Even the Communist Chinese Worry About Obama's Spending

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"straw that will break the camels back!"
If America losses its' AAA credit rating China might be very happy to get 75 cents on the dollar for our bonds they have. So obama's debt could be "straw that will break the camels back!"
"U.S. Stripped of AAA Credit Rating...By China?!"
Submitted by asiablues on 07/13/2010
http://www.zerohedge.com/article/us-stripped-aaa-credit-ratingby-china

Bill Hedges of MO 10:42AM July 15, 2010

The Federal Revenue says we are fully consumed by three programs that have been in place for many years Social Security Medicare and Medicaid. Then you add Obamacare and Obamas reckless spending and you have the straw that will break the camels back! Big Time!

Alexander of OH 10:20AM July 15, 2010

I'm glad to see you play the Communist Party propaganda card US News. Now that's some funny ironic stuff there boy.

Stephen Real of CA 10:15PM July 14, 2010

It would be a win , win deal , lets work on it .
While we work on that , maybe Steve can move there , China is right up his alley , they are sooo free and controlled by the goverment , he would fit right in .

Hunter of WI 7:21PM July 14, 2010

What "Insult" is this? I just asked "what Chinese Communists?" since Chinese now seems to be quite capitalist. My aren't we sensitive. And this coming from someone who insists I'm a "useful idiot." Maybe you haven't thought of a good answer to my last post on this thread.
Gee Schaefer, You're right on top of the latest trends. I don't think the term "Chi-Coms" has been used since Joe McCarthy was thrown out of the US Senate.

steve of IL 7:02PM July 14, 2010

I was going to answer you then I noticed in your title the insult. See no reason to answer someone who insults so much.
I understand what she is saying.

Bill Hedges of MO 6:45PM July 14, 2010

The Chinese would never dump our bonds because doing so would destroy the dollar which is now strong. This is important to maintain the value of the bondholders US assets and to sustain China's single most important export market. This alone makes US bonds a safe bet. In addition, high levels of US debt has always been the way China sustains its US markets. Consumer debt is worse for China than US government debt; consumer debt could lead to a dramatic slowdown in consumer spending thus hurting China's economy. China survives on US debt.
Government debt doesn't hurt the economy when there is high unemployment and low capacity utilization. We need fiscal stimulus.
Bill, You claim that further tax cuts will stimulate the economy. I submit to you that effective tax rates on all income levels have never been lower. In addition, corporate income taxes both effective rates and as a share of the GDP are historically quite low. More tax cuts won't spur job growth. We've had failed supply side economics for 30 years. Fiscal stimulus, not tax cuts, will spur growth.
http://www.cbpp.org/cms/index.cfm?fa=view&id=3090
Here is a report directly from the IRS;
"The IRS has just released an analysis of the richest 400 American tax filers. The top-line finding drawing the most attention is that these 400 earned about $138 billion, collectively, in 2007, the most recent year of data. In contrast, the bottom 90 percent of Americans, over 24 million filers, earned $247 billion...the tax rates of the rich are far more closely linked to the capital gains taxes than income taxes. Salaries and wages, the source of income taxed at the blue line, represented only 6.5 percent of these filers’ income. Nearly two-thirds of their income comes from capital gains, and this is why you see a much tighter coupling between the orange and red lines...the overall tax rates are really not that high. Contrary to concerns about socialism or a government takeover, the richest Americans, those earning an average of $345 million in 2007, paid about 16.5 percent in federal income taxes."
http://www.quickanded.com/2010/02/effective-tax-rates-of-the-richest-400-americans.html
http://www.irs.gov/pub/irs-soi/07intop400.pdf
A recent GAO report has established that current effective tax rates on large corporations is fairly low;
"The average U.S. effective tax rate on the domestic income of large corporations with positive domestic income in 2004 was an estimated 25.2 percent. There was considerable variation in tax rates across these taxpayers, as shown in the figure below. The average U.S. effective tax rate on the foreign-source income of these large corporations was around 4 percent, reflecting the effects of both the foreign tax credit and tax deferral on this type of income."
http://www.gao.gov/new.items/d08950.pdf#page=5
US corporate income taxes as a share of GDP is 1.8%, among the lowest of the OECD countries.
http://www.cbo.gov/ftpdocs/69xx/doc6902/11-28-CorporateTax.pdf

steve of IL 6:08PM July 14, 2010

Let's see, they do grow rice here and there's lot's of cats, dogs and pigeons so the menu thing is happenin'. And, San Francisco wants to outlaw pets so it takes care of that problem too.
Mexico is close so they could import people who are willing to work. The progressive, intellectual elite don't like to work and they don't like having babies - so maybe that will take care of itself too.
I don't think the Chinese do the "Green Thing" so there could be some protests on that front - but the "Tiananmen Square Response Team" is prepared to deal with "non-team players". Nobel Price Laureate, "Big Al the Sex Poodle" can keep out of the way on his mega estate, "Carbon Mammoth" in Montecito. For a few bucks maybe Big Al could give his stamp of approval to the toxic waste dumps the Chinese would build all over the state - unless Jerry Brown, Barbra Boxer, Diane Fienstein or Nancy Pelosi sucks up before he does.
I think the Chinese are pretty much neutral on the Gay Pride Tide - So San Franny can still keep it's holidays and sex soaked parades. And, Gavin Newsom would pretty much bow or get down on his knees for anyone - so no drama there.
Don't the Chinese sterilize "non-producers"? That covers about 92% of the state right there - so that issue is self limiting.
I'm sure the Hollywood crowd would welcome the Chi-Coms. Danny Glover and Sean Penn could be part of the "interface team". The Rad-Fems could teach the Chinese political bosses how they wish to be treated - that would be fun to watch, but they do have mandatory abortion as common ground.
All things considered - could be a win-win.

R.L. Schaefer of CA 6:01PM July 14, 2010

If 20% (or more) of the budget gap must come from revenue enhancement, it should come from a VAT.
But, the ideal implementation of the VAT (now) is revenue neutral as a replacement for the corporate income tax. Taxes should not be raised until the economy is off life-support.
VAT would be stimulative in itself. Replacing the corporate income tax with a VAT would eliminate an incentive for corporations to shift profits through transfer pricing to lesser-taxed foreign subsidiaries. Gone would be the double-taxation of dividends. And, because the VAT is border-adjustable, the U.S. would become more competitive in international trade.
Importantly, the expectation of a VAT increase at time-certain in the future, say two years (after the economy begins to rebound) will serve to stimulate consumer purchases in the short-term, i.e., an off-budget stimulus.
For newsworthy information on VAT, and for experts in VAT, go to the VAT-US.com website.
Steve
Steve Abramson
VAT-US.com

Steve Abramson of NY 5:43PM July 14, 2010

I'm not surprised. I'd suggest selling California to China to payoff the debt, However, considering the way progressive liberals have run the state of California into the ground, China would say, "You pay us to take California and all it's troubles of your hands."

david of ID 3:42PM July 14, 2010