Comments on: Government’s Creative Accounting http://www.thelibertypapers.org/2007/05/29/governments-creative-accounting/ Life. Liberty. Property. Defending individual freedom and liberty, one post at a time. Wed, 08 Feb 2012 17:04:34 +0000 hourly 1 http://wordpress.org/?v=3.2.1 By: Julian http://www.thelibertypapers.org/2007/05/29/governments-creative-accounting/#comment-29044 Julian Wed, 30 May 2007 21:57:08 +0000 http://www.thelibertypapers.org/2007/05/29/governments-creative-accounting/#comment-29044 It's not fair that I don't even have a say in today's policies (I'm 16), but I'll have to pay for them when I'm older Nothing short of taxation without representation in my point of view The deficit has become so large that it is frankly unconstitutional It’s not fair that I don’t even have a say in today’s policies (I’m 16), but I’ll have to pay for them when I’m older

Nothing short of taxation without representation in my point of view

The deficit has become so large that it is frankly unconstitutional

]]> By: Brad Warbiany http://www.thelibertypapers.org/2007/05/29/governments-creative-accounting/#comment-29030 Brad Warbiany Wed, 30 May 2007 16:13:49 +0000 http://www.thelibertypapers.org/2007/05/29/governments-creative-accounting/#comment-29030 Don, I see what you're saying, and you've got a point... While they haven't taken the time to figure out how to pay for their promises in the future, calling it a "loss" today isn't necessarily the right thing to do. I do believe we can both agree that politicians are lying bastards who are mortgaging our future with their insane spending, though, right? ;-) Don,

I see what you’re saying, and you’ve got a point… While they haven’t taken the time to figure out how to pay for their promises in the future, calling it a “loss” today isn’t necessarily the right thing to do.

I do believe we can both agree that politicians are lying bastards who are mortgaging our future with their insane spending, though, right? ;-)

]]> By: T F Stern http://www.thelibertypapers.org/2007/05/29/governments-creative-accounting/#comment-29017 T F Stern Wed, 30 May 2007 13:32:27 +0000 http://www.thelibertypapers.org/2007/05/29/governments-creative-accounting/#comment-29017 Don, "there is no meaning for a market value of a government. While the future cash flows and earnings of corporations can impact their current market value, no such consideration exists for government." That isn't quite true because the ability to survive in the world market place is determined by those other countries and their belief that our economy will justify their acceptance of our form of payment. If they have no faith in our dollar then our dollar is worthless. Don,

“there is no meaning for a market value of a government. While the future cash flows and earnings of corporations can impact their current market value, no such consideration exists for government.”

That isn’t quite true because the ability to survive in the world market place is determined by those other countries and their belief that our economy will justify their acceptance of our form of payment. If they have no faith in our dollar then our dollar is worthless.

]]> By: Don Lloyd http://www.thelibertypapers.org/2007/05/29/governments-creative-accounting/#comment-29014 Don Lloyd Wed, 30 May 2007 13:14:04 +0000 http://www.thelibertypapers.org/2007/05/29/governments-creative-accounting/#comment-29014 Brad, You've been had by an economically illiterate newspaper story. Whatever future mandates the government may set for taxes and entitlement payouts, it is neither reasonable to treat any shortfalls as current debts nor is it meaningfully possible to prefund them. The federal government differs in fundamental ways from corporations and cannot be subject to the same methods of accounting. First, the ability of the government to costlessly print new money is unique, and there is no justification to tax and slow the present economy by salting away current tax money only to bring it forth in the future, when new future money will serve just as well, and not depress the economy in the meantime. This is not an argument in favor of money-printing, but an argument for the futility of prefunding. Secondly, whatever the government may promise, it is not subject to being sued to force the keeping of its promises. The projected future shortfalls are nothing more than spreadsheet entries, and are routinely ignored by today's politicians who will be well of the line of fire when the bills come due. Thirdly, there is no meaning for a market value of a government. While the future cash flows and earnings of corporations can impact their current market value, no such consideration exists for government. The fact that payroll taxes may be projected to fall 28% short of currently mandated SS ouflows in 2042 is significant only in and of itself. Trying to convert it into debt and add it onto current debt levels is absurd. Regards, Don Brad,

You’ve been had by an economically illiterate newspaper story.

Whatever future mandates the government may set for taxes and entitlement payouts, it is neither reasonable to treat any shortfalls as current debts nor is it meaningfully possible to prefund them.

The federal government differs in fundamental ways from corporations and cannot be subject to the same methods of accounting.

First, the ability of the government to costlessly print new money is unique, and there is no justification to tax and slow the present economy by salting away current tax money only to bring it forth in the future, when new future money will serve just as well, and not depress the economy in the meantime. This is not an argument in favor of money-printing, but an argument for the futility of prefunding.

Secondly, whatever the government may promise, it is not subject to being sued to force the keeping of its promises. The projected future shortfalls are nothing more than spreadsheet entries, and are routinely ignored by today’s politicians who will be well of the line of fire when the bills come due.

Thirdly, there is no meaning for a market value of a government. While the future cash flows and earnings of corporations can impact their current market value, no such consideration exists for government.

The fact that payroll taxes may be projected to fall 28% short of currently mandated SS ouflows in 2042 is significant only in and of itself. Trying to convert it into debt and add it onto current debt levels is absurd.

Regards, Don

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