Why The Congress Cannot Balance The Budget

Video

This video was made by an accountant who examines the 2013 budget proposed by The White House and shows exactly, in hard numbers, why the budget cannot be balanced. It is only 6 minutes, it is worth watching. Note in the video still shot shown that all non-mandatory spending is crossed out, it isn't counted at all.

reply to post by DarthMuerte

Still watching the video but one of the biggest reasons is because we have a debt based monetary system.

This is by design.

The central banksters ie the Rothschilds, wanted a monetary system which requires debt in order to create money. In other words, the Federal Reserve "buys" US bonds (a debt note) with their Federal Reserve Notes aka funny money. The US Treasury then takes this money and deposits it in a bank where its lent out x 9 (fractional reserve banking).

The Fed bought a $10k bond but we have to return the principal (the $10k) plus interest. Problem is, that interest was never created into the money supply so where does it come from?

One place: bankruptcies, boom and bust cycles. The interest has to come from someone else's money.

Which is why Ron Paul wants to audit the Fed. He wants to get rid of the debt based monetary system.

Edit***

Ron Paul suggested that we not pay owed interest to the private Federal Reserve. So what did they do?

They got Obama to re-classify interest payments to the Fed as MANDATORY spending.

reply to post by gladtobehere

Even if we ignore all of that and just go by simple mathematics, the budget cannot be balanced. We have to cut spending. There is going to be allot of pain in the short term, either that or complete economic collapse if we do not address the problem.

reply to post by DarthMuerte

For sure.

Spending has to be cut drastically and there was only one man who dare mention it: Ron Paul.

The first place he suggested: our overseas military empire.

reply to post by gladtobehere


If you notice in the video, even if we cut 100% of the defense budget, we still cannot balance the budget.

I have known all this and been telling everyone I know for the last three years.

They simply do not want to hear it, telling me I don't know what I'm talking about, that some politician has it under control or that it simply can't happen. This country has a major problem, people have had it too good for too long, and they simply don't accept that it can change.

It is obvious no politicians seriously want to do anything about it and I'm not sure if it is because they are also in denial or realize at this point not much can even really be done.

All anyone can do at this point is prepare for what is coming.

Originally posted by gladtobehere
reply to post by DarthMuerte

 

For sure.

Spending has to be cut drastically and there was only one man who dare mention it: Ron Paul.

The first place he suggested: our overseas military empire.

BINGO!!!!!! Thats the where we need to CUT SPENDING ASAP...

The military budget both domestic and overseas needs to be CUT BIG TIME. This is PRIORITY 1 for cuts. Priority 2 is getting rid of the Bush tax breaks. Any Conservative who is GENUINELY concerned with debt would NOT argue against this. But heck, they never cared about debt ever in the past until a solution of ending the Bush tax cuts was put on the table. Then all of a sudden, the Conservatives are concerned with debt. Hmmm, interesting eh?

Since when has balancing the budget mattered. if people are willing to give us money for almost no interest and in many cases negative interest, why not?

I know most ATS people dont understand this but balanced budgets and debt dont really matter.

Originally posted by gorgi
Since when has balancing the budget mattered. if people are willing to give us money for almost no interest and in many cases negative interest, why not?

I know most ATS people dont understand this but balanced budgets and debt dont really matter.

Got to be kidding me..If you never pay off debt you become dictators with money.If you never balance the budget you cause massive debt problems that leads to massive unemployment.You also risk your government from people rising up to a revolution to take over the government for putting your own citizens into to much debt.Big thing is you risk the sovereignty of a nation as well which is very dangerous..Also risk the people no longer having trust or faith in the government and you no longer need to have responsible leaders.

Originally posted by Jobeycool

Originally posted by gorgi
Since when has balancing the budget mattered. if people are willing to give us money for almost no interest and in many cases negative interest, why not?

I know most ATS people dont understand this but balanced budgets and debt dont really matter.

Got to be kidding me..If you never pay off debt you become dictators with money.If you never balance the budget you cause massive debt problems that leads to massive unemployment.You also risk your government from people rising up to a revolution to take over the government for putting your own citizens into to much debt.Big thing is you risk the sovereignty of a nation as well which is very dangerous..Also risk the people no longer having trust or faith in the government and you no longer need to have responsible leaders.

edit on 4-11-2012 by Jobeycool because: (no reason given)

What?
None of what you said has any causation to having a debt nor connected to each other.

reply to post by YourWIFI

Did you watch the video at all? Even if we reduce the military budget to zero, we could not balance the budget. Entitlements must be cut. Entitlement spending is now larger than the amount of taxes we currently collect. That is JUST entitlement spending. All other spending for everything else is only roughly 1/2 of what we spend on entitlements and interest payments.

Basically we just drove ourselves off a cliff.
Well...maybe we haven't started the freefall yet.

If you allow a nation to become "used" to entitlements and handouts, they become addicted like a drug. Ever try to give someone something beneficial and then take it back? It would cause massive riots the likes of which we've never seen. Nationwide chaos...

But we must stop spending drastically.
If it means shutting down gov't, so be it.
Those fat cats need a pay-free year or ten.

But that, like another poster said above me, is destruction by design.
This country will not last the way it is headed...
Simple math will tell you that.

We need to cut military spending and entitlements and then we need to raise taxes on everyone. We need to get rid of all the tax loopholes which allow corporations to hide their money in offshore accounts and any other ones that allow someone with a lot of money to get out of paying to help our country. Once all that is done, all surplus should be going to pay down the debt.

Unfortunately NONE of those things will even come close to happening.

reply to post by Krazysh0t

We need to get rid of all the tax loopholes which allow corporations to hide their money in offshore accounts and any other ones that allow someone with a lot of money to get out of paying to help our country.

Ahh but you are not looking at things like a businessman.
Supose you start a company called Krazysh0t pizza in NYC. It does well, very well.
You decide that London is ready for Krazysh0t pizza and you open a store there. It does well, very well.
After one year you decide to open another British outlet. You take the profits from the London store and invest it in a second store in Kent.

Since you are paying British taxes (very high)on the operation of the London store and you are reinvesting the profits in a second Kent store, Why should you pay any US taxes on the overseas stores?
That's the issue that is never talked about. It amount to double taxation. Most of the overseas operation(s) never show much of a profit. Most of the spare cash is deposited in a British bank as a buffer for normal operations just like you do here.
What makes the whole thing a good idea in the first place is it improved the value of the stock. A multinational company is worth more.

I'm not going to pretend to know tax law. However I have talked to many investors about tax law and I know that the system is built to make the rich richer. These tax laws need to be simplified and these people need to be paying more. I don't know how I'd go about doing it and I know it isn't going to be a simple fix. But I know that the profits from the NY store in your example shouldn't be able to be hidden in offshore accounts, which can and does happen now.

reply to post by Krazysh0t


The solution is most definitely NOT raising taxes.
It is to create a FAIR tax for everyone...i.e., 15%.
No more Corporations paying -12% or -8%...
No more tax breaks or financial "loopholes".
Everyone pays. Regardless of class.

Like the video narrator said, even if we stopped all entitlements, we still are in debt.
There has to be drastic measures taken, none of which would be easy.

But...I'm afraid this economy is too far gone.
It's designed to fail, because you can't keep compounding debt.

The only real reset will change the world forever.
Maybe that's why this system keeps the elites rich.
They know this system is failing so they want the crash to happen.

....and it seems that's what they are banking on!

reply to post by havok

It is to create a FAIR tax for everyone...i.e., 15%.
No more Corporations paying -12% or -8%...
No more tax breaks or financial "loopholes".
Everyone pays. Regardless of class.

As has been mentioned before 15% of what?
It's not that we can't have one flat rate but how do you determine what is taxable?

You said the tax code is set up to make the rich richer.
Do you think the stock market is necessary? Of course it is. No company can grow beyond one or two stores without it. Banks won't lend you that much money with almost no collateral.
Enter your rich get richer belief.
If I sell a stock for a $10,000 profit should I pay income tax on it?
You say yes, I say maybe. Examples:
If that's the only stock I have ever sold in my life, then yes I should pay tax on $10,000.
But..
I lost $7,000 on American Airlines this year (For real). So in the real world I only came out with $3,000 in my pocket. I say 15% on $3,000. That's fair.

If you can't offset you losses you won't invest in new upstart companies. Apple wasn't always this big.

the budget will not be balanced simply because we borrow money, at interest, from the federal reserve, our own money we borrow at interest and it's a system with no future. the banksters are winning and we are loosing so it's no wonder mere legislators cannot balance the budget, when half of them work for the banksters, why and how would they balance anything?

doesn't matter how, when or why but the illusion of a republic in our country is just that, an illusion. those with the money have the power now and those without do not and it's a very old paradigm to say the least.

our POTUS has no chance in a pool full of sharks, get used to it, or work to change it. in the same way our decent legislators, the few we still have, don't have a chance either because they're out numbered 2-1 these days, i would imagine.

there is no fix for this situation other then letting it break down and rebuilding a new.

Most of the sheep don't care about the ramifications of this extraordinary deficit and national debt. The roads get plowed and salted in the winter, the cops are still patrolling neighborhoods, the power is still on...etc...etc...etc.

They have no idea what is going to happen when the economy starts to turn a little more positive and the interest rates start to rise. It will be at that point that the lion's share of incoming revenue will be going to pay interest on the debt and will not be there for their personal pet programs...the little things they take for granted.

Superstorm Sandy needs to be a wake up call for everyone. There is going to come a time that disaster is going to hit and there is not going to be any money to do anything about it and GOV IOU's are not going to get disaster areas cleared and homes, bridges and roads rebuilt.

The only solution IMO is to take on the debt just like an individual does trying to pay off a mortgage early. You cut spending, increase revenues and apply that to the principle which over the long term will reduce accrued interest. However, none of our representatives are actually serious about addressing the problem...it's all lip service.

Originally posted by LittleBlackEagle
the budget will not be balanced simply because we borrow money, at interest, from the federal reserve, our own money we borrow at interest and it's a system with no future. the banksters are winning and we are loosing so it's no wonder mere legislators cannot balance the budget, when half of them work for the banksters, why and how would they balance anything?

doesn't matter how, when or why but the illusion of a republic in our country is just that, an illusion. those with the money have the power now and those without do not and it's a very old paradigm to say the least.

our POTUS has no chance in a pool full of sharks, get used to it, or work to change it. in the same way our decent legislators, the few we still have, don't have a chance either because they're out numbered 2-1 these days, i would imagine.

there is no fix for this situation other then letting it break down and rebuilding a new.

We are quite beyond the ablility to just "let it break down". That would be bad enough if it were merely a closed system. Had the government only borrowed from the FED.
But, they borrowed from other countries. The piper's will call the shots at some point of how to pay.

For the people decrying that debts don't matter then they are evidently not a party who is owed.

It seems to me that there needs to be some sort of debt settlement day, before we can move forward.
But, no one wants to be the first to make the move and pay up first. They don't want to pay until their debts are
paid.

I say we start with the largest central bank and have them pay back first.
First they pay back all the fraudulent interest charged to the US government and other countries likewise their central banks, also.

Take the US for example. The US gets refunded all that interest line item accumulated via the FED.
Vast sum. They in turn pay back the pension funds due in lump sum to the contributors what they paid in.
They pay back all the money paid in to SS in one lump sum.
Money paid back to Medicare and Medicaid in one lump sum.
Then dissolve the program.
Once the in house items have been settled, then the US can go about paying back it's debt to other countries.
Who will then be able to pay back their debts to their citizens and other creditors
I figure it will take a few cycles around paying back and forth to settle the whole mess.

Once done, people and countries will not be very happy about the central banks, fiat money and living outside of one's means.

Also, mortgages and loan interest should be set at the same rate as savings interest. Flat 5%.
No net gain for banks. Too bad. Guess they'll live off card fees and account fees.