President Obama vs Mitt Romney

Originally posted by Iuckshot

Originally posted by Iuckshot

I think the dutch economy is also still getting a bit worse?
Surely worldwide economy still getting a bit worse isn't to blame on just the american president? :P
I've not studied politics and don't follow american politics so I don't know if he's good or bad at it, but Obama didn't pick the easiest of times to be a president

Drokun, let me break this down as simply as possible for you to understand what is going on in America. Our Government does not have the money to sustain itself. There are two options at this point. Cut spending and/or increase revenues through taxes, since the economy is not producing. The economy is solely dependant on the fact that people will spend money and through every microtransaction, the government gets tax revenue. People only spend money when they actually have money in their pocket. 

So let me tell you what this President's solution has been - raise spending. Please tell me how this solves our problems? On top of that, in order to sustain the added spending, he wants to raise taxes on everyone. Anyone that says otherwise just doesn't get how the taxes work. Therefore, people will have less money. People will spend less, which means our economy will start to recede, thus bringing in less revenue to the Government. As a result, the Government, in order to sustain itself, will have to raise taxes again, and again, and again. Do you see the fundamental problem?  

In addition to the fundamental problem this President's policy has created, the amount of debt he has accumulated ($6 trillion in 4 years) has been unsustainable even for borrowing from China (who own 8% of America) and Russia (who own 7% of America). Therefore, our Federal Reserve Bank (not really a bank) has been forced to print money to cover costs. Well, when you print more money, the value of the dollar goes down significantly. As a result, people have to pay a lot more for something that cost them a lot less before. Therefore, they again have less money in their pockets to spend in order to stimulate the economy.

All of this can be avoided by two simple functions. Keep taxes at the levels they are now (in order to create consistent expectations) and cut spending. This consistency will allow people to save money and budget their purchases. It will be consistent so they will know that their income next year will be the same as it is this year. And yes, some entitlements will have to go, simply because we cannot afford them at this time. The biggest being the "Affordable Health Care Act", which is a mandatory tax on people who do not have health insurance. In addition to the people paying for it out of their own pocket, it's going to cost our government an additional $2 trillion in 10 years to keep the program alive. Please tell me how this makes any sense?

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P.S. To King and Feh, I appreciate the kind words. Call me uneducated all you want, however, I have a J.D. from USC and an MBA from UCLA's Anderson School of Management. Additionally, I'm a tax attorney. So I may be uneducated, but the company I work for counts on me to understand the fundamental of economics in order to make sure our clients money is handled properly. And everything this administration has done has directly impacted everyone in my industry, our clients, and their employees, including the US Government who is our customer. So let's keep this up. 


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