This is not a political debate, this is a question,

How can people feel comfortable with this number as our national debt? And with no real plan to ever pay it down, only to ever increase.

This is a question I can not wrap my head around. I can't help but entertain the idea that by the time I'm an old man, America will be dead.

Forclosed on. A part of another, or many other countries who have all cashed in on what's theirs. What flag will we be saluting in 30 years? I'll be 58 years old then.

What can be done aside from pointing fingers. I don't know all the history, I don't know all the politics, but I do know that that's an astounding number to comprehend.

How can it work, if I ran my household budget like this, I'd be bankrupt. If I made $100 day and spent $1,000 per day, how long would this last? Why is it that this practice would lead to disaster and bankruptcy for individuals and private businesses, yet our government seems to be immune to the idea that eventually all loans have to be paid back.

So what happens to America when that day comes?

At least it looks as though Obama is at least trying to make jobs, as opposed to just throwing money at people so they can buy more stuff from China.

I'm not the smartest man in the world, I'm just an ordianry High School graduate who maintained a C average, but for the life of me, I can't figure out how this kind of financial policy can work...

Maybe I'm just an idiot.

Then I look at this: http://news.bbc.co.uk/2/hi/business/411973.stm

Ahh, the good old days... Looking at that chart makes me roll on the floor now... what a joke!

I certainly agree with you Andrew. The level of debt the US is in is quote mind boggling and beyond comprehension for me. Im sure others here have a better understanding of it but it sure scares me a little.

My country (Australia) is slightly better off, however our PM is trying to pass a stimulus package at the moment that will see us go from a large budget surplus to a large deficit in the space of a few months.

Its easy to spend someone else's money isn't it?

This is not a political debate, this is a question,

How can people feel confortable with this number as our national debt? And with no real plan to ever pay it down, only to ever increase.
...
So what happens to America when that day comes?

At least it looks as though Obama is at least trying to make jobs, as opposed to just throwing money at people so they can buy more stuff from China.

I'm not the smartest man in the world, I'm just an ordianry High School graduate who maintained a C average, but for the life of me, I can't figure out how this kind of financial policy can work.....
...

Ahh, the good old days.... Looking at that chart makes me roll on the floor now... what a joke!

Hello, Andrew; you are no idiot! I've always maintained that, to get the right answer, one must ask the right question, and you have: "So what happens to America when that day comes?"

It's my belief that there is almost nothing new under the sun, which is why we study history. And I cite to you the example of Weimar Germany and its experimentation with hyperinflation. The ultimate 'winner' is anyone's guess. But Obama's efforts to create jobs is worthless because government, even the most well-intentioned, knows nothing about real jobs, much less creating one. For example: we find ourselves, in the U.S. with a president who has never hired anyone in his life, has never 'created' a job. Why should he be able to do so now? I recently visited a shoe distribution center, back in the Fall of 2008 when all the talk was Congress bailing-out the sinking financial mess. I looked around the center at all the conveyor belts and the thought occurred that there is not one member of Congress who could explain how that distribution center worked. How do they understand banking or finance? They don't, or at least most of them don't. The U.S. gov't has been interfering with the economy for a year and the stock market is down about 3,000 points. Doesn't that tell us something? (Let me offer this observation as well: it has nothing to do with tax cuts.)

Inflation in the Weimar Republic - Wikipedia, the free encyclopedia (http://en.wikipedia.org/wiki/Inflation_in_the_Weimar_Republic)

Hey, someone in our local paper said that they should require politicians to have only a high school education and no more.

I remember back in the 80s, when Reagan cut taxes and a democratic congress and the military budget spent and spent. I remember the outcry about soaring defecits then.

Then the cold war ended and Clinton and this country were the beneficiaries of a "surplus" in large part due to the GOP "contract with America".

--------------------------------------------


The scary part is
-- Reagan was an optimist and raised confidence. Obama is telling us the sky is falling.

-- Nuclear annihilation is real and it is constitutionally correct to spend money on defense [ and a good offense contribute to a good defense].

Someone should tell Obama that the economy does cycle. By the time his "shovel ready" jobs have started after all the deliberations and bureacratic delays take 6-12 months, theeconomy would have recovered on its own.


Obama and the congress are using this to spend and spend our taz dollars and our children's tax dollars on what? Bailing out failing banks and uncompetitive industry?

But the bottom line is confidence, as long as we the taxpayors and those that own t bills have confidence that the US gov is and can pay back its debt it does not matter.

A rough measure of this confidence is the stockmarket.

3 mo ago dow was at 9035
1 mo ago dow was at 8375
1 week ago dow was at 8249
2/17/09 7552 *

[per I phone app ]*

Oh! Oh!







G&P

To reinforce the views expressed above ,this op-ed at Financial Times is a good read :
IBDeditorials.com: Editorials, Political Cartoons, and Polls from Investor's Business Daily -- The Price Of Fear (http://www.ibdeditorials.com/IBDArticles.aspx?id=319768125902184)

We are betting a lot on a neo-Keynes-on- steroids economic theory. But the debt service will consume a large portion of future budgets ;and as George , Excon and others have pointed out ,the level of spending could imperil the monetary system.
And this does not even factor in future entitlement obligations (which I'm sure in issues like SS we will be screwed... that's why some in Congress are seriously contemplating confiscation of private 401-K money and incorporating them into a public pension program) .

Hoover and FDR turned an cyclical economic slump into a depression with the combination of protectionism and Keynesian pump priming . I don't think it will be any more successful this time.

To But the debt service will consume a large portion of future budgets ;and as George , Excon and others have pointed out ,the level of spending could imperil the monetary system..Hello tom:

COULD?

Or, maybe it's an attempt at achieving that very objective. After all, who benefits the most from inflation? That would be DEBTORS, because they get to pay back their loans with cheaper dollars. It's the lenders who get screwed.

Who is the worlds biggest debtor? That would be US. Who stands to gain the most from an imperiled monetary system? That would be our government. In fact, the government could pay the entire $10 Trillion off in a couple of weeks if hyper-inflation gets underway.

I said if. I should have said WHEN.

Buy gold.

excon

Hyperinflation will occure when or if the Fed "Monetizes the debt" .That will happen when they can't find "suckers "... oops I mean investors to purchase the debt. The investors until recently have been China ,Japan ,the OPEC nations etc. But their appetite for owing our debt is likely to diminish given the current economic climate.

Andrew understated the debt . Once the bucket list American Recovery and Reinvestment Act of 2009 is calculated into the equation the debt balloons .

Treasury is preparing to borrow up to $2.5 trillion in 2009 to cover the 2009 federal budget deficit, followed by borrowing another $4 trillion in 2010, with the prospect of increasing the current $10 trillion U.S. national debt by 65 percent in the first two years of the Obama administration. The true current obligations of the federal government, as determined by the U.S. Treasury using GAAP, or Generally Accepted Accounting Practice, rules, totaled $65.5 trillion , exceeding the GDP of the world. This is based on future obligations for unfunded liability entitlements including Social Security and Medicare benefits .

These figures don't show up in the budget because entitlements are not for some reason I can't explain are not included in the liabilities column . When a Corporation like Enron did that the execs got frog marched.
Like Elliot mentioned in a previous posting ;why is this not a Madoff-like ponzi scheme ?

Scary scary scary...

In laymens terms, it strikes me as a big "cash advance" ring! And we know how long those last on those who use them. A few months at the most?

When the government has to borrow money to pay it's bills, then we are in trouble, just like the family who has to borrow from one cash advance to pay another.

I'm not expert on it, but it just seems like we are teetering on completle collapse, that to me, could spell the end of America as we know it, maybe even America period.

Obama's plan has to work because if it doesn't what is plan B, sorry, plan C, sorry maybe we are up to play Q or R now?

Like I've always been told, you can't grow money by shaking it from one side to another...

And then there are those opitimist who say "we have always had the debt"

True

BUT if you look at any chart of the debt, you see the termendous surge right after 2000. It's like it stays on one spot for most of the last century, then suddely, the bar moves right off the chart!

I am one who has no problem with reasonable debt to deal with targeted specific expenditures. When you buy a house you don't put cash down ,you finance it long term. Your assets and revenues need to cover the debt service.

How much is reasonable ? Much less than our obligations by a long shot.

But let's consider the asset side of the ledger . Beyond the gvt ability to tax, the country owns about 30% of the land mass of the country. (the most amazing number is 45.3% of the State of California is Federal Lands. What is the value of that ?

Also as of this date ,the United States is still a good and reliable investment that other nations can invest in . You have not seen the nations I listed above stop purchasing Treasuries.

I do not think there is an imminent danger of collapse . But the canary in the mine is beginning to gag. The warning signs are lit up like neon. But we just voted for HopenChange and he believes in priming the pump .Which also means that he is transferring a lot of the economy out of the private sector into the public. Even if I was to buy into that theory I have doubts that most people who endorse the nanny state think it is a temporary situation.

I understand tomder, my concern is that public land being used for collateral. I don't know how much of it is true and how much is rumor, but it's been told to me that the American government owns about as much of the "federal land" as the typical American homeowner owns on a mortgages house.

So what happens to the homeowner when he can't cash advance anymore and all the equity in his house has been exhausted?

I don't know ;there's a whole bunch of resources awaiting leasing rights under the Federal holdings . There is revenue to be had from the land without mortgaging it.

I share your concern . The growth of spending was uncalled for in the last decade and the new leadership appears to want to triple down on it . There is no doubt that long term it is unsustainable.

But when ? The alarm bell to me is that I have never seen proof that the nanny state ever shrinks. There was ample opportunity in the last 30 years to do so but pet programs and the size of the bureaucracy constantly expand . Even reductions in the rate of increases gets very negative press.

And then there are those opitimist who say "we have always had the debt"

True

Not true. I recall speaking with a (liberal) teacher during the 1964 national election (Johnson v. Goldwater). One issue was the 'Great Society'. My teacher said, why have all that money piling-up in Washington D.C. when it gets to be just like manure, raising an ugly stench? Another teacher (civics) said, what's wrong with the U.S. borrowing money, because we will always be friends with those that loaned it?

... my concern is that public land being used for collateral....

I have never heard of national debt and public lands held in a mortgage relationship before. In fact, I do not believe it works that way. Economic problems have led to wars, but the Chinese, et al, are not coming for us even if we start hyperinflation, unless somehow the situation began to undermine the Chinese gov't's ability to regulate itself, in which case, it might lead to hostilities.

I have never heard of national debt and public lands held in a mortgage relationship before. In fact, I do not believe it works that way. Economic problems have led to wars, but the Chinese, et al, are not coming for us even if we start hyperinflation, unless somehow the situation began to undermine the Chinese gov't's ability to regulate itself, in which case, it might lead to hostilities.

While I do not doubt you, let's discuss, I'm curious as to what's your take on this...

I'm not saying it's 100% fact, everyone knows you can't believe everything you read on the internet. So I thought this would be a good time to bring it up and hear other opinions:

Here is the link:
Is The U.S. Already Bankrupt? (http://www.whatreallyhappened.com/ARTICLE2/doodoo.html)

And then we have this:
http://whatreallyhappened.com/WRHARTICLES/ifiwere2.html?q=ifiwere2.html

Among items in the second link, this catches my eye... I've had these pages bookmarked for a few years now... it's almost like they looked into a crystal ball...


The trend is obvious; unless there is a radical change to the cash flow across the border, the US government is staring at total economic collapse. The citizens cannot be taxed enough to pay the interest on the debt, let alone the debt itself. The dollar will cease to be the currency of choice in the global market. The situation is desperate. And as Clancy illustrates in his book, a desperate government will take desperate chances.

I have never heard of national debt and public lands held in a mortgage relationship before. In fact, I do not believe it works that way.


I did not say that it is . Our debt is financed with Tresury notes which only collateral is the "full faith and credit".
The reason I brought it up was because of the comparison being made to a home owner who overextends.

The real point I was making is that controllable debt is not the worse thing in the world . It allows for planning . As andrew pointed out ,it is the debt service as a percentage of the budget that is becoming scary.

BUT if you look at any chart of the debt, you see the termendous surge right after 2000. It's like it stays on one spot for most of the last century, then suddely, the bar moves right off the chart!

For a different perspective on the debt growth in the last 8 years.

American Thinker: Who Are the Big Spenders? (http://www.americanthinker.com/2009/02/who_are_the_big_spenders.html)
But when all was said and done, spending levels remained about where they were for the previous 50 years (as a fraction of GDP).

Very good read Tomder, a different persective.

Like I said, I don't claim to be a political expert. I'm not one of the partisan people that is all for the democrats or republicans, I voted third party in the 2008 election. So I don't have any problem with Obama, we won the presidency and I hope this country fares well under this administration.

However that said, I do see a blatant double standard when the democrats criticize ANY frivilous spending by formers adminstrations, when as the website you said suggested, his administration has already added quite a chunk to it.

I was talking to my boss today, and I noted that I have been observing the welfare class latley, and they have gotten to the point were they almost bank on two or three stimulous checks every year.

What the don't realize is every time the government pulls money out of thin air, it's not a free lunch. The cost of imports go up, because the value of the dollar goes down. And since almost everything we buy comes from overseas, then the cost of what we buy goes up.

If they want to keep sending me money every year for not spending money, have at it. What do I do with mine? Well, I didn't break my neck to get to walmart an buy a new China made flat screen. I paid my credit cards off with them.

Andrew you isn't seen nothing yet. First draft of the budget President Obama is going to submit will be available Thursday. All indications are that the bucket list economic recovery bill was a tack hammer compared to the sledge hammer that is going the be proposed.

That's scary,

I had an idea this morning, granted, I'm just an ordianry working man, but maybe the feds should just tax the hell out of imports, so that domestic products can compete.

It seemed like a win win to me, because we just can't dust off those 50 year old factories and put them back to work overnight, no, we'd still have to import most of everything while we retrain our workforce to build things again. But all the while, we are taxing those imports.

It's a "stimulous plan" that makes money, rather than uses it. I'd bet with all the crap with import from china, the tax levied off it could elliminate the debt!

But then I got to thinking as to why we won't do that, and the only conclusion I can reach is that Washington is scared of China. And rightfully so, they are a nuclear nation, they are rich, we are poor, the outnumber us greatly, they produce 99% of what the world uses. They can build their own bombs, we can assemble ours, but only with components made in... you guessed it, CHINA. They kind of have us by the balls if you ask me...

And the reason why I brought this up is because the REASON behind all this stimulous and additional debt is because of the economy. And the economy is failing because nobody has any jobs anymore, and nobody as any jobs because they all went to China, so thinking in reverse, if you tackle the problems I just listed in that order, starting with bringing the jobs back home, the rest of the issues should resolve theirself.

Right down to the debt. More people working means more people paying sales tax, income tax, property tax, more can afford a home, the debt goes down. That is of course if the government actually uses it to pay it down and doesn't spoil us with programs we don't really need.

Protectionism doesn't work ,and in fact would hurt the American markets more .True we are the largest importers in the world,but also ,our exports are among the largest in the world.

History tells us that trade protection measures hurt not only other countries, but eventually the country that erected them in the first place. The U.S. adopted the Smoot-Hawley Act in 1930, which raised import duties of over 20,000 foreign products significantly and provoked protectionist retaliation from other countries. Faced with that crisis, other countries retaliated and that slashed global trade volume from $36 billion in 1929 to $12 billion in 1932. U.S. exports shrank from $5.2 billion in 1929 to $1.2 billion in 1932. The Smoot-Hawley Act was the catalyst that aggravated the effects of the Great Depression and I would argue actually caused the 1929 market crash.Smoot-Hawley was signed into law in June, 1930, but the Senate voted approval October, 1929 .Stock prices crashed in response to the protectionist votes of senators.

Roosevelt campaigned in 1932 to roll-back Smoot-Hawley .But once in office he torpedoed efforts at the London Economic Conference to stabilize currencies and roll back tariffs July, 1933. Tariff rates were raised, not lowered, and excise taxes on imports were added. This prolonged the Great Depression and did nothing to help the American worker or businesses.

For a practical example see my posting here :
https://www.askmehelpdesk.com/current-events/spectre-protectionism-awakened-319354.html

Canada is one of our largest trading partners . We import oil from them ;a reliable source of energy from a friendly neighbor. Yet ,provisions of the so called Stimulus bill threaten that relationship.

Protectionism doesn't work ,and in fact would hurt the American markets more .True we are the largest importers in the world,but also ,our exports are among the largest in the world.

History tells us that trade protection measures hurt not only other countries, but eventually the country that erected them in the first place...

Canada is one of our largest trading partners . We import oil from them ;a reliable source of energy from a friendly neighbor. Yet ,provisions of the so called Stimulus bill threaten that relationship.

Very good points and a corollary is that we don't go to war with our friends, our trading partners. It's like the "Golden Rule" of good international relations. And one might say that the Stimulus Porkage is just the 'opening salvo' of a new wave of economic protectionism. The U.S. needs to unleash our existing industry from excessive labor rules, environmentalism, and taxes; and encourage new industry by not taxing its proponents out of economic existence.

Tomder,

That was an excellent response to my statement, and I understand completley. It still would be nice if we could import a little less from China. My hometown of Pulaski VA died on accont of China, and I've seen the trickle down effects to other local businesses, such as restaruants, department stores etc. China and Mexico killed this town. Now there is nothing left but welfare and unemployment.

In a town of almost 10,000 people, our largest employer employs 300 at the most. The remainder draw off the state. And it seems to me that is the reason why the debt is so high. To many people taking from the system, and not enough paying in.

I couldn't work in this town, my employer is 50 miles away, and if I lost that job, I'd just have to move to another area or something.

So what would you say the solution would be to bring jobs back without unbalancing the global market? Because I do think that it's going to boil down to jobs. People who have jobs spend money, that stokes the economy, more taxes paid, the debt goes down.

The U.S. debt is very scary. Entitlements such as medicare, medicaid, pensions and Bush's prescription drug benefits are part of the problem. This may be unpopular, but a national sales tax would be a big help. Canada had a major debt until the 1990s when the goods and services tax was introduced. It was extremely unpopular at the time and caused the Conservatives to be reduced to two seats in the next election, but Canada became one of the few countries in the world to have balanced budgets until the financial crisis began.

http://img100.imageshack.us/img100/5745/bennec20090221low.jpg

http://pursuingholiness.com/wp-content/uploads/stimulusvsiraq1.gif (http://pursuingholiness.com/wp-content/uploads/stimulusvsiraq1.gif)

The population bar isn't even a bar, it's a flat spot at the bottom of the chart, if not for this being a "3d" chart, it would be invisible! :D

Andrew I have not forgotten your question about bringing the jobs back . The truth is that jobs lost do not come back because of the evolution of manufacturing .

Since Henry Ford invented the assembly line there has been a constant non-stop pursuit of efficiency . That means inevidibly that products can be made better with LESS labor.

Manufacturing still goes on in the country .But it is higher tech ;and I think the answer to your question is that your region needs to create an environment that attracts the higher tech companies. Reality bites ;but low tech manufacturing to be competitive needs to go to places where labor is cheaper . Consumers will just not pay for products where the prices are jacked up due to labor costs.

To attract the business your State needs to get more involved with incentives . These usually come in the forms of tax breaks,abatements ,rezoning , infrastructure improvements ,quality of life promotion, worker retraining programs ,and grants... often times R&D grants.

You are in Va. I bet the state has done something similar in the DC area but often as in NY state ,the less urban areas tend to get neglected until election time .Only then do politicians
Pay lip service to rural development .

You mention China. China has seen the economy slip also . In Nov. they passed a "stimulus" plan that was heavy on infrastructure and getting labor doing those what we call "shovel ready projects" . Many of them were targeted to rural development.

But now that the immediate crisis has passed there is a fierce debate going on in China if projects to the poor rural areas should be advanced over projects to help the more populus and affluent coastal areas. There are many there that argue that pumping money into these under-developed areas would be a drain and the gvt should help the urban middle class get back on their feet . The counter argument is the one that says giving to the poor would have an immediate impact on the GDP because they are more likely to return money spent into the economy.
Since the Communist Party makes all decisions there ,it can be assumed that there is an internal debate in the party itself over the best course of action.

Meanwhile Sec State Evita Clintoon went to China ,hat in hand ,demanding they continue to finance our debt . At the same time the Democrat bucket list has provisions that mandate the purchase of American made goods over imports . This specifically punishes China at the same time we come a begging .

Well, China has made a fair deal of money off us. We'll be paying off that country forever.

I don't mind some china imports, but the China thing is getting a little out of control. It's getting to be like finding something made in USA or not made in China is like trying to locate a 4 leaf clover.

I personally think it's a matter of national security. If China ever pulls the rug out from under us, who's going to manufacture our cell phones, TV's, radio's, light bulbs, washing machines, and the list of billions of other things that have never been manufactured in America?

And the results of this are clear. Our jobs status says it all. Many people dismiss this as low wage jobs that the nation could afford to loose. True, Pulaski Furniture was never a high paying establishment, but it was jobs. It was income taxes paid, it was local businesses staying open late on paydays.

Now it's a brown field, and most people have left, those few who remain are just living off the system. In my opinion, a low paying job is better than no job at all.

BTW: For anyone here thinking of buying a piece of furniture with the "Pulaski Furniture" brand, don't think you are supporting American jobs. Pulaski Furniture shut down ALL operations here a few years ago, ever single thing the produce comes from China now. If you don't believe me, feel free to peel off exit 94 of I81 and see for yourself. Just look for the big blue building that has been gutted of all it's scrap metal.

Oh dear . This made in Americamade vs overseas thing is just so deceptive .

A perfect example is the auto industry that is costing us a fortune to save American jobs. check out these made in America (all UAW ) cars and trucks

Mazda 6
Mitsubishi Eclipse
Mitsubishi Galant
Toyota Corolla
Isuzu I-Series Truck
Mazda B-series Truck
Mitsubishi Raider Truck
Toyota Tacoma Truck

Here are some imports (again made by UAW workers outside the country )
Buick Lacrosse
Chevrolet Impala
Chrysler 300
Dodge Challenger
Dodge Charger
Ford Crown Victoria
Lincoln Town Car
Mercury Grand Marquis
Pontiac Grand Prix

Chevy Aveo, built by Korean automaker Daewoo for Detroit-based General Motors. Chrysler PT Cruiser, built in Mexico.Honda Pilot and Honda Civics, built in the U.S. with higher domestic content (70%) than the 2008 Dodge Ram (68%) and the Michigan-built Ford Mustang (65%).

Toyota Tundra, Toyota Sienna and Honda Odyssey rank #5, #6 and #7 for the "Top American-Made Cars" in 2008 by Cars.com.

My question is this ;if I were looking to buy "Pulaski Furniture" built in the USA ,how much more would it have cost me as a consumer of the furniture to keep the factory going ? Next question .I know for a fact that Chinese came here with their dollars and reinvested in American... not just buying the debt ;but opening up manufacturing facilities... just like the Japanese did.. creating American jobs. When you talk of them pulling out that is as big a concern as the prospect of them ending their monetary investment in the U.S. Will it be OK that those jobs get lost ?

Where will the money come from ? Maybe India,maybe we'll go back to having terrorist supporting oil Sheiks funding us... but certainly not Americans.The Americans have never been known as savers and I see no indication that Americans are willing to shrink the size of their government... a government that is hell bent to absorb all the remaining US capital that could otherwise be used to create jobs .

Pulaski Furniture is a name brand, it always has been and always will be expensive. The cost of the furniture never went down when operations moved overseas.

oh dear . This made in Americamade vs overseas thing is just so deceptive .

A perfect example is the auto industry that is costing us a fortune to save American jobs. check out these made in America (all UAW ) cars and trucks

Mazda 6
Mitsubishi Eclipse
Mitsubishi Galant
Toyota Corolla
Isuzu i-Series Truck
Mazda B-series Truck
Mitsubishi Raider Truck
Toyota Tacoma Truck

here are some imports (again made by UAW workers outside the country )
Buick Lacrosse
Chevrolet Impala
Chrysler 300
Dodge Challenger
Dodge Charger
Ford Crown Victoria
Lincoln Town Car
Mercury Grand Marquis
Pontiac Grand Prix

Chevy Aveo, built by Korean automaker Daewoo for Detroit-based General Motors. Chrysler PT Cruiser, built in Mexico.Honda Pilot and Honda Civics, built in the U.S. with higher domestic content (70%) than the 2008 Dodge Ram (68%) and the Michigan-built Ford Mustang (65%).

Toyota Tundra, Toyota Sienna and Honda Odyssey rank #5, #6 and #7 for the "Top American-Made Cars" in 2008 by Cars.com.

My question is this ;if I were looking to buy "Pulaski Furniture" built in the USA ,how much more would it have cost me as a consumer of the furniture to keep the factory going ? Next question .I know for a fact that Chinese came here with their dollars and reinvested in American...not just buying the debt ;but opening up manufacturing facilities....just like the Japanese did ..creating American jobs. When you talk of them pulling out that is as big a concern as the prospect of them ending their monetary investment in the U.S. Will it be ok that those jobs get lost ?

Where will the money come from ? Maybe India,maybe we'll go back to having terrorist supporting oil Sheiks funding us .... but certainly not Americans.The Americans have never been known as savers and I see no indication that Americans are willing to shrink the size of their goverment ...a government that is hell bent to absorb all the remaining US capital that could otherwise be used to create jobs .


Gergetown KY makes Camry's

In the news here, even Toyota is feeling the downturn.
The workers from low all the way to management took a pay cut rather than layoff anyone

Toyota cutting costs with lower pay, buyout programs, more - Latest News - Kentucky.com (http://www.kentucky.com/181/story/692644.html)






G&P

Andrew ;because one industry leaves it doesn't mean that a new industry can't replace it. Here in NY we lost textiles a long time ago to the South .But new cutting edge industry replaces that. On Long Island a whole generation worked in the defense industry . Now ;although remnants of it still remains , corridors of high tech businesses provide the jobs.

Like I said, it is up to the community leadership to create an environment where other industry comes in to replace what gets lost.

In ;yes it is hard to sell cars when no one is buying them. I own a Camry because it is the most dependable car on the road. The Corolla I handed off to my daughter has 200,000 miles on it and still goes strong. Toyota may be the vicitim of it's own success . Back in the 1970s I replaced cars every 100,000 miles.

General Motors posted a $9.6 billion fourth-quarter loss and is asking for more bailout $$$... $30billion more . Chapter 11 time.

I cannot for the life of me find how much it cost to actually make one car and how much they mark them up. (from goods, labor and to transport.. etc) Why would it be so hard to just lower the price, make some money still and keep employees?

My own opinion... fixed legacy costs makes their product uncompetitve.In 2005 Chrysler’s health-care costs were about eleven hundred dollars more per vehicle than Toyota’s...GM was even worse at $1,600-per-vehicle .

Every car made has to pay for very generous (compared to the marketplace) retirement packages and it is reflected in the bottom line cost of the vehicle .

Back in the old days when they were the only game in town they could get away with that. But they are not ;their market share continues to shrink as many nations build good cars now .

Their business model was fine when they were the only game in town .But they have been slow to adjust.

my own opinion ......fixed legacy costs makes their product uncompetitve.In 2005 Chrysler’s health-care costs were about eleven hundred dollars more per vehicle than Toyota’s...GM was even worse at $1,600-per-vehicle .

Every car made has to pay for very generous (compared to the marketplace) retirement packages and it is reflected in the bottom line cost of the vehicle .

Back in the old days when they were the only game in town they could get away with that. But they are not ;their market share continues to shrink as many nations build good cars now .

Their business model was fine when they were the only game in town .But they have been slow to adjust.
Hello tom:

Bingo. That's why health care reform has to happen before or in concert with the auto industry reform.

If the country's where our car industry has to compete, PAY their workers health care and don't make the EMPLOYER do it, we're going to have to do it too. And, we are...

You say THEY'VE been slow to adjust... But, when they've burdened themselves with these legacy costs, you can't just UNBURDEN yourself. The government'll take it on.

excon

We agree on heath care reform... but probably not in the form it will take. Medicare ,medicaid ,VA are all examples of the inefficiency that we will expose the whole country to under a gvt. Run plan.

But yes, American businesses pay a hefty price for the pre-WWII model we are currently dealing with .

we agree on heath care reform ...but probably not in the form it will take. Medicare ,medicaid ,VA are all examples of the inefficiency that we will expose the whole country to under a gvt. run plan.

Don't forget Amtrak, the post office, Freddie, Fannie, et cet.

I'm back, I had to tend to some stuff around the house this week.

Anyway, going back to your last comment to me tomder. I understand what you are saying. And as I think about it, it's not so much the lack of industrial interest that has kept this town down over the years. Granted, in the last 12 months, that has been the case, but prior to that, this county has it's own skeletons in the closet that repels industry. Lack of an industrial sewage facility is among the list.

Moving onto cars:
Everything in the auto market is marked up. If you built a Ford Escort out of car parts acquired indivudually from stores, I swear the car would cost at least $100,000. I will never buy a new car. For what you get out of it, I find them to be very overpriced. Why pay $30,000 for a new car, trade it in in 10 years when a good used car can be purchased out of the trading post for under $5,000, and drive it for 10 years. I've had my car for 3 years, and paid $1200 for it, that's $33 per month. And I purchased it with one of Bush's tax rebate checks. All I've done to it is put on a set of tires and replace the window switch.

Moving onto health care:
I HATE our health care system. After years of being uninsured, I'm happy to say that our family is now covered. But at a premium price. Running about $240 bi-weekly with a $2,000 deductable. When I took on the plan, it was almost a third of my income. And to date, it is the highest bill I pay. I pay more to health care than I do to taxes to both state and federal.

What I am saying is that diversity is the best bet . Detroit is getting hardest hit because it is too dependent on one industry . Look to Pittsburg. They have taken the steps to reinvent themselves from to rust belt days . Even though it does not sustain the population it did in it's hay day, they have reinvented themselves as a high-tech center . Look at the growth around the Charlotte NC corridor . It can be done.

Going back to an original quote from your thread...


How can it work, if I ran my household budget like this, I'd be bankrupt

Doesn't work for me, I can't just hold my nose and wastefully spend money I don't have. I suppose a good sign in all this is the media is starting to reluctantly hold Obama's feet to the fire somewhat.


President Barack Obama will break a campaign pledge against congressional earmarks (http://www.google.com/hostednews/ap/article/ALeqM5iIg34ct-JZVW_v1Nx7Yg9GhIScqwD96LQ9FO0) and sign a budget bill laden with millions in lawmakers' pet projects, administration officials said.

Administration budget chief Peter Orszag and White House chief of staff Rahm Emanuel both downplayed the $410 billion spending bill and signaled Obama would hold his nose and sign it.

Orszag said: "We want to just move on. Let's get this bill done, get it into law and move forward."

Said Emanuel: "That's last year's business."

The House last week passed the measure that would keep the government running through Sept. 30, when the federal budget year ends. Taxpayers for Common Sense, a watchdog group, identified almost 8,600 earmarks totaling $7.7 billion; Democrats say the number is $3.8 billion.

Either way, it is far more than Obama promised as a candidate. He refused earmarks for the economic stimulus package he championed and a children's health bill.

He similarly pledged to reject tailored budget requests that let lawmakers send money to their home states. Orszag said Obama would move ahead and overlook the time-tested tradition that lets officials divert millions at a time to pet projects.

Is that what you Obama supporters elected him for, to hold his nose and sign a pork-laden budget? Is that what you Obama supporters elected him for, to “overlook the time-tested tradition” of congressional pet projects, to just ignore even more wasteful spending for the sake of moving on?