Quote:
Originally Posted by parsonsj
The assertion that "mostly it is based on entitlements and high tax rates" doesn't match the data. There is no such thing as "European" debt, and no such thing as a European bond. The argument needs to be based on the individual countries in Europe in order to have data to match the assertion, and when you do that you find the argument doesn't work so well. Here's why:
1. Northern European countries (Finland, Sweden, Norway) have the strongest growth over the past few years, and they have the highest tax rates and most comprehensive safety nets in Europe.
2. Central European countries are doing ok, though they may be in recession now or on their way to recession. Germany, France, Austria, etc. They have lower tax rates, and more private sector safety net (private health insurance, etc.).
3. Southern European and peripheral European countries are doing poorly. The so-called GIPSI (Greece, Ireland, Portugal, Spain, and Italy) countries are in this group, and they are the ones in crisis. These countries are the ones we need to discuss to see if there is a lesson for the US.
When you dig into the the GIPSI countries' data, you find that the assertion that "high tax rates and large entitlements" argument doesn't match either. Recent attempts to cut government spending in those countries have resulted in even larger deficits, and worse, has put millions of people out of work. Cutting government spending is not working. If we look at the GIPSI woes, the lesson is pretty clear: it's better to pursue policies of increasing employment, and growing the economy to reduce future government debt.
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Forget Europe for a second and then try the argument of continuing spending in America...Take California, and try to argue that you need to increase the spending and the debt to grow it's economy..
Instead of lowering the debt, they continue to spend on Government employees, and Bullet train projects ,that will triple in costs and be unfinished.
City after city is going bankrupt due to massive over spending..
The spending and growth you talk about is only on the government programs, and the government employees, not the private sector..The private sector is being punished with more taxes to pay for the spending.
This is the canary in the coal mine...The nation is following California's lead..
I can appreciate your posts , so that the reader's can decide for themselves.
But i guarantee that I don't see through your eyes and never will..When you say that it is clear what is happening, I say the same thing...It is pretty clear what is happening..There is a Debt crisis due to massive overspending..
Government has always been the most wasteful entity ever, and increasing it's size and power only lends to more wasteful spending..
More bankrupcies to follow.And they will all be cities and states...More bailouts, printing and spending is coming.