74 Billion?
- Thread starter Mike
- Start date
Dr. Mac
Player
On the contrary, He knows exactly what he's doing.
Tax cut, plus war equals budget deficits (and deficit spending by the government, I might add) equals high interest rates equals high credit and credit card interest equals high monthly payments on debt equals more money out of yours and my pocket per hundred dollars of credit equals a much longer period of time for you and me to pay off debt equals more cash flow from our monthly payments into the hands of his buddies who lend the money in the first place.
It aint about profit, its about insuring cash flow. Lend a little and get it repaid back to you over and over again. High interest rates that stem from the stuff I mentioned above lead exactly to this. Reagan did the same thing. You see there is no interest in getting the national debt down. That's why.
Regards.
Tax cut, plus war equals budget deficits (and deficit spending by the government, I might add) equals high interest rates equals high credit and credit card interest equals high monthly payments on debt equals more money out of yours and my pocket per hundred dollars of credit equals a much longer period of time for you and me to pay off debt equals more cash flow from our monthly payments into the hands of his buddies who lend the money in the first place.
It aint about profit, its about insuring cash flow. Lend a little and get it repaid back to you over and over again. High interest rates that stem from the stuff I mentioned above lead exactly to this. Reagan did the same thing. You see there is no interest in getting the national debt down. That's why.
Regards.
Mike
Ace Dawg! RQQ!!!!
Originally posted by Ms. Jag4Jag
LOL
Well whatchu gon' be riding in while I drive your G35?
You can drive it to work. I don't won't folks at my job inquiring about where I got the money to get it. Plus, you already riding with the rich folks over there in Space City. Might as well look like the folks you work with. :lol:
Dr. Mac,
High interest would drive this country into a recession. Bush is banking on the price of a barrel of oil going down.
If you had a blank check would you be concern about $74 Billion. Iraq will pay for this war, remember we're not talking about some poor third world country. We've already gotten control of some of their assets. The cost of this war and who is going to pay for it is a moot point.
I'm not saying that this war is about oil, but the future of Iraq's oil reserves and their impact on world oil prices and the U.S. economic expansion are among the most crucial elements of the present conflict. Each $10 increase in the price of a barrel of oil is like a $100 billion tax hike, slowing U.S. economic growth by more than a half percent over the course of a year. The $12 or so increase per barrel since November, which insiders call it the "war premium" threatens to tip the U.S. into recession. Conversely, a sharp decline in oil prices from the $36 a barrel could help reignite the economy. For example, if oil prices return to the low 20s after the war, that could inject $150 billion into the economy, far more than the rebates from Bush's 2001 tax cut.
No one knows for sure which way things will go. but if you had to make a bet, the most likely scenario is that a year from now, with a new regime in Bagdad and long dormant Iraqi wells finally pumping out crude, oil prices will be back in the mid 20s. Matter of fact if the war is short and Saddam doesn't set fire to his oil fields, crude will hit $22 a barrel by this summer.
With the almost certain drop in the price of a barrel of oil and its effect on the economy makes it clear why Bush is not concern about the Demo slashing his proposed tax cut and the cost of this war.
Bush would be in big trouble if he depended on a tax cut and war to jump start the economy.
Mike
Ace Dawg! RQQ!!!!
Yeah and it's clear what this war is all about, too. :smh:
You can say that it ain't , but we all know that it is. OPEC is some of the biggest theives in this world. They grossly rape our pockets by claiming that refineries are down, until a crisis hits. Then all of a sudden the refinery is operational again. Once the crisis passes, the refinery closes due to some unknown problem for 7-10 months.
I'm not stupid and the cost of oil shouldn't be that dayum high.
You can say that it ain't , but we all know that it is. OPEC is some of the biggest theives in this world. They grossly rape our pockets by claiming that refineries are down, until a crisis hits. Then all of a sudden the refinery is operational again. Once the crisis passes, the refinery closes due to some unknown problem for 7-10 months.
I'm not stupid and the cost of oil shouldn't be that dayum high.
Dr. Mac
Player
Ice Man:
I agree that high interest rates would drive the country into a recession. That's what Greenspan and company have been trying to prevent. My earlier post was post was stating that Bush is aware of the impact of proposing tax cuts while asking for spending increases to support this war, and that he knows who will benefit.
But Bush, in his own words, is the one who is stating that tax cuts will lead to economic growth (i.e., more money in each taxpayers pocket that they will then use to buy something with). This was a centerpiece of his campaign (nevermind that daddy once referred to it as "Voodoo Economics'), he cited it again when he passed it as a temporary measure that resulted in the $500 rebate checks most people got back in 2001, and it is at the centerpiece of these permanent cuts he's trying to get passed now. And the fact of the matter is that wars have generally had a postive after-impact on this nation's economy. I'm not saying that this is his motive but I'm sure that that is not lost on Bush and his advisors.
You are absolutely right about the impact of Iraqi oil on the market if the price goes down. But what's to say that the price will go down that substantially. If Bush puts in his plan his boys will be controlling the spigots, not the Iraqis. We can rest assured that they are only going to allow only enough oil out to keep prices at a level that insures them the profit that they want to make. There is only so much demand for the supply. Bush's boys will keep prices, based on the demand model, that will be of most benefit to them. Most experts I've heard talk about this (and I know, we all know about the "experts") think that we will never see prices at the pump again at the $1.00 to $1.25 a gallon level that existed, at times, during the Clinton administration. I tend to agree with them. Even if the price of oil came down substantially, the oil companys would cite "loses" in previous years as to why there won't be a corresponding decrease in price. We might see some economic benefit in Iraqi oil on the market but I doubt if it will be that great.
But considering the other scenario: if there were a lot of oil on the market and the price came down, Bush is then depending on trickle down theory to boost the economy. Most people are leary of spending a lot of money now and its going to take a bit for consumer confidence in his plan to take root; thus, no quick rebound will occur. Further, if it did occur and people started spending all of this additional wealth that they have because oil prices went down, Inflationary pressures would soon rise due to companys making profits which would lead to workers wanting their piece of the pie. Then Greenspan would start rising interest rates and we are right back to the situation in my previous post.
The oil companys aint the only supporters he's concerned about. They are pretty well covered any way it goes. They have a monopoly and they know it. Why else is the price of a gallon of regular the same at all four gas stations located on a corner. The money exchangers, his other group of power supporters, ain't happy either. They don't like low interest rates and want them up.
Finally, even if the price of a barrel of oil and gas is at an acceptable level, high interest rates resulting from budget deficits associated with tax cuts (and don't get me wrong, I like my money in pocket, too) cause a strain on economic spending. That's what happened during the Reagan years when interest rates shot through the roof. He was spending money hand over foot to outdo the Russians military with Star Wars and the like and driving the deficit and the national debt sky high. The government was using more money to pay off the interest on the debt and that left less money for the Feds to lend out. And with less money to lend, they lent it out at higher interest rates and the higher money costs made its way to the consumers. This is the likely outcome, and also the cause of the scenario in my previous post, that would occur if Bush's plan backfires.
I hope you are right and that the Iraqi oil drives down gas prices and has the economic impact you cite. That's better off for me. But my gut tells me it ain't going to happen that way; especially if Bush has his way and if his boys are controlling the Iraqi oil flow after the war.
Regards.
I agree that high interest rates would drive the country into a recession. That's what Greenspan and company have been trying to prevent. My earlier post was post was stating that Bush is aware of the impact of proposing tax cuts while asking for spending increases to support this war, and that he knows who will benefit.
But Bush, in his own words, is the one who is stating that tax cuts will lead to economic growth (i.e., more money in each taxpayers pocket that they will then use to buy something with). This was a centerpiece of his campaign (nevermind that daddy once referred to it as "Voodoo Economics'), he cited it again when he passed it as a temporary measure that resulted in the $500 rebate checks most people got back in 2001, and it is at the centerpiece of these permanent cuts he's trying to get passed now. And the fact of the matter is that wars have generally had a postive after-impact on this nation's economy. I'm not saying that this is his motive but I'm sure that that is not lost on Bush and his advisors.
You are absolutely right about the impact of Iraqi oil on the market if the price goes down. But what's to say that the price will go down that substantially. If Bush puts in his plan his boys will be controlling the spigots, not the Iraqis. We can rest assured that they are only going to allow only enough oil out to keep prices at a level that insures them the profit that they want to make. There is only so much demand for the supply. Bush's boys will keep prices, based on the demand model, that will be of most benefit to them. Most experts I've heard talk about this (and I know, we all know about the "experts") think that we will never see prices at the pump again at the $1.00 to $1.25 a gallon level that existed, at times, during the Clinton administration. I tend to agree with them. Even if the price of oil came down substantially, the oil companys would cite "loses" in previous years as to why there won't be a corresponding decrease in price. We might see some economic benefit in Iraqi oil on the market but I doubt if it will be that great.
But considering the other scenario: if there were a lot of oil on the market and the price came down, Bush is then depending on trickle down theory to boost the economy. Most people are leary of spending a lot of money now and its going to take a bit for consumer confidence in his plan to take root; thus, no quick rebound will occur. Further, if it did occur and people started spending all of this additional wealth that they have because oil prices went down, Inflationary pressures would soon rise due to companys making profits which would lead to workers wanting their piece of the pie. Then Greenspan would start rising interest rates and we are right back to the situation in my previous post.
The oil companys aint the only supporters he's concerned about. They are pretty well covered any way it goes. They have a monopoly and they know it. Why else is the price of a gallon of regular the same at all four gas stations located on a corner. The money exchangers, his other group of power supporters, ain't happy either. They don't like low interest rates and want them up.
Finally, even if the price of a barrel of oil and gas is at an acceptable level, high interest rates resulting from budget deficits associated with tax cuts (and don't get me wrong, I like my money in pocket, too) cause a strain on economic spending. That's what happened during the Reagan years when interest rates shot through the roof. He was spending money hand over foot to outdo the Russians military with Star Wars and the like and driving the deficit and the national debt sky high. The government was using more money to pay off the interest on the debt and that left less money for the Feds to lend out. And with less money to lend, they lent it out at higher interest rates and the higher money costs made its way to the consumers. This is the likely outcome, and also the cause of the scenario in my previous post, that would occur if Bush's plan backfires.
I hope you are right and that the Iraqi oil drives down gas prices and has the economic impact you cite. That's better off for me. But my gut tells me it ain't going to happen that way; especially if Bush has his way and if his boys are controlling the Iraqi oil flow after the war.
Regards.
LMAO at controlling the spigots. There are no rising and falling oil derricks like the one you might find in Texas. That's because oil doesn't need to be pumped to the surface in Southern Iraq. The black gold bubbles up on its own.
To fully understand what I'm saying don't look at the impact on the US economy, but a global economy. A drop in the price of a barrel of oil will be welcomed by the world. It's not only Iraq that will make this happen. OPEC, believe it or not, wants prices lower too. In the past decade the cartel's leaders and other oil producers have quietly agreed that the best place for oil prices is between $22 and $28 a barrel. While high prices may fill OPEC's pockets in the short term, they know that $40 a barrel oil will ultimately choke off economic growth and send prices plunging. That's why OPEC will keep pumping in order to make up for any production lost during the war. Plus OPEC and Bush knows that the only way Iraq will get back on its feet is to let the oil flow.
Remember that the only force who has control the flow of Iraq output is the U.S. Navy. Because of Saddam and 20 years of conflict, first with Iran then with U.S. Iraq has been on the sidelines of the oil world.
Bush is more concern about backlash from America for going to war and he's hoping that a thriving economy will make American forget about the sacrifices of this war and re-elect him. He knows his proposed tax cut didn't work last year and he know's it want work this year.
Dr. Mac
Player
Iceman:
Controlling the "spigots" was a figure of speech. Its referring to the amount of production of Iraqi oil that will be allowed out. If its US controlled (by Bush's boys), it will only be that amount that maximizes economic benefit for the oil companies.
You say that Bush knows his tax cuts won't work; I not sure about that. Most republican presidents use that strategy for whatever reason. I don't think he would be proposing it if he didn't think that it would work. I agree that he hopes a thriving economy will get him re-elected, that's why he's worried about the US economy and not the world's (although there is some linkage between the two). I don't think his ways of going about it will get him there. His approach is not balanced, and there are too many fears among business and the public that his leadership has not alleviated.
Regards.
Controlling the "spigots" was a figure of speech. Its referring to the amount of production of Iraqi oil that will be allowed out. If its US controlled (by Bush's boys), it will only be that amount that maximizes economic benefit for the oil companies.
You say that Bush knows his tax cuts won't work; I not sure about that. Most republican presidents use that strategy for whatever reason. I don't think he would be proposing it if he didn't think that it would work. I agree that he hopes a thriving economy will get him re-elected, that's why he's worried about the US economy and not the world's (although there is some linkage between the two). I don't think his ways of going about it will get him there. His approach is not balanced, and there are too many fears among business and the public that his leadership has not alleviated.
Regards.
Fresh off the Press:
Mar 28, 9:06 AM EST
Bush Seizes $1.62B in Iraqi Assets
By JEANNINE AVERSA
Associated Press Writer
WASHINGTON (AP) -- The Bush administration has seized $1.62 billion in Iraqi assets already frozen in the United States and will use the money to help rebuild the country once Saddam Hussein is ousted, a top Treasury Department official said Thursday.
The department's general counsel, David Aufhauser, provided updated figures that follow up an initiative from President Bush last week.
Aufhauser said the money has been transferred to an account at the Federal Reserve Bank of New York. An additional $77 million is expected to be transferred soon, bringing the total to about $1.69 billion.
The assets, which belong to the Iraqi government, have been frozen since 1990 and have been sitting in accounts at U.S. banks, including Citigroup, Bank of America and Wachovia.
Last week, Treasury officials said they expected roughly $1.4 billion to be transferred to the Fed account.
The revised figure is higher because less money from the frozen accounts had to be set aside to cover legal claims by people who said they were victims of the Iraqi government, Treasury officials said.
It is envisioned that the money in the Fed account would be used to help rebuild Iraq, including providing money for humanitarian purposes, according to the department.
The frozen assets were being held in bank accounts under the names of the government of Iraq, the Central Bank of Iraq, Rafidain Bank, Rasheed Bank and the State Organization for Marketing Oil.
Also Thursday, Aufhauser said that "hundreds of millions of dollars of previously unknown illegal proceeds have been uncovered abroad in a matter of days, and are now subject to seizure."
Aufhauser would not disclose where the money was found. Aufhauser said there is a "strong suspicion" the money came from illegal oil-smuggling schemes.
A General Accounting Office report last year said that Iraq generated $6.6 billion in illegal revenue from smuggling oil and other schemes in the last 12 years.
Last week, Treasury Secretary John Snow said the United States was beginning a worldwide hunt for those and other funds that may have been used to bankroll terrorist activities.
The United States in 1990 issued an order blocking any assets belonging to the government of Iraq and related entities. That order was aimed at cutting the Iraqi president and his government from financial assets that could be used to support terrorist activities. Treasury officials say no personal assets belonging to Hussein have been found in the United States.
Mar 28, 9:06 AM EST
Bush Seizes $1.62B in Iraqi Assets
By JEANNINE AVERSA
Associated Press Writer
WASHINGTON (AP) -- The Bush administration has seized $1.62 billion in Iraqi assets already frozen in the United States and will use the money to help rebuild the country once Saddam Hussein is ousted, a top Treasury Department official said Thursday.
The department's general counsel, David Aufhauser, provided updated figures that follow up an initiative from President Bush last week.
Aufhauser said the money has been transferred to an account at the Federal Reserve Bank of New York. An additional $77 million is expected to be transferred soon, bringing the total to about $1.69 billion.
The assets, which belong to the Iraqi government, have been frozen since 1990 and have been sitting in accounts at U.S. banks, including Citigroup, Bank of America and Wachovia.
Last week, Treasury officials said they expected roughly $1.4 billion to be transferred to the Fed account.
The revised figure is higher because less money from the frozen accounts had to be set aside to cover legal claims by people who said they were victims of the Iraqi government, Treasury officials said.
It is envisioned that the money in the Fed account would be used to help rebuild Iraq, including providing money for humanitarian purposes, according to the department.
The frozen assets were being held in bank accounts under the names of the government of Iraq, the Central Bank of Iraq, Rafidain Bank, Rasheed Bank and the State Organization for Marketing Oil.
Also Thursday, Aufhauser said that "hundreds of millions of dollars of previously unknown illegal proceeds have been uncovered abroad in a matter of days, and are now subject to seizure."
Aufhauser would not disclose where the money was found. Aufhauser said there is a "strong suspicion" the money came from illegal oil-smuggling schemes.
A General Accounting Office report last year said that Iraq generated $6.6 billion in illegal revenue from smuggling oil and other schemes in the last 12 years.
Last week, Treasury Secretary John Snow said the United States was beginning a worldwide hunt for those and other funds that may have been used to bankroll terrorist activities.
The United States in 1990 issued an order blocking any assets belonging to the government of Iraq and related entities. That order was aimed at cutting the Iraqi president and his government from financial assets that could be used to support terrorist activities. Treasury officials say no personal assets belonging to Hussein have been found in the United States.
Dr. Mac
Player
Iceman:
I don't expect the benefits to outweigh the capital expended; and by capital expended I mean monetary, political, goodwill, world standing, and resumption of the former way of life and comfort with it in this country.
There is an article in the business section of today's USAToday on page 3 that questions if oil stocks are a good investment right now. A line from it states "Iraq could probably pump 3 million barrels of oil a day, once production is restored. That's not enough to seriously flood the oil market, which averaged 76 million barrels a day last year." This suggests that the Iraqi oil won't have much impact on supply.
The article also stated "the Saudis need oil prices to stay (at least) around $24 dollars to keep their economy humming. If Oil prices fall to a level (i.e., below this) that destabilizes Saudi Arabia, it could leave us with a bigger mess." It concludes with there is so much uncertainty and volatility in the oil industry and that "so much of it is driven by politics and not the market." This is similar to comments in my earlier posts; Politics and policy will play a large part in determining how much oil comes out of Iraq, and that will be impacted by how much profit is required.
Consider, also, the demand side of the equation. Most of your posts looked only at the supply side. Big consumers of oil products like the airline industry, the tourism industry (both from people traveling by car and purchasing products that use petroelum when they get to their destination, etc.) were hurting before the war and will not suddenly rebound just because Iraqi oil hits the market and the price of gas gets a little cheaper. Those industries are still suffering (a lot of it due to 9/11) and will continue to do so until people in this country become more comfortable with the state of everyday life. If anything, this war's aftermath might make people more uncomfortable in utilizing these industries and make things worse for them. And if the supply formerly used by the airline, tourism, and ancillary support industries to those two is not utilized, then the oil companies will have to get profits from the smaller supply that is utilized; thus, continued higher prices for a gallon of gas.
There is more to fixing this economy than tax cuts, Iraqi oil, and the like. Tax cuts, increased deficits, high national debt, and the like all combined will only make things worse. No amount of Iraqi oil, and especially the amount expected, in addition to tax cuts alone will be able to fix it.
Regards.
I don't expect the benefits to outweigh the capital expended; and by capital expended I mean monetary, political, goodwill, world standing, and resumption of the former way of life and comfort with it in this country.
There is an article in the business section of today's USAToday on page 3 that questions if oil stocks are a good investment right now. A line from it states "Iraq could probably pump 3 million barrels of oil a day, once production is restored. That's not enough to seriously flood the oil market, which averaged 76 million barrels a day last year." This suggests that the Iraqi oil won't have much impact on supply.
The article also stated "the Saudis need oil prices to stay (at least) around $24 dollars to keep their economy humming. If Oil prices fall to a level (i.e., below this) that destabilizes Saudi Arabia, it could leave us with a bigger mess." It concludes with there is so much uncertainty and volatility in the oil industry and that "so much of it is driven by politics and not the market." This is similar to comments in my earlier posts; Politics and policy will play a large part in determining how much oil comes out of Iraq, and that will be impacted by how much profit is required.
Consider, also, the demand side of the equation. Most of your posts looked only at the supply side. Big consumers of oil products like the airline industry, the tourism industry (both from people traveling by car and purchasing products that use petroelum when they get to their destination, etc.) were hurting before the war and will not suddenly rebound just because Iraqi oil hits the market and the price of gas gets a little cheaper. Those industries are still suffering (a lot of it due to 9/11) and will continue to do so until people in this country become more comfortable with the state of everyday life. If anything, this war's aftermath might make people more uncomfortable in utilizing these industries and make things worse for them. And if the supply formerly used by the airline, tourism, and ancillary support industries to those two is not utilized, then the oil companies will have to get profits from the smaller supply that is utilized; thus, continued higher prices for a gallon of gas.
There is more to fixing this economy than tax cuts, Iraqi oil, and the like. Tax cuts, increased deficits, high national debt, and the like all combined will only make things worse. No amount of Iraqi oil, and especially the amount expected, in addition to tax cuts alone will be able to fix it.
Regards.
Dr. Mac,
Put little stock in a article from USA Today. In the hard-hit, gas-guzzling industries I'm talking about make-or-break savings. You said it, The airlines sector is already a basket case, with United and US Airways in Chapter 11 and American threatening to follow. Even if war results in lower oil prices, it will be too late to avert billions in losses as Americans cut back on travel plans. But over the long term the savings from cheaper jet fuel will enable the bankrupt giants to reemerge as viable companies rather than end up in the liquidator's boneyard, putting even more people out of work. While airlines are the most obvious beneficiaries, cheaper oil prices will boost the entire economy, from manufacturing to farming. Indicators in the manufacturing and farming industry say cheaper gas prices will be a big lift. According to the University of Iowa a 40% decrease in fuel costs reduces the cost of producing a bushel of corn by 3 cents.
Don't buy into Saudi Arabia $24 barrel theory. Iraq and neighbors have cheap oil. It costs about $15 to produce a single barrel of crude in the U.S. and Iraq and its neighbors can do it for $5 a barrel or less. So they can sell to the U.S. at $22 a barrel and still make a tidy profit.