The only serious attempt I've seen to address US budget issues was the Simpson-Bowles Commission under Obama in 2010. It recommended a menu of tax increases and benefit reductions. It was promptly ignored by Congress which was not surprising. As an exercise it was useful just to demonstrate what a serious proposal would have to look like and the nature of compromise that would be needed.
Of course, in the 15 years since the fiscal situation has gotten worse, so any of the recommendations it made then would need to be more severe now.
Keynes said something that has always stuck with me.
> Anything we can actually do we can afford
I find it increasingly paradoxical that supposedly, our collective economic capability routinely increases (implied by ever growing GDP), while our budget situation looks ever grimmer.
This is such a profound quote, but most people need more context to understand it. I certainly did when I ran across it a few years ago. I believe our society would be much better if more people did.
It is a good quote, but the article you link actually undermines it slightly. Keynes' words are relying on a non-expert in construction being confident that construction is easy despite the fact that the systems we use to measure cost-benefit indicating that it cannot or should not be done.
No evidence is mentioned that there was enough available in the way of bricks, mortar, steel, cement or labour. The banker quite likely hadn't checked any statistics or made any estimates. There is no particular reason to consider his opinion even informed on the topic. Britain had just had suffered around a half-million war casualties drawn disproportionately from their able-bodied labourers and their factories for things like steel and cement had probably suffered a few hard blows and were likely being run ragged.
They could have forcefully reallocated resources away from something people thought was more important towards building houses; but the issue that is being glossed over is if someone thought that there were higher priorities than building houses ... what if they were right? The thing about economics is prices aren't arbitrary, they encode a combination of how easy a good is to produce and how much demand there is for a good. They can't just be overridden expecting a good result without factoring in those things.
If Britain had some magic ability to just build whatever they want and there were enough resources available to do whatever then the empire wouldn't have collapsed shortly afterwards. They were way over-extended in terms of what resources they needed vs what they had available.
You're reinforcing the quote. You're questioning the conditional part of the quote, the "if we can do it" part. If they actually couldn't do it, then they couldn't afford it. And that's what Keynes said.
Your second criticism performs the standard hijack. The natural follow on is "if we can do it, and we can afford it, should we do it"? Should we do it is the right question to ask. Just because we can and we can afford it, doesn't mean we should do it. But far too many people try to squelch the debate by asserting that we can't afford it. We can afford universal health care or a modest UBI or a green new deal or whatever expensive thing that the left wants. Whether we should is the question, not whether we can.
There isn't any evidence that they could do what Keynes was suggesting they could. I thought he was making the comment after the war, but I just looked at the date again and realised they were in the middle of WWII at the time! They most certainly did not have spare resources and couldn't possibly afford to be building houses with them. The example he's giving is a case where they couldn't afford it because they couldn't do it. If he'd picked an example where they could do it but people were claiming they couldn't afford it that'd be different and better. But if they could do something we'd probably also find that the financial figures suggesting they could in fact afford it.
"You can afford what you can do" is a truism - if you can do something, the financial system will tell you that you can afford it except if something really weird is going on. If the resources were there to build the houses then the prices would shuffle around until it was also affordable.
> Keynes > Anything we can actually do we can afford
Yes, but Keynes also pointed out the result of that: "In the long term we are all dead" :)
Seriously, extraordinary claims require extraordinary evidence, and as much as the economics mainstream likes this to be true nobody ever presented convincing evidence in support of it.
Just in the last 3 days, there were several posts on HN that pointed out the inadequacy of the GDP as a measure of economic development, and they presented serious evidence.
I feel that in a sense, "we" (the collective society) can do a lot because of the productivity growth from technology "afford" (enable) us.
In another sense, what "we" (part of that society -- an individual, a group, a government) can do is limited by what we can "afford" (pay). We cannot command the bricks and mortar and steel and cement and labor and architects to build houses and infrastructure without some form of compensation -- money for the architects and builders and cement/steel/mortar/brick makers and movers to exchange for food, drink, and shelter.
And in this grim budget situation, "we" (the government) are running out of ways to ask for productivity (goods and services for healthcare, education, welfare, defense) because we are out of ways to compensate the providers.
What can a government do then?
- force them to offer productivity without equal compensation (communism, colonialism, slavery, forced labor, cheap labor, unequal trade agreements, etc.)
- promise to repay them later (government bonds)
- give them something that they think is valuable but is less so and decreasingly so (money printing)
- encourage giving without compensation (charitable work and donation)
- repay them with compensation collected from those who benefited the most from the economic productivity growth (taxing)
I think the quote "We can afford what we can actually do" encourages the audience to think more about what we (as a society) can do and less about how we (the individual) are compensated.
>He had budget surpluses for fiscal years 1998–2001, the only such years from 1970 to 2023. Clinton's final four budgets were balanced budgets with surpluses, beginning with the 1997 budget
I don't really understand why they can't do something like that which was carefully thought out and worked, rather than the present mess. I realise carefully thought out doesn't really go with the current president but I actually had hopes Musk might do something sane.
I think the demographic situation is one difference. The population was younger in 1998-2001 than today, so less of the population was on Social Security/Medicare than now. The article mentions that the increase in spending today is mainly due to Social Security, Medicare, and interest on the national debt.
To illustrate my point, last year the budget was $6.75 trillion and the deficit was $1.83 trillion. Discretionary spending only made up $1.72 trillion of the budget. This means that if Congress decided the federal government shouldn't do anything and cut 100% of discretionary spending, we would still have a slight deficit. It's possible to increase taxes to counteract this, but last year the government only brought in $4.92 trillion so the increase would be significant (and therefore unpopular). If we wanted to continue the surplus, we'd also have to keep increasing taxes through the late 2040s as the proportion of the population on Social Security and Medicare continues to increase. Given that we haven't fixed things for the past 45 years when they would have been a lot easier to fix, I don't see the political will for both spending cuts and massive tax increases to materialize anytime soon.
Budgets were balanced by slightly higher tax rates, and a whole lot of capital gains to tax.
We've got a massive market bubble right now, and could potentially make a dent in the deficit by taxing it. The deficit has grown so much since the 90s that you couldn't come anywhere close to balancing it even with an aggressive tax regime, but it would be much more effective than haphazardly firing Federal employees.
We did actually raise taxes a bit -- or rather, tariffs. They've taken in about $150B, more than DOGE has done. But that comes mostly from the poor and middle class, and doesn't come anywhere close to balancing the tax cuts (which go primarily to the upper class).
How high can the debt go before it can't go any higher? What happens when the interest payments themselves are higher than annual revenue? What happens when the interest payments are higher than the entire GDP so that even a theoretical 100% tax rate still wouldn't pay it? I feel like this _has_ to crash at some point, but I would have thought we would have hit that point by now. I know what would happen if my own interest debt overtook my own income, but I'm not a government.
It's never impossible for the US to pay a dollar denominated debt, as they can always create more dollars to pay it.
The real end point is when no one will buy new debt, because it seems to risky. Either because the US has rapidly growing inflation from creating dollars to pay debts, or because a default seems likely.
But this really isn’t about justifying spending as a moral good. The main changes which accelerate this debt are tax breaks for the wealthiest.
Welfare spending and public investment are about a shared sense of public good. That’s really what the US lacks, compared to European countries which support much higher levels of public spending with (historically at least) very broad public support.
Reminds me of this comment I saw under a YT video on the topic, 4mo back: The national debt won’t matter until it does…and then it’ll matter more than anything else.
20% of the immense USA budget is used to just pay interests.
The gap between revenue, and debt only keeps growing, it's growing at a rate of 4% relative to GDP per year (revenues at ~18%, debt at ~22%), and the lines are diverging with debt growing faster than revenues.
This debt accruance will eat more and more of the budget, less money for all the expenses, diminished levels of public services, less money for infrastructure projects at a time when your infrastructure needs quite a lot of renovation; less money for education, so on and so forth.
At some point it has to give, without reigning in this increasing divergence between debt, and revenues the USA will have to print money to either service interests or basic public services... Inflation might not become hyperinflation but definitely won't be on the 2% target when the burden of interest payment gets really bad.
A leading thesis in the macro space is that the general response to interest burden is for policy to naturally shift to financial repression, or using monetary tools and regulations to suppress real interest rates and devalue the debt stock while dropping interest payments.
Ex: after 2020 debt to GDP went down in real terms despite the massive increase in liquidity.
Of course that just enables more deficit spending and shifts the world more towards a modern monetary policy model, where inflation is the limiting factor.
It's a plausible view. Just as governments that can print their own money will not default, they will print to pay, they will also generally avoid going into a crushing crisis due to interest payment burden. It's politically easier to use the currency as an outlet.
Interest rate payments are supposed to limit the extent of deficit spending (and government budgets getting squeezed by interest is arguably partly deflationary, in that it can spur deflationary crisis and bad real economic environments), but in practice increasing interest payments creates more of a phase shift where the system shifts to forced debt haircuts, and that flows in kind to extra pressure on the currency.
Just look at the current environment where Fed independence is being breached like never before, with the aim of forcing interest rates down without consideration for data driven risk analysis...
It will not crash, they will just print more money, which will raise inflation and devalue debt. So elites and speculators will make money by pumping everything up with debt, and then they will tax (through inflation) the people who need paychecks to survive, while their assets will just go up with inflation. Then the cycle repeats.
The development of the Global financial system is an ongoing narrative though. It was never going to continue indefinitely. The modern euro dollar system is fairly new, spawned in the 70s. Before that you had a huge shift with the Sterling losing dominance. Then go back another 50 years and you have swarms of independent banks issuing their own currency.
It's a mix of a constantly churning "history rhymes it doesn't repeat" cycles (ex: stablecoins being rehypothecated/used as base level collateral with which to generate leverage is somewhat of a modern version of the late 1800s bank currency cycle), combined with what may be best described as technological development as theories and tools and ecosystems develop.
The zeitgeist is very much that it's about time for the Eurodollar (offshore dollars/Eurodollars bound by the 20 trillion dollar Eurodollar derivative market) to fade, but as of yet there haven't been any good alternatives.
It's a big burden to export your monetary policy and backstop global economic fragility, because it becomes your responsibility. Ex: that doesn't work with a system like China because they don't like putting their own people last in a loud and public way, while in the US the average person regularly and obviously comes away worse off during big interventions. It's also a bit of a trap to step into this, because central banks have mandates to protect systemic stability, yet by unwinding this sort of arrangement, capital flows reverse en-masse which is a clear threat to bond markets (and asset markets in the US's case, since it is so hyper financialized). That's something that is often missed in this conversation. It's a service that has to be provided, and it has costs.
Or perhaps we will attempt to give a system with no bank/regulator of last resort a go again. Probably a "history rhymes" style outcome, but you never know.
Printing money will help paying debt in nominal terms but can scare buying bonds without a premium, why would investors hold bonds paying 4% if the USA government might just devalue it by 3%/year through inflation by the end of the bond term? Increasing rates would cause a spiral.
No they do not, except for things that don't even seem to benefit anyone.
Republicans have been openly bragging about preventing the government from doing anything for decades. Specifically about Obama, they vowed to make him a one term president by preventing him from doing anything.
Since that time, the MAGA folk have taken over the party and edict #1 is to hate and obstruct and harm democrats, so anyone who has crossed the party line to get anything done, no matter how important, has been primaried out of the party.
Any budget proposal that cuts Medicare or social security is dead in the water and it's ridiculous for any group to even consider it. Not only would it be political suicide but it would also literally kill people.
Social security lives in a parallel universe to the budget, so they could cancel the program entirely and it wouldn't affect the deficit. Mixing it up with the regular budget is a way to confuse people into being open to killing it, a long-term goal of the cadre of financial geniuses who brought us The Great Depression.
Medicare is another story, and until the US has a come to Jesus moment on single payer healthcare and confronting the regulatory capture in healthcare it will only get worse.
> Social security lives in a parallel universe to the budget, so they could cancel the program entirely and it wouldn't affect the deficit.
100% true, if you're operating in sane-world where anything makes sense.
Here in insane world, my pet theory is that, given another year (maybe two, they might wait until after the midterms, assuming they hold on to congress) we're going to see an attempt to nullify the government debt owned by Social Security by converting it into some convoluted scheme involving crypto-backed-by-the-stock-market or something. Ta-da, debt reduced, deficit reduced (by the amount of interest on the debt owned by the trust fund)! Plus sooooo many opportunities to steal.
This'll kill the program stone-dead, but it'll take a little while. Kinda like how they already killed Obamacare by removing the individual mandate, and they're just waiting for the death-spiral to hit bottom so they can declare the program a failure and proof that we should never try to fix healthcare in any kind of actually-decent way again.
Haha. Last time it took the great depression and intense economic pain for americans to snap out of it and actually build a slightly better world (New Deal). I wouldn't expect it to take anything less this time around. Europe required 2 world wars and over 100M dead.
> they could cancel the [social security] program entirely and it wouldn't affect the deficit
I don't think this is true. During the surplus years the savings vehicle was US bonds. So social security lent the US government money.
Now that we are not in a surplus situation, we are using money from those bonds to pay benefits (we are also using SS revenue of course, only part of the payouts come from the bonds).
So if the program were cancelled, the bonds could revert back to the US government - in other words a bunch of debt would be forgiven and would not need to be paid out. Deficit (and debt) reduced.
> So if the program were cancelled, the bonds could revert back to the US government - in other words a bunch of debt would be forgiven
That seems like a passive-voice way of saying "We could steal from millions of people, pocketing the retirement savings they worked for their entire lives."
Also, there's nothing stopping Social Security from upping the cap and thus returning to surplus, aside from the group of people who would absolutely love to steal from the fund.
>That seems like a passive-voice way of saying "We could steal from millions of people, pocketing the retirement savings they worked for their entire lives."
You brought up cancelling the program. I was just pointing out that your statement about it having no effect on the deficit was incorrect.
> That seems like a passive-voice way of saying "We could steal from millions of people, pocketing the retirement savings they worked for their entire lives."
For a lot of younger people the view is they promised themselves something unsustainable and expect young people to cover it.
Is it? Is that a thing that has been shown to motivate young voters?
If anything I would believe that younger voters would be in favor of more social safety net. Many would be comfortable with the government outright nationalizing most industries.
More social safety net that goes to everyone, not just the people directly responsible for destroying this one. It's hard to be asked to bail out people who intentionally spiked the ball.
I guess "the children are our future" really was what they meant, we just misinterpreted it.
Our health system already kills people, and people seem essentially okay with that.
But, I agree about the political suicide. I unfortunately don't believe anyone is even going to attempt reform after how successful the Republican party's attacks on Obamacare were. People will just conclude there's no reward for trying.
A couple of points:
1) The deficit applies to discretionary budget. Medicare and Social Security are not discretionary.
2) Really. You can't cut anything out of medicare and social security (both of which are the most expensive program of the kind compared to any other first world equivalent) without killing people? There is not a cent of waste in these programs?
You really must stop taking Republicans at their word. The stated goals of Doge are obviously different from the actual goals. Try not to listen to their words, only watch their actions.
In this case, Doge's actions are to shrink government, especially any agencies that were opposing or investigating Musk in any way.
"That is largely because the main drivers of spending kept rising: social programs, including Social Security and Medicare, and interest on the public debt, which topped $1 trillion by one measure for the first time."
It sure would be nice if, instead of cutting taxes for the ultra-wealthy, that money being given back to the people who need it the absolute least were instead used to reduce the public debt.
And how much money did DOGE spend on its quest to save nothing by trashing scientific research?
The thing is, the most common spending that they attempt to cut is spending that has multiplier effects on the economy, because it's giving money (whether directly or indirectly) to the poorest people.
Really? Please provide a decline in net dollars (excluding projected drawdowns) that demonstrates this point.
On a dollar-by-dollar basis, regardless of economic station, _every_ American has seen a combined discretionary + non-discretionary increase in benefits since 1980. The group that is less advantaged is the upper-middle class, which has seen relative stagnation.
I don’t think the next administration, whichever party ends up winning, will be likely to reverse these tariffs just based on how much revenue they bring in for the federal government.
Reducing spending is of course another different problem altogether.
It raises taxes but arguably impacts GDP in a very direct and equal way, so it mostly nets out. The argument that follows from there would be that taxing the rich would have less of an impact on GDP.
Social security doesn't contribute to the general budget deficit. Its funding source is totally distinct. It doesn't and can't (under current laws) borrow to fund itself—if nothing changes, then as the fund runs low, payments will be reduced.
Mention of Social Security as a major driver of the budget deficit is a red flag you're reading something by someone who's ill-informed on the topic, or else they're deliberately bullshitting you.
You’re only considering one part of the system, not the whole. As the GAO puts it[1]:
> Intragovernmental debt holdings represent federal debt owed by Treasury to federal government accounts—primarily federal trust funds such as those established for Social Security and Medicare—that typically have an obligation to invest their excess annual receipts (including interest earnings) over disbursements in federal securities.
> Debt held by the public represents a claim on today’s taxpayers and absorbs resources from today’s economy, meaning that when an investor buys Treasury securities it is not investing that money elsewhere in the economy.
> Intragovernmental debt holdings reflect a claim on taxpayers and the economy in the future. Specifically, when federal government accounts redeem Treasury securities to obtain cash to fund expenditures, Treasury usually borrows from the public to finance these redemptions.
Or to put it simply the excess contributions are lent to the Treasury who uses it for general government expenditures. When it’s time to pay it back the Treasury can either pay it with tax revenue assuming it has excess or has cut spending elsewhere or it will be forced to borrow it. The latter is generally what happens.
I wouldn’t be so quick to call people ill-informed on this subject if I were you.
No, I considered the whole thing. It's worth, in some contexts, pointing out that we borrow to service existing debt, but it remains irrelevant that one of the owners of that debt happens to be the Social Security Trust Fund, if we're talking about the budget deficit.
We halt all spending on Social Security tomorrow. Great, wonderful. Buuuuut... that debt still exists and nothing whatsoever changes for the budget deficit. [EDIT pedantic nuance: technically it might let us spread repaying that debt over a longer period, but the debt itself remains identical, unless we decide we're just gonna let it sit there and never pay anything against it, which is identical to nullifying it, which, see next paragraph]
Unless we're prepared to nullify debts we've already incurred, in which case, why single out the debt Social Security owns for that treatment?
> I wouldn’t be so quick to call people ill-informed on this subject if I were you.
Nah, gonna continue until I see any reason to stop.
>why single out the debt Social Security owns for that treatment
Because it's the biggest slice of the federal budget pie, and currently it goes to the segment of the US population with the highest average net worth.
Whether you think it's right or wrong, it is a massive chunk of mandatory spending. Combined with Medicare, it's close to 40% of the entire budget, and it is ultimately unsustainable.
> Because it's the biggest slice of the federal budget pie
It's not spent out of the general fund. The only—only—effect Social Security spending has on the budget is that for part of its spending, it calls in debt the general budget already owes it when it spend its money (which is invested in government debt). That money came from a dedicated, separate source, and wasn't generated by deficit spending, but by actual income. That money bought US government debt, so we owe that back, and that repayment is the only part of any of this that affects the budget.
[EDIT] To boil this down for international readers or people who just haven't ever bothered to learn the super interesting (LOL) way Social Security is structured:
1) Social Security is funded by the majority of the money that comes out of workers' paychecks under the "FICA" heading (some goes to other benefits-related stuff, but most of it goes to Social Security). This is a static proportion of ~15%, not progressively bracketed like ordinary income tax. About half is paid separately by your employer, typically, but people filing as independent contractors (form 1099) pay the whole shebang. This tax also phases out abruptly at a certain level (I forget exactly where, something like $200k for an individual tax filer I think) which means it's actually not just not-progressive, but rather extremely regressive (i.e. it preferentially targets income dollars with the highest marginal utility, not the lowest)
2) Under certain circumstances, but mostly when you get sufficiently old, you can start to draw benefits (payments back to you) out of Social Security. These benefits are (basically) adjusted for how much you paid in. Paid in more? Get more back.
3) For a long time Social Security ran a surplus from their FICA income, so that money went into the Social Security "Trust Fund". This money is not available to the general budget. The law is structured such that the excess money couldn't just be spent on other stuff.
4) ... however, you don't really want money just sitting around inflating away, you want to invest it. Plus, sure would be nice for the rest of the budget to access that big tempting pile of money somehow, if you're a politician and kinda an asshole (but I repeat myself). So, the trust fund bought government debt.
5) Social Security is now deficit spending, because we have a fuckload of old people drawing benefits from it, and not enough young people funding it to balance that out. That means it's spending down the trust fund (ITS OWN MONEY that it ALREADY COLLECTED). This requires cashing in some of those IOUs.
6) "Well when it runs out of money it saved up, won't that mean that spending becomes deficit spending against the general budget?" Nope! Not without changing the law, anyway (which opens up practically infinite possibilities, so it's kinda pointless to introduce to a discussion of "how does this work?"). What'll happen is the SSA (Social Security Administration) has to cut benefits until payments balance with income (from the FICA tax).
How is the amount of money paid as interest dependent on the measure used? I can understand different interpretations of some expenses as capex vs opex, and similar other questions. But interest?
Once the government is involved, everything is "interpretation." Unemployment? Well... it depends on what you mean by unemployment. We changed how we "count" a few years back. Owe? It depends what you mean by "owe." What is the definition of "is?"
If I buy a $1000 bond with a 1 year duration and 2% coupon for $950, realizing $70 of net income from it over the following year ($20 coupon payments, $50 "extra" principal return), has the government paid $20 or $70 of interest?
I'm not sure there's a significant difference in practice, but technically the $50 would be part of the bond's debt principal, not interest.
A bond with a face value of $1000 means the government has $1000 of debt regardless of what is paid for the bond.
The coupon payments represent the "interest" on that debt - the $20 coupon means the government is paying $20 of interest per year.
Paying below face value doesn’t make the difference "interest." It simply means investors are buying the bond at a discount, so the government receives less cash upfront in exchange for repaying the full $1,000 at maturity. Bonds differ from traditional loans in that their market price can fluctuate, but the debt obligation remains fixed at the face value.
In practice, the government's accounting labels the discount as an "interest expense", so it still gets captured as interest in the budget.
That's a reasonable interpretation from the Treasury's perspective. But if you ask the IRS, I've realized all $70 as interest income ($50 as OID, which they consider a form of interest).
(And yes, coupons pay 2x yearly, but they are quoted on an annual basis; I would receive two $10 payments.)
Yes, secondary sellers can claim capital losses. But they typically go for a discount even at the primary Treasury auction, so there's still more than $20 of total profit after netting across holders.
Inaccurate headline. DOGE did a lot at government agencies, including violating any and all possible best practices, copying entire databases of citizens, then handling the data in unknown ways.
Trust me. DOGE has done a great deal, just none of it is reasonable or sane from our perspective.
> 1. Tariffs are bringing in real money.
> The U.S. collected $195 billion in customs duties, more than double the prior year. That doesn’t capture the full jump because tariff rates only ramped up in April, halfway through the year.
That's actually more than I expected.
> President Trump seeks to shift the government’s reliance on income taxes toward taxes on imported goods. Still, tariffs contribute a relatively small 3.7% of overall federal revenue, compared with 51% for the individual income tax.
We really need to close large ccorporate tax dodges as well. Too many smaller companies pay 35% rates while the Apples and NVIDIAs pay a fraction of that rate. There's apparently plenty enough corporation money sloshing around to spend trillions on GPUs for AI in the US.
The tariffs don't actually bring in money, they just move money from one place (US taxpayers, who'd otherwise use it productively) and put it elsewhere (the treasury).
Now normally this might be put to some sensible use, perhaps building infrastructure, but since this revenue is being used to offset huge tax cuts for a tiny group of people determined to turn around and use the capital for (let's be real here) speculation it's a net negative.
In the end we're going to look back at this chapter of 'Devil Take the Hindmost: A History of Financial Speculation' and say "Well obviously those idiots should've see that coming."
To say that tariffs don't actually bring in money is simply wrong. We are talking about income to the government. Yes, tariffs take actual money and give it to the government. It doesn't matter where it came from, inside or outside the US.
If your definitions are used, then literally nothing actually brings in money. It just moves it from one place to another.
Not true, issuing a loan brings in money (albeit mirrored by an equal amount of debt). So the federal deficit brings in a substantial amount of money. In the same vein, paying down the national debt completely, an oft-cited goal of some national leaders, destroys all money.
Setting aside the issue of generating money, which is not under discussion, and which loans can help with, do you really still claim that "The tariffs don't actually bring in money"? 51% of the government income is from income taxes, which you would say "doesn't actually bring in money." So what exactly is the point of talking the way you are talking?
Our current leadership and their populist supporters are super gung-ho on converting the US into a mercantile economy like China. That's what these tariffs are about: creating an environment of protectionism from which the US will emerge as an export powerhouse, with massive trade imbalances in the US' favor.
So in their own language, these tariffs are merely domestic transfers of capital and do not 'bring in money.'
The language under discussion is the national debt and deficit.
You’re trying to make a political point by changing the definition of words.
I may agree with your point, but pretending like tariffs don’t generate income that bring down the deficit is not the way to argue it. It just convinces people you aren’t arguing in good faith, or don’t understand simple math.
The last legal ruling on the matter found that they are mostly being enacted illegally by using emergency powers[1] and may end up being refunded entirely. So until they are actually able to be booked, we can't say they are impacting the budget one way or another. If they aren't legalized then the work it took to collect and then refund them all is money that may as well have been incinerated.
> The tariffs don't actually bring in money, they just move money from one place (US taxpayers, who'd otherwise use it productively) and put it elsewhere (the treasury).
So your argument seems to be “We have yet to see whether these new tariffs are legal and therefore whether the income will be able to be kept.”
That’s a far cry from saying tariffs don’t generate income for the government, which is what I understood you to be saying.
It's going to be the biggest heist in American history. That tariff revenue is as good as gone. It's not about whether the money can actually be brought in, but more about the reality that crooks have access to the pot. It's really all about that. These are not fiscal conservatives generating revenue to pay down debt, these are actual crooks that will gift it to each other.
With the global minimum tax rules in place, weighted by GDP and by revenue, corporate tax rates are actually fairly consistent across the world - roughly 25% worldwide. It's a myth that companies are not paying taxes, and also a myth that the largest sectors in the US are not paying taxes. It's a great talking point, though.
You also seem to be conflating investment for profit (GPUs for AI, for example) with income. Capital outlays of this type are almost always financed (see recently Nvidia, OpenAI + AMD, etc. deals). None of the large players are self-funding AI on that scale right now. This is why OpenAI's burn rate is so catastrophically high.
Perhaps for most companies, which was part of my point. But it's interesting to consider. I haven't read up too much on it in recent years.
The largest, most profitable international mega-corps always seem to pay much less because they can afford to game the system more.
It does look like my data is out of date concerning US corporate tax rates, which looks to be a flat 21% now from Trump's first term. Guess I'd only heard about the personal income tax breaks.
Spot checking Alphabet, it seems big corps might still be getting big tax breaks. A quick Google search on Alphabet Inc's effective tax rate AI summary of [1] gives:
> Alphabet's most recent effective tax rate was 16.91% for the quarter ending June 30, 2025, and 16.44% for the fiscal year ending December 31, 2024. The company's effective tax rate has varied, hitting a recent low of 13.9% in 2023 before increasing again in 2024.
That looks to be about 25% cut off their taxes.
Interesting tidbit: Averaging Alphabet's Q1&Q2 revenue and taxes and then calculating what they would pay at a 25%, 35%, or 21% corporate tax rate I get:
> est_annum_lost_vs_21 => $ 6,057 millions
> est_annum_lost_vs_25 => $12,115 millions
> est_annum_lost_vs_35 => $27,259 millions
So Google alone could be paying about 3.10% (or 6.21-13.97% with 25/35% rates) worth of the proceeds from tariffs just by itself.
Is that a big amount or not isn't clear to me. But it's an interesting perspective to consider.
> You also seem to be conflating investment for profit (GPUs for AI, for example) with income. Capital outlays of this type are almost always financed
True, and my comment over-simplifies all of that. Nevertheless those finance deals effect the debt markets raising the US government's interest rates. It also effects regular home buyers as well who will likely continue seeing higher mortgage rates.
Perhaps, if they were paying more of their fair share of taxes Nvidia, OpenAI + AMD, etc would have both less expected profits in the future and therefore less ability to finance such large amounts.
They're not shelling out the cash now. Given their general profitability and large cash reserves they can leverage even larger amounts of debt than they'd be able to otherwise.
Why should Nvidia pay any taxes except payroll for their local headcount? They could easily book all revenue overseas in tax heavens. They should pay more taxes to the places where chips are made, not to the US government.
The 2010s and Obama called - they want their foreign policy back.
Most countries (including the US) have signed global minimum tax rates at this point. Effective tax rates (either directly or via clawbacks) are theoretically 25%.
Of course, I am not enough of an expert to know if that is happening in China. I somewhat doubt it.
Actually, the US has joined. Although it has not joined Pillar II, the effective tax rate, according to third-party economists, shows adherence to the 25% number.
>We really need to close large ccorporate tax dodges as well. [...] There's apparently plenty enough corporation money sloshing around to spend trillions on GPUs for AI in the US.
This does not follow. The figures for "trillions" come from estimates for what will be spent in the next few years, not amount actually spent. Moreover while tech companies have initially funded their AI investments from their cash piles, they're now tapping debt markets to fund that growth, so the fact they're spending "trillions" doesn't imply they're evading taxes.
Corporations take their revenue to pay people as either employees or shareholders. I am not sure why we need to tax corporations at all. Take employees as income perhaps, tax dividends, tax shares being sold, but allow companies to use their money productively.
Though I would prefer a 0% income and capital tax, and we move to a pure land value tax and rent tax system.
There's a lot of ways to siphon money out of firms. People declare their car as a "work vehicle", CEOs fly to the beach on the company's jet, etc.
So I guess you want some level of corporate tax? (it's the same for why there are large sales tax in developing countries; sure they are less efficient than income taxes, but lots of people evade those)
>There's a lot of ways to siphon money out of firms. People declare their car as a "work vehicle", CEOs fly to the beach on the company's jet, etc.
That's why there are specific IRS regulations for this[1]. "Company cars" basically disappeared as a result. Moreover contrary to what you imply, corporate taxes don't really solve this issue either. Corporate taxes are paid on profit, not revenue, and expenses like "work vehicles" or private jets aren't taxed either way.
> Corporations take their revenue to pay people as either employees or shareholders. I am not sure why we need to tax corporations at all. Take employees as income perhaps, tax dividends, tax shares being sold, but allow companies to use their money productively.
I believe almost the opposite. We should tax corporations more and individuals less. As long as we keep estate taxes to curtail dynasties.
We have far too much concentration in towards ever larger, more powerful corporations. By their nature corporations lack ethics and morals of normal people. Even when operated by well meaning people the system anonymizes individuals and increases group think, etc. That's not purely a bad thing as it also enables large scalable systems which profit humanity as a whole. However there should also be curtails on corporate power and control.
>> President Trump seeks to shift the government’s reliance on income taxes toward taxes on imported goods. Still, tariffs contribute a relatively small 3.7% of overall federal revenue, compared with 51% for the individual income tax.
Doesn't he also say tariffs are going to cause manufacturing to move to the US? That seems at odds with tariffs as a replacement for income taxes.
It's very important to realize that it isn't true that DOGE didn't "do much". It's just that what they did was kill hundreds of thousands to millions of people worldwide.
If tariff revenue is rising, and the economy hasn’t shrunk (yet), and DOGE has returned money (recission later being authorized) then some money was clearly generated.
Alternatively, Doge could have been totally ineffectual and tariffs returning nothing, but this article seems to indicate otherwise.
This means that less money then planned was spent. Against a null hpothesis, that indicates that the situation is "better" then doing nothing at all (at which point, the rise in government lending costs, the out of control benefit costs, and all of the other stupid crap that has been festering out there since Bill Clinton won the white house for ridiculing Bush for raising taxes comes home to roost.
I'm solidly in the never-trump camp, and maybe there was an argument made after the paywall, but this feels like an ideology in search of a headline.
1. Doge isn't free. They have staff with expenses which haven't been accounted for in your argument.
2. Cancelation of forward facing contracts shouldn't affect the immediate numbers. But it's like laying off the entire company; you're going to record a record Q4 with all those sales but no expenses however come Q1 good luck for the company.
Although people have posted links so you can read the article [1] which largely points out that spending is up by $220 billion. Which is about 2.2 trillion worse than Doge promised.
(Can't read the article due to paywall and no working mirror on archive.is right now.)
I mean... duh? This shouldn't be news to anyone paying attention. DOGE was shock-and-awe theater, and a means to shake up agencies and gain access to sensitive information. At best, they saved a few tens of millions of dollars, which at that level isn't really worth the effort.
The GOP always cries about spending and the deficit, but when they're in charge, they spend just as much as Democrats (if not more!), and, to make things worse, cut taxes (usually for the rich more than anyone else). The largest part of the federal budget isn't the discretionary spending, anyway.
And the effects of the tariffs have been obvious to anyone not drinking the MAGA Kool-Aid.
They keep cutting taxes, too. That's a big part of the problem.
A space alien newly arrived on Earth and looking at just actions taken, GAO/CBO reports, and the actual historical data, would conclude that, at least since 1980, Democrats were the ones who cared (a lot) more about the budget deficit than Republicans. The notion that voting for Republicans is the best move for a voter whose major issue is the deficit, is just marketing.
There was a time, probably before Reagan came to office, that the cutting/reforming taxes yielded positive returns. But fifty years on, the high-hanging fruit has all been picked. This is widely acknowledged by "true conservatives" (takes one to know one).
Everything goes to the debt, the only way out is through cuts to entitlements or broadly raising taxes, both deeply unpopular.
> The GOP always cries about spending and the deficit, but when they're in charge, they spend just as much as Democrats (if not more!), and, to make things worse, cut taxes (usually for the rich more than anyone else). The largest part of the federal budget isn't the discretionary spending, anyway.
IMHO, the GOP wants to reduce government spending for ideological reasons, but doesn't generally have any particular thing it wants to reduce spending on, and certainly doesn't want to take the blame for cutting any particular programs. So they do a tax cut, because voters like tax cuts; and chances are Democrats will be in power when the deficit / debt gets big enough that it needs to be addressed. Then Democrats will have to do the poor PR business of raising taxes or making specific cuts. If Democrats make specific cuts to reduce government spending in order to make the lower taxes work, the GOP furthered their ideology and got good vibes for lowering taxes, while the Democrats got bad vibes for cutting programs.
I don't like it, but it works for the GOP, so I'm sure we'll see it continue.
Right from the start, any impartial observer could tell that it wasn't a sincere effort grounded in truth.
First, the goal of the tariffs was to reduce US deficit spending.
Then it was reducing debt. Isolating & containing China. Dissuading them from invading Taiwan. Replacing the income tax. Retaliating against Europe, Japan, & S. Korea for unfair trade practices. Compelling other countries to buy American. Onshoring manufacturing. Forcing foreigners to pay a premium to access American markets. Forcing Canada & Mexico to get illegal immigration & narcotics trafficking under control. Punishing Brazil for persecuting Bolsonaro. Compelling third countries to accept expelled immigrants.
Then they pivoted to: Art of the Deal! He's deliberately making unrealistic demands as an intro offer.
The only serious attempt I've seen to address US budget issues was the Simpson-Bowles Commission under Obama in 2010. It recommended a menu of tax increases and benefit reductions. It was promptly ignored by Congress which was not surprising. As an exercise it was useful just to demonstrate what a serious proposal would have to look like and the nature of compromise that would be needed.
Of course, in the 15 years since the fiscal situation has gotten worse, so any of the recommendations it made then would need to be more severe now.
https://en.wikipedia.org/wiki/National_Commission_on_Fiscal_...
Keynes said something that has always stuck with me.
> Anything we can actually do we can afford
I find it increasingly paradoxical that supposedly, our collective economic capability routinely increases (implied by ever growing GDP), while our budget situation looks ever grimmer.
This is such a profound quote, but most people need more context to understand it. I certainly did when I ran across it a few years ago. I believe our society would be much better if more people did.
Here's a good explanation I found quickly via Google, I'm sure there are others: https://medium.com/mydex/we-can-afford-what-we-can-actually-...
It is a good quote, but the article you link actually undermines it slightly. Keynes' words are relying on a non-expert in construction being confident that construction is easy despite the fact that the systems we use to measure cost-benefit indicating that it cannot or should not be done.
No evidence is mentioned that there was enough available in the way of bricks, mortar, steel, cement or labour. The banker quite likely hadn't checked any statistics or made any estimates. There is no particular reason to consider his opinion even informed on the topic. Britain had just had suffered around a half-million war casualties drawn disproportionately from their able-bodied labourers and their factories for things like steel and cement had probably suffered a few hard blows and were likely being run ragged.
They could have forcefully reallocated resources away from something people thought was more important towards building houses; but the issue that is being glossed over is if someone thought that there were higher priorities than building houses ... what if they were right? The thing about economics is prices aren't arbitrary, they encode a combination of how easy a good is to produce and how much demand there is for a good. They can't just be overridden expecting a good result without factoring in those things.
If Britain had some magic ability to just build whatever they want and there were enough resources available to do whatever then the empire wouldn't have collapsed shortly afterwards. They were way over-extended in terms of what resources they needed vs what they had available.
You're reinforcing the quote. You're questioning the conditional part of the quote, the "if we can do it" part. If they actually couldn't do it, then they couldn't afford it. And that's what Keynes said.
Your second criticism performs the standard hijack. The natural follow on is "if we can do it, and we can afford it, should we do it"? Should we do it is the right question to ask. Just because we can and we can afford it, doesn't mean we should do it. But far too many people try to squelch the debate by asserting that we can't afford it. We can afford universal health care or a modest UBI or a green new deal or whatever expensive thing that the left wants. Whether we should is the question, not whether we can.
There isn't any evidence that they could do what Keynes was suggesting they could. I thought he was making the comment after the war, but I just looked at the date again and realised they were in the middle of WWII at the time! They most certainly did not have spare resources and couldn't possibly afford to be building houses with them. The example he's giving is a case where they couldn't afford it because they couldn't do it. If he'd picked an example where they could do it but people were claiming they couldn't afford it that'd be different and better. But if they could do something we'd probably also find that the financial figures suggesting they could in fact afford it.
"You can afford what you can do" is a truism - if you can do something, the financial system will tell you that you can afford it except if something really weird is going on. If the resources were there to build the houses then the prices would shuffle around until it was also affordable.
It's my first time reading this quote, and the context you provide definitely helped. Thanks.
> Keynes > Anything we can actually do we can afford
Yes, but Keynes also pointed out the result of that: "In the long term we are all dead" :)
Seriously, extraordinary claims require extraordinary evidence, and as much as the economics mainstream likes this to be true nobody ever presented convincing evidence in support of it.
> our collective economic capability routinely increases (implied by ever growing GDP)
Just in the last 3 days, there were several posts on HN that pointed out the inadequacy of the GDP as a measure of economic development, and they presented serious evidence.
Thanks for the profound quote.
I feel that in a sense, "we" (the collective society) can do a lot because of the productivity growth from technology "afford" (enable) us.
In another sense, what "we" (part of that society -- an individual, a group, a government) can do is limited by what we can "afford" (pay). We cannot command the bricks and mortar and steel and cement and labor and architects to build houses and infrastructure without some form of compensation -- money for the architects and builders and cement/steel/mortar/brick makers and movers to exchange for food, drink, and shelter.
And in this grim budget situation, "we" (the government) are running out of ways to ask for productivity (goods and services for healthcare, education, welfare, defense) because we are out of ways to compensate the providers.
What can a government do then?
- force them to offer productivity without equal compensation (communism, colonialism, slavery, forced labor, cheap labor, unequal trade agreements, etc.)
- promise to repay them later (government bonds)
- give them something that they think is valuable but is less so and decreasingly so (money printing)
- encourage giving without compensation (charitable work and donation)
- repay them with compensation collected from those who benefited the most from the economic productivity growth (taxing)
I think the quote "We can afford what we can actually do" encourages the audience to think more about what we (as a society) can do and less about how we (the individual) are compensated.
Might be before your time (1993): https://en.wikipedia.org/wiki/National_Partnership_for_Reinv...
> elimination of over 100 programs, the elimination of over 250,000 federal jobs, the consolidation of over 800 agencies
Didn't solve all budget issues, but was a legitimate and meaningful effort to reduce waste. Polar opposite of DOGE.
Yeah, and the results:
>He had budget surpluses for fiscal years 1998–2001, the only such years from 1970 to 2023. Clinton's final four budgets were balanced budgets with surpluses, beginning with the 1997 budget
I don't really understand why they can't do something like that which was carefully thought out and worked, rather than the present mess. I realise carefully thought out doesn't really go with the current president but I actually had hopes Musk might do something sane.
I think the demographic situation is one difference. The population was younger in 1998-2001 than today, so less of the population was on Social Security/Medicare than now. The article mentions that the increase in spending today is mainly due to Social Security, Medicare, and interest on the national debt.
To illustrate my point, last year the budget was $6.75 trillion and the deficit was $1.83 trillion. Discretionary spending only made up $1.72 trillion of the budget. This means that if Congress decided the federal government shouldn't do anything and cut 100% of discretionary spending, we would still have a slight deficit. It's possible to increase taxes to counteract this, but last year the government only brought in $4.92 trillion so the increase would be significant (and therefore unpopular). If we wanted to continue the surplus, we'd also have to keep increasing taxes through the late 2040s as the proportion of the population on Social Security and Medicare continues to increase. Given that we haven't fixed things for the past 45 years when they would have been a lot easier to fix, I don't see the political will for both spending cuts and massive tax increases to materialize anytime soon.
Clinton's budget surpluses had more to do with the dotcom boom than with his spending plans. Federal spending continued to rise all through the 90s:
https://fred.stlouisfed.org/series/W019RCQ027SBEA
Budgets were balanced by slightly higher tax rates, and a whole lot of capital gains to tax.
We've got a massive market bubble right now, and could potentially make a dent in the deficit by taxing it. The deficit has grown so much since the 90s that you couldn't come anywhere close to balancing it even with an aggressive tax regime, but it would be much more effective than haphazardly firing Federal employees.
We did actually raise taxes a bit -- or rather, tariffs. They've taken in about $150B, more than DOGE has done. But that comes mostly from the poor and middle class, and doesn't come anywhere close to balancing the tax cuts (which go primarily to the upper class).
But it took 5 year, that's slow and inefficient! DOGE can't be slow and inefficient because it's lead by corporate america, not bureaucratic america.
How high can the debt go before it can't go any higher? What happens when the interest payments themselves are higher than annual revenue? What happens when the interest payments are higher than the entire GDP so that even a theoretical 100% tax rate still wouldn't pay it? I feel like this _has_ to crash at some point, but I would have thought we would have hit that point by now. I know what would happen if my own interest debt overtook my own income, but I'm not a government.
It's never impossible for the US to pay a dollar denominated debt, as they can always create more dollars to pay it.
The real end point is when no one will buy new debt, because it seems to risky. Either because the US has rapidly growing inflation from creating dollars to pay debts, or because a default seems likely.
Yes, the Fed can always buy the debt so the end point is ultimately runaway inflation. A tale almost as old as money itself.
Spending someone else's money is pretty fun, especially once you find a way to justify it as a moral good.
But this really isn’t about justifying spending as a moral good. The main changes which accelerate this debt are tax breaks for the wealthiest.
Welfare spending and public investment are about a shared sense of public good. That’s really what the US lacks, compared to European countries which support much higher levels of public spending with (historically at least) very broad public support.
>Welfare spending and public investment are about a shared sense of public good
>But this really isn’t about justifying spending as a moral good
hmm
Reminds me of this comment I saw under a YT video on the topic, 4mo back: The national debt won’t matter until it does…and then it’ll matter more than anything else.
Well, it's been 50 years since I first heard that the debt would cause an imminemt hyperinflation, so I'd say it could be another 50 years.
Sometimes prophets have to revise the date of doomsday, but it doesn't seem to make them any less popular as prophets.
> Well, it's been 50 years since I first heard that the debt would cause an imminent hyperinflation.
I haven't heard anyone predict hyperinflation, but high and under-reported inflation is here and it's not just government debt that is causing it.
20% of the immense USA budget is used to just pay interests.
The gap between revenue, and debt only keeps growing, it's growing at a rate of 4% relative to GDP per year (revenues at ~18%, debt at ~22%), and the lines are diverging with debt growing faster than revenues.
This debt accruance will eat more and more of the budget, less money for all the expenses, diminished levels of public services, less money for infrastructure projects at a time when your infrastructure needs quite a lot of renovation; less money for education, so on and so forth.
At some point it has to give, without reigning in this increasing divergence between debt, and revenues the USA will have to print money to either service interests or basic public services... Inflation might not become hyperinflation but definitely won't be on the 2% target when the burden of interest payment gets really bad.
A leading thesis in the macro space is that the general response to interest burden is for policy to naturally shift to financial repression, or using monetary tools and regulations to suppress real interest rates and devalue the debt stock while dropping interest payments.
Ex: after 2020 debt to GDP went down in real terms despite the massive increase in liquidity.
Of course that just enables more deficit spending and shifts the world more towards a modern monetary policy model, where inflation is the limiting factor.
It's a plausible view. Just as governments that can print their own money will not default, they will print to pay, they will also generally avoid going into a crushing crisis due to interest payment burden. It's politically easier to use the currency as an outlet.
Interest rate payments are supposed to limit the extent of deficit spending (and government budgets getting squeezed by interest is arguably partly deflationary, in that it can spur deflationary crisis and bad real economic environments), but in practice increasing interest payments creates more of a phase shift where the system shifts to forced debt haircuts, and that flows in kind to extra pressure on the currency.
Just look at the current environment where Fed independence is being breached like never before, with the aim of forcing interest rates down without consideration for data driven risk analysis...
It will not crash, they will just print more money, which will raise inflation and devalue debt. So elites and speculators will make money by pumping everything up with debt, and then they will tax (through inflation) the people who need paychecks to survive, while their assets will just go up with inflation. Then the cycle repeats.
We may not live to see a crash but that doesn't mean it won't happen. It doesn't seem like this cycle is stable enough to continue indefinitely
The development of the Global financial system is an ongoing narrative though. It was never going to continue indefinitely. The modern euro dollar system is fairly new, spawned in the 70s. Before that you had a huge shift with the Sterling losing dominance. Then go back another 50 years and you have swarms of independent banks issuing their own currency.
It's a mix of a constantly churning "history rhymes it doesn't repeat" cycles (ex: stablecoins being rehypothecated/used as base level collateral with which to generate leverage is somewhat of a modern version of the late 1800s bank currency cycle), combined with what may be best described as technological development as theories and tools and ecosystems develop.
The zeitgeist is very much that it's about time for the Eurodollar (offshore dollars/Eurodollars bound by the 20 trillion dollar Eurodollar derivative market) to fade, but as of yet there haven't been any good alternatives.
It's a big burden to export your monetary policy and backstop global economic fragility, because it becomes your responsibility. Ex: that doesn't work with a system like China because they don't like putting their own people last in a loud and public way, while in the US the average person regularly and obviously comes away worse off during big interventions. It's also a bit of a trap to step into this, because central banks have mandates to protect systemic stability, yet by unwinding this sort of arrangement, capital flows reverse en-masse which is a clear threat to bond markets (and asset markets in the US's case, since it is so hyper financialized). That's something that is often missed in this conversation. It's a service that has to be provided, and it has costs.
Or perhaps we will attempt to give a system with no bank/regulator of last resort a go again. Probably a "history rhymes" style outcome, but you never know.
> It was never going to continue indefinitely
I'm can't see where you're going with that, can you explain?
We remind all federal employees not to use billions as toilet paper, as it is technically defacing the currency.
Inflating the debt away doesn’t work unless the budget is also balanced.
Otherwise what is inflated away will be recouped by the interest rates when forced to keep borrowing.
Nailed it!
Printing money will help paying debt in nominal terms but can scare buying bonds without a premium, why would investors hold bonds paying 4% if the USA government might just devalue it by 3%/year through inflation by the end of the bond term? Increasing rates would cause a spiral.
Serious question - do cross-party things like this still happen?
It feels like everything is done along party lines now with no room for compromise or working together.
No they do not, except for things that don't even seem to benefit anyone.
Republicans have been openly bragging about preventing the government from doing anything for decades. Specifically about Obama, they vowed to make him a one term president by preventing him from doing anything.
Since that time, the MAGA folk have taken over the party and edict #1 is to hate and obstruct and harm democrats, so anyone who has crossed the party line to get anything done, no matter how important, has been primaried out of the party.
> The only serious attempt I've seen to address US budget issues was the Simpson-Bowles Commission under Obama in 2010.
Wasn't Clinton the last president to balance the budget?
People on HN are younger than you think.
What are your thoughts on https://en.wikipedia.org/wiki/Omnibus_Budget_Reconciliation_... ?
Any budget proposal that cuts Medicare or social security is dead in the water and it's ridiculous for any group to even consider it. Not only would it be political suicide but it would also literally kill people.
Social security lives in a parallel universe to the budget, so they could cancel the program entirely and it wouldn't affect the deficit. Mixing it up with the regular budget is a way to confuse people into being open to killing it, a long-term goal of the cadre of financial geniuses who brought us The Great Depression.
Medicare is another story, and until the US has a come to Jesus moment on single payer healthcare and confronting the regulatory capture in healthcare it will only get worse.
> Social security lives in a parallel universe to the budget, so they could cancel the program entirely and it wouldn't affect the deficit.
100% true, if you're operating in sane-world where anything makes sense.
Here in insane world, my pet theory is that, given another year (maybe two, they might wait until after the midterms, assuming they hold on to congress) we're going to see an attempt to nullify the government debt owned by Social Security by converting it into some convoluted scheme involving crypto-backed-by-the-stock-market or something. Ta-da, debt reduced, deficit reduced (by the amount of interest on the debt owned by the trust fund)! Plus sooooo many opportunities to steal.
This'll kill the program stone-dead, but it'll take a little while. Kinda like how they already killed Obamacare by removing the individual mandate, and they're just waiting for the death-spiral to hit bottom so they can declare the program a failure and proof that we should never try to fix healthcare in any kind of actually-decent way again.
> come to Jesus moment
Haha. Last time it took the great depression and intense economic pain for americans to snap out of it and actually build a slightly better world (New Deal). I wouldn't expect it to take anything less this time around. Europe required 2 world wars and over 100M dead.
> they could cancel the [social security] program entirely and it wouldn't affect the deficit
I don't think this is true. During the surplus years the savings vehicle was US bonds. So social security lent the US government money.
Now that we are not in a surplus situation, we are using money from those bonds to pay benefits (we are also using SS revenue of course, only part of the payouts come from the bonds).
So if the program were cancelled, the bonds could revert back to the US government - in other words a bunch of debt would be forgiven and would not need to be paid out. Deficit (and debt) reduced.
> So if the program were cancelled, the bonds could revert back to the US government - in other words a bunch of debt would be forgiven
That seems like a passive-voice way of saying "We could steal from millions of people, pocketing the retirement savings they worked for their entire lives."
Also, there's nothing stopping Social Security from upping the cap and thus returning to surplus, aside from the group of people who would absolutely love to steal from the fund.
>That seems like a passive-voice way of saying "We could steal from millions of people, pocketing the retirement savings they worked for their entire lives."
You brought up cancelling the program. I was just pointing out that your statement about it having no effect on the deficit was incorrect.
> That seems like a passive-voice way of saying "We could steal from millions of people, pocketing the retirement savings they worked for their entire lives."
For a lot of younger people the view is they promised themselves something unsustainable and expect young people to cover it.
Is it? Is that a thing that has been shown to motivate young voters?
If anything I would believe that younger voters would be in favor of more social safety net. Many would be comfortable with the government outright nationalizing most industries.
More social safety net that goes to everyone, not just the people directly responsible for destroying this one. It's hard to be asked to bail out people who intentionally spiked the ball.
I guess "the children are our future" really was what they meant, we just misinterpreted it.
Our health system already kills people, and people seem essentially okay with that.
But, I agree about the political suicide. I unfortunately don't believe anyone is even going to attempt reform after how successful the Republican party's attacks on Obamacare were. People will just conclude there's no reward for trying.
A couple of points: 1) The deficit applies to discretionary budget. Medicare and Social Security are not discretionary. 2) Really. You can't cut anything out of medicare and social security (both of which are the most expensive program of the kind compared to any other first world equivalent) without killing people? There is not a cent of waste in these programs?
You really must stop taking Republicans at their word. The stated goals of Doge are obviously different from the actual goals. Try not to listen to their words, only watch their actions.
In this case, Doge's actions are to shrink government, especially any agencies that were opposing or investigating Musk in any way.
Gift link: https://www.wsj.com/economy/federal-budget-fiscal-2025-e8d21...
from paragraph 1:
"That is largely because the main drivers of spending kept rising: social programs, including Social Security and Medicare, and interest on the public debt, which topped $1 trillion by one measure for the first time."
It sure would be nice if, instead of cutting taxes for the ultra-wealthy, that money being given back to the people who need it the absolute least were instead used to reduce the public debt.
And how much money did DOGE spend on its quest to save nothing by trashing scientific research?
This is a problem that is far far older then DOGE.
And maybe, just maybe, the answer is to both raise taxes and reduce spending?
The thing is, the most common spending that they attempt to cut is spending that has multiplier effects on the economy, because it's giving money (whether directly or indirectly) to the poorest people.
Really? Please provide a decline in net dollars (excluding projected drawdowns) that demonstrates this point.
On a dollar-by-dollar basis, regardless of economic station, _every_ American has seen a combined discretionary + non-discretionary increase in benefits since 1980. The group that is less advantaged is the upper-middle class, which has seen relative stagnation.
Aren’t tariffs basically raising taxes like you’re suggesting?
The new tariffs are projected to raise an additional $200B this year for the federal government.
https://www.reuters.com/world/us/us-could-collect-300-billio...
I don’t think the next administration, whichever party ends up winning, will be likely to reverse these tariffs just based on how much revenue they bring in for the federal government.
Reducing spending is of course another different problem altogether.
It raises taxes but arguably impacts GDP in a very direct and equal way, so it mostly nets out. The argument that follows from there would be that taxing the rich would have less of an impact on GDP.
Of course that's the answer, it's just people don't want to do that.
unfortunately boomers want neither :)
No point dunking on retirees. You'll understand when you retire (and become a boomer equivalent)
i pray every day that i dont become as selfish and uninterested in the welfare of the next generation as current boomers.
Social security doesn't contribute to the general budget deficit. Its funding source is totally distinct. It doesn't and can't (under current laws) borrow to fund itself—if nothing changes, then as the fund runs low, payments will be reduced.
Mention of Social Security as a major driver of the budget deficit is a red flag you're reading something by someone who's ill-informed on the topic, or else they're deliberately bullshitting you.
You’re only considering one part of the system, not the whole. As the GAO puts it[1]:
> Intragovernmental debt holdings represent federal debt owed by Treasury to federal government accounts—primarily federal trust funds such as those established for Social Security and Medicare—that typically have an obligation to invest their excess annual receipts (including interest earnings) over disbursements in federal securities.
> Debt held by the public represents a claim on today’s taxpayers and absorbs resources from today’s economy, meaning that when an investor buys Treasury securities it is not investing that money elsewhere in the economy.
> Intragovernmental debt holdings reflect a claim on taxpayers and the economy in the future. Specifically, when federal government accounts redeem Treasury securities to obtain cash to fund expenditures, Treasury usually borrows from the public to finance these redemptions.
Or to put it simply the excess contributions are lent to the Treasury who uses it for general government expenditures. When it’s time to pay it back the Treasury can either pay it with tax revenue assuming it has excess or has cut spending elsewhere or it will be forced to borrow it. The latter is generally what happens.
I wouldn’t be so quick to call people ill-informed on this subject if I were you.
[1] https://www.gao.gov/assets/gao-25-107138.pdf
No, I considered the whole thing. It's worth, in some contexts, pointing out that we borrow to service existing debt, but it remains irrelevant that one of the owners of that debt happens to be the Social Security Trust Fund, if we're talking about the budget deficit.
We halt all spending on Social Security tomorrow. Great, wonderful. Buuuuut... that debt still exists and nothing whatsoever changes for the budget deficit. [EDIT pedantic nuance: technically it might let us spread repaying that debt over a longer period, but the debt itself remains identical, unless we decide we're just gonna let it sit there and never pay anything against it, which is identical to nullifying it, which, see next paragraph]
Unless we're prepared to nullify debts we've already incurred, in which case, why single out the debt Social Security owns for that treatment?
> I wouldn’t be so quick to call people ill-informed on this subject if I were you.
Nah, gonna continue until I see any reason to stop.
>why single out the debt Social Security owns for that treatment
Because it's the biggest slice of the federal budget pie, and currently it goes to the segment of the US population with the highest average net worth.
Whether you think it's right or wrong, it is a massive chunk of mandatory spending. Combined with Medicare, it's close to 40% of the entire budget, and it is ultimately unsustainable.
> Because it's the biggest slice of the federal budget pie
It's not spent out of the general fund. The only—only—effect Social Security spending has on the budget is that for part of its spending, it calls in debt the general budget already owes it when it spend its money (which is invested in government debt). That money came from a dedicated, separate source, and wasn't generated by deficit spending, but by actual income. That money bought US government debt, so we owe that back, and that repayment is the only part of any of this that affects the budget.
[EDIT] To boil this down for international readers or people who just haven't ever bothered to learn the super interesting (LOL) way Social Security is structured:
1) Social Security is funded by the majority of the money that comes out of workers' paychecks under the "FICA" heading (some goes to other benefits-related stuff, but most of it goes to Social Security). This is a static proportion of ~15%, not progressively bracketed like ordinary income tax. About half is paid separately by your employer, typically, but people filing as independent contractors (form 1099) pay the whole shebang. This tax also phases out abruptly at a certain level (I forget exactly where, something like $200k for an individual tax filer I think) which means it's actually not just not-progressive, but rather extremely regressive (i.e. it preferentially targets income dollars with the highest marginal utility, not the lowest)
2) Under certain circumstances, but mostly when you get sufficiently old, you can start to draw benefits (payments back to you) out of Social Security. These benefits are (basically) adjusted for how much you paid in. Paid in more? Get more back.
3) For a long time Social Security ran a surplus from their FICA income, so that money went into the Social Security "Trust Fund". This money is not available to the general budget. The law is structured such that the excess money couldn't just be spent on other stuff.
4) ... however, you don't really want money just sitting around inflating away, you want to invest it. Plus, sure would be nice for the rest of the budget to access that big tempting pile of money somehow, if you're a politician and kinda an asshole (but I repeat myself). So, the trust fund bought government debt.
5) Social Security is now deficit spending, because we have a fuckload of old people drawing benefits from it, and not enough young people funding it to balance that out. That means it's spending down the trust fund (ITS OWN MONEY that it ALREADY COLLECTED). This requires cashing in some of those IOUs.
6) "Well when it runs out of money it saved up, won't that mean that spending becomes deficit spending against the general budget?" Nope! Not without changing the law, anyway (which opens up practically infinite possibilities, so it's kinda pointless to introduce to a discussion of "how does this work?"). What'll happen is the SSA (Social Security Administration) has to cut benefits until payments balance with income (from the FICA tax).
> topped $1 trillion by one measure
How is the amount of money paid as interest dependent on the measure used? I can understand different interpretations of some expenses as capex vs opex, and similar other questions. But interest?
Once the government is involved, everything is "interpretation." Unemployment? Well... it depends on what you mean by unemployment. We changed how we "count" a few years back. Owe? It depends what you mean by "owe." What is the definition of "is?"
If I buy a $1000 bond with a 1 year duration and 2% coupon for $950, realizing $70 of net income from it over the following year ($20 coupon payments, $50 "extra" principal return), has the government paid $20 or $70 of interest?
I'm not sure there's a significant difference in practice, but technically the $50 would be part of the bond's debt principal, not interest.
A bond with a face value of $1000 means the government has $1000 of debt regardless of what is paid for the bond.
The coupon payments represent the "interest" on that debt - the $20 coupon means the government is paying $20 of interest per year.
Paying below face value doesn’t make the difference "interest." It simply means investors are buying the bond at a discount, so the government receives less cash upfront in exchange for repaying the full $1,000 at maturity. Bonds differ from traditional loans in that their market price can fluctuate, but the debt obligation remains fixed at the face value.
In practice, the government's accounting labels the discount as an "interest expense", so it still gets captured as interest in the budget.
That's a reasonable interpretation from the Treasury's perspective. But if you ask the IRS, I've realized all $70 as interest income ($50 as OID, which they consider a form of interest).
(And yes, coupons pay 2x yearly, but they are quoted on an annual basis; I would receive two $10 payments.)
For IRS, would the person who sold you it at loss of 50 be able to harvest loss of that 50? Thus well overall there was only 20 of profit?
Yes, secondary sellers can claim capital losses. But they typically go for a discount even at the primary Treasury auction, so there's still more than $20 of total profit after netting across holders.
Whoops, I haven't worked with bonds directly in a bit and forgot the coupon rate was split across payments.
Inaccurate headline. DOGE did a lot at government agencies, including violating any and all possible best practices, copying entire databases of citizens, then handling the data in unknown ways.
Trust me. DOGE has done a great deal, just none of it is reasonable or sane from our perspective.
> 1. Tariffs are bringing in real money. > The U.S. collected $195 billion in customs duties, more than double the prior year. That doesn’t capture the full jump because tariff rates only ramped up in April, halfway through the year.
That's actually more than I expected.
> President Trump seeks to shift the government’s reliance on income taxes toward taxes on imported goods. Still, tariffs contribute a relatively small 3.7% of overall federal revenue, compared with 51% for the individual income tax.
We really need to close large ccorporate tax dodges as well. Too many smaller companies pay 35% rates while the Apples and NVIDIAs pay a fraction of that rate. There's apparently plenty enough corporation money sloshing around to spend trillions on GPUs for AI in the US.
The tariffs don't actually bring in money, they just move money from one place (US taxpayers, who'd otherwise use it productively) and put it elsewhere (the treasury).
Now normally this might be put to some sensible use, perhaps building infrastructure, but since this revenue is being used to offset huge tax cuts for a tiny group of people determined to turn around and use the capital for (let's be real here) speculation it's a net negative.
In the end we're going to look back at this chapter of 'Devil Take the Hindmost: A History of Financial Speculation' and say "Well obviously those idiots should've see that coming."
To say that tariffs don't actually bring in money is simply wrong. We are talking about income to the government. Yes, tariffs take actual money and give it to the government. It doesn't matter where it came from, inside or outside the US.
If your definitions are used, then literally nothing actually brings in money. It just moves it from one place to another.
Not true, issuing a loan brings in money (albeit mirrored by an equal amount of debt). So the federal deficit brings in a substantial amount of money. In the same vein, paying down the national debt completely, an oft-cited goal of some national leaders, destroys all money.
Setting aside the issue of generating money, which is not under discussion, and which loans can help with, do you really still claim that "The tariffs don't actually bring in money"? 51% of the government income is from income taxes, which you would say "doesn't actually bring in money." So what exactly is the point of talking the way you are talking?
Our current leadership and their populist supporters are super gung-ho on converting the US into a mercantile economy like China. That's what these tariffs are about: creating an environment of protectionism from which the US will emerge as an export powerhouse, with massive trade imbalances in the US' favor.
So in their own language, these tariffs are merely domestic transfers of capital and do not 'bring in money.'
The language under discussion is the national debt and deficit.
You’re trying to make a political point by changing the definition of words.
I may agree with your point, but pretending like tariffs don’t generate income that bring down the deficit is not the way to argue it. It just convinces people you aren’t arguing in good faith, or don’t understand simple math.
The last legal ruling on the matter found that they are mostly being enacted illegally by using emergency powers[1] and may end up being refunded entirely. So until they are actually able to be booked, we can't say they are impacting the budget one way or another. If they aren't legalized then the work it took to collect and then refund them all is money that may as well have been incinerated.
[1] https://www.npr.org/2025/08/29/nx-s1-5522457/tariffs-trump-t...
> The tariffs don't actually bring in money, they just move money from one place (US taxpayers, who'd otherwise use it productively) and put it elsewhere (the treasury).
So your argument seems to be “We have yet to see whether these new tariffs are legal and therefore whether the income will be able to be kept.”
That’s a far cry from saying tariffs don’t generate income for the government, which is what I understood you to be saying.
You might be ahead of the US president in understanding how tariffs work.
It's going to be the biggest heist in American history. That tariff revenue is as good as gone. It's not about whether the money can actually be brought in, but more about the reality that crooks have access to the pot. It's really all about that. These are not fiscal conservatives generating revenue to pay down debt, these are actual crooks that will gift it to each other.
Yeah, the latest thing is the the 20 billion $ Argentina bailout (or Bessents hedge fund buddies exit liquidity).
20 billion ... gone.
Another 15 billion will go to soybean farmers to bail them out. And so on.
Yes, they're essentially a sales tax on Americans. But from a budget deficit perspective, they do bring in money to the gov (citizens be dammed).
So instead of taxing our wealthier citizens and corporations more, we tax them less and instead tax everyone by raising the cost of imported goods.
With the global minimum tax rules in place, weighted by GDP and by revenue, corporate tax rates are actually fairly consistent across the world - roughly 25% worldwide. It's a myth that companies are not paying taxes, and also a myth that the largest sectors in the US are not paying taxes. It's a great talking point, though.
You also seem to be conflating investment for profit (GPUs for AI, for example) with income. Capital outlays of this type are almost always financed (see recently Nvidia, OpenAI + AMD, etc. deals). None of the large players are self-funding AI on that scale right now. This is why OpenAI's burn rate is so catastrophically high.
Last I checked (last year, I think?), the amount the federal government takes in corporate taxes relative to corporate profit was lower than 25%. Looking again, it looks like it's around 13%? See https://fred.stlouisfed.org/series/FCTAX and https://fred.stlouisfed.org/series/A446RC1A027NBEA
Perhaps for most companies, which was part of my point. But it's interesting to consider. I haven't read up too much on it in recent years.
The largest, most profitable international mega-corps always seem to pay much less because they can afford to game the system more.
It does look like my data is out of date concerning US corporate tax rates, which looks to be a flat 21% now from Trump's first term. Guess I'd only heard about the personal income tax breaks.
Spot checking Alphabet, it seems big corps might still be getting big tax breaks. A quick Google search on Alphabet Inc's effective tax rate AI summary of [1] gives:
> Alphabet's most recent effective tax rate was 16.91% for the quarter ending June 30, 2025, and 16.44% for the fiscal year ending December 31, 2024. The company's effective tax rate has varied, hitting a recent low of 13.9% in 2023 before increasing again in 2024.
That looks to be about 25% cut off their taxes.
Interesting tidbit: Averaging Alphabet's Q1&Q2 revenue and taxes and then calculating what they would pay at a 25%, 35%, or 21% corporate tax rate I get:
> est_annum_lost_vs_21 => $ 6,057 millions > est_annum_lost_vs_25 => $12,115 millions > est_annum_lost_vs_35 => $27,259 millions
So Google alone could be paying about 3.10% (or 6.21-13.97% with 25/35% rates) worth of the proceeds from tariffs just by itself.
Is that a big amount or not isn't clear to me. But it's an interesting perspective to consider.
> You also seem to be conflating investment for profit (GPUs for AI, for example) with income. Capital outlays of this type are almost always financed
True, and my comment over-simplifies all of that. Nevertheless those finance deals effect the debt markets raising the US government's interest rates. It also effects regular home buyers as well who will likely continue seeing higher mortgage rates.
Perhaps, if they were paying more of their fair share of taxes Nvidia, OpenAI + AMD, etc would have both less expected profits in the future and therefore less ability to finance such large amounts.
They're not shelling out the cash now. Given their general profitability and large cash reserves they can leverage even larger amounts of debt than they'd be able to otherwise.
1: https://csimarket.com/stocks/singleProfitabilityRatios.php?c...
Why should Nvidia pay any taxes except payroll for their local headcount? They could easily book all revenue overseas in tax heavens. They should pay more taxes to the places where chips are made, not to the US government.
The 2010s and Obama called - they want their foreign policy back.
Most countries (including the US) have signed global minimum tax rates at this point. Effective tax rates (either directly or via clawbacks) are theoretically 25%.
Of course, I am not enough of an expert to know if that is happening in China. I somewhat doubt it.
I'm sure US is not part of it. As UAE and tax heavens like Cayman islands.
Actually, the US has joined. Although it has not joined Pillar II, the effective tax rate, according to third-party economists, shows adherence to the 25% number.
Even the UAE has joined at this point.
>We really need to close large ccorporate tax dodges as well. [...] There's apparently plenty enough corporation money sloshing around to spend trillions on GPUs for AI in the US.
This does not follow. The figures for "trillions" come from estimates for what will be spent in the next few years, not amount actually spent. Moreover while tech companies have initially funded their AI investments from their cash piles, they're now tapping debt markets to fund that growth, so the fact they're spending "trillions" doesn't imply they're evading taxes.
Apple paid corporate tax rate of 24.1 % in 2024, which is higher than the corporate statutory rate.
In 2023 it was something like 16 %, with variations due to moving money across country boundaries if i read that correctly.
https://www.sec.gov/Archives/edgar/data/320193/0000320193240...
Corporations take their revenue to pay people as either employees or shareholders. I am not sure why we need to tax corporations at all. Take employees as income perhaps, tax dividends, tax shares being sold, but allow companies to use their money productively.
Though I would prefer a 0% income and capital tax, and we move to a pure land value tax and rent tax system.
There's a lot of ways to siphon money out of firms. People declare their car as a "work vehicle", CEOs fly to the beach on the company's jet, etc.
So I guess you want some level of corporate tax? (it's the same for why there are large sales tax in developing countries; sure they are less efficient than income taxes, but lots of people evade those)
>There's a lot of ways to siphon money out of firms. People declare their car as a "work vehicle", CEOs fly to the beach on the company's jet, etc.
That's why there are specific IRS regulations for this[1]. "Company cars" basically disappeared as a result. Moreover contrary to what you imply, corporate taxes don't really solve this issue either. Corporate taxes are paid on profit, not revenue, and expenses like "work vehicles" or private jets aren't taxed either way.
[1] https://www.irs.gov/publications/p15b
> Corporations take their revenue to pay people as either employees or shareholders. I am not sure why we need to tax corporations at all. Take employees as income perhaps, tax dividends, tax shares being sold, but allow companies to use their money productively.
I believe almost the opposite. We should tax corporations more and individuals less. As long as we keep estate taxes to curtail dynasties.
We have far too much concentration in towards ever larger, more powerful corporations. By their nature corporations lack ethics and morals of normal people. Even when operated by well meaning people the system anonymizes individuals and increases group think, etc. That's not purely a bad thing as it also enables large scalable systems which profit humanity as a whole. However there should also be curtails on corporate power and control.
>tax dividends
That's basically what tax on profits are supposed to cover, because a tax on dividends only doesn't cover buybacks.
>tax shares being sold
UK has this, and it's widely considered be economists to be anti-growth.
If you tax profits, corporations are more inclined to spend, e.g. on employees, R&D, etc.
>> President Trump seeks to shift the government’s reliance on income taxes toward taxes on imported goods. Still, tariffs contribute a relatively small 3.7% of overall federal revenue, compared with 51% for the individual income tax.
Doesn't he also say tariffs are going to cause manufacturing to move to the US? That seems at odds with tariffs as a replacement for income taxes.
Or, we do away with all the money spent on enforcing corporate and income taxes by not having them and only tax international trade.
That would envigorate the domestic economy and enrich our citizens.
Color me surprised. DOGE didn't touch the #1 candidate (defense spending) so it shows you where their priorities were.
It's very important to realize that it isn't true that DOGE didn't "do much". It's just that what they did was kill hundreds of thousands to millions of people worldwide.
Can you elaborate? I haven't been keeping up with DOGE
Lots of people have reported on this, but here's the Lancet https://www.thelancet.com/journals/lancet/article/PIIS0140-6...
Some intellectual curiosity:
If tariff revenue is rising, and the economy hasn’t shrunk (yet), and DOGE has returned money (recission later being authorized) then some money was clearly generated.
Alternatively, Doge could have been totally ineffectual and tariffs returning nothing, but this article seems to indicate otherwise.
This means that less money then planned was spent. Against a null hpothesis, that indicates that the situation is "better" then doing nothing at all (at which point, the rise in government lending costs, the out of control benefit costs, and all of the other stupid crap that has been festering out there since Bill Clinton won the white house for ridiculing Bush for raising taxes comes home to roost.
I'm solidly in the never-trump camp, and maybe there was an argument made after the paywall, but this feels like an ideology in search of a headline.
Well, the two main counter points are.
1. Doge isn't free. They have staff with expenses which haven't been accounted for in your argument.
2. Cancelation of forward facing contracts shouldn't affect the immediate numbers. But it's like laying off the entire company; you're going to record a record Q4 with all those sales but no expenses however come Q1 good luck for the company.
Although people have posted links so you can read the article [1] which largely points out that spending is up by $220 billion. Which is about 2.2 trillion worse than Doge promised.
[1]: https://news.ycombinator.com/item?id=45530994
(Can't read the article due to paywall and no working mirror on archive.is right now.)
I mean... duh? This shouldn't be news to anyone paying attention. DOGE was shock-and-awe theater, and a means to shake up agencies and gain access to sensitive information. At best, they saved a few tens of millions of dollars, which at that level isn't really worth the effort.
The GOP always cries about spending and the deficit, but when they're in charge, they spend just as much as Democrats (if not more!), and, to make things worse, cut taxes (usually for the rich more than anyone else). The largest part of the federal budget isn't the discretionary spending, anyway.
And the effects of the tariffs have been obvious to anyone not drinking the MAGA Kool-Aid.
As long as I’ve been alive, the biggest deficit hawks (read: Republicans) are the biggest spenders when it’s their turn on power.
They keep cutting taxes, too. That's a big part of the problem.
A space alien newly arrived on Earth and looking at just actions taken, GAO/CBO reports, and the actual historical data, would conclude that, at least since 1980, Democrats were the ones who cared (a lot) more about the budget deficit than Republicans. The notion that voting for Republicans is the best move for a voter whose major issue is the deficit, is just marketing.
There was a time, probably before Reagan came to office, that the cutting/reforming taxes yielded positive returns. But fifty years on, the high-hanging fruit has all been picked. This is widely acknowledged by "true conservatives" (takes one to know one).
Everything goes to the debt, the only way out is through cuts to entitlements or broadly raising taxes, both deeply unpopular.
> The GOP always cries about spending and the deficit, but when they're in charge, they spend just as much as Democrats (if not more!), and, to make things worse, cut taxes (usually for the rich more than anyone else). The largest part of the federal budget isn't the discretionary spending, anyway.
IMHO, the GOP wants to reduce government spending for ideological reasons, but doesn't generally have any particular thing it wants to reduce spending on, and certainly doesn't want to take the blame for cutting any particular programs. So they do a tax cut, because voters like tax cuts; and chances are Democrats will be in power when the deficit / debt gets big enough that it needs to be addressed. Then Democrats will have to do the poor PR business of raising taxes or making specific cuts. If Democrats make specific cuts to reduce government spending in order to make the lower taxes work, the GOP furthered their ideology and got good vibes for lowering taxes, while the Democrats got bad vibes for cutting programs.
I don't like it, but it works for the GOP, so I'm sure we'll see it continue.
Anything DOGE "saved" was quickly burned by punching cities in the nose, trying to get a rise out of them.
Right from the start, any impartial observer could tell that it wasn't a sincere effort grounded in truth.
First, the goal of the tariffs was to reduce US deficit spending.
Then it was reducing debt. Isolating & containing China. Dissuading them from invading Taiwan. Replacing the income tax. Retaliating against Europe, Japan, & S. Korea for unfair trade practices. Compelling other countries to buy American. Onshoring manufacturing. Forcing foreigners to pay a premium to access American markets. Forcing Canada & Mexico to get illegal immigration & narcotics trafficking under control. Punishing Brazil for persecuting Bolsonaro. Compelling third countries to accept expelled immigrants.
Then they pivoted to: Art of the Deal! He's deliberately making unrealistic demands as an intro offer.
Which is it again?!