Peak Oil News and Message Boards

The debt ceiling debate hasn't gone away. I guess Mnuchin is pushing for a "clean debt ceiling bill" before they leave for their August recess. They don't have much of a war chest, because they spent it on a stock market rally. I just hope they have enough to get us to around Sept/Oct before we get into trouble. The Freedom Caucus folks are fighting for some deficit reduction, the Dems are not thrilled with anything the Repubs are up to, but they still need at least 8 of them to go along and of course the rich are pushing for tax cuts. I don't see much hope for a "clean bill" that will push the debt ceiling up to over 25 trillion. We'll see, but it could get ugly.

http://www.politico.com/story/2017/06/0 ... ing-239267

Revi wrote:The debt ceiling debate hasn't gone away. I guess Mnuchin is pushing for a "clean debt ceiling bill" before they leave for their August recess. They don't have much of a war chest, because they spent it on a stock market rally. I just hope they have enough to get us to around Sept/Oct before we get into trouble. The Freedom Caucus folks are fighting for some deficit reduction, the Dems are not thrilled with anything the Repubs are up to, but they still need at least 8 of them to go along and of course the rich are pushing for tax cuts. I don't see much hope for a "clean bill" that will push the debt ceiling up to over 25 trillion. We'll see, but it could get ugly.

http://www.politico.com/story/2017/06/0 ... ing-239267

Just reading this the thought occurred to me the same problem explains both the lack of effective climate change regulation and the failed attempts at debt reduction. No government wants to really swallow the bitter pills that it will take to mitigate either of these problems. Both require cuts in either economic growth or government spending. In other words, keeping the existing status quo going always wins over any short term mitigation.

There has to breaking points here somewhere along this trend line of stupidity and denial.

Alas, once again it just confirms that external consequences are the driver here.

I put this on another environmental thread but I think its quite pertinent to this discussion. "keeping the existing status quo going always wins over any short term mitigation. " Or protecting Nature
https://theconversation.com/around-the- ... ways-77590
Around the world, environmental laws are under attack in all sorts of ways

The bind that politicians and governments are in is quite simple. Governments are hamstrung between their voters and their corporate lobbyists. They are held hostage by both. Self sacrifice will bring about rebellion from the masses or overt sabotage by corporations who will see their bottom line negatively impacted.

Both citizens and corporations demand growth. The masses, voters, want to see their personal standard of living increase in a linear trend line just like lobbyists represent the goals of corporations and shareholders to see linear growth of their stock valuations. Any correction, whether it be climate change regulations or debt reduction through allowing natural cyclical corrections to occur are prevented at all costs by shoving the problem further into the future.


And thus we surrender to external consequences as driving change.

This is a common theme that explains various converging instabilities in our global civilization.

"are prevented at all costs by shoving the problem further into the future. " Yet, the distressing cues of environmental/economic limits (external consequences) are becoming ever more pronounced . Or you are say ,the Overshoot Predator is becoming ever more aggressive and ravenous

It's all so stupid. If congress doesn't want to spend more money and take on additional debt, then they should, to state the obvious, STOP DOING THAT.

The debt is there because congress spends more money than it collects in revenues over time. Period.

So wasting time and energy on the debt ceiling every X years is just grotesquely stupid -- even for Washington.

For one thing, maybe that time could be spent actually, you know, trying to solve a pressing problem or three, or make a program (or a hundred) more efficient to save some money, etc.

But no, because grandstanding apparently buys votes from the masses. Fabulous.

...

I'm not sure why I bother to vote any more. Oh, that's right -- to feel like I have the right to observe and complain, since at least I tried to vote the worst of the clown-fest out.

We started piling up debt around 1970, which we know is when we hit peak in the US. Since then we have been pumping around 10 million barrels per day and using 20. We have been fortunate because we have been able to put off the day of reckoning because everyone wants our IOU's. We have been living far outside of our budget for so long that we have forgotten how to live within it. The Chinese use about the same amount we use just for driving around (11 million barrels per day) for everything, including manufacturing. Our government budget has been growing all this time, and we are up to borrowing around an extra trillion per year lately. I think they should pass the debt ceiling waiver and raise it again. We are living on borrowed money. We'll have a day of reckoning soon enough. Keep it going for a little while longer. There's no fixing any of it.

Revi wrote:We started piling up debt around 1970, which we know is when we hit peak in the US. Since then we have been pumping around 10 million barrels per day and using 20. We have been fortunate because we have been able to put off the day of reckoning because everyone wants our IOU's. We have been living far outside of our budget for so long that we have forgotten how to live within it. The Chinese use about the same amount we use just for driving around (11 million barrels per day) for everything, including manufacturing. Our government budget has been growing all this time, and we are up to borrowing around an extra trillion per year lately. I think they should pass the debt ceiling waiver and raise it again. We are living on borrowed money. We'll have a day of reckoning soon enough. Keep it going for a little while longer. There's no fixing any of it.

But Revi, don't worry. We are making America great again!

Functionally extinct. My favorite new term, an ecological concept that perfectly describes our current economic / ecological situation.

Here's who we owe the debt to, as of about 5 years ago or more:

Revi wrote:We started piling up debt around 1970, which we know is when we hit peak in the US.

1. Actually we don't know that 1970 is when we hit peak in the US because it now appears 1970 is NOT the peak in the US. US oil production has been growing steadily for years and is back near the 1970 production level now.

2. The year 1970 isn't important for debt either. The Federal debt was pretty managable prior to 2000 when Bush was elected. Then Bush ca. doubled the debt from 2000 to 2008, and Obama ca. doubled it again from 2008 to 2016. Its really only the huge increase in debt under Bush and especially under Obama that is a crushing burden, because now the debt is so large the federal government has to spend hundreds of billions of dollars each year just covering the interest on the debt. Thats money that should be going to infrastructure etc. but thanks to Bush and Obama, its now just wasted on paying interest on the debt.

3. I'm not sure I agree with you that the debt is unmanageable either, even at these extreme levels. There is one basic strategy to wipe out government debt, and that is inflation. If the US goes through massive inflation again, the existing debt denominated in dollars will shrink along with the value of the dollar. Of course it will wipe out a lot of the boomers who have saved for retirement, but thats how it goes.

CHEERS!

pstarr wrote:Crazy

I know. You have my deepest sympathies.

Cheers!

Well we have a three month reprieve if the house passes the extension tomorrow. It's hooked into the Harvey and Irma relief, so it's going to pass. Then in December the whole thing starts up again. I guess we got a 3 month reprieve. It could be the Grinch that stole Christmas...

pstarr wrote:It's like when you blame the Great Recession on bad mortgages

That kind of mockery works about as well as "It's like when you tell me the earth is round and we went to the moon!" It just makes you sound incredibly ignorant.

asg70 wrote:

pstarr wrote:It's like when you blame the Great Recession on bad mortgages

That kind of mockery works about as well as "It's like when you tell me the earth is round and we went to the moon!" It just makes you sound incredibly ignorant.

Especially when he says it again and again, year in and year out, even after repeatedly being presented evidence (by multiple posters) that the vast majority of economists (those folks who, strangely enough, are specialists in understanding matters of real world economics) state plainly that the primary reason for the 2008-2009 crash was global fallout from the real estate bubble.

This would be surprising if it weren't pstarr, the same person who keeps claiming that gasoline (i.e. oil based products) is now unaffordable AFTER the oil price collapsed -- the same gasoline that was affordable just fine in 2010-2014, at about double the average crude oil price vs in recent months. And pointing out all kinds of objective economic evidence to him about how, for example, when the average car costs about $33,000 in the US, and people are choosing expensive and inefficient cars in huge numbers -- makes the idea that people generally can't afford gasoline downright silly -- to those willing to look at data and use logic.

Trump and the Ds have agreed to work towards repeal of the debt ceiling.

Its all part of Trump's secret plan to surpass Obama's 10 trillion in new debt.

Plantagenet wrote:Trump and the Ds have agreed to work towards repeal of the debt ceiling.

Its all part of Trump's secret plan to surpass Obama's 10 trillion in new debt.

I notice that the D's are beating Trump up about this. (Why am I not surprised?)

Weren't they complaining loudly when it was looking like he was going to hold the debt ceiling hostage?

Since liberals tend to want to abolish the debt ceiling (a principle I agree with -- if the idiots on Capitol Hill don't like excessive spending -- they can STOP VOTING FOR THAT. The debt ceiling is primarily for political grandstanding, since the debt MUST be paid (in vastly inflated dollars, perhaps) for the spend and borrow game to continue long term.)

So, here's a point where the liberal press could act credibly and agree with Trump and thank him for sanity on this point (since he did what they want).

But no, they call him weak, etc., putting politics above all else.

...

And then they wonder why roughly 40% of the country ignores their noise machine on critical issues on Trump -- where they actually have an excellent point.

It's so stupid and unproductive. I suppose it's just party politics as usual, but it seems that in the internet age some aspects of politics would gain a lot more traction if they were interspersed with just a wee bit of foresight and intelligence.

I think debt actually begets inflation. It is the destruction of debt which leads the other way, to deflation. The expansion of the money supply that debt creates works that way. It's really only modern inventions, like off-shoring of tax shelter investments, that works against that, as it inherently redistributes wealth away from worker's wages. Federal debt may not be as inflationary as the expansion of personal debt because of certain things the Federal Government has to spend money on having lower multipliers than others, preventing further borrowing in a cascade, but it is by and large still inflationary.

As for what pstarr says about the high oil price being responsible, all I can give you are my anecdotal observations. At the time the price of gas was rising, seemingly daily. It kept going up, as if people's ability to pay had no impact upon its rise. Remember, real wages had not gone up in years. It was borrowing that people used to make up the difference. Then, one day, I found myself in Cheyenne, Wyoming at the gas pump. The price was something like $5.25 a gallon, maybe pushing $5.65 (it's hard to remember), and Cheyenne was the cheapest place to buy gas for maybe a thousand miles in any direction. I was, and still am, making deliveries for a living. The high price was severely cutting into my ability to keep my head above water. Good thing I wasn't in debt. Turns out I wasn't the only one having that problem. I was driving a high gas mileage car, but the bulk of the economy wasn't. They were trapped trying to survive behind the wheel of an F-350, or similar. Two days later the gas price was something like $1.28. Those high prices had finally broken those mostly independent contractors, and it showed up at the pump. You would think it was relief, but it was too little too late. Yes, they were faced with paying for that gas, using debt, and their mortgages, which had largely reset or were resetting. Subprime was actively destroying off-shore money. The middle class was beginning to default as well. The money supply was shrinking. It's complicated, but I don't think you can rule out oil as a contributing cause. You may not call the straw that broke the camel's back the cause, but neither was it nothing.

Why don't Trump just print 20 coins at $1 trillion dollar a coin and deposit it at the Federal Reserve?

Debt? What debt? Trump can just pay back $20 trillions worth of debt with twenty coins

http://www.telegraph.co.uk/finance/financialcrisis/9784898/US-seriously-considering-1-trillion-coin-to-pay-off-debt.html

The price was something like $5.25 a gallon, maybe pushing $5.65 (it's hard to remember), and Cheyenne was the cheapest place to buy gas for maybe a thousand miles in any direction.

Ya sure. Your anecdotal evidence is known as factually incorrect dim memories.



The debt ceiling is kabuki theater. If congressional critters appropriate spending for their gerry mandered districts specifically and the nation holistically, then clearly they should simultaneously finance the spending in excess of revenues.