitment to fiscal responsibility could enable a
    return to profligacy in the future. Cutting spending indiscriminately would
    force us to cut investments in vital public goods, and focusing reform solely
    on spending would impose an undue burden on those most in need while ignoring
    the opportunity to make our tax system more simple, fair, and efficient.
    The President's plan navigates these challenges. The Budget lays the foundation
    for long-term growth while cutting spending in order to reduce the deficit.
    Making a multi-year commitment to the principles embodied in the President's
    Budget will reduce the risk of future crises, reassure investors and provide
    certainty about the future path of spending and taxes. In addition, a
    multi-year commitment will help ensure that borrowing costs remain low, making
    home ownership and higher education more accessible for Americans and making
    long-term investments more attractive for American businesses. Together the
    increased certainty and improved confidence will contribute immediately to
    economic growth and job creation.
    History provides many examples of how past Congresses have made similar
    multi-year commitments. In some cases, Congress made permanent changes to
    policy that lowered the deficit over many years. For example, the 1983
    amendments to Social Security extended the solvency of the Social Security
    Trust Fund for several generations. In other cases, Congress adopted budget
    rules that locked in a path of deficit reduction, limiting future deficit
    spending. For example, discretionary spending caps and PAYGO rules for
    mandatory spending and revenue legislation adopted in 1990 and 1993 contributed
    to reductions in the budget deficit, and eventually to budget surpluses.
    Restoring fiscal sustainability will require courage from both the
    Administration and Congress, as we cannot move forward without compromise. We
    know compromise is possible. The December tax agreement proves that we are
    capable of forging agreements that move our economy forward.
    There is no doubt that Members of this Congress in both parties and both
    houses have many good ideas of their own for promoting fiscal sustainability.
    While we believe the President's Budget is appropriately balanced in its
    priorities, we look forward to working with you to make a commitment that
    reflects our common ground -- creating American jobs and promoting long-term
    economic growth.

  2. #2
    Atypical is offline

    Havakasha Posted This In Another Thread But It Also Belongs Here

    A brief elementary economic talk from an economist that accurately explains the games many are playing when they talk about the deficit 'problem'.

  3. #3
    Havakasha is offline
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    Here is David Stockman (Ronald Reagan Budget Director) who takes on Obama and Republicans to task. Watch the entire interview.

  4. #4
    SiriuslyLong is offline
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    Good link Lloyd - Obama "the toastmaster" lol. You know, Celente may actually be on to something regarding the uprising of a third party. It is clear the current state of politics isn't addressing what needs to be done.

  5. #5
    Havakasha is offline
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    Yeah, its called the Tea Party. Very scary.

  6. #6
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    Obama: I didn't punt on entitlement reform in federal budget
    Critics complain that President Obama's federal budget doesn't trim entitlement programs like Medicare and Medicaid. But Obama said that reform will come about through bipartisan negotiation.

    By Linda Feldmann, Staff writer / February 15, 2011

    President Obama pushed back Tuesday on bipartisan criticism that his 2012 budget proposal fails to address the unchecked growth of government entitlement programs – foremost Medicare and Medicaid, which are big contributors to the nation’s unsustainable fiscal picture.

    In an hour-long press conference, Mr. Obama suggested the omission was by design, and that the goal is to reach consensus in a negotiation, not through public posturing. Obama also asserted that the report last December by his bipartisan deficit commission, which called for far steeper deficit reduction than in his 2012 budget, has not been “shelved;” it still provides the “framework” for a conversation.

    "Look at the history of how these deals get done," Obama said. "Typically it's not because there's an Obama plan out there. It's because Democrats and Republicans are committed to tackling this in a serious way."

    Obama referred to the 1983 deal struck by President Ronald Reagan and Democratic House Speaker Tip O’Neill addressing the insolvency of Social Security as a model of bipartisan problem-solving. He suggested the same approach in tackling entitlement reform and tax reform.

    “This is going to be a process in which each side, in both chambers of Congress, go back and forth and start trying to whittle their differences down until we arrive at something,” Obama said. That’s his “goal,” he said, not to “get a good headline on the first day.”

    Patience urged for 'negotiation process'

    Obama also chided the news media for being “pretty impatient,” not just on his approach to the deficit commission but also on Egypt, health-care reform, and repeal of “don’t ask, don’t tell.” By referencing those three historic events that took place on his watch, Obama in effect promised progress, sooner or later, in addressing the nation’s structural deficits. He left the timing vague.

    “We're going to be in discussions over the next several months,” he said. “I mean, this is going to be a negotiation process.”

    When asked about the possibility of a government shutdown, if Congress and the president cannot agree upon funding levels beyond March 4, Obama again preached bipartisan negotiation. He warned against making “symbolic cuts” that could endanger the economic recovery.

    “Let’s use a scalpel. Let’s not use a machete,” he said. “And if we do that, there should be no reason at all for a government shutdown.”
    Last edited by Havakasha; 02-15-2011 at 09:09 PM.

  7. #7
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    By Richard Wolf, USA TODAY

    WASHINGTON — President Obama on Tuesday adamantly defended his decision not to offer bold proposals to rein in Medicare and Social Security or overhaul the tax code in his 2012 budget, arguing that only a bipartisan effort would succeed.

    The experiences of the past four presidents often bear that out.
    Obama cited Ronald Reagan's work with Democrats to rescue Social Security in 1983 and Bill Clinton's work with Republicans to balance the budget in 1997. "When it comes to difficult choices about our budget and our priorities, we have found common ground before," he said.

  8. #8
    SiriuslyLong is offline
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    Quote Originally Posted by Havakasha View Post
    Yeah, its called the Tea Party. Very scary.
    I think it will be a more centrist movement. I'm not a seasoned individual to politics, but it certainly seems that there is a "great divide" between republicans and democrats, and that the divide today is too steep to be negotiable. I mean look right here - you have, "you" and then there is John. Do you think you two would ever, EVER, come to a consenus solution? I'd bet not.

    The Tea Party is too extreme. It will never get traction with the masses.

  9. #9
    Havakasha is offline
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    Can you come to a consensus with John?

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