Foreign aid... Thats what, .3% of the budget?
and in the big list of 'things to cut', it'd rank up there pretty high, regardless of how much it is...
Foreign aid... Thats what, .3% of the budget?
America would implode and Canada would have to share its bored with Mexico
I'm a Libertarians, and I WILL touch it (some psychos play with fire, a like playing with knives). No, aping Europe wouldn't help. Need to cut spending. Say, if there was no Great Society and welfare and all that junk.
Avoiding the Cold War would be good too, wouldn't have to spend so much on weapons. Of course, technology wouldn't have advanced as fast as it has in that case.
Oh, and no more loop holes in the tax codes to let corporations off.
And then we can add some tariffs to it. I know the Libertarian Party is more a free trade place, but I happen to disagree on that subject.
I think there is a basic misunderstanding in this thread. Our "debt" to China in particular does not come from government deficits but from our trade deficit. As long as we have a trade deficit with China, China will necessarily have a surplus of dollars, and they will most likely spend that surplus to buy U.S. Treasuries. If by some miracle, the outstanding U.S. government debt is so low that there aren't enough Treasuries for China to buy, they will instead spend that money buying up U.S. property, ie real estate, office buildings, factories, corporations, etc. For most people that fret about the "debt" to China in particular as opposed to government debt in general, that would actually be a worse outcome. So since the premise of your thread is mistaken, I'd suggest revising it. Like say, what ways the U.S. could have acted to minimize its trade deficit, or the long term effects of very low levels of government debt.
Sorry, but the Chinese (and Japanese) holding a huge amount of t-bonds that have been issued by the US government to cover federal budget deficits is foreign debt.
I don't care if the original poster has presented us with a sketchy, bare bones what-if, or if he has a habit of getting into flamewars with people over similar topics. He is fundamentally right that China holds massive amounts of US government debt.
Doesn't matter if you have a Friedmanite economics vocabulary with which to mount your political argument. (Heh, I have Thomas Friedman to validate what I've just written.)
You can try reading my post for one. Our national debt comes from our deficit. Our debt to any particular nation on the other hand, comes from the trade deficit with that particular nation. China holds a massive amount of U.S. government debt, that is true, but no amount of economizing that does not also reduce the trade deficit would reduce the amount of either debt or other U.S. property held by China. That is the mistake I was pointing to.
xchen08 said:Our "debt" to China in particular does not come from government deficits but from our trade deficit... the outstanding U.S. government debt is so low that there aren't enough Treasuries for China to buy... the long term effects of very low levels of government debt.
You can try accepting the real world reality that US treasury bonds issued to fund the US deficit are popularly, legitimately, & non-gate-keeperly, considered foreign debt when they are held by the central banks & finance ministries of China, Japan, et al.
If you want to educate us as to the correct Chicago-school definitions of 'foreign debt' and 'national debt' then I'm perfectly happy to school you as to how us non-economics-undergrads use the expressions.
Though in my experience the terms used have always been simplified to 'government debt' and 'non-government debt', with 'current accounts' thrown into the mix. But what would I know, I live in a country where the terminology is more English than American.
And yet again, you continue ignoring my point that the level of U.S. debt outstanding and Chinese holdings of either that debt or other U.S. property are not the same. I honestly don't even know what point you are trying to make, since you keep on pounding on a point I have not and never did dispute.
LATE EDIT:
So, you explicitly state there is little or even no US government debt held by the PRC, not that there is merely a difference between the espressions 'trade debt' and 'national debt'. That's Cheney "deficits don't matter" thinking, I suppose. Or maybe the Laffer Curve applied to geopolitics.
Hoist. Petard. Own.
me said:Our "debt" to China in particular does not come from government deficits but from our trade deficit. As long as we have a trade deficit with China, China will necessarily have a surplus of dollars, and they will most likely spend that surplus to buy U.S. Treasuries. If by some miracle, the outstanding U.S. government debt is so low that there aren't enough Treasuries for China to buy, they will instead spend that money buying up U.S. property, ie real estate, office buildings, factories, corporations, etc. For most people that fret about the "debt" to China in particular as opposed to government debt in general, that would actually be a worse outcome.
I'll grant you that there are diferences between government & non-government debt--yet that doesn't really matter in a debate where you state that American debt to China doesn't have much of anything to do with government deficits.
Nice, you editted my post into an incomprehensible mess in order to to make it mean close to opposite what it actually did. Real nice.
xchen08 said:In other words, our trade deficit with China results in China having a large surplus of dollars, which China will use to buy dollar denominated assets. The most prominent of those in the international market are U.S. Treasuries. If a balanced budget in the United States has resulted in insufficient Treasuries on the open market for China to buy, it will buy other dollar denominated assets, such as U.S. real estate, corporation stock, etc.
xchen08 said:And it doesn't, if U.S. debt to China is the sum of U.S. government and non-government debt to China, which is what I was talking about.
incomprehensible ranting
so what if the American People had tax system like in post WW2 Europe? And this had resulted in no debt to China?
Sorry if you think you've been taken out of context, but your first sentence was too clever by half.
Naturally you have ignored the context of this thread (US domestic fiscal policies dealing with balancing the US budget--or perhaps not balancing the US budget) so as to advance Kudlow-esque boilerplate about how the US government deficit (or at least the Bush deficits) is/are not worth commenting on, because it's not as if the US government has recently run a trade deficit with the PRC at the same time as running a budget surplus at home.
Oh, right. That's not true, of course.
Okay, I'll grant you that you have an agenda here, that that agenda is probably about deliberately ignoring the death of fiscal responsibility under Bush and the radical increase in the PRC's trade surplus with America that occured at the same time. Because it's actually fiscally responsible to believe government deficits don't matter, or something. (Though I like your sideswipe at the opponents of deficit spending as a bunch of xenophobes who would freak if Chinese capital was going towards buying downhome American assets. Kudos. The best defence is offence.)