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None Dare Call It Default (Beyond the Fiscal Cliff)
WSJ ^ | 111/23/2012 | Holman Jenkins

Posted on 11/25/2012 12:05:54 PM PST by mojito

To call Greece First World may be a stretch, but Greece has defaulted once already, and it is only a matter of time until Greece defaults again. Welcome to default-o-rama, the next chapter in the First World's struggle for fiscal sustainability.

Japan is piling up debt in the manner of a nation beyond hope. France, Belgium, Spain and Italy are defaults waiting to happen unless Europe can somehow generate the kind of growth that has eluded it for decades.

America's fiscal cliff is an artificial crisis. We have no trouble borrowing in the short term. But at some point the market will demand evidence that long-term balance is being restored. President Obama said in his first post-election press conference that he doesn't want any proposals that "sock it to the middle class." He knows better. A long-term socking is exactly what's coming to the middle class, which must pay for the benefits it consumes.

A few years ago, when the economy was humming, a common estimate held that federal taxes would have to rise 50% immediately to fully fund entitlement programs. Today, a 50% tax increase would be needed just to meet the government's current spending, never mind its future obligations.

One way or another, then, entitlements will be cut. Don't call it default. The correct term is entitlement reform.

You saw this day coming and saved for your own retirement. Don't call it default when Washington inevitably confiscates some of your savings, say, by raising taxes on dividends and capital gains. Taxpayers accept the risk of future tax hikes that may make the decision to save seem foolish in retrospect.

According to economists...state and local taxes would have to increase by $1,385 per household immediately to make good the pension promises to state and local workers....

(Excerpt) Read more at online.wsj.com ...


TOPICS: Business/Economy; Crime/Corruption; Editorial; Government
KEYWORDS: bankrupt; debt; default; entitlements; fiscalcliff; obama; spending; tyranny
Default, confiscations, inflation: the new economic tyranny loometh just on the other side of the fiscal cliff.
1 posted on 11/25/2012 12:06:03 PM PST by mojito
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To: mojito

If the 47% didn’t get their tax refund, how much would that bring in revenue??


2 posted on 11/25/2012 12:08:47 PM PST by GeronL (http://asspos.blogspot.com)
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To: mojito
It's like I told my mother this week (I am 48 years old). People my age and younger just have to accept that we got robbed. We have to get over it--and make other plans. I have been suppporting my family members (I am childless myself). I don't see how I will retire before 80.

It sucks--and I would love to hang all of the Congress-critters who got us here-- but that would require an ex-post facto law or bill of attainder.

3 posted on 11/25/2012 12:11:11 PM PST by Lysandru
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To: mojito
The notional derivatives debt is over $600T.

It's silly. These debts cannot be paid. You can raise taxes. You can confiscate wealth. You can inflate the currency. But you'll never pay off a $600T debt.

Solution -- Jubilee. Cancel all the debts. Tell the creditors that they played a good game, but they pushed it too far and broke the bank. Now we all owe nothing, and we start over.

4 posted on 11/25/2012 12:14:08 PM PST by ClearCase_guy (Global Warming is a religion, and I don't want to be taxed to pay for a faith that is not mine.)
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To: ClearCase_guy

I think we need to look around ourselves. We have people in their thirties now...still owing $45k on college loans, $50k in credit card debt, and buying $35k cars with only $1k on the down-payment. These people will never live decent lives, and find themselves at age 65....mostly in debt with no savings. Their entire life depends on social security and Medicare.

You have city and county governments who have employees now easily making $120k a year, and paying $14k on their health insurance (with no contribution by the employee).

I don’t see anything great going on by 2020. We will be measured along the level of Brazil or Thailand. Our super-power status is virtually gone.


5 posted on 11/25/2012 12:20:58 PM PST by pepsionice
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To: pepsionice
'We have people in their thirties now...still owing $45k on college loans, $50k in credit card debt, and buying $35k cars with only $1k on the down-payment. '

It's a great game. Hey, purchase this, ya need college, loans are fine. Btw, ya gotta pay that back while we outsource and look for lower wages. Oh, ya willing to work for less? Sure, no problem. Also, no more benefits for ya, its just the way it is in today's global workforce.

Wage arbitrage will level the playing field for everyone. Some 'people' will benefit, will others will have a lower standard of living.

6 posted on 11/25/2012 12:27:31 PM PST by Theoria (Romney is a Pyrrhic victory.)
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To: Theoria

It will hit us ALL at some point.

http://confoundedinterest.wordpress.com/2012/11/25/japanese-and-spanish-house-price-deflation/


7 posted on 11/25/2012 12:51:39 PM PST by whitedog57
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To: FReepers; Patriots

FR really needs your help!

Please Contribute Today.

FReepathon Day 56

8 posted on 11/25/2012 1:00:54 PM PST by onyx (FREE REPUBLIC IS HERE TO STAY! DONATE MONTHLY! IF YOU WANT ON SARAH PALIN''S PING LIST, LET ME KNOW)
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To: ClearCase_guy

The problem is millions of those creditors are Americans, like those owning US Savings Bonds, military retirees, civilian retirees, those who paid into social security and medicare. No, a total default would be a very bad idea that would certainly bring about a violent revolution.


9 posted on 11/25/2012 1:19:33 PM PST by rcofdayton
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To: rcofdayton

Please post your solution.


10 posted on 11/25/2012 1:32:44 PM PST by ClearCase_guy (Global Warming is a religion, and I don't want to be taxed to pay for a faith that is not mine.)
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To: mojito

11 posted on 11/25/2012 1:36:31 PM PST by Travis McGee (www.EnemiesForeignAndDomestic.com)
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To: mojito

Exactly.

We can vote ourselves Magical House Elves for all the chores we don’t want to do - but it’s not going to materialize.


12 posted on 11/25/2012 1:48:40 PM PST by Tzimisce (What do you do when every every branch of the government is corrupt and aligned against you?)
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To: ClearCase_guy
Solution -- Jubilee. Cancel all the debts.

This is the ONLY solution......., everyone's in the same boat. Start over.

13 posted on 11/25/2012 1:55:54 PM PST by annieokie
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To: rcofdayton

It seems like we’re getting closer and closer to that inevitably happening.

I’m a young guy, and I see plenty of angry young guys these days. I fear that it’s only a matter of time before we become Weimar Germany and people take to the streets.

God help us if it happens.


14 posted on 11/25/2012 1:57:56 PM PST by Shadow44
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To: annieokie

The solution to debt created in the 1920’s became World War 2.


15 posted on 11/25/2012 2:08:20 PM PST by research99
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To: rcofdayton

No, the bulk of the debt issued these days is purchased by the Federal reserve. Private individuals who own that debt should read the writing on the wall and cash out while they can.

Repudiation and/or default are coming. Its the timing and form of that repudiation that are in question.


16 posted on 11/25/2012 2:11:08 PM PST by RKBA Democrat (Getting in touch with my inner rebel)
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To: Lysandru
It sucks--and I would love to hang all of the Congress-critters who got us here-- but that would require an ex-post facto law or bill of attainder.

All it would require is a few feet of rope. It's reusable.

Right after they have been tarred and feathered. G.D. traitors, all of them.

17 posted on 11/25/2012 2:30:39 PM PST by unixfox (Abolish Slavery, Repeal The 16th Amendment!)
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To: mojito

Also;.. http://www.youtube.com/watch?feature=player_embedded&v=fEqkphVOkHc#t=5s


18 posted on 11/25/2012 2:32:07 PM PST by hosepipe (This propaganda has been edited to include some fully orbed hyperbole..)
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To: mojito

Call it a deficiency of morality and manufacturing. Be good, and deregulate (beginning in state and county governments), or face the consequences. Freedom and the muzzling and layoffs of gossips is the answer.


19 posted on 11/25/2012 3:10:32 PM PST by familyop (We Baby Boomers are croaking in an avalanche of rotten politics smelled around the planet.)
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To: ClearCase_guy; rcofdayton
well, the feds still have plenty of assets. The creditors should be paid off in assets, probably with the SSA at the head of the line. Also the SSA should be privatized and it's directors should be elected in such a manner as to assure they have a clear un-conflicted interest in the welfare of the beneficiaries.

Of course it's more likely the house of cards remain standing as long as possible to ensure the con artists a safe exit.

20 posted on 11/25/2012 4:33:29 PM PST by no-s (when democracy is displaced by tyranny, the armed citizen still gets to vote)
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To: mojito

Those investors who took a gamble on insane socialist debt, need to eat it...hard and completely. They only tricked themselves and the buck of liberal insanity should stop with them.

The financers of global socialism should not be able to pass their losses onto everyone else. They are the ones who make socialist enslavement and oppression possible, so they deserve it’s outcome - poverty. Anyone who buys into the ponzi scheme of socialism needs badly to experience the truth of it. It’s the only way to stop global socialism.

Why do we buy into the “nobility” bs that we have to pay the debt failure of socialists? No, we don’t. Investors into supidity, pay. It’s dishonorable to bail them out.


21 posted on 11/25/2012 4:34:58 PM PST by SaraJohnson
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To: rcofdayton

Have you noticed that the media doesn’t even dare to utter the word “default”?

Or when the word is mentioned, it is preceded by the word “disastrous” or “cataclysmic.”

The reason why default is never mentioned as a possibility by the Socialist media, is because default will destroy U.S. gubmint credit, making it impossible for gubmint to borrow. (Maybe) It would force balanced budgets for a generation?

Socialists prefer inflation, which is disguised taxation, or even austerity. But a Keynesian’s worst nightmare is a government unable to borrow money.


22 posted on 11/25/2012 5:03:50 PM PST by TurboZamboni (Looting the future to bribe the present)
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To: no-s

Watch the latest Ann Barnhardt 8 part YouTube. “A house of cards is an iron cage compared to our economy.”


23 posted on 11/25/2012 5:48:54 PM PST by wastoute (Government cannot redistribute wealth. Government can only redistribute poverty.)
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To: TurboZamboni

They won’t mention default or depression.

Not as long as their guy is in charge.

Wonder how they will describe our version of Weimar when it happens.

Prep and keep on prepping.

when the money stops, the moochers/looters will go ape excrement.


24 posted on 11/25/2012 5:57:18 PM PST by Texas resident (Welcome to the nightmare)
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To: Lysandru

Re: “We got robbed”

Only if you agree to pay the bills run up by the generations of Americans before you.

Take Mr. Jenkins “advice.”

Default.

Elect Congress people who absolutely refuse to pay any debts or any unfunded entitlements.


25 posted on 11/25/2012 11:10:36 PM PST by zeestephen
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To: GeronL
If the 47% didn’t get their tax refund, how much would that bring in revenue??

When Ubanga said "Everybody must make sacrifices," his "everybody" certainly didn't include his party's base of moochers.

26 posted on 11/25/2012 11:39:52 PM PST by Lancey Howard
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To: zeestephen
Elect Congress people who absolutely refuse to pay any debts or any unfunded entitlements.

Elect Congress people who refuse to increase the "debt ceiling" one more freaking dime. Because, after all...

"The fact that we are here today to debate raising America’s debt limit is a sign of leadership failure. It is a Sign that the US Government cannot pay its own bills. It is a sign that we now depend on ongoing financial assistance from foreign countries to finance our Government’s reckless fiscal policies. ...Increasing America’s debt weakens us domestically and internationally. Leadership means that 'the buck stops here'. Instead, Washington is shifting the burden of bad choices today onto the backs of our children and Grandchildren. America has a debt problem and a failure of leadership. Americans deserve better."

- SENATOR BARACK HUSSEIN OBAMA, MARCH 2006

27 posted on 11/25/2012 11:43:46 PM PST by Lancey Howard
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To: unixfox

What do you do with the Morons who reelected the same Thieves for Decades?


28 posted on 11/26/2012 4:30:32 AM PST by ballplayer
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To: ClearCase_guy

I don’t have a comprehensive solution but here are some thoughts:
Get the federal government out of education
Close down the federal support of Medicaid
Close down the federal unemployment support of unemployment
Allow greater harvesting of oil and natural gas
Do not bail out any more companies
Reform social security now and don’t have automatic raises, only increase payments when there is money to do so
Destroy the liberal media and make it illegal for anyone to advocate that the federal government to enact a program that is not an enumerated power
End farm subsidies for large farmers, slowly end farm subsidies for smaller farmers
Close a lot of overseas military bases, especially those in Europe

These are just some thoughts. I am sure you have suggestions as well.


29 posted on 11/27/2012 9:47:14 AM PST by rcofdayton (.)
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To: annieokie
Solution -- Jubilee. Cancel all the debts. This is the ONLY solution......., everyone's in the same boat. Start over.

I have an out of the box CPA friend that is a self taught Biblical Scholar with a Founding Fathers perspective on politics has been saying this since 2004 if my memory is correct, he sees it as the only solution...

30 posted on 11/27/2012 9:51:29 AM PST by taildragger (( Tighten the 5 point harness and brace for Impact Freepers, ya know it's coming..... ))
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To: TurboZamboni
Socialists prefer inflation, which is disguised taxation, or even austerity. But a Keynesian’s worst nightmare is a government unable to borrow money.

Ok, how does Soro's engineer it, and how does he make a bootle on it, and enjoy the Collapse of the U.S......

31 posted on 11/27/2012 9:55:34 AM PST by taildragger (( Tighten the 5 point harness and brace for Impact Freepers, ya know it's coming..... ))
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To: taildragger
Glad to hear it, it is a very simply solution.

Really it is already being done. They are forgiving Bankruptcies & Foreclousures, bailing out companies, transfering those companies to the Unions, forgiving many Foreign debts and still giving them more.

If you claim poverty and refuse to work. Here, here's your FREE voucher, free food, freeeeeee stuff, your forgiven.

We are a very forgiving country for everyone except the taxpayer, we should have known better/sarc.

32 posted on 11/27/2012 11:18:11 AM PST by annieokie
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