The Debt Ceiling Deal: What It Means for You

Allison Kade
Posted

John BoehnerYesterday, the United States House of Representatives passed a historic bill to raise the government’s debt ceiling and cut spending by $2.4 trillion. The Senate is expected to approve the plan today. But the question remains: How does this fit into the big picture?

What’s Been Going On So Far

Over two months ago, the U.S. hit its debt limit, requiring Congress to authorize the Treasury Department in order to borrow more money. Although it sounds idyllic to say that we should not borrow any more money, the U.S. government might have had to default on its payments to bondholders if it didn’t. A modern U.S. default would be totally unprecedented: The last serious default was when FDR, saddled with war debt, refused to redeem gold bonds in the 1930s. The economy is very different now, and a default would rock the world economy.

How the Government’s Budget Works

Just like us, the government has a budget. Here are some basic facts about how the government’s budget works:

  • Income: The government gets money by collecting taxes like income tax, property tax, payroll tax, etc.
  • Spending: The government spends money to operate and provide public services. This ranges from maintaining roads and running public schools to providing Social Security and Medicare.
  • Loans: The government borrows money from regular people, businesses and other countries through bonds. Many “regular” people own government debt in their mutual funds or savings bonds. As of the beginning of this year, just under half of America’s debt was owned by foreign countries like China, Japan, the U.K. and Brazil. (China singlehandedly owns about a quarter of America’s foreign-held debt.)

Government Default Would Be Terrible for Investor Confidence

Defaulting would be incredibly damaging to the U.S. because government bonds are traditionally seen as some of the safest debt around. If the U.S. defaulted, it would be a shocking blow and would make borrowing money a lot harder in the future.

Just like us, governments have “credit scores,” as measured by international credit rating agencies like Moody’s and Standard & Poor’s. The highest credit score is AAA, which is what the U.S. government currently holds. Even if the deal passes, these events put the U.S. government at risk of losing its AAA rating. When our individual credit score takes a dip, our ability to get a loan weakens and our interest rates go up. The same thing happens for the U.S. government. Credit ratings are signs of a borrower’s ability to “make good” on debt and help determine countries’ interest rates. If the rating is demoted, our government would have to pay even more to borrow money from now on. (Learn more about how interest rates work.)

Also, a demotion to AA rating could upend the idea of government bonds as traditionally safe investments. On one hand, bonds might take a dive as people become more nervous about the government’s ability to repay the loans … but on the other hand, more investors might flock to these investments since their interest rates will probably go up.

Your Cheat Sheet: The Debt Deal Boiled Down to the Basics

After weeks of bickering, President Obama and congressional leaders finally agreed on a deal. The proposal would:

  1. Raise the debt ceiling by $2.4 trillion.
  2. Cut spending by $2.4 trillion to offset the raise.
  3. Separate the $2.4 trillion spending cut into two installments. The first installment will be $917 billion in spending cuts over 10 years; the second will be determined through a committee, which will cut another $1.5 trillion through overhauls of the tax system and safety-net programs.

The bulk of the cuts (the $1.5 trillion) are being punted, leaving tough decisions about what programs to cut to congressional committees. According to the deal, a congressional “super-committee” of six Democrats and six Republicans will need to reach a conclusion on spending cuts by November 23, 2011. These proposed cuts will need to be approved by Congress by December 23, 2011; if they are not approved in time, an array of prearranged cuts will kick in. Most of the fighting over programs and services is just getting started.

Your Cheat Sheet: The Key Players

By now, there have been so many proposed plans that it’s hard to keep them all straight. Here are the most important players:

  • Senate Majority Leader Harry Reid: This Democrat has been key to the debates, proposing a compromise of his own last week. He’s endorsed the current pact.
  • Speaker of the House John Boehner: This Republican has also been a key player, but he’s had to struggle with a conservative contingent in his own party, which keeps pushing back on him. He was forced to rewrite his proposed plan last week.
  • House Minority Leader Nancy Pelosi: She is not thrilled with this new deal because it doesn’t include any revenue (tax) increases, only cuts.
  • President Barack Obama: Criticized by some pundits like Paul Krugman for giving in to Republican demands, the president has said: “This process has been messy and it’s taken far too long.” In earlier weeks, he and Boehner were seeking a “big deal” to cut a great deal of spending and also raise revenue, but those talks broke down.
  • Rep. Charlie Dent and the Tuesday Group: A small group of relatively centrist Republicans. In Dent’s words, “People have to stop talking about what they can’t do or what they won’t do, and start talking about what they must do.”
  • Gang of Six: Six Republican and Democratic Senators created an earlier bipartisan plan that would have saved $3.7 trillion over 10 years and overhauled the tax system. It did not come to pass.
As for us, we just hope to put this issue to rest … and that the political fallout won’t be as intense next time around.

What This Means for You

Here are some things you should do to make sure you’re prepared for what’s to come:

Don’t Let YOUR Budget Get Out of Hand …

Link your accounts now in LearnVest’s My Money Center so you can stay on top of your own budget!
  1. This deal will almost certainly mean that the government won’t be available to throw more money into a future economic stimulus package, so you’ll need to create your own security blanket. Make sure you have a robust emergency fund with at least six to nine months of living expenses. This will protect you in case (heaven forbid) you lose your job or encounter some other dire circumstance.
  2. The spending cuts will mean reduced funding for Social Security, so you can count less than ever on the government’s help for retirement. To make sure that you won’t have to work through the entirety of your golden years, start saving more aggressively for retirement through a 401(k) or IRA. If you’re looking for extra guidance on how to invest in those accounts, our Retirement and Investing Courses can help. (Will Social Security exist when you’re ready to retire?)
  3. You can also expect Medicare and Medicaid funding to be cut substantially, so safeguard yourself now by making sure you have the best health insurance for your lifestyle and circumstances.

More Reading

A walk-through of the debates that happened on Friday: Read here.

Here’s a breakdown of the issues around the debt ceiling debate. Click here.

Image: House GOP Leader/Flickr

  • http://twitter.com/KristinLogan Kristin Logan

    Great information, thanks for breaking it down !

  • http://twitter.com/KristinLogan Kristin Logan

    Great information, thanks for breaking it down !

    • http://www.bmwysp.deviantart.com Jennifer Megan Varnadore

      I agree. The government officials and corporations have so much money, and they like to cut the middle and the poor down. It keeps the poverty level up. How is that a good thing? If they cut spending (and the salaries of the higher classes) and taxed higher classes more, then maybe we could cut the difference like 300 times quicker.

  • http://twitter.com/KristinLogan Kristin Logan

    Great information, thanks for breaking it down !

  • http://twitter.com/KristinLogan Kristin Logan

    Great information, thanks for breaking it down !

  • Venire23

    Eighty-seven Teabag Party Republicans held 300,000,000 Americans hostage to get everything they wanted.  It is an outrage!  There should have been tax increases on millionaires, elimination of tax loopholes which allow corporations to avoid paying taxes, letting the Bush tax cuts for millionairs expire and a tax on hedge fund transactions.  Why should the middle class, seniors and the working poor have to bear ALL of the brunt of this so-called “deal”? 

    Note to Americans who whine about paying taxes: you live in the greatest country in the world. Step up to the plate and pay for the battleships and fighter planes you love so well. Where do you think the govt gets $ for those things?  Answer: taxes.

    If the millionaires are the “job creators” WHERE ARE THE JOBS?  They got their Bush tax cut extension in December 2010; they’ve had plenty of time but the job numbers are anemic.

    This was NOT a compromise!  A compromise would be half spending cuts (to social programs like senior nutrition centers, etc.) and half tax increases FOR MILLIONAIRES & CORPORATIONS.  That’s how Clinton did it and we all got richer in the 1990s.   

    • Anne

      Agreed.  I am seeing polls saying this exact same thing.  I am sick to my stomach. 

    • Anne

      Agreed.  I am seeing polls saying this exact same thing.  I am sick to my stomach. 

    • http://twitter.com/KristinLogan Kristin Logan

      I agree 1,000 times over! We’ve all been held ransom and sold to the highest bidder.

    • Guest

      51% of all americans pay absolutely no income tax and get more back in credits than what they put in.  The top 1% wealthy americas pay 70% of the tax burden.  Why not have no income tax and just pay a consumption tax so even drug dealers amd prostitues pay taxes as well?

  • http://www.bmwysp.deviantart.com Jennifer Megan Varnadore

    I was reading about John Boehner’s bill earlier. It came to me through my weekly Stumbleupon suggestions. It was talking about how the Tea Party group has a major decision impact on the bill.

    http://news.yahoo.com/tea-party-role-debt-bill-raises-gop-eyebrows-214619577.html

    I didn’t know China owned a 1/4 of our debt, but I’m not surprised in the least. We get so many things from China that it’s unreal. Wish we could go back to relying on ourselves a lot more. We were once a Superpower, and now we’re vulnerable if one other country decides we’re not worthy enough. Our government should take advice from Learnvest. Maybe they would learn something.

  • http://www.bmwysp.deviantart.com Jennifer Megan Varnadore

    I was reading about John Boehner’s bill earlier. It came to me through my weekly Stumbleupon suggestions. It was talking about how the Tea Party group has a major decision impact on the bill.

    http://news.yahoo.com/tea-party-role-debt-bill-raises-gop-eyebrows-214619577.html

    I didn’t know China owned a 1/4 of our debt, but I’m not surprised in the least. We get so many things from China that it’s unreal. Wish we could go back to relying on ourselves a lot more. We were once a Superpower, and now we’re vulnerable if one other country decides we’re not worthy enough. Our government should take advice from Learnvest. Maybe they would learn something.

  • Kathryns

    What’s the stupidest thing you can do if you have extreme credit card debt? Raise your limit. Crisis not averted: http://www.nytimes.com/2011/08/01/opinion/the-president-surrenders-on-debt-ceiling.html?src=recg

    • http://twitter.com/KristinLogan Kristin Logan

      Everyone in congress should have to come to Learn Vest and take some finance 101 classes before messing our debt system up any further.

  • caligurl

    Thank you so much for “decoding” the debt ceiling bill for us. How can this country can grow into a strong economy without addressing education? Elementary teachers are paying for basic school supplies, “minimum days” are the norm, without mentioning the “cheating grades “scandals. I agree with everybody else: the poverty level is up and the middle and poor classes are still paying to maintain the higher classes lifestyle. How lame!

  • caligurl

    Thank you so much for “decoding” the debt ceiling bill for us. How can this country can grow into a strong economy without addressing education? Elementary teachers are paying for basic school supplies, “minimum days” are the norm, without mentioning the “cheating grades “scandals. I agree with everybody else: the poverty level is up and the middle and poor classes are still paying to maintain the higher classes lifestyle. How lame!

  • Anne

    Thank you for breaking it down for me.  I am so disgusted and upset.    I have been a SAHM for 5 1/2 and I am trying to go back to work.  So far, no luck. 

  • win the future

    this article was not thoroughly accurate in it’s overview. why is there no mention of the fact that the congress and senate have just illegally given up their constitutional duties to a “super commitee” and the potus? these are key (very illegal) actions that in the end will prove to be more destructive than it would’ve been had we defaulted. and there’s another fear mongering tactic that people fell for – we never would have defaulted on our debts, we just wouldn’t have been able to borrow money to continue our unsustainable spending.
    yes, we are in a recession still (or depression, because that’s being realistic), and this coutry will see even worse days than it already has unless people start to realize that this country needs to trim the beaurucratic fat, lay down the law for the rich and corporations that evade taxes (we can include politicians because there’s a number of them that don’t play fair – repubs and dems), decrease defense spending and bring our troops home, create incentives for small businesses, and if we really want to turn things around fiscally, we will not vote for irresponsible people who do not understand the simple task of keeping a checkbook balanced. stimulus + debt + wars with strategically no end = wrong. bush was wrong, and obama is only perpetuating them further with help from the leaches lining their pockets. washington doesn’t work for the average citizen. vote for someone who does.

    • http://www.bmwysp.deviantart.com Jennifer Megan Varnadore

       In another article on Learnvest, they mention that the U.S. will more than likely never default.

  • win the future

    this article was not thoroughly accurate in it’s overview. why is there no mention of the fact that the congress and senate have just illegally given up their constitutional duties to a “super commitee” and the potus? these are key (very illegal) actions that in the end will prove to be more destructive than it would’ve been had we defaulted. and there’s another fear mongering tactic that people fell for – we never would have defaulted on our debts, we just wouldn’t have been able to borrow money to continue our unsustainable spending.
    yes, we are in a recession still (or depression, because that’s being realistic), and this coutry will see even worse days than it already has unless people start to realize that this country needs to trim the beaurucratic fat, lay down the law for the rich and corporations that evade taxes (we can include politicians because there’s a number of them that don’t play fair – repubs and dems), decrease defense spending and bring our troops home, create incentives for small businesses, and if we really want to turn things around fiscally, we will not vote for irresponsible people who do not understand the simple task of keeping a checkbook balanced. stimulus + debt + wars with strategically no end = wrong. bush was wrong, and obama is only perpetuating them further with help from the leaches lining their pockets. washington doesn’t work for the average citizen. vote for someone who does.

  • win the future

    this article was not thoroughly accurate in it’s overview. why is there no mention of the fact that the congress and senate have just illegally given up their constitutional duties to a “super commitee” and the potus? these are key (very illegal) actions that in the end will prove to be more destructive than it would’ve been had we defaulted. and there’s another fear mongering tactic that people fell for – we never would have defaulted on our debts, we just wouldn’t have been able to borrow money to continue our unsustainable spending.
    yes, we are in a recession still (or depression, because that’s being realistic), and this coutry will see even worse days than it already has unless people start to realize that this country needs to trim the beaurucratic fat, lay down the law for the rich and corporations that evade taxes (we can include politicians because there’s a number of them that don’t play fair – repubs and dems), decrease defense spending and bring our troops home, create incentives for small businesses, and if we really want to turn things around fiscally, we will not vote for irresponsible people who do not understand the simple task of keeping a checkbook balanced. stimulus + debt + wars with strategically no end = wrong. bush was wrong, and obama is only perpetuating them further with help from the leaches lining their pockets. washington doesn’t work for the average citizen. vote for someone who does.

  • Sbstephanie

    Yes, there needs to be less loopholes and higher taxes for the rich, but instead of focusing on how lame it is, I think I best get out there and build my own business! Personally, if I was rich I wouldn’t want to give my money to the government- they don’t know how to handle it correctly anyway; anyone I have ever known that has had thousands of dollars in credit card debt and gets it paid off by a family member usually ends up right back in debt- I believe the spending is the culprit here… I would rather give my money to non-profits who are better at spending it than the govt like Warren Buffett & Bill Gates do…

    Also, why do we owe money to Japan? We shouldn’t be helping countries left and right if we’re not getting paid (or forgiven some debt). If the American people care so much- let’s give our money to non-profits who want to help (there are plenty of them and they’ll put something like 10-20% of your money to cover admin costs while the rest will go towards the cause; on the other hand the govt. doesn’t know how to handle money and 80% of every dollar will be spent on rediculous administration costs). Also, we spend billions of dollars “protecting” countries in the Middle East who don’t pay us and who don’t want us there- let’s handle things at home first!

    CUT SPENDING…is the gist I’m getting at.

  • Sbstephanie

    Yes, there needs to be less loopholes and higher taxes for the rich, but instead of focusing on how lame it is, I think I best get out there and build my own business! Personally, if I was rich I wouldn’t want to give my money to the government- they don’t know how to handle it correctly anyway; anyone I have ever known that has had thousands of dollars in credit card debt and gets it paid off by a family member usually ends up right back in debt- I believe the spending is the culprit here… I would rather give my money to non-profits who are better at spending it than the govt like Warren Buffett & Bill Gates do…

    Also, why do we owe money to Japan? We shouldn’t be helping countries left and right if we’re not getting paid (or forgiven some debt). If the American people care so much- let’s give our money to non-profits who want to help (there are plenty of them and they’ll put something like 10-20% of your money to cover admin costs while the rest will go towards the cause; on the other hand the govt. doesn’t know how to handle money and 80% of every dollar will be spent on rediculous administration costs). Also, we spend billions of dollars “protecting” countries in the Middle East who don’t pay us and who don’t want us there- let’s handle things at home first!

    CUT SPENDING…is the gist I’m getting at.

    • http://www.bmwysp.deviantart.com Jennifer Megan Varnadore

      I agree with you. Wholeheartedly. I do think it’s great to help other people, but we do need to take care of ourselves first. This is not only financially a responsibility, but it is smart.

  • Sbstephanie

    Yes, there needs to be less loopholes and higher taxes for the rich, but instead of focusing on how lame it is, I think I best get out there and build my own business! Personally, if I was rich I wouldn’t want to give my money to the government- they don’t know how to handle it correctly anyway; anyone I have ever known that has had thousands of dollars in credit card debt and gets it paid off by a family member usually ends up right back in debt- I believe the spending is the culprit here… I would rather give my money to non-profits who are better at spending it than the govt like Warren Buffett & Bill Gates do…

    Also, why do we owe money to Japan? We shouldn’t be helping countries left and right if we’re not getting paid (or forgiven some debt). If the American people care so much- let’s give our money to non-profits who want to help (there are plenty of them and they’ll put something like 10-20% of your money to cover admin costs while the rest will go towards the cause; on the other hand the govt. doesn’t know how to handle money and 80% of every dollar will be spent on rediculous administration costs). Also, we spend billions of dollars “protecting” countries in the Middle East who don’t pay us and who don’t want us there- let’s handle things at home first!

    CUT SPENDING…is the gist I’m getting at.

  • Sbstephanie

    Yes, there needs to be less loopholes and higher taxes for the rich, but instead of focusing on how lame it is, I think I best get out there and build my own business! Personally, if I was rich I wouldn’t want to give my money to the government- they don’t know how to handle it correctly anyway; anyone I have ever known that has had thousands of dollars in credit card debt and gets it paid off by a family member usually ends up right back in debt- I believe the spending is the culprit here… I would rather give my money to non-profits who are better at spending it than the govt like Warren Buffett & Bill Gates do…

    Also, why do we owe money to Japan? We shouldn’t be helping countries left and right if we’re not getting paid (or forgiven some debt). If the American people care so much- let’s give our money to non-profits who want to help (there are plenty of them and they’ll put something like 10-20% of your money to cover admin costs while the rest will go towards the cause; on the other hand the govt. doesn’t know how to handle money and 80% of every dollar will be spent on rediculous administration costs). Also, we spend billions of dollars “protecting” countries in the Middle East who don’t pay us and who don’t want us there- let’s handle things at home first!

    CUT SPENDING…is the gist I’m getting at.

  • Sbstephanie

    Yes, there needs to be less loopholes and higher taxes for the rich, but instead of focusing on how lame it is, I think I best get out there and build my own business! Personally, if I was rich I wouldn’t want to give my money to the government- they don’t know how to handle it correctly anyway; anyone I have ever known that has had thousands of dollars in credit card debt and gets it paid off by a family member usually ends up right back in debt- I believe the spending is the culprit here… I would rather give my money to non-profits who are better at spending it than the govt like Warren Buffett & Bill Gates do…

    Also, why do we owe money to Japan? We shouldn’t be helping countries left and right if we’re not getting paid (or forgiven some debt). If the American people care so much- let’s give our money to non-profits who want to help (there are plenty of them and they’ll put something like 10-20% of your money to cover admin costs while the rest will go towards the cause; on the other hand the govt. doesn’t know how to handle money and 80% of every dollar will be spent on rediculous administration costs). Also, we spend billions of dollars “protecting” countries in the Middle East who don’t pay us and who don’t want us there- let’s handle things at home first!

    CUT SPENDING…is the gist I’m getting at.

  • Sbstephanie

    Yes, there needs to be less loopholes and higher taxes for the rich, but instead of focusing on how lame it is, I think I best get out there and build my own business! Personally, if I was rich I wouldn’t want to give my money to the government- they don’t know how to handle it correctly anyway; anyone I have ever known that has had thousands of dollars in credit card debt and gets it paid off by a family member usually ends up right back in debt- I believe the spending is the culprit here… I would rather give my money to non-profits who are better at spending it than the govt like Warren Buffett & Bill Gates do…

    Also, why do we owe money to Japan? We shouldn’t be helping countries left and right if we’re not getting paid (or forgiven some debt). If the American people care so much- let’s give our money to non-profits who want to help (there are plenty of them and they’ll put something like 10-20% of your money to cover admin costs while the rest will go towards the cause; on the other hand the govt. doesn’t know how to handle money and 80% of every dollar will be spent on rediculous administration costs). Also, we spend billions of dollars “protecting” countries in the Middle East who don’t pay us and who don’t want us there- let’s handle things at home first!

    CUT SPENDING…is the gist I’m getting at.

  • Sbstephanie

    Yes, there needs to be less loopholes and higher taxes for the rich, but instead of focusing on how lame it is, I think I best get out there and build my own business! Personally, if I was rich I wouldn’t want to give my money to the government- they don’t know how to handle it correctly anyway; anyone I have ever known that has had thousands of dollars in credit card debt and gets it paid off by a family member usually ends up right back in debt- I believe the spending is the culprit here… I would rather give my money to non-profits who are better at spending it than the govt like Warren Buffett & Bill Gates do…

    Also, why do we owe money to Japan? We shouldn’t be helping countries left and right if we’re not getting paid (or forgiven some debt). If the American people care so much- let’s give our money to non-profits who want to help (there are plenty of them and they’ll put something like 10-20% of your money to cover admin costs while the rest will go towards the cause; on the other hand the govt. doesn’t know how to handle money and 80% of every dollar will be spent on rediculous administration costs). Also, we spend billions of dollars “protecting” countries in the Middle East who don’t pay us and who don’t want us there- let’s handle things at home first!

    CUT SPENDING…is the gist I’m getting at.

  • Sbstephanie

    Yes, there needs to be less loopholes and higher taxes for the rich, but instead of focusing on how lame it is, I think I best get out there and build my own business! Personally, if I was rich I wouldn’t want to give my money to the government- they don’t know how to handle it correctly anyway; anyone I have ever known that has had thousands of dollars in credit card debt and gets it paid off by a family member usually ends up right back in debt- I believe the spending is the culprit here… I would rather give my money to non-profits who are better at spending it than the govt like Warren Buffett & Bill Gates do…

    Also, why do we owe money to Japan? We shouldn’t be helping countries left and right if we’re not getting paid (or forgiven some debt). If the American people care so much- let’s give our money to non-profits who want to help (there are plenty of them and they’ll put something like 10-20% of your money to cover admin costs while the rest will go towards the cause; on the other hand the govt. doesn’t know how to handle money and 80% of every dollar will be spent on rediculous administration costs). Also, we spend billions of dollars “protecting” countries in the Middle East who don’t pay us and who don’t want us there- let’s handle things at home first!

    CUT SPENDING…is the gist I’m getting at.

  • Laskmel Bella1234

    I probably fall into”well off category right now as small business owner. I already pay so much in taxes I sometimes wonder if it worth it. I also give lots to many non profits in my community. If why would I want additional taxes imposed on me?also I am not a tea partyember but know people. Who. Are. They are business people farmers nurses. Etc hood everyday people and they fought for what they believe in and that is what america is about isn’t it?

    • http://www.bmwysp.deviantart.com Jennifer Megan Varnadore

       Small busineses are not the same as Corporations. Having a small business is a good thing. Especially considering it helps to make you a working class citizen that is financially stable on your own, and by your own self-made decisions. “Too Big to Fail” corporations own the largest portion of the wealth in the world, as well as the highest making earners do.

    • http://www.bmwysp.deviantart.com Jennifer Megan Varnadore

       Small busineses are not the same as Corporations. Having a small business is a good thing. Especially considering it helps to make you a working class citizen that is financially stable on your own, and by your own self-made decisions. “Too Big to Fail” corporations own the largest portion of the wealth in the world, as well as the highest making earners do.

  • Laskmel Bella1234

    I probably fall into”well off category right now as small business owner. I already pay so much in taxes I sometimes wonder if it worth it. I also give lots to many non profits in my community. If why would I want additional taxes imposed on me?also I am not a tea partyember but know people. Who. Are. They are business people farmers nurses. Etc hood everyday people and they fought for what they believe in and that is what america is about isn’t it?

  • Laskmel Bella1234

    I probably fall into”well off category right now as small business owner. I already pay so much in taxes I sometimes wonder if it worth it. I also give lots to many non profits in my community. If why would I want additional taxes imposed on me?also I am not a tea partyember but know people. Who. Are. They are business people farmers nurses. Etc hood everyday people and they fought for what they believe in and that is what america is about isn’t it?

  • Laskmel Bella1234

    I probably fall into”well off category right now as small business owner. I already pay so much in taxes I sometimes wonder if it worth it. I also give lots to many non profits in my community. If why would I want additional taxes imposed on me?also I am not a tea partyember but know people. Who. Are. They are business people farmers nurses. Etc hood everyday people and they fought for what they believe in and that is what america is about isn’t it?

  • http://twitter.com/matthewtuey Matthew Tuey

    I heard an excellent analogy (excuse the crudeness) today that summed up my thoughts of the root problem and why this is so bad pushing things forward, AGAIN! From one of my friends: “Imagine getting home to find your sewers had backed up and there was sewage all the way to the top of your ceiling. You call the plumber and say, fix this. They come back with a plan to raise the ceiling 6 feet.” So true, so true. They can raise that ceiling all they want, still doesn’t fix the waste and smells that are destroying your home . . .

  • adnama43

    “And I sincerely believe, with you,
    that banking establishments
    are more dangerous than standing armies;
    and that the principle of spending money
    to be paid by posterity,
    under the name of funding,
    is but swindling futurity
    on a large scale.”
    - Thomas Jefferson
       in a letter to John Taylor, 1816

    It’s time we vote for the only person who has the wisdom to listen to history and will protect our freedoms. It’s not the government’s debt – it’s ours! Vote Ron Paul for president in 2012.
    http://www.dailypaul.com

  • http://www.mangomoney.com Mango Money

    I don’t want to make light of the whole situation, but I will play the optimistic card. In the 1940s, the U.S. debt was over 120% of GDP. We are at nearly 100% today. We were able to pull ourselves out of the hole then, so here’s to pulling ourselves out of the hole now! *raises coffee mug in the air* 
    But in all serious, I work for a money blog, and if you want to watch our sock puppet show on the history of national debt, here’s the link: http://www.mangomoney.com/blog/trends/mango-puppet-theater-presents-the-u-s-national-debt
    -Melissa @ MangoMoney

  • http://www.mangomoney.com Mango Money

    I don’t want to make light of the whole situation, but I will play the optimistic card. In the 1940s, the U.S. debt was over 120% of GDP. We are at nearly 100% today. We were able to pull ourselves out of the hole then, so here’s to pulling ourselves out of the hole now! *raises coffee mug in the air* 
    But in all serious, I work for a money blog, and if you want to watch our sock puppet show on the history of national debt, here’s the link: http://www.mangomoney.com/blog/trends/mango-puppet-theater-presents-the-u-s-national-debt
    -Melissa @ MangoMoney

  • http://www.mangomoney.com Mango Money

    I don’t want to make light of the whole situation, but I will play the optimistic card. In the 1940s, the U.S. debt was over 120% of GDP. We are at nearly 100% today. We were able to pull ourselves out of the hole then, so here’s to pulling ourselves out of the hole now! *raises coffee mug in the air* 
    But in all serious, I work for a money blog, and if you want to watch our sock puppet show on the history of national debt, here’s the link: http://www.mangomoney.com/blog/trends/mango-puppet-theater-presents-the-u-s-national-debt
    -Melissa @ MangoMoney

  • Concerned

    Disappointed. Article is oversimplified and worded so it is slanted left. Reading several of the comments though, I understand the majority of the posters are right there with the author (and oh c’mon, are people still of the mindset: big companies are bad!? Rich people are bad! Let’s punish them for working and making themselves successful!! Let’s take their money and throw it at government programs instead of helping people get on their feet and provide for themselves!). But agree with the purpose & spirit of the article which is that we can rely on no one but ourselves; we have to build our own security blanket.

  • Concerned

    Disappointed. Article is oversimplified and worded so it is slanted left. Reading several of the comments though, I understand the majority of the posters are right there with the author (and oh c’mon, are people still of the mindset: big companies are bad!? Rich people are bad! Let’s punish them for working and making themselves successful!! Let’s take their money and throw it at government programs instead of helping people get on their feet and provide for themselves!). But agree with the purpose & spirit of the article which is that we can rely on no one but ourselves; we have to build our own security blanket.

    • http://www.bmwysp.deviantart.com Jennifer Megan Varnadore

      Actually, I never said big companies and rich people are “Bad” I think that the fact that every working person in certain working brackets are taxed heavily, when the higher tax brackets (mind you, who get to choose who gets taxed anyway and why would they want to have to part with their millions anyway, right?) don’t. Corporations get to embezzle and do whatever they want to do while rarely getting punished for it, and not getting taxed either….I think this is ridiculous. If you have more money than the government, I mean seriously? You could help out others. It’s what I would do. I would not complain if my taxes were raised when I would make thousands of dollars in a salary every month anyway. Especially knowing that the only way the government really makes any money is with taxes. Why tax more for people who don’t have the money to give in taxes anyway? It makes sense to tax those who have the money to be able to be taxed, instead of forcing the lower tax brackets into poverty.

    • http://www.bmwysp.deviantart.com Jennifer Megan Varnadore

      Actually, I never said big companies and rich people are “Bad” I think that the fact that every working person in certain working brackets are taxed heavily, when the higher tax brackets (mind you, who get to choose who gets taxed anyway and why would they want to have to part with their millions anyway, right?) don’t. Corporations get to embezzle and do whatever they want to do while rarely getting punished for it, and not getting taxed either….I think this is ridiculous. If you have more money than the government, I mean seriously? You could help out others. It’s what I would do. I would not complain if my taxes were raised when I would make thousands of dollars in a salary every month anyway. Especially knowing that the only way the government really makes any money is with taxes. Why tax more for people who don’t have the money to give in taxes anyway? It makes sense to tax those who have the money to be able to be taxed, instead of forcing the lower tax brackets into poverty.

  • Concerned

    Disappointed. Article is oversimplified and worded so it is slanted left. Reading several of the comments though, I understand the majority of the posters are right there with the author (and oh c’mon, are people still of the mindset: big companies are bad!? Rich people are bad! Let’s punish them for working and making themselves successful!! Let’s take their money and throw it at government programs instead of helping people get on their feet and provide for themselves!). But agree with the purpose & spirit of the article which is that we can rely on no one but ourselves; we have to build our own security blanket.

  • Concerned

    Disappointed. Article is oversimplified and worded so it is slanted left. Reading several of the comments though, I understand the majority of the posters are right there with the author (and oh c’mon, are people still of the mindset: big companies are bad!? Rich people are bad! Let’s punish them for working and making themselves successful!! Let’s take their money and throw it at government programs instead of helping people get on their feet and provide for themselves!). But agree with the purpose & spirit of the article which is that we can rely on no one but ourselves; we have to build our own security blanket.

  • Concerned

    Disappointed. Article is oversimplified and worded so it is slanted left. Reading several of the comments though, I understand the majority of the posters are right there with the author (and oh c’mon, are people still of the mindset: big companies are bad!? Rich people are bad! Let’s punish them for working and making themselves successful!! Let’s take their money and throw it at government programs instead of helping people get on their feet and provide for themselves!). But agree with the purpose & spirit of the article which is that we can rely on no one but ourselves; we have to build our own security blanket.