It’s a fundamental difference in world view between you and I, I’m afraid. You take the “is” of Federal Government spending and treat it as some sort of sacred “ought” — a given that must not be tampered with except perhaps on the barest of the margins (unless, of course, we’re talking defense dollars).

And from whence cometh the laughable “what the Democrats want to do is raise revenue and cut spending”? That assertion is, in light of facts on the ground, completely unserious. The party and President that has not passed a budget since 2009(!) clearly “wants” nothing of the sort. Understanding that any serious attempt to reign in the budget will involve significant pain for favored constituencies and beloved programs they are more than happy to hide behind endless continuing resolutions and finger pointing at the opposition….

Further evidence of cognitive difference based on world view betwixt us is the citation of the American people as “Not wanting” to cut the level of spending? So what? I “don’t want” a lot of things that nevertheless should be – for my own good or for the good of the community/world in which I live.

I believe, frankly, that there is a prudential and moral case to be made that endless deficit spending (and the attitude behind it) creates a culture of dependency and entitlement and weakens the national fabric. When stakeholders become, instead, net recipients, (as nearly half the taxpayers now are) changes are bound to occur. Tocqueville saw this potential (and warned against it) long ago. It has now come to pass. I mourn that estate, with its concomitant loss of freedom. You clearly see it differently — what is there, really, left to talk about?

Scare quotes around “starving the beast”? As if I would find that somehow compelling? Somehow revelatory of Republican malfeasance? Would that…

Actually most of the spending has been neutralized by cutbacks in state and local gov’t spending as stimulus ended. The last source of stimulus left is that the income tax’s nature is that if you have less income you pay less tax…hence deficits are still here.

You haven’t provided us with any evidence. You’ve assumed that the Great Recession should follow the mold of previous light recessions with a rapid bounceback. If the proper model is a serious recession like Japan in the 1990′s or the US in the 1930′s then recovery is painfully slow and unemployment goes painfully deep. If that’s the case then we are amazingly lucky that we didn’t break 10% unemployment

David C,

If you watch the film, the first thing the banker asks is, “Have you made any cuts in your expenses?” When the guy says he has cut $380 from his annual budget, the banker says, “Hey, maybe you should think about generating new income. Maybe a new job? Maybe asking for that raise?” So the banker has talked about cuts to spending and increases in revenue.

Surely one can grasp that the repayment (or significant reduction) of a debt generates “new” income . . .

When you are spending more than you take in, how do you get the money to pay down debt? The government can only cut costs or increase its revenue. Since about 97% of the federal government’s revenue comes from taxes, the only practical way to increase revenue is to raise taxes. What the Democrats want to do is raise revenue and cut spending. What the Republicans want to do is only to cut spending. Now, it is “mostly true” that taxes on families are at their lowest level in about 50 years. If the American people really want government to shrink back to what it was in the early 1960s, then the Republicans are right. There should be drastic cuts in spending and drastic cuts in what government does. But the American people don’t want that. For the Republicans, the real issue isn’t the deficit. It’s shrinking the size of government. They want to “starve the beast.”

But there is evidence. In spite of all the money spent we are still in a slow recovery years after the recession. Yet somehow that doesn’t slow down those who want to spend more.

And you find this positive?

It’s at least as “interesting to note” that the only way that some folks can ever come up with to “generate new income” is “raising taxes and closing loopholes”.

Surely one can grasp that the repayment (or significant reduction) of a debt generates “new” income — (ie. income that is freed from one use to be applied to another)? Or that the cutting of budgetary items judged wasteful, unnecessary, obsolete, or redundant can also do the same?

I am lost as to why those who insist that only the revenue side is to ever be considered seem to believe they are holding all the trumps or the moral high ground? Regardless of analogy all budgets are two sided — there is revenue and there is expense. Why the notion that only income can solve any imbalance?

I guess that old saw about “every problem looking like a nail when the only tool one has is a hammer” pertains?

Evidence? None.

The last time we had a like crises was the Great Depression and unemployment peaked at nearly 25%. This time it’s been less than half that. Other countries, esp. European ones who embraced austerity have seen unemployment over 20% so it’s not like it’s impossible to ever see such high unemployment in modern economies.

Now how does national debt inhibit recovery? here it helps to have some model experience to refer too. The only model that makes sense would be for a doubling of the national debt to suck up savings out of the financial markets leaving banks unable to lend to businesses and individuals in the private sector. Problem: The prime symptom of such a thing is rising interest rates (and NO the Federal Reserve does not magically control all interest rates to hold them down). We’ve seen dropping interest rates, esp. in the long term.

Japan’s stagnation has absolutely nothing to do with it’s debt load. Just the opposite. Its debt load is due to its stagnation.

If only the problem were black and white, then we could ignore one to solve the other. Except, the national debt has more than doubled since Obama came into office mainly as stimuli of various sorts to get the recovery going. It hasn’t worked. It’s even possible that such spending keeps the recovery slow, especially as it increases the national debt.

So now recast your ‘household’ analogy by extending it multiple generations. What was the average debt load of your great grandparents by year? Your grandparents/parents/you and then your kids? You’ll probably find on average the debt load increasing in nominal terms just as it does for nations.