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Thread: Deficit spending as an extra tax.

  1. #1

    Default Deficit spending as an extra tax.

    Did anybody make any estimates of what the extra burden of deficit spending on an average taxpayer is? My back of the envelope calculations is we get taxed an extra 15-20% because of the federal government overspending. This does not take into account things like ZIRP which is absolutely necessary given the amount of public debt.
    What is the punishment for the attempted murder of freedom on earth? 👁👁



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  3. #2

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    You're trying to put a dollar figure on it, or make a percentage out of it.

    The ballooning debt has kept us tied to the Federal Reserve Funny Money. And that has cost us the middle class, which was made poor. It also cost the working poor their independence and freedom, as the wages they get for working forty, sixty, even eighty hours a week will no longer feed, clothe and house them. So, even though they're gainfully working their asses off being productive, they have to jump through government hoops and bow to government mandates just to eat.

    And how has this happened? The dollar got devalued every day. We need a raise every day to keep up. Who can get a raise every day?

    Quote Originally Posted by acptulsa View Post
    I think what the newcomer to this discussion has the most trouble understanding is the dollar is not a dollar--it's a nickel.

    What do I mean? Well, my old man got out of the Army Air Corps after WWII and got himself a good job paying a dollar an hour. How is that a good job? Easy--it was 1946 and the dollar was still a dollar. As in, when he wanted a Pepsi he paid a nickel for it--now it costs a dollar. When he wanted to ride a bus, he put seven cents in the meter, or a nickel and a half--now it costs a buck and a half. When he wanted to sit down and have a cup of regular old coffee, he paid a dime, or two nickels--now it costs two bucks. When he put gas in the car (it was always cheap in Oklahoma), he paid 14.9 cents per gallon, or three nickles--now it costs three bucks. When he was hungry for lunch, he bought a deluxe double hamburger with all the trimmings for a silver quarter, or five nickles--now it costs five bucks. When he wanted to go to a movie, he paid thirty-five cents or seven nickles--now it costs seven bucks. And when he shopped for a new top of the line Dodge Custom with heater and radio and other options, it would set him back two grand, or forty thousand nickles--now it costs forty thousand dollars.

    The Pepsi isn't any wetter, the gas doesn't burn any brighter, the double burger isn't any more filling, and the movie doesn't last any longer today (with no newsreel, serial and cartoon, it actually doesn't last as long). So, there's only one explanation. The dollar is no longer worth a dollar. The dollar is worth a nickel. Period.

    Why do you think all the five and ten cent stores have been replaced with dollar stores?
    The debt has ultimately cost the nation its middle class, and has cost the working poor their independence and liberty. How does that work out percentage-wise...?
    'It ain't what we don't know that hurts us, it's what we "know" that ain't so.'--Will Rogers

    'I prefer someone who burns the flag and then wraps themselves up in the Constitution over someone who burns the Constitution and then wraps themselves up in the flag.'--Molly Ivins

  4. #3

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    I feel fortunate that I grew up in a time that the poor were independent and managed for themselves . They were better people than today . My Father was the local County Clerk and then a state representative , a farmer and then sold real estate after he no longer worked as a public servant . He was a real public servant . Representing the people . Doing taxes for others for free etc . Of course he knew everyone , he ate as many meals and had as many conversations with poorer people as he did of people with means , probably more. To him everyone was the same . And they were , there was no welfare . Everyone scratched to make do and the Churches etc were able to help rhose who could not .

  5. #4

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    Yes. It will cost you at least one and a half of your children.
    "And now that the legislators and do-gooders have so futilely inflicted so many systems upon society, may they finally end where they should have begun: May they reject all systems, and try liberty; for liberty is an acknowledgment of faith in God and His works." - Bastiat

    "It is difficult to free fools from the chains they revere." - Voltaire

  6. #5

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    Quote Originally Posted by timosman View Post
    Did anybody make any estimates of what the extra burden of deficit spending on an average taxpayer is? My back of the envelope calculations is we get taxed an extra 15-20% because of the federal government overspending. This does not take into account things like ZIRP which is absolutely necessary given the amount of public debt.
    The extra burden for this year is $266 billion- that is what interest on the debt cost the government. That is about 6.5%.
    Quote Originally Posted by NorthCarolinaLiberty View Post

    Half the crap I write here is just to entertain myself.
    I am Zippy and I approve of this post. But you don't have to.

  7. #6

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    Quote Originally Posted by Zippyjuan View Post
    The extra burden for this year is $266 billion- that is what interest on the debt cost the government. That is about 6.5%.
    You forget the immediate cost of letting the government spend the extra money that didn't exist.
    What is the punishment for the attempted murder of freedom on earth? 👁👁

  8. #7

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    Quote Originally Posted by Zippyjuan View Post
    The extra burden for this year is $266 billion- that is what interest on the debt cost the government. That is about 6.5%.
    Which is paid for by devaluing the dollar, not by paying off quantities.
    1776 > 1984

    The FAILURE of the United States Government to operate and maintian an
    Honest Money System , which frees the ordinary man from the clutches of the money manipulators, is the single largest contributing factor to the World's current Economic Crisis.

    The Elimination of Privacy is the Architecture of Genocide

    You are Ron Paul's Media!

    Quote Originally Posted by Zippyjuan View Post
    Our central bank is not privately owned.

  9. #8

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    Quote Originally Posted by timosman View Post
    You forget the immediate cost of letting the government spend the extra money that didn't exist.
    But it did exist. It was funded through the sale of US Treasuries. Investors purchased them by their own choice from money already had and they could have decided to do something else with.
    Quote Originally Posted by NorthCarolinaLiberty View Post

    Half the crap I write here is just to entertain myself.
    I am Zippy and I approve of this post. But you don't have to.

  10. #9

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    Quote Originally Posted by Zippyjuan View Post
    But it did exist. It was funded through the sale of US Treasuries. Investors purchased them by their own choice from money already had and they could have decided to do something else with.
    The Cayman Islands, a country with $2.5B GDP holds $269B of US debt - https://www.thebalance.com/who-owns-...l-debt-3306124

    Are we running out of places where to stuff this turkey?
    What is the punishment for the attempted murder of freedom on earth? 👁👁

  11. #10

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    Quote Originally Posted by timosman View Post
    Did anybody make any estimates of what the extra burden of deficit spending on an average taxpayer is? My back of the envelope calculations is we get taxed an extra 15-20% because of the federal government overspending. This does not take into account things like ZIRP which is absolutely necessary given the amount of public debt.
    Did you not get the memo?

    A republican is President now, deficits don't matter

  12. #11

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    Quote Originally Posted by timosman View Post
    Did anybody make any estimates of what the extra burden of deficit spending on an average taxpayer is? My back of the envelope calculations is we get taxed an extra 15-20% because of the federal government overspending. This does not take into account things like ZIRP which is absolutely necessary given the amount of public debt.
    This is a very rough estimate but I think we collect about 3 trillion and borrow about a trillion so we're spending 33% more than we're collecting.

    I think the cost of that 33% extra we borrow every year is going to fall more on the holders of dollars. I think if you hold real assets you can avoid a lot of that.

  13. #12

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    Quote Originally Posted by timosman View Post
    The Cayman Islands, a country with $2.5B GDP holds $269B of US debt - https://www.thebalance.com/who-owns-...l-debt-3306124

    Are we running out of places where to stuff this turkey?
    The Cayman Islands is a large banking center and a lot of hedge funds have offices there. The Treasuries are held by investors there. https://cnsbusiness.com/2016/06/caym...reasury-bonds/
    Quote Originally Posted by NorthCarolinaLiberty View Post

    Half the crap I write here is just to entertain myself.
    I am Zippy and I approve of this post. But you don't have to.

  14. #13

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    Quote Originally Posted by Zippyjuan View Post
    The Cayman Islands is a large banking center and a lot of hedge funds have offices there. The Treasuries are held by investors there. https://cnsbusiness.com/2016/06/caym...reasury-bonds/
    He asked if we were running out of places to stuff this turkey. Did you think lecturing us with information most of us already knew was going to distract us from that valid question?

    Water is a good thing everyone wants around, until the floodwaters come. Is the market for U.S. T Bills infinite or not?
    'It ain't what we don't know that hurts us, it's what we "know" that ain't so.'--Will Rogers

    'I prefer someone who burns the flag and then wraps themselves up in the Constitution over someone who burns the Constitution and then wraps themselves up in the flag.'--Molly Ivins

  15. #14

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    Quote Originally Posted by acptulsa View Post
    He asked if we were running out of places to stuff this turkey. Did you think lecturing us with information most of us already knew was going to distract us from that valid question?

    Water is a good thing everyone wants around, until the floodwaters come. Is the market for U.S. T Bills infinite or not?
    The market for anything is not infinite. The question is how big the market actually is. That will be shown by what interest rates people are wiling to accept to purchase US debt. Are we at the limits to that market? Rates are so low they suggest we are not.

    Historic Ten Year US Treasury Rates:


    http://www.multpl.com/10-year-treasu.../table/by-year
    Quote Originally Posted by NorthCarolinaLiberty View Post

    Half the crap I write here is just to entertain myself.
    I am Zippy and I approve of this post. But you don't have to.

  16. #15

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    Quote Originally Posted by Zippyjuan View Post
    The market for anything is not infinite. The question is how big the market actually is. That will be shown by what interest rates people are wiling to accept to purchase US debt. Are we at the limits to that market? Rates are so low they suggest we are not.
    Are you really talking about The Market? You wouldn't be trying to cover up the fact that the biggest customer for the nation's mortgage at this point is your masters at the Federal Reserve, would you?

    Yeah, buddy, the Federal Reserve is clearly the free Treasury market at work. They aren't propping that vehicle up at all.

    Answer: Why, yes, Zippy is trying to deflect from the question.
    Last edited by acptulsa; 02-14-2018 at 01:34 PM.
    'It ain't what we don't know that hurts us, it's what we "know" that ain't so.'--Will Rogers

    'I prefer someone who burns the flag and then wraps themselves up in the Constitution over someone who burns the Constitution and then wraps themselves up in the flag.'--Molly Ivins

  17. #16

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    Quote Originally Posted by acptulsa View Post
    Are you really talking about The Market? You wouldn't be trying to cover up the fact that the biggest customer for the nation's mortgage at this point is your masters at the Federal Reserve, would you?

    Yeah, buddy, the Federal Reserve is clearly the free Treasury market at work. They aren't propping that vehicle up at all.
    Actually Social Security is the biggest holder. The Fed currently has $2.4 trillion or about eleven percent. And they are reducing- not increasing- their holdings so they are not currently a customer for US debt. They stopped being a net- buyer back in October, 2014 (they do purchase some Treasuries still- to replace ones they currently own but have matured).

    https://www.thebalance.com/who-owns-...l-debt-3306124

    Which agencies own the most Treasurys? Social Security, by a long shot. Here's the detailed breakdown as of December 31, 2016.

    Social Security (Social Security Trust Fund and Federal Disability Insurance Trust Fund) - $2.801 trillion
    Office of Personnel Management Retirement - $888 billion
    Military Retirement Fund - $670 billion
    Medicare (Federal Hospital Insurance Trust Fund, Federal Supplementary Medical Insurance Trust Fund) - $294 billion

    All other retirement funds - $304 billion
    Cash on hand to fund federal government operations - $580 billion.
    Debt Held by the Public. The public holds the rest of the national debt ($14.7 trillion). Foreign governments and investors hold nearly half of it. One-fourth is held by other governmental entities. These include the Federal Reserve, as well as state and local governments. Fifteen percent is held by mutual funds, private pension funds and holders of savings bonds and Treasury notes. The remaining 10 percent is owned by businesses, like banks and insurance companies. It's also held by an assortment of trusts, companies, and investors.

    Here's the breakdown of holders of the public debt as of December 2016:

    Foreign - $6.004 trillion
    Federal Reserve - $2.465 trillion
    Mutual funds - $1.671 trillion
    State and local government, including their pension funds - $905 billion
    Private pension funds - $553 billion
    Banks - $663 billion
    Insurance companies - $347 billion
    U.S. savings bonds - $166 billion
    Other (individuals, government-sponsored enterprises, brokers and dealers, bank personal trusts and estates, corporate and non-corporate businesses, and other investors) - $1.662 trillion.
    China and Japan each have roughly $1.1 trillion.
    Last edited by Zippyjuan; 02-14-2018 at 01:48 PM.
    Quote Originally Posted by NorthCarolinaLiberty View Post

    Half the crap I write here is just to entertain myself.
    I am Zippy and I approve of this post. But you don't have to.

  18. #17

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    Quote Originally Posted by Zippyjuan View Post

    China and Japan each have roughly $1.1 trillion.
    What percentage of treasuries are bought by the private market? Any treasuries bought by central banks and foreign countries are artificial.

  19. #18

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    Quote Originally Posted by Madison320 View Post
    What percentage of treasuries are bought by the private market? Any treasuries bought by central banks and foreign countries are artificial.
    Difficult to say for certain. When they list the holdings a foreign country has, that includes both private investors and their central bank holdings. The Cayman Islands for example.
    Quote Originally Posted by NorthCarolinaLiberty View Post

    Half the crap I write here is just to entertain myself.
    I am Zippy and I approve of this post. But you don't have to.






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