29 Jul 11
Originally posted by AThousandYoungHis job is to propose a budget, however, and they never get passed without modification, sometimes small, sometimes large. But I think that the failure that SG is talking about may reflect on what I see as Obama's failure to grasp the rudiments of the kind of negotiations that he urges on others. I mean, normally, we criticize him (from the Dem side) for giving things up without meaningful quid pro quo--but maybe he doesn't know how to propose something that has appropriate clues for people to get a handle on either. (I'd have to actually read his budget proposal though, before commenting directly on it.)
No, I blame it on the fact that it's not his job to pass budgets.
29 Jul 11
Well, let's talk about Obama's plan and why it didn't get one vote.
http://thehill.com/homenews/senate/163347-senate-votes-unanimously-against-obama-budget
The president’s budget called for ending tax cuts for the wealthy and a three-year domestic spending freeze, saving an estimated $1.1 trillion over 10 years. Democratic senators at the time called it “an important step forward”, “a good start” and a “credible blueprint.”
No Democratic senator was willing to support it, however, after Obama discussed a more ambitious plan at George Washington University to save $4 trillion over 12 years
29 Jul 11
1 edit
This is the plan that the Dems didn't like:
http://blogs.abcnews.com/politicalpunch/2011/04/president-obama-to-describe-vision-for-deficit-reduction-contrast-with-republican-plan.html
Though the president has yet to describe his plan in detail, Republicans are assailing the notion of any tax increases while Democrats are criticizing him for discussing changes to Medicare.
29 Jul 11
1 edit
Originally posted by AThousandYoung[/b]“Ninety-seven senators voted against a motion to take it up.
Well, let's talk about Obama's plan and why it didn't get one vote.
http://thehill.com/homenews/senate/163347-senate-votes-unanimously-against-obama-budget
The president’s budget called for [b]ending tax cuts for the wealthy and a three-year domestic spending freeze, saving an estimated $1.1 trillion over 10 years. Democratic senators ...[text shortened]... d a more ambitious plan at George Washington University to save $4 trillion over 12 years
Democratic aides said ahead of the vote that the Democratic caucus would not support the plan because it has been supplanted by the deficit-reduction plan Obama outlined at a speech at George Washington University in April.”
Technically, it seems they didn’t vote against the bill, but the motion to take it up. Nevertheless, I think the above quote illustrates my point about the rudiments of negotiation. He proposes a budget, presumably wants his team to get it to the floor for debate, then says things that lets them think it has been “supplanted”? He either sent terrible miscues, or his own party in the Senate read his cues terribly—or he changed his plans midstream and wanted his own formal budget proposal to not get to the floor for debate?
29 Jul 11
2 edits
Originally posted by AThousandYoungPeople take starting positions expecting to have to make trades in the negotiating process. When the starting positions are public, you’re apt to be criticized by your own side (although this has been a kind of three-way affair) as well as the opposition, as people begin to lobby the public as part of the negotiation process. Even in negotiations where all the actual bargaining is done behind closed doors, the parties may issue public statements—and I have seen such public statements that bore little resemblance to what was actually going on. So I learned to discount them. In this case, that may prove to be an error… And then again, maybe I don't have the sense of fortitude at the 11th hour that I used to...
This is the plan that the Dems didn't like:
http://blogs.abcnews.com/politicalpunch/2011/04/president-obama-to-describe-vision-for-deficit-reduction-contrast-with-republican-plan.html
Though the president has yet to describe his plan in detail, Republicans are assailing the notion of any tax increases while [b]Democrats are criticizing him for discussing changes to Medicare.[/b]
29 Jul 11
2 edits
Originally posted by dryhumpYou might be right—
Newsflash, the credit rating is very likely getting downgraded even if they raise the debt ceiling.
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NEW YORK (TheStreet) -- Ratings agencies Standard & Poor's and Moody's Investors Service(MCO) are attempting to get tough in the wake of the financial crisis, hoping to rehabilitate their seriously bruised reputations, say market watchers.
"The ratings agencies are engaged in some sort of campaign to restore their credibility," says Arturo Cifuentes, a professor at the University of Chile and former Moody's analyst who has testified before the U.S. Congress about the role of the ratings agencies in the subprime crisis. He points to recent threats to downgrade the U.S. sovereign rating, something he says "they should have done a long time ago," as a prime example of this campaign.
…
Regardless, Cifuentes believes ratings agencies' efforts to improve their reputations will prove fruitless. "In the PR arena their image is probably broken beyond repair," he says.
http://www.thestreet.com/_yahoo/story/11203758/1/ratings-agencies-get-tough-wreak-havoc.html?cm_ven=YAHOO&cm_cat=FREE&cm_ite=NA
EDIT: I am not a fan of theStreet.com, and generally think of them as an internet tabloid.
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Regardless of the rating agencies, the real question is whether, and how severely, the market downgrades government debt. And, as ATY noted, that may have more to do with whether or not the government defaults on paying any of their accounts payable.
29 Jul 11
Originally posted by AThousandYoungDid you happen to read The Big Short? The impression I have gotten is that the folks at Goldman’s and elsewhere that put together all the multi-tranched CDOs were laughing up their sleeves at what they pulled over on the ratings agencies—but that part of the agencies’ (S&P, Moody’s, Fitch) “gullibility” or incompetence was at least abetted by the fact that they were being paid by Goldman, et al.
Moody's can go screw itself. I hate them. The shenanigans of Moody's and Goldman Sachs were a major part of this economic meltdown.
29 Jul 11
Originally posted by vistesdNo, but I've seen Michael Lewis interviews, so I'm coming from the same place.
Did you happen to read The Big Short? The impression I have gotten is that the folks at Goldman’s and elsewhere that put together all the multi-tranched CDOs were laughing up their sleeves at what they pulled over on the ratings agencies—but that part of the agencies’ (S&P, Moody’s, Fitch) “gullibility” or incompetence was at least abetted by the fact that they were being paid by Goldman, et al.
30 Jul 11
Originally posted by badmoonThere is nothing rational about having a law placing a "ceiling" on debt, and then ignoring it by revising it upward every couple of years.
Even conservatives, rational ones, have to agree that using that power is preferable to a default.
Up 'till now, even the most "radical" plan, cut, cap and balance, isn't really serious about dealing with the full scope of the national financial problem.
The plans being debarted now, don't even cut below the current "baseline" which is artificially high due to the spending spree of the last couple of years, and that of Bush before him.
Cuts of less than 7% on any line item amount to actual increases in spending. The arguements against "default" are pure scare tactics, and default isn't the only alternative. When a household comes up against its credit card limitations, and the issuing company refuses to raise the limit, is bankruptcy the only option?
Clearly, when no more debt is available, and revenues may not be raised, the alternative is spending within one's means. That may be painful now, but the longer the pain is put off, the greater it ultimately becomes.
30 Jul 11
Originally posted by SleepyguyThat would be even better, to be sure, but I would be impressed enough if he just showed the conviction to do what he believes necessary, polling or no polling. Politicians these days don't have opinions of their own, they borrow them from Rasmussen.
Bah! How about hanging his a** out there and presenting a responsible budget and a plan to address our fiscal problems?