Now Trump Is Actually Chasing Billionaires Away From The Republican Party

A few days ago, we saw how Ohio's top Republican donor, Leslie Wexner, has grown so fed up with the GOP-- primarily Trump but also the congressional enablers-- that all it took was hearing an Obama speech for him to quit the GOP!

Yesterday Heather Long, in a report for the Washington Post, ‘I support higher taxes’: The billionaire behind the National Debt Clock has had it with Trump Post, wrote that NYC real estate billionaire Douglas Durst is also bidding the GOP a not so fine adieu. He takes the national debt seriously and-- even though I know his brother Bobby, who's in enough trouble of his own-- I can't reach out to him to go to a Stephanie Kelton lecture on MMT. Doug is the name behind the actual National Debt clock. "U.S. government debt per household is now $127,000 (and rising)," wrote Long. "When U.S. government debt topped a trillion dollars for the first time in the early 1980s, New York real estate magnate Seymour Durst sent every member of Congress a holiday card that said: 'Happy New Year! Your share of the federal debt is $5,000.' When lawmakers refused to act, Durst went further, putting up the National Debt Clock in 1989 on a building he owned just off New York City’s bustling Times Square. Three decades later, the clock is still running, yet U.S. debt has skyrocketed and most in Congress ignore it. Republicans, including President Donald Trump, campaigned on balancing the budget, yet they have added more than $1.5 trillion to the debt in the past year."

Pelosi and Hoyer are probably on the phone with the Dursts right now-- asking them how much PAY-GO would be worth to them.

The result is that by the end of 2018, the nation will hit milestone: The federal government’s total debt owed to outsiders (known as “debt held by the public”) will exceed all debt that U.S. households have for mortgages, credit cards, cars, student loans and other personal loans for the first time in modern history, according to JPMorgan.

Seymour’s normally private son, Douglas Durst, manages the National Debt Clock and the family’s real estate empire now. He felt compelled to speak out after what he calls the “worst months” he’s ever seen for fiscal policy.

Douglas has a message for Congress: Tax the rich more.

“I support higher taxes on people like me,” said Douglas in an interview from his office in midtown Manhattan with sweeping views of the city. “I think America has more of a revenue problem than a spending problem.”

When his father put up the National Debt Clock, total gross U.S. debt was just shy of $3 trillion-- or about $12,000 a person. Today it is over $21 trillion, or about $65,000 a person.

Economists typically focus on debt held by the public, which is currently about $16 trillion, because that is the amount the government truly owes creditors (the rest of the debt is money one government agency owes another). Debt held by the public will top $127,000 per household by the end of the year, according to JPMorgan. Personal debt per household will average about $126,000.

“This is an astonishing statistic,” said David Kelly, chief global strategist at JPMorgan Funds. “Americans have a lot of debt. I always feel nervous signing a mortgage or a car loan. I think, can I afford all this debt? Then you realize the government is busy borrowing even more money on your behalf.”

The United States hasn’t had this high of a debt level as a percent of GDP since the World War II era, according to the nonpartisan Congressional Budget Office. It’s expected to grow quickly as Social Security, Medicare and interest payments balloon.

In good economic times, the government is usually able to shrink the deficit, but the latest data out last week shows the federal government is on track to spend about $900 billion more this year than the revenue it is bringing in. The last time the unemployment rate was this low, the government ran a surplus.

Durst's campaign contribution pattern seems to indicate he's a Republican since he gives thousands of dollars to Republican Party organizations, but when it comes to individual candidates, he gives to Republicans and to Democrats, though generally establishment Dems who favor the status quo.

“We’re mortgaging our children’s future. It’s one thing to borrow money for infrastructure investment, but this …” Douglas said. He makes an exasperated face and his eyebrows shoot up over his circular glasses. “The tax cut was an overall step in the wrong direction. Nobody who has any background in economics thought the tax bill was a good idea." Douglas says he will pay less in taxes now, although he declined to say how much he will save. Forbes estimates the Durst Organization is worth more than $5 billion.

“Fix the debt” has long been a Republican rallying cry and many GOP leaders have seized on the debt clock as a useful prop. Mitt Romney and Paul D. Ryan brought a mock debt clock to campaign stops on the 2012 presidential election trail, and Rep. Jeb Hensarling (R-TX) has projected a debt clock on the House Financial Services Committee room since he became committee chair several years ago.

The National Debt Clock helped propel Congress to enact balanced budgets from 1998 to 2001, but the fiscal soundness was short-lived. The federal government has spent more money than it brings in every year since then. Debt shot up under George W Bush because of the wars in Afghanistan and Iraq, then it surged under Barack Obama during the Great Recession. Trump campaigned on shrinking-- or even eliminating-- the debt, but so far he has added substantially to it as well from the tax cuts and more military spending.

When debt gets this high, the government spends hundreds of billions of dollars each year on interest to creditors. That is money that must be paid and can mean that there are fewer funds available for education, infrastructure, the military and other priorities. Douglas is particularly concerned about the environment.

In recent years, the U.S. government has been borrowing additional money to continue funding programs. Some economists like Dean Baker of the left-leaning Center for Economic and Policy Research, argue U.S. debt is highly desirable and the U.S. Treasury can continue borrowing without any issues.

“We have had no problem selling our debt, as shown by the low market interest rate on long-term bonds,” Baker said. “But suppose that for some reason in the next downturn no one wanted to buy our debt. In this highly unlikely scenario, the Federal Reserve could simply buy the debt.”

But most on the left and right warn there is probably a limit to how much borrowing can occur. At some point, the government will have to make hard choices about programs to scale back or cut or ways to raise revenue, especially as Social Security, Medicare and interest payments jump in the coming years. Republicans tend to favor cutting programs while Democrats tend to favor raising taxes on the rich. Many fiscal policy experts say Congress will probably have to do both.

Prominent Americans as varied as GOP senate candidate Romney, conservative Washington Post commentator George Will, Clinton’s Treasury Secretary Robert Rubin and Obama’s former defense secretary Leon Panetta have all warned recently the debt is leaving the country vulnerable to “economic collapse” (Will’s words), but their respective parties show little sign of restoring fiscal discipline.

Last week Republicans introduced a “tax bill 2.0” that would add another $2 trillion to the debt, and Democrats have numerous education and health care programs they would like to pass if they regain power that would probably increase costs.

The late Seymour Durst walked to work for most of his life and was famous for never wearing a winter coat because he thought it a waste of money. He couldn’t understand why top U.S. government officials didn’t have the same frugal mentality. He was part of a generation of Americans that came of age during the Great Depression and never lost a sense of valuing each penny and dime, but that generation is passing away.

Even the National Debt Clock no longer gets quite the attention it once did. The clock has been moved to an alley off West 43rd Street where few pedestrians stop to look at it. On a recent summer evening, several Chinese tourists were the only ones taking photos of it (China is the largest foreign holder of U.S. debt).

It's lovely that Seymour scrimped on taxis and clothing but personal budgets have nothing to do with governmental debt. When Stephanie Kelton-- Bernie Sanders' top economic advisor-- was asked recently about deficits she explained that she doesn't just worry "about the magnitude but about the purpose. We could add $1.5 trillion to the deficit over 10 years, as we just did with tax cuts that go disproportionately to people in the top-income distribution, and we could have done, for instance, student debt cancellation at virtually the same price tag. We could have done massive infrastructure investment, or R&D investment."

You can have the same budgetary outcome, but very different economic outcomes, in terms of the potential to boost long-term growth and productivity, impacts on the distribution of income, and so forth. Every economy has its own internal speed limit. You can only absorb so much additional spending at any point in time, given the slack that the economy has at that moment. So can the deficit be too big? Of course! But can it be too small? Yes. And that’s something you rarely hear people say. Or complain about it."

Government debt is just the money the government spent into the economy and didn’t tax back. That’s all the national debt is. It’s a historical record of all of the times that they made a net deposit, spent more than they taxed out, and the bonds are the difference between those. One of the greatest cons ever perpetrated on the American people is this notion that the national debt belongs to us, that we are responsible in our individual capacity for a share of it."

When asked if the debt crises in Greece, Portugal, Spain, Italy, Argentina worry her, she told the interviewer that "it’s not a lesson for America. You know, back in 2010, at the height of the European debt crisis, I can remember standing in my kitchen with the TV on, and turning on the news, cooking dinner, and seeing the opening to the nightly news. And it goes, dah, dah, dah, the debt crisis in America. And I go, what debt crisis in America? But that is really what the narrative started to become: This is a warning for America. We need to get our fiscal house in order.

What’s different? Look, Italy in 1995 had a debt-to-GDP ratio of around 120%. Spain in 1995 had a debt ratio of 62%. Greek debt-to-GDP over 100% before joining the euro. These countries were borrowing and spending in a currency that they created. Who remembers the debt crisis in Europe in ’95? There was no debt crisis in ’95, because Italy could always meet every obligation that came due, on time, in full, because it was paying in lira. Where and how else is the lira going to come from but the Italian government?