Deficit reduction proposals

The Postal Service has lost a few billion a year each of the last few years. It's not entirely government funded any more, but the losses require Congress to front 3 billion here or 5 billion there.

Current project budget overruns at the DoD - not the projects themselves, just the amount they're overbudget - run into the hundreds of billions of dollars.

 

2 + 2 does not equal 22.

You read way more into that than was there.

IF you were irresponsible . . . IF you bought a house you could not afford . . . and then took out a 30-year mortgage on it . . . you get a monster tax break. All of that is true.

But it's a Bob Beamon-sized leap to read that as "everyone on a 30-year mortgage bought a house they could not afford." Basically just someone looking to be pissed off at something. Congrats. You succeeded.

 

Start building stuff. Get the economy back on its feet.

Worry about the deficit once unemployment drops back to pre-2007 levels.

 

How much did we spend in Iraq and Afghanistan the past 8 years? There's the trillion or so you're looking for.

 

Deficit reduction is passe. Let's just use inflation to pay off our debts. Then we'll have something else to worry about.

 

Pretty big leap to say a 30-year home loan is "irresponsible." People shop based on the monthly payment more than the actual price of the house, and in the current reality the interest deduction plays a gigantic role in determining the monthly payment. It factors into everything from the online calculators to the bank's qualification process, and that's for every loan of the past however many decades, not just the speculative environment of the last 10 years.

To remove that from the equation now is changing the rules of the game at halftime. I could see phasing it out over a span of 10-15 years or saying no new loans will qualify for the interest deduction, but to eliminate it isn't fair.

But the most universally utilized and beloved tax break isn't likely to go anywhere, so this discussion is mostly academic anyway.

 

The mortgage interest deduction only subsidizes about a third of homeowners. These are folks affluent enough (or whose interest payments and taxes are expensive enough) to itemize. If you don't itemize, you only get a standard deduction. Now, keep in mind, you take that deduction because it's LARGER than the interest/taxes you paid.

So, the homebuyer who buys a smaller home that can be afforded with a 10-year mortgage in essence receives a subsidy, too, since the standard deduction is one-size-fits-all and likely is way more than the interest/taxes that are being incurred.

 

It will never happen. Political suicide. Old people always vote.

They'd be better off taking away student loans altogether.

 

But-but-but-but-but-but-but...

The old people just voted, overwhelmingly from all accounts, for people who according to public statements were concerned, very very concerned, about the catastrophic deficit.

So, fine. Start working on it now.

See above. Do that too.

 

If people were so damn worried about the debt, we should have elected Dave Ramsey.

 

Totally off-topic threadjack, but I've always wondered, how does anyone truly follow his advice to go without a credit card? I don't mean from the "pay as you go" standpoint, I get the idea that handing over the cash makes it more meaningful and thus you're more likely to hold onto more of it. Makes a lot of sense. But I mean from the standpoint of booking a hotel room or a rental car or an airline ticket or just buying something online. How does that happen without a credit card?

 

The way it works is this. Old people will vote for proposals to cut Medicare and Social Security in the far future, that is, for the young people whose taxes now pay their benefits, in order to preserve what they're getting. HOWEVER, this will never result in any savings because by the time they are supposed to go into effect, young people will be old people who vote, and the kick will be kicked further down the road, ad infinitum.
All the deficit does is illustrate that all of American politics works on the "I'm a selfish shit" principle.