** An American Promise **
● A Balanced-Budget Amendment to the Constitution, with appropriate exceptions for times of war and recession.
● A line-item veto, to give the President a fighting chance to eliminate pork and earmarks.
● A limitation on federal spending, to 20% of GDP.
** About We Elected You **
** Building A Million Dollar Retirement Portfolio **The average carried credit card balance in the U.S. is almost $16,000 per household. The average interest on that carried balance is 12.79% (source: Creditcards.com). The true cost of borrowing money is the sum of interest paid, plus the earnings foregone had that money been invested; this is what economists call "opportunity cost": the cost of the foregone opportunity to do things differently. For example, the true cost of a "Zero-percent interest!" auto loan is actually the earnings foregone had the money been invested, i.e., around 6.6%; and the true cost (the opportunity cost) of a carried balance on a credit card is the sum of the interest charged (12.79%) plus the earnings foregone (an average market return of 6.6%), or over 19%.
Have Your Say!
- John Lumbard on Problems With a Balanced Budget Amendment?
- Chris Curley on Problems With a Balanced Budget Amendment?
- John Lumbard on How to Fix the Health Care Mess
- Did Government Agencies “Raid” Social Security “Coffers”? « Joejolly’s Weblog on “The Debt The Government Owes Itself For Raiding Social Security”
- John Lumbard on The Antidote
- Gen Y on The Keepers of the Flame
- Chuck Bailey on Amendment Filed. Call Your Congressman!
- Phoebe Addington on Party On!
- FaGaurlwal on Incentives Rule!
- James Schaefer on The ENTIRE Government Runs on Borrowed Money
Topics$1.6 trillion deficit $8.2 trillion American Promise Austerity Balanced Budget Amendment balance the budget bipartisan reform cbo compound interest Congressional Budget Office Constitutional Amendment Contract From America debt burden default economy entitlements fair tax system federal budget Federal debt Federal deficit fiscal respnsibility fiscal responsibility Fiscal Sanity government debt Greece growth of government interest rates Investing Judd Gregg limit on federal spending Line-Item Veto national debt Pledge of Fiscal Responsibility political platform Portugal Social Security Spending Cap Spending Limit Amendment Sustainable Government Tax Reform Tea Party Term Limits The Stock Market trillion dollars unsustainable fiscal policy
unsustainable fiscal policy Archive
By John Lumbard. The economy is accelerating. It’s been almost four years since the official end of the 2007-2009 recession, yet New York Times op-ed columnist Paul Krugman is still calling for more stimulus spending! Maybe if we were to pave every road every year . . . Last month the former...Read More
By Drew Kellner, CFA. In the final days of 2012, as the Bush Tax Cuts were about to expire forever, the sitting President pressed to make them permanent for nearly every American. There was a brief debate about whether “nearly every” meant 98% or 99% of all taxpayers (in the end...Read More
By James Schaefer. Some years back, at an annual company off-site retreat, a presenter was elaborating on money. He gave many definitions, then asked us to think of money in a slightly different way. Rather than thinking of it as a medium of exchange, he asked us to think of money as...Read More
By John Lumbard. The legislatures of seventeen states have recently passed a bill calling for a constitutional convention that would be focused solely on the drafting of a balanced budget amendment to the Constitution. Each of these bills explicitly states that it will be declared null and void if the Supreme...Read More
By John Lumbard. The debt of Portugal has fallen in value so much that a buyer can now get a yield of 16% on long term, ten year bonds. Portugal won't have to actually pay 16% until it has to borrow again (most likely when an old bond issue matures and...Read More
That's what Erskine Bowles, co-chair of the president's National Commission on Fiscal Responsibility, said about our government's ever-so-slowly-developing fiscal calamity in this Senate Budget Committee testimony. The President disavowed the findings of his commission, but it continued on in a scaled-down group of six members (all Senators) called the Gang of...Read More
By John Lumbard. What does the allegedly-amoral head of the International Monetary fund have to do with budget deficits in the U.S.? Ever since the fall of 2008 Americans have been losing trust in their leadership and institutions. The arrest of "DSK" pulls one more pillar out from under the...Read More
By James Schaefer "There's no such thing as a free lunch." Fifty years ago most Americans believed those words, and they were used by Milton Friedman in a 1975 book of that title. Jenny Fisher-Sullivan elaborated in the Wall Street Journal (March 3, 2011): The Fed works for our bankrupt federal government and...Read More
By John Lumbard. When we launched this blog the federal debt was 12-and-something trillion, and we were fretting about the first trillion-dollar budget deficit. Really, I shouldn't have been surprised to see the $14 trillion number at the top of our home page, but it touched a nerve anyway. And...Read More