Why can the Feds run up astronomical deficits and state/locals can't?

Anyone who has worked in state/local civil service has seen it over and over again, no doubt: you become increasingly efficient as your budget shrinks. Transportation, public safety, water, sanitation, education, all things that citizens RELY upon daily--and they all deliver. Service cutbacks get some grumbling, but the public grumbles a bit and learns to accept it.

This doesn't seem to apply to the Feds, where cronyism and bloat are the rule of this administration.

So why, when the deficit is astronomical, does the admin not call for cutbacks in non-essential services? Why are they allowed to charge it to my 8 year old son while my city government works the problem out?

I see this as a winning issue for the Dems in '06 if we can address it skillfully and powerfully.

(BTW--I am a civil servant and have seen cutbacks three years in a row)

by various means and local-state can only tax or float tax free bonds to raise money. well they also rely on "cash" back from the feds

And lately, the printing presses have been running 24/7...

to borrow with no limit at no risk premium.

don't have to worry about filing for bankruptcy.

Although maybe China might stop lending or call in their debt.

This group of thugs feels they can just do whatever they want to, and everyone else has to live with what they send our way.

:puke:

Thanks for refreshing my addled memory!

When the republicans use to complain about the tax and spend democrats running up high deficit's... No one cared!

Republicans realized it was a non issue to most Americans...
The republicans know this very well now...BushCo & the republicans don't care about the huge deficit, because most people don't understand it and as long as the money flows all is well...(they learned under Reagan...spend, steal and create huge deficits and the people don't care...as long as you keep spending for their needs (and even if you don't, few are going to point to the deficit.

Now the Demo's are bitching about the deficit, and again most people don't give a shit!!!!

Even republicans right now, are saying not to worry everything is A OK!

Of course years after Bush is out of office and he and his republican donors, buddies and cronies have sucked America dry for trillions of dollars, they will be long gone...

But the American people right now just don't care as long as we keep spending.

Deficits, is a sure way to defeat if that becomes the Dems main issue...it's been proven by republicans and democrats alike, over and over again!

Republicans will point the finger and say see, the Democrats are always raising your taxes...The Dems will scream it's because of the republican deficit...but not many will listen...if there's no money for their programs and the republican owned media starts pounding over and over how the Democrats just keep raising taxes...

Then a republican will campaign on cutting taxes and win run up the deficit and on and on it goes!!!

Clinton did it best, he raised taxes on the richest and the corporations and they hated him for it, the republicans wanted to destroy him for it.

The rich and the corporations are too powerful now under Bush, they won't that happen again if by some remote chance a Democrat ever gets into the presidency again.

Could Congress demand it (while allowing for a dire emergency to reopen it)?

Just about every governmental entity below the federal level has a constitutional or a charter provision that requires a balanced budget annually. If revenues go up or down unexpectedly, states and localities have to be prepared to either give back some revenue, give taxpayers a credit on next year's taxes (in the case of a surplus), or cut spending and programs in case of a deficit.

If a state or local government has to spend more than it takes in for capital improvements (new roads, a new school, etc.), then they issue bonds or raise taxes. A bond issue is in effect government borrowing from its citizens. The bonds are paid off (retired) over a specified period of time (30 years or whatever), the folks who bought the bonds make a bit of money, and the taxpayers spread out the cost of the capital improvement over time.

The federal government, by contrast, has no constitutional requirement to balance its budget, but it still has to pay its bills when expenditures exceed revenues. As such, the federal government issues bonds (U.S. Savings Bonds are actually loans you as a private citizen make to the Treasury) or increasingly borrows from folks with lots of money. This can be high-finance entities like banks, but it can also be other governments.

The federal government, as borrowing as it is, has never defaulted on a loan or a bond, so lenders continue to line up to finance government operations. If you buy a savings bond, you can redeem it at any bank any time after holding it for six months. The longer you hold the bond, the more interest (which is taxable as income) you are paid, up to a certain limit. The bigger creditors receive their interest payments, service fees, and other considerations -- pecuniary and political -- in the same way.

eom.

Otherwise, the GOP has absolutely no right to talk about deficits.

countries hold american reserves as the world dollar - the American dollar is thus subsidized. Allowing for more debt.

Otherwise - if people around the world were being rational and concerned only with american finances in the short term - they would dump US dollar and it would fall. Thus causing perhaps a recession as imports go up in price and exports of american goods start to heat up (because American products would be more competitive). This all would cause inflation & and/or recession and the wealthy don't like that. They also are not so concerned with employment going up (a lower dollar would do that) as the inflation resulting from the price of oil is "fought off" on the backs of less than fully employed or poorly paid workers in the US. Rich people hate inflation cause it makes their money worth less.

Because oil is traded in U.S. dollars and China, Japan etc. all hold U.S. dollar reserves - it is a subsidy and allow for more U.S. debt without the US dollar falling a ton.

States do not have that relationship with the dollar vs. the outside world. In fact - a place like Alabama, with a dismal employment, would benefit a great deal from a lower dollar that suits the state of its economy. But Alabama has and never will have a US dollar or monetary policy "devoted to its needs". The U.S. dollar is devoted & reflects the needs of the aggregate of American states.

Think of Germany which has high unemployment for various reasons and because it joined in with the Euro and got rid of the Mark - it now, all of a sudden, has no monetary policy of its own. So it has no control over the Euro and thus - cannot lower its dollar and create jobs.

IMHO