Fed Chair Admits: ‘Deficits Will Rise To Unsustainable Levels’ Unsure Whether U.s. Should Be Considered Capitalist Or An Oligarchy

Deleted member 472633 · May 8, 2014

http://www.cnsnews.com/news/article/terence-p-jeffrey/fed-chair-deficits-will-rise-unsustainable-levels

Federal Reserve Chairman Janet Yellen, referencing the Congressional Budget Office'slong-term budget projections, told the Joint Economic Committee of Congress today that under current policies the federal government's deficits â€œwill rise to unsustainable levels.â€
In the 10-year budget projections it released in April, the CBO estimated that the federal government will run $7.618 trillion in deficits from 2015 through 2024. At the same time, the CBO projected that the federal government's debt held by the public would rise from $11.983 trillion at the end of fiscal 2013 to $20.947 trillion by the end of 2024.
\nThe debt held by the public is the part of the U.S. government debt that is not held by the federal government itself. It primarily consists of marketable Treasury securities, including bills, notes and bonds. It does not include what the government calls â€œintragovernmental debt," which is the money the Treasury has borrowed out of the Social Security Trust Fund and other government trust funds to pay current expenses.
The total debt of the federal government at the end of fiscal 2013--including both the debt held by the public and the intragovernmental debt--was $16.719 trillion. The CBO estimates that by 2024, the total debt of the federal government will be $27.159 trillion-of which $20.947 trillion will be debt held by the public.
If that projection holds up, the federal debt held by the public in 2024 would be more than four times the $5.035 trillion federal debt held by the public at the end of 2007.
Yellen made her statement about unsustainable deficits when she was question by Sen. Dan Coats (R.-Ind.). Coats remarked that businessmen in Indiana told him that their businesses were underperforming at this time because of the uncertainty they felt as result of federal taxation and regulatory policies.

â€œWhat recommendations would you give to us in terms of dealing with this uncertainty that is basically causing a lot of these businesses to underperform?â€ Coats asked.
â€œSo, I agree with you,â€ said Yellen. â€œMy own discussions with businesses, I hear exactly the same things that you are citing: concerns with regulations, about taxation, about uncertainty about fiscal policy.
â€œI guess one recommendation that I would give you is that long-term budget deficits, we can see in, for example, CBO's very long-term projections, that they remain,â€ said Yellen. â€œThere is more work to do to put fiscal policy on a sustainable course. That progress has been made over the last several years, in bringing down deficits in the short term, but that a combination of demographics, the structure of entitlement programs, and historic trends in health-care costs, we can see that over the long-term deficits will rise to unsustainable levels relative to the economy.
â€œAnd," she said, "putting in place a package of reforms-ones, I know these are very controversial matters--but that would probably help confidence.â€

Coats later said to Yellen: â€œYou join a long list of very responsible Americans who have the experience and the expertise to give us some warnings about what may happen in the future and our inability to act over the last several years now in addressing these major problems that are going to have significant consequences on the economy of this country and on future generations.
â€œI don't know what it is going to take for us to summon the will to do what we all know that we need to do,â€ said Coats. â€œBut I appreciate your adding your name to that long list saying you have a responsibility up here and you're not fulfilling that responsibility.â€
According to the CBO, â€œmandatoryâ€ federal spending will increase approximately 58 percent over the next ten years, rising from $2.32 trillion in 2015 to $3.664 trillion in 2024. Over that decade, total federal â€œmandatoryâ€ spending will be $29.737 trillion.
That will include $8.25 trillion on Medicare, $4.55 trillion on Medicaid, $9.9 trillion on Social Security, $1.78 trillion on disability insurance, and $728 billion on food stamps.
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http://cnsnews.com/news/article/susan-jones/fed-chair-unsure-if-capitalism-or-oligarchy-describes-us

CNSNews.com) - "Are we still a capitalist democracy or have we gone over into an oligarchic form of society in which incredible economic and political power now rests with the billionaire class?" Sen. Bernie Sanders, a Vermont socialist, asked that question of Federal Reserve Chair Janet Yellen at a hearing on Capitol Hill Wednesday.

Yellen said she'd "prefer not to give labels," but she admitted to being very concerned about income inequality.

"So, all of the statistics on inequality that you've cited are ones that greatly concern me, and I think for the same reason that you're concerned about them. They can shape the -- determine the ability of different groups to participate equally in the democracy and have grave effects on social stability over time.

"And so I don't know what to call our system or how to -- I prefer not to give labels; but there's no question that we've had a trend toward growing inequality and I personally find it very worrisome trend that deserves the attention of policy-makers.
Sanders told Yellen, "There comes a point, where the billionaire class has so much political power -- where the Koch brothers are now, because of Citizens United, able to buy and sell politicians -- they have so much political power -- at what point is that reversible?" he asked.

Sanders also asked Yellen about repealing the estate tax: "Would it make sense to you to give enormous tax breaks to the families of the top one percent of people in this country?"

Yellen repeated that she shares Sanders' concern with inequality -- but "it's up to the Congress to decide what's appropriate."

Sanders tried again, asking Yellen if giving tax breaks to the Koch brothers, who are worth $80 billion -- "do you think that's going to create a whole lot of jobs in this country?"

"Well, I'd say most of the evidence that we have suggests that transfers to lower income people ted to be spend -- a larger fraction of the dollar is spent than when there's a transfer to a wealthy individual...so that's from the demand side," Yellen said. "Tax policy also has supply side effects that one should take into account."
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This fed chair is a smidgon more honest than the last one. Of course she still tows the Democrat Party line that the only way to fix the deficit is to tax and spend more.

dubaba · May 8, 2014

Nah thats ubsurd, it doesnt matter how much money we spend, we can just print more.

cball · May 8, 2014

let it fail.

trixman22 · May 8, 2014

cball said:

let it burn.
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Fixed that for you.

rain dancer · May 8, 2014

The us is an oligarchy was the top headline on bbc for a week recently.

cball · May 8, 2014

trixman22 said:

Fixed that for you.
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hmm...

rain dancer · May 8, 2014

Ah sarcasm......

So thick you can swim through it in politics section.

forty winks · May 8, 2014

Unsure Whether U.s. Should Be Considered Capitalist Or An Oligarchy
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A capitalists' oligarchy ...

goober0331 · May 8, 2014

Surprised Yellen said that.

At the same time not surprised Sanders continues to pay partisan politics.

yurigadaisukida · May 8, 2014

dubaba said:

Nah thats ubsurd, it doesnt matter how much money we spend, we can just print more.
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But its true isnt it? I mean whats more worthless than worthless? Can it get more worthless just because we print more?

Obviously it works! Until china becomes oil independant and the petro dollar collapses that it

Sent from my LG-E739 using Grasscity Forum mobile app

*ColtClassic* · May 9, 2014

"Yeah, that private corporation that I'm the chairwoman of, well it's been fucking the economy for 100 years now and we are going to enter an economic death-spiral, just thought I'd let you guys know what we've been up to.... you know just fucking with the economy and shit."

cball · May 9, 2014

*ColtClassic* said:

"Yeah, that private corporation that I'm the chairwoman of, well it's been fucking the economy for 100 years now and we are going to enter an economic death-spiral, just thought I'd let you guys know what we've been up to.... you know just fucking with the economy and shit."
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swimming through that sarcasm...the 100 meter dash!!

LonestarLoner · May 10, 2014

forty winks said:

A capitalists' oligarchy ...
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Plutocracy?

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Fed Chair Admits: ‘Deficits Will Rise To Unsustainable Levels’ Unsure Whether U.s. Should Be Considered Capitalist Or An Oligarchy

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Fed Chair Admits: ‘Deficits Will Rise To Unsustainable Levels’ Unsure Whether U.s. Should Be Considered Capitalist Or An Oligarchy

Deleted member 472633 Guest

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rain dancer Guest

forty winks under socialized Old School

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