Supply-Side Economics

[whell]

Originally Posted by finnbow

You have yet again proven your economic ignorance. It's kinda like saying that if you have a mortgage, you are bankrupt. I hate to break it to you, but annual deficits/surpluses are different than total debt (i.e., you can have an annual operating surplus, but still have debt). Stick to what you understand, though that seems to be precious little.

Got it wrong again, tool, possibly because your knowledge of budgeting came from inside the Beltway. And your analogy sucks. Here's a better one:

Cali saying that they have a surplus is like saying that I have a mortgage payment that doesn't fit my annual budget, so I'm going to borrow the money to pay the mortgage. Not only that, but I'm going to borrow more money than I need to make this year's payments, and I'll call the additional funds "revenue". And then, since I'll have more "revenue" than I have expenses, I'll declare a "surplus" this year.

This is exactly what's happening in Cali, and its the same thing Clinton did in the 90's. And just like the 90's when the Congressional Dems wanted to spend the "surplus" by calling it "The Peace Dividend", the Cali legislature is pushing to spend Cali's faux surplus this year.

Because the Cali Treasury has more funds on account than they have expenses, including funds that came from borrowing, they "should" only have two options: refund the excess to the taxpayers (except that its not really an excess so that really isn't an option), or pay down the long term debt. Yeah...that won't happen either.

[finnbow]

Originally Posted by whell

Got it wrong again, tool, possibly because your knowledge of budgeting came from inside the Beltway. And your analogy sucks. Here's a better one:

Cali saying that they have a surplus is like saying that I have a mortgage payment that doesn't fit my annual budget, so I'm going to borrow the money to pay the mortgage...

What you're describing is a second mortgage. Having a second mortgage doesn't make one any more bankrupt than having a first mortgage.

[whell]

Originally Posted by finnbow

What you're describing is a second mortgage. Having a second mortgage doesn't make one any more bankrupt than having a first mortgage.

Individuals don't need to take out a second mortgage to pay their bills. There are personal loans, home equity loans, advances from credit cards (thus my "paying the Visa with the Master Card" reference), borrowing money from a 401(k), an advance or a loan from an employer, etc.

On the other hand, individuals or businesses don't get to loan/bond revenue as income. In business, bond sales are booked as balance sheet items: income received as an asset and bonds payable as a liability.

[Chicks]

How amusing that someone from Detroit is giving “lessons” to California on public debt. Detroit’s solution was just like Donny’s. Declare bankruptcy, screw those to whom money is owed. Meanwhile, CA just jumped up a spot in the world’s most vibrant economies, overtaking the UK.

https://en.m.wikipedia.org/wiki/Detroit_bankruptcy

[finnbow]

Originally Posted by whell

Individuals don't need to take out a second mortgage to pay their bills. There are personal loans, home equity loans...

Second mortgages and home equity loans are not materially different, other than tax treatment since 2018 (and second mortgages are better in that interest upon them is tax deductible).

[whell]

Originally Posted by Chicks

How amusing that someone from Detroit is giving “lessons” to California on public debt. Detroit’s solution was just like Donny’s. Declare bankruptcy, screw those to whom money is owed. Meanwhile, CA just jumped up a spot in the world’s most vibrant economies, overtaking the UK.

https://en.m.wikipedia.org/wiki/Detroit_bankruptcy

Nice attempt at a dodge, Chicklet. Can't address the facts posted so now you try to change the topic.

I'll give you this much:

I certainly was a witness to Detroit's spectacular fall from a great American city, to the fall from grace amid profligate spending against declining revenues, to city officials and employees convicted of looting the city and creating a pay to play environment, to a budding resurgence. Detroit chased businesses and investments out of town that might have changed its fortunes.

California might be able to weather its increasing debt for the foreseeable future largely due to the economic clout of Silicon Valley and Hollywood, and the high taxes that those businesses pay. However, it remains THE worst state to do business in.

But nothing lasts forever and California is fueling its own demise. The folks that help create California's revenue stream have been leaving steadily. Businesses have also been leaving California for other states, and that trend shows no sign of changing.

California is a long way from becoming another Illinois. But it needs to address those elements that are driving up housing costs, and driving individuals and businesses to relocate.

[Chicks]

If California's a 'bad state for business,' why is it leading the nation in job and GDP growth?

http://www.latimes.com/business/hilt...nap-story.html

Post all the right wing nonsense you want, it’s worthless.

The most obvious answer is that the business-friendliness and competitiveness rankings are pretty much baloney. They don't actually examine what makes a state successful; instead, they merely judge its adherence to right-wing economic orthodoxy.

[finnbow]

Originally Posted by whell

California might be able to weather its increasing debt for the foreseeable future largely due to the economic clout of Silicon Valley and Hollywood, and the high taxes that those businesses pay.

You forgot agriculture. California's agricultural economy is over 13% of the entire nation's, larger than the next two states combined (Texas and Iowa), totaling over $32 billion (compared to ~$4 billion for Michigan). And then there's tourism, where California is by far the largest at $130 billion (vs $18 billion for Michigan). California is the nation's economic powerhouse and no other state comes close (it's over 5x bigger than Michigan's).

[Chicks]

More facts-based information on CA’s economy, without the right wing spin.

California ranked as nation’s 5th fastest-growing economy

https://www.mercurynews.com/2018/04/...owing-economy/

[bobabode]

Originally Posted by finnbow

You forgot agriculture. California's agricultural economy is over 13% of the entire nation's, larger than the next two states combined (Texas and Iowa), totaling over $32 billion (compared to ~$4 billion for Michigan). And then there's tourism, where California is by far the largest at $130 billion (vs $18 billion for Michigan). California is the nation's economic powerhouse and no other state comes close (it's over 5x bigger than Michigan's).

Originally Posted by Chicks

More facts-based information on CA’s economy, without the right wing spin.

California ranked as nation’s 5th fastest-growing economy

https://www.mercurynews.com/2018/04/...owing-economy/

Bam and double bam. Put that in your pipe and smoke it, Whell.