Posted on 05/17/2011 8:54:40 AM PDT by CSM
You can't borrow your way out of debt.
Whenever the talking heads on TV start talking about the national economy, most of our eyes start to glaze over. The gigantic numbers that they throw out there are ridiculous; most Americans have no idea what those numbers mean in practical terms. So, I thought it’d be fun to turn those figures into something we can understand a little better—like a household budget.
The federal government will take in $2.173 trillion in 2011. That’s their income, and it sounds pretty good. Until, that is, you factor in that the federal government will spend $3.818 trillion during the year. So, just like many families, the government’s outgo exceeds their income—to the tune of $1.645 trillion in overspending. That’s called the deficit. Altogether, the government has $14.2 trillion in debt.
What would happen if John Q. Public and his wife called my show with these kinds of numbers? Here’s how their financial situation would stack up:
If their household income was $55,000 per year, they’d actually be spending $96,500—$41,500 more than they made! That means they’re spending 175% of their annual income! So, in 2011 they’d add $41,500 of debt to their current credit card debt of $366,000!
What’s the first step to get out of debt? Stop overspending! But that means a family that is used to spending $96,500 a year has to learn how to live on $55,000. That’s a tough pill to swallow. Those kinds of spending cuts seriously hurt, but it’s the only way out of debt for John Q. Public.
If I ever got a call from a family that was spending $41,500 more than they made every year, you would definitely expect me to yell at them for their dumb behavior, right? Kids, no more McDonald’s four times a week. Snacks come from the grocery store now. And we’re not going to the movies for a while, so break out the board games and TV Guide. This family has a problem, so it’s time to amputate the lifestyle!
It works the same way for the government. You can’t borrow your way out of debt, whether you’re a typical American family or the entire U.S. government. At some point, you’ve got to say, “Enough is enough!” and make the hard cuts necessary to win over the long haul.
I heard this discussion recently on Dave’s show and thought you might enjoy this article....
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Democrats don’t understand math nor common sense.
I also have to add that in this scenario, the “tax the rich” crowd is saying that they would get the extra job to cover the spending. That extra job would add $80 of income to their budget.....
The trick is to live beneath your income so you can sock away some cash for a cushion. I convert $ into warehouse-store pizza equivalents ($10 increments.) It feels pretty good to have the power to get an extra pizza at the end of the month if you want to.
Why can’t the theives elected be like the widowed mother with two children, If she does not have the money she’ll do without.
Oh wait that is much to difficult for the elected morons to understand.
Mac Daddy and his merry band of morons sold their souls to so many people and these people want a return for their support so scre* the peons.
If they passed a law saying that debts/bills ran up by family members were automatically passed onto related decendents (offspring) more families would act like the government.... in fact... a big part of the Federal governments spending is related to families NOT paying their bills, their mortages, other bills.
“Democrats don’t understand math nor common sense.”
Liberals are thieves by definition. They are communists. They steal from others. So, this national debt? They couldn’t care less because they think someone one else, maybe not even born yet, will pay the bill.
My take is this. If I did not have enough income to provide for my family, I would increase my income. Like get a better job or a second job. What I would not do is to put my family on dog food or tell my sick child, he has to live with it. The government should increase it’s income.
later
The problem of course is that far too many people in this country think nothing of living their own lives this way. They don't see any sort of problem in having maxed out credit cards and other massive debts for cars they can't afford or educations for which they overpaid.
These people become voters who support politicians who borrow our way into oblivion.
The G. should raise my taxes and take more of my cash instead of cutting back on how much of my cash it gives to welfare begging filth?
The government should increase it’s income.
The Government has no income. That which is earned.
The Government has revenue. That which it confiscates through taxes and fees.
Uh, no. The Government needs to stop spending on things that are not its legal (Constitutional) responsibility to fund. This is where the household analogy breaks down: necessity needs in the family do not equate to illegal free-wheel spending or giveaways... especially the giveaways intended to but votes and sucker a whole class of people into an entitlement mentality.
(debt) by family members were automatically passed onto related descendents...
Look at it another way; that's what the modern family's kid does do in the opposite direction, pass it on to their parents; in other words it is the juvenile, momma's little love bundle, who is incapable and unwilling to face the real cost, and momma, emotional and incapable of objective reality herself, concedes. The politicians, the juveniles, are the electorates' little love bundle, whining and moaning for more money, and momma electorate, incapable of reality also, is gratuitously complicit.
Thus the whole thing is what they call a cluster-something. Obama's America is the phoniest society in the developed world (how obvious is that?), and it extends right down to the last Democrat.
Johnny Suntrade
The only way the government can “ make” more money is by forcing it out of you under threat of imprisonment. The government isn’t qualified to earn income like the rest of us. They can’t make any more unless they steal it or fire up their printing presses to manufacture promissory notes not backed by valuable commodities
“The government should increase it’s income.”
What do you propose as a means to increase revenue?
BAD analogy! If your grown child was living at home and spending EVERYTHING you made on gambling, hookers and drugs, you'd be crazy to try to out-earn his ability to spend. You'd fix the son problem.
I totally agree that we don't have a revenue problem, but I do think we should raise taxes on the half of households who currently pay no federal tax. They should not be getting a free ride.
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