As I'm on SSD, I do worry about austerity and cuts to my benefits. I could take a cut and I planned for it. but what about other folks having to deal with cuts and didn't plan, and believed the lies that everything is fine. They believed the Govt and they saw all the taxes taken out of their paychecks for 40 years. But what if the Feds cut all entitlements in half?, stop paying pensions? how about the Agriculture subsidies or food stamps.This is happening Europe right now and Turbo Timmy has already raided the Federal workers pensions.
One of the worse things about this is that all of this starts a feedback loop.
- I'm afraid I won't get my SSD, it could be your pension, paycheck or unemployment. So you cut way back on your spending. You have stopped taking on more debt, or things are so bad you are using you credit cards to get just the basics.Which put's you more in debt and starts to kill you an inch at a time because of higher interest. Perhaps you have a 401k and you take out some money or a loan for this emergency. Less money in the market, lower prices and lower profits mean less taxes taken in.
- Now local businesses don't have any customers, and the are on the edge of making it because of higher costs. A guy just set up a little kiosk in the local mall, lots of local artists metal work at a very good price. I wanted to spend about $50.00-$100.00 to finish up buying Birthday and Xmas gifts for the year. Now I can't because the idiots in DC say they "might not" pay SSD.
- I'm okay, as it's not really costing me money not to buy. But it's crushing this guy and his business, the state gets no sales tax and the US Gov. can't tax non-existent income from his business.
- Now I'm only one person but let's say 10-20 million folks are thinking like me and are just getting the basics. That's a hell of a lot of money just sitting doing nothing. So that means less revenue, lower GDP, fewer jobs etc.