.. the contraction probably will begin with the annual budget deficit exceeding $1 trillion.
.. The president’s Office of Management and Budget — not that there really is a meaningful budget getting actual management — projects that the deficit for fiscal 2019, which begins in six weeks, will be $1.085 trillion. This is while the economy is, according to the economic historian in the Oval Office, “as good as it’s ever been, ever.”
.. The fastest — 13.4 percent — was 1950’s fourth quarter, perhaps produced largely by bad news: The Cold War was on, the Korean War had begun in June, and fear of the atomic bomb was rising (New York City installed its first air-raid siren in October), as was (consequently) a home-building boom outside cities and “scare buying” of products that might become scarce during World War III.
.. Today, Shiller says, “it seems likely that people in many countries may be accelerating their purchases — of soybeans, steel and many other commodities — fearing future government intervention in the form of a trade war.” And fearing the probable: higher interest rates.
.. among those economies, ours is performing especially well. What, however, if this is significantly an effect of exploding debt? Publicly held U.S. government debt has tripled in a decade.
.. the political class is more united by class interest than it is divided by ideology. From left to right, this class has a permanent incentive to run enormous deficits — to charge, through taxation, current voters significantly less than the cost of the government goods and services they consume, and saddle future voters with the cost of servicing the resulting debt after the current crop of politicians has left the scene.
.. This crop derives its political philosophy from the musical “Annie”: Tomorrow is always a day away. For normal people, however, the day after tomorrow always arrives.
US Debt to Increase from $21 Trillion to 33 Trillion in 10 Years
“The combined effect of President Donald Trump’s tax cuts and last month’s budget-busting spending bill is sending the federal deficit toward the $1 trillion mark next year, according to a new analysis by the Congressional Budget Office.
The CBO report says the nation’s $21 trillion debt would spike to more than $33 trillion in 10 years”
Deal Gives Kushners Cash Infusion on 666 Fifth Avenue
The deal, in which Brookfield paid the rent for the entire 99-year term upfront, helps remove the family’s biggest financial headache: a $1.4 billion mortgage on the office portion of the tower that was due in February next year.
.. The Kushners have spent more than two years on an international search for new partners or fresh financing that stretched from the Middle East to China.
The deal would enable the Kushners to pay off at least a large portion of what they owe lenders and retain ownership of the land beneath the tower. But they may not make any money from it.
.. Charles Kushner, Jared’s father, who now runs the company, in turn, negotiated with his lenders to pay less than the company owed to satisfy the debts, the executive said.
Analysts have long said that 666 Fifth was worth less than its debts. The building was 30 percent vacant and only generated about half the annual mortgage payments. In recent months, the building’s largest remaining tenant, Millennium Management, signaled that it too planned to leave.
.. Jared and Charles Kushner sold 666 Fifth’s most valuable asset — the Fifth Avenue retail space — for $525 million and used the proceeds to pay down some of their debt. But office rents continued to fall and two of the tower’s biggest tenants left.
.. In 2016, Charles and Jared Kushner pitched a new deal to investors in the United States and abroad: They would demolish the building and erect a $7.5 billion luxury supertower in its place. They got close to a deal with a billionaire from Qatar, Hamad Jassim Al-Thani, the country’s former prime minister, and with Anbang, a giant Chinese insurance company.
.. Mr. Kushner argued that 666 Fifth was not worth the $1.4 billion that was owed.
.. At 666 Fifth Avenue, Brookfield is betting on a turnaround based on the building’s premier location on Fifth Avenue, near Rockefeller Center and Central Park, and its access to public transportation. The company plans to spend about $700 million renovating the lobby, installing new elevators, refurbishing the vacant office space and attracting new tenants.
“666 Fifth Avenue has the potential to be one of New York City’s most iconic and successful office properties,” Ric Clark, chairman of Brookfield Property Group, said
.. Brookfield is one of the world’s biggest real estate companies, and among its investors is the Qatar Investment Authority, one of the world’s largest sovereign funds
.. That has raised questions given Jared Kushner’s portfolio in the White House, which includes the Middle East.
Brookfield has said that the Qataris had no knowledge of the deal before its public announcement.
How Republican Hypocrisy Lifts Social Democrats
By its astoundingly cynical approach to deficits and debt, the G.O.P. has opened the door to an expansive left.
That Ms. Ocasio-Cortez’s brand of expansive, expensive socialism has found this moment so conducive to its popularity is no accident. Its rise has been uniquely fueled by President Trump, who as both a businessman and a politician has embodied a cartoon version of rapacious capitalism.
.. But it has also been emboldened by more conventional aspects of the Republican agenda, in particular the party’s astoundingly hypocritical approach to debt and deficits.
.. Under Mr. Obama, Paul Ryan, the outgoing speaker of the House, repeatedly blasted the president for declining to manage the federal budget. In 2012, he told the Republican National Convention that “in this generation, a defining responsibility of government is to steer our nation clear of a debt crisis while there is still time.”
.. A year earlier, Senator Mitch McConnell called the federal debt “the nation’s most serious long-term problem.” Over and over, Republicans cast Mr. Obama’s rising deficits as a profound social menace, a form of budgetary terrorism that threatened the country’s future.
.. The Republicans’ pretense to deficit hawkery put pressure on Democrats to adopt a similar stance. Whether or not most Democrats actually cared about the deficit, their leaders tended to act as if they did. So the health care law was structured, with the help of some gimmickry, to score as an overall reduction to the federal deficit, and Mr. Obama, in speeches, singled out entitlement spending as the biggest driver of the long-term debt and convened a bipartisan committee to recommend deficit-reduction strategies.
.. Nor do Republicans appear ready to reverse course. President Trump recently proposed a $12 billion bailout for farmers hurt by the trade war he started, and senior White House advisers have called for a second round of tax cuts that would make permanent the individual rate cuts in the first tax law, at a cost of roughly $600 billion.
Reports suggest the administration is mulling a unilateral change to the taxation of capital gains that would add another $100 billion to the deficit. Another giant spending bill is on the horizon.
.. The party’s hypocrisy on the budget is not new. After Bill Clinton dramatically shrank both deficits and government spending as a share of the economy, George W. Bush took office and proceeded to dramatically increase both.
.. Through their actions, they have proven that they cared about the deficit primarily for its usefulness as a political cudgel, an easy way to curtail Democratic policy goals.
.. .. Think tanks from across the political spectrum estimate a Bernie Sanders-style single-payer system would cost around $32 trillion over a decade, and while that might be less, overall, than the current partially private system, the challenge would be to finance the enormous increase in government spending on health care.
.. both her errors and answers seemed to suggest that finding plausible ways to finance the full cost of her policies is not exactly at the top of her agenda.
.. there is already a movement within liberal policy circles arguing that debt and deficits are far less important than most lawmakers have assumed.
.. although Republicans will surely attack the new class of Democratic Socialists and their policies as debt-increasing budget busters — that is, after all, what Republicans do — their own actions will ensure that those criticisms have no real authority. Their opposition to the socialist agenda will be hollow, because they helped make that agenda possible.