On this day:
1807
The U.S. Congress passes the Act Prohibiting Importation of Slaves, disallowing the importation of new slaves into the country.
1825
Roberto CofresÃ, one of the last successful Caribbean pirates, is defeated in combat and captured by authorities.
1836
Texas Revolution: Declaration of Independence of the Republic of Texas from Mexico.
1855
Alexander II becomes Tsar of Russia.
1861
Emancipation reform of 1861 in Russia: Tsar Alexander II signs the emancipation reform into law, abolishing Russian serfdom.
1939
Cardinal Eugenio Pacelli is elected Pope and takes the name Pius XII.
1998
Data sent from the Galileo spacecraft indicates that Jupiter’s moon Europa has a liquid ocean under a thick crust of ice.
The U.S. Congress passes the Act Prohibiting Importation of Slaves, disallowing the importation of new slaves into the country.
1825
Roberto CofresÃ, one of the last successful Caribbean pirates, is defeated in combat and captured by authorities.
1836
Texas Revolution: Declaration of Independence of the Republic of Texas from Mexico.
1855
Alexander II becomes Tsar of Russia.
1861
Emancipation reform of 1861 in Russia: Tsar Alexander II signs the emancipation reform into law, abolishing Russian serfdom.
1939
Cardinal Eugenio Pacelli is elected Pope and takes the name Pius XII.
1998
Data sent from the Galileo spacecraft indicates that Jupiter’s moon Europa has a liquid ocean under a thick crust of ice.
Use the talents you possess, for the woods would be a very silent place if no birds sang except the best. -Henry van Dyke, poet (10 Nov 1852-1933)
***
A grandson of Ayatollah Ruhollah Khomeini, the late founder of the Islamic Republic of Iran, is likely to figure prominently in the deliberations of the clerics who will determine who replaces Ayatollah Ali Khamenei as Supreme Leader.
Good thing they got rid of the Shah and his heir.
***
A man who scaled the Gulf Tower in Downtown Pittsburgh has now been criminally charged.
***
China has officially implemented new regulations that ban hidden door handles, as reported by Bloomberg.
The rules prohibit both the type of door handles that pop out by pressing on one end of the handle and those that are electrically powered.
***
Links between social media use and mental wellness in youth are an artifact of other factors: implications for public policy and meta- analysis--paper by Christopher J.Ferguson
***
Worry #2: Debt
Revenues are not the problem. Even after extending and adding to the Trump tax cuts, federal receipts are projected to remain near or above their historical average as a share of the economy, growing from $5.2 trillion (17.2 percent of GDP) to $8.3 trillion (17.8 percent of GDP) over the decade.
The problem is that federal spending exceeds revenues by a lot and is growing much faster than revenues. Spending is projected to grow from $7 trillion (23.1 percent of GDP) to $11.4 trillion (24.4 percent of GDP).
The widening annual deficit (the gap between annual spending and revenue) is overwhelmingly driven by the growth in Social Security, Medicare, Medicaid, and rising interest costs. By 2036, interest costs, Social Security, Medicare, and Medicaid are projected to consume 100 percent of federal revenues.
Read that again.
Under current law, within a decade, every dollar collected in revenue will be absorbed by health care programs, Social Security, and interest spending to service the ballooning federal debt, leaving nothing for national defense or any other core function of government.
Multiple estimates, from the Congressional Budget Office, the Yale Budget Lab, the Penn Wharton Budget Model, and the Tax Foundation, estimate that the Trump tariffs would generate from $1 trillion to $3 trillion in additional revenue over a decade, depending on assumptions and whether economic feedback effects are included.
Those are large numbers in isolation. But they are small relative to the size of the federal budget hole.
CBO projects that the United States will borrow an additional $25 trillion over the next decade. Closing that gap would require eight to 25 times the revenues that Trump administration tariffs were estimated to bring in. About $16 trillion of those deficits will go toward interest payments alone. Even under optimistic assumptions, tariff revenue would offset only a small fraction of that amount.
Put differently: even if every dollar of projected tariff revenue materialized, the debt would still surge past its historic high within a few years and continue unsustainably climbing thereafter.
Moreover, tariffs are neither free money nor are they paid by foreign exporters. They function as taxes on imported goods and production inputs that are paid by Americans. According to the Kiel Institute, American consumers and importers paid 96 percent of tariff costs, while foreign exporters absorbed only four percent. Higher input costs reduce business profits and workers’ wages, shrinking corporate and individual income tax collections. From generating uncertainty to reducing available capital for investment, tariffs reduce hiring and dampen economic growth.
Part of the “revenue gain” from tariffs is thus clawed back through weaker economic performance and a smaller tax base. That’s one way to shoot yourself in the foot.
Meanwhile, the real driver of America’s debt trajectory is far more entrenched.
The entirety, more than 100 percent, of the federal government’s long-term funding shortfall stems from the growth of Social Security and Medicare, according to the Financial Report of the United States Government. These programs expand automatically as the population ages, beneficiaries live longer, benefits increase by design, and health costs rise. They were set up for a younger country with far fewer retirees per worker and transfer income from working Americans to retirees, regardless of need. One of the best ways to curb their growth is to refocus these programs’ benefits on seniors in need.
As debt climbs, interest costs compound. CBO projects that net interest will more than double over the next decade, consuming a growing share of the budget.
Interest costs already surpass what the United States government allocates toward national defense expenditures. As the Hoover Institution’s Niall Ferguson writes: “When a great power spends more on debt service than on defense, it will not be great for much longer.” The US Senate unanimously recognized deficits as “unsustainable, irresponsible, and dangerous,” as if they were innocent bystanders. But Congress has yet to act to curb the debt threat.
This is how fiscal crises develop — not because a single revenue stream disappears, but because structural commitments grow faster than the economy that must finance them.
The United States is already well above the debt levels that much of the economic literature associates with slower long-term growth. Every year of delay increases the eventual adjustment required to stabilize the debt.
Congress should adopt a credible plan that stabilizes spending and the growth in debt. Members of the bipartisan fiscal forum in Congress recently proposed a three-percent-of-GDP deficit target, led by Representatives Bill Huizenga (R-MI), Scott Peters (D-CA), Lloyd Smucker (R-PA) and Mike Quigley (D-IL). That’s a promising goal. To succeed in meeting it, Congress will need structural entitlement reforms. Not killing the goose that lays the golden eggs with economy-crushing tax hikes — whether those are dressed up as tariffs or as a border adjustment tax.
Congress can reduce excess health care spending, streamline taxes, and cut welfare programs prone to fraud and abuse, using the same reconciliation process that Republicans leveraged in July to extend and expand the Trump tax cuts and slow the growth in Medicaid and food stamps (SNAP).
Going yet further, Congress can work toward advancing a Base Realignment and Closure–style fiscal commission to overcome policy inertia and provide Congress with political cover to advance necessary entitlement reforms. The Fiscal Commission Act, championed by Representatives Scott Peters (D-CA) and Bill Huizenga (R-MI) is a promising step in that direction.
If America ever experiences fiscal “ruin,” it will not be because presidential tariff authority was constrained. It will be because elected officials of both parties failed to modernize the country’s largest entitlement programs and halt their automatic spending growth.
The Supreme Court’s ruling does not create a fiscal crisis. Tariffs raised revenue at the margin. In the process, they also distort trade and slow growth. But they do not alter the fundamental arithmetic driving America’s debt.
The path to fiscal stability runs through entitlement reform and spending control — not through executive-imposed tariffs that were never large enough to solve the problem in the first place. (much from Reason)
***
A man who scaled the Gulf Tower in Downtown Pittsburgh has now been criminally charged.
***
China has officially implemented new regulations that ban hidden door handles, as reported by Bloomberg.
The rules prohibit both the type of door handles that pop out by pressing on one end of the handle and those that are electrically powered.
***
Links between social media use and mental wellness in youth are an artifact of other factors: implications for public policy and meta- analysis--paper by Christopher J.Ferguson
***
Worry #2: Debt
The average American citizen is concerned about prices and oceans, Mars and China, but does not scrutinize their inner workings. That they leave to their arrogant, posturing, insincere representatives. Government is a labyrinth of arcane demands and prohibitions that have, over the years, evolved to cover the basic skeleton of the country's hopeful and revolutionary aspirations and principles. And fears, especially fears. That government package is now wrapped in an inscrutable layer of mendacity, bombast, innuendo, and outright deception that makes it inaccessible and its convenient use almost impossible.
Of the worries of the nation, AI is an obscure, technical, uncertain, and imposed problem. Like a tiger. The government, especially the national debt, is internal, the result of willful ignorance and cowardly, inept "leadership."
Trump is a parody of our problems and is both loved and hated for it. Parodies may give us insight, but do not give solutions. We are at that point now in America: the problems are more visible, but Trump is not the next step. The Sineater needs an exorcism, but one that won't destroy the village.
Tariffs are a tax on consumers that will raise prices, create shortages, offend trading partners, and disrupt normal economic give-and-take. Contrary to the President’s claims, tariffs will not improve the national debt. Like it or not, America has a debt crisis, and it is not caused by a revenue problem. The federal government has an unsustainable spending problem.
The Congressional Budget Office’s (CBO) latest Budget and Economic Outlook shows that debt held by the public exceeds 100 percent of GDP this year and will rise above its World War II record by 2030. Ten years from now, debt will be roughly 120 percent of GDP and will continue to climb to 175 percent by 2056 — and that is under optimistic projections that assume no economic, financial, or public health crises over that time.
Revenues are not the problem. Even after extending and adding to the Trump tax cuts, federal receipts are projected to remain near or above their historical average as a share of the economy, growing from $5.2 trillion (17.2 percent of GDP) to $8.3 trillion (17.8 percent of GDP) over the decade.
The problem is that federal spending exceeds revenues by a lot and is growing much faster than revenues. Spending is projected to grow from $7 trillion (23.1 percent of GDP) to $11.4 trillion (24.4 percent of GDP).
The widening annual deficit (the gap between annual spending and revenue) is overwhelmingly driven by the growth in Social Security, Medicare, Medicaid, and rising interest costs. By 2036, interest costs, Social Security, Medicare, and Medicaid are projected to consume 100 percent of federal revenues.
Read that again.
Under current law, within a decade, every dollar collected in revenue will be absorbed by health care programs, Social Security, and interest spending to service the ballooning federal debt, leaving nothing for national defense or any other core function of government.
Multiple estimates, from the Congressional Budget Office, the Yale Budget Lab, the Penn Wharton Budget Model, and the Tax Foundation, estimate that the Trump tariffs would generate from $1 trillion to $3 trillion in additional revenue over a decade, depending on assumptions and whether economic feedback effects are included.
Those are large numbers in isolation. But they are small relative to the size of the federal budget hole.
CBO projects that the United States will borrow an additional $25 trillion over the next decade. Closing that gap would require eight to 25 times the revenues that Trump administration tariffs were estimated to bring in. About $16 trillion of those deficits will go toward interest payments alone. Even under optimistic assumptions, tariff revenue would offset only a small fraction of that amount.
Put differently: even if every dollar of projected tariff revenue materialized, the debt would still surge past its historic high within a few years and continue unsustainably climbing thereafter.
Moreover, tariffs are neither free money nor are they paid by foreign exporters. They function as taxes on imported goods and production inputs that are paid by Americans. According to the Kiel Institute, American consumers and importers paid 96 percent of tariff costs, while foreign exporters absorbed only four percent. Higher input costs reduce business profits and workers’ wages, shrinking corporate and individual income tax collections. From generating uncertainty to reducing available capital for investment, tariffs reduce hiring and dampen economic growth.
Part of the “revenue gain” from tariffs is thus clawed back through weaker economic performance and a smaller tax base. That’s one way to shoot yourself in the foot.
Meanwhile, the real driver of America’s debt trajectory is far more entrenched.
The entirety, more than 100 percent, of the federal government’s long-term funding shortfall stems from the growth of Social Security and Medicare, according to the Financial Report of the United States Government. These programs expand automatically as the population ages, beneficiaries live longer, benefits increase by design, and health costs rise. They were set up for a younger country with far fewer retirees per worker and transfer income from working Americans to retirees, regardless of need. One of the best ways to curb their growth is to refocus these programs’ benefits on seniors in need.
As debt climbs, interest costs compound. CBO projects that net interest will more than double over the next decade, consuming a growing share of the budget.
Interest costs already surpass what the United States government allocates toward national defense expenditures. As the Hoover Institution’s Niall Ferguson writes: “When a great power spends more on debt service than on defense, it will not be great for much longer.” The US Senate unanimously recognized deficits as “unsustainable, irresponsible, and dangerous,” as if they were innocent bystanders. But Congress has yet to act to curb the debt threat.
This is how fiscal crises develop — not because a single revenue stream disappears, but because structural commitments grow faster than the economy that must finance them.
The United States is already well above the debt levels that much of the economic literature associates with slower long-term growth. Every year of delay increases the eventual adjustment required to stabilize the debt.
Congress should adopt a credible plan that stabilizes spending and the growth in debt. Members of the bipartisan fiscal forum in Congress recently proposed a three-percent-of-GDP deficit target, led by Representatives Bill Huizenga (R-MI), Scott Peters (D-CA), Lloyd Smucker (R-PA) and Mike Quigley (D-IL). That’s a promising goal. To succeed in meeting it, Congress will need structural entitlement reforms. Not killing the goose that lays the golden eggs with economy-crushing tax hikes — whether those are dressed up as tariffs or as a border adjustment tax.
Congress can reduce excess health care spending, streamline taxes, and cut welfare programs prone to fraud and abuse, using the same reconciliation process that Republicans leveraged in July to extend and expand the Trump tax cuts and slow the growth in Medicaid and food stamps (SNAP).
Going yet further, Congress can work toward advancing a Base Realignment and Closure–style fiscal commission to overcome policy inertia and provide Congress with political cover to advance necessary entitlement reforms. The Fiscal Commission Act, championed by Representatives Scott Peters (D-CA) and Bill Huizenga (R-MI) is a promising step in that direction.
If America ever experiences fiscal “ruin,” it will not be because presidential tariff authority was constrained. It will be because elected officials of both parties failed to modernize the country’s largest entitlement programs and halt their automatic spending growth.
The Supreme Court’s ruling does not create a fiscal crisis. Tariffs raised revenue at the margin. In the process, they also distort trade and slow growth. But they do not alter the fundamental arithmetic driving America’s debt.
The path to fiscal stability runs through entitlement reform and spending control — not through executive-imposed tariffs that were never large enough to solve the problem in the first place. (much from Reason)
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