US debt spiral

By the year 2020, the United States is expected to have a total national debt load of approximately $20 trillion dollars. The cost to service the public portion of that debt is expected to be nearly $800 billion per year, and that's assuming that we don't encounter significantly higher interest rates.

  

• The combination of high debt, mounting spending pressures from population aging, and moderate growth pose the risk of fiscal/financial crisis – a low probability event but one with potentially enormous costs for the U.S. and global economies. 
• To reduce that risk, the US Administration and Congress should restore the health of the country's public finances through gradual but sustained further reductions in the deficit.
• Economic growth is vital for a nation's ability to sustain its public debt. Many debt crises in emerging economies have been caused by declines in growth. In advanced economies, the largest increases in debt ratios occurred when policymakers mistook a prolonged decline in growth for a temporary recession, and failed to cut spending or increase taxes. 
• Economic growth is key because when growth declines, revenues decline commensurately, and governments are reluctant to cut spending in response, so that more debt accumulates.
• Living with high debt is living dangerously. As larger deficits are financed, the debt also swells.
• An interest-debt spiral is inconceivable for the United States, long considered a safe haven and benefiting from the "exorbitant privilege" stemming from the dollar's role as a reserve currency. A country's status as a safe haven is ultimately based on investors' perceptions, which can change abruptly. With privilege comes responsibility, and preserving the credibility of the U.S. public finances is vital not only for its citizens but also for the stability of the international financial system.
• If it were possible to sustain high inflation and low interest rates, investors would take their funds abroad. That rules out the "financial repression" strategy. Alternative approaches such as outright default would be even more disruptive. To avoid spooking investors, candidates should not suggest inflation or default as potential means of slashing the debt. That leaves old-fashioned fiscal adjustment through spending cuts – which are increasingly difficult as population aging adds pressures on entitlement programs – and revenue increases. The pace of adjustment should be gradual, in order not to disrupt the global recovery. The U.S. debt ratio may thus be expected, at best, to decline slowly. 
• Imposing statutory caps on domestic and military spending will definitely temper the deficit but will get swamped by healthcare and social security spending that will rise with aging population. Also Trump wants to spend $1 trillion on infrastructure in 10 years, surge in military spending and large tax cuts for individuals and corporations which will only increase overall debt.
• Deficits are helpful when economies are in recession. But when they are in near full employment , as US economy is now, deficits should be kept below 3% to avoid drag on investment or worse a financial crisis.
• The share of public debt is expected to reach 89% of GDP by 2027, increasing the risk of financial crisis and raise possibility that investors will become skittish about financing government's borrowing, although many countries have far higher debt levels.
• Besides deficit, tepid economic growth is also a concern. Over next 10 years real economic growth may not exceed 1.9% per annum. The steadily growing economy appears to be giving policy makers more time.
• Prepare to live dangerously for several more years.

Any person or corporation or state or nation, which can't repay smaller debt today will certainly can't repay bigger debt in future. So it is in the interest of lenders to stop restructuring of loans, that has very poor track record (1 in 100 success rate or even less), and stop dealing with such over spending entities after few warnings. Eventually, such debts will get written off in some form or other. But lenders are also helpless about parking their earnings or trade surpluses safely. Balance is the key! Every one must learn to balance income & expenditure, imports & exports so on on real time basis. Not doing so is recklessness or irresponsibility or both. Stay away from such people.

Telangana bungles budget & accounts 2016-17

The CAG has been very critical of the TS government's financial management and financial indiscipline. Against the TS government’s claim of surplus budget in the financial year 2016-17, the CAG report commented that the revenue surplus was overstated by Rs 6,778 crore on account of irregular accounting. Thus the state had a revenue deficit of Rs 5,392 crore in 2016-17. 

  

  

• The fiscal deficit of Rs 35,281 crore stood at 5.46% of GSDP was understated by Rs 2,500 crore due to crediting of borrowed funds as revenue receipts.
• The ratio of fiscal deficit to GSDP, excluding the amount transferred under UDAY scheme (Rs 7,500 crore), was 4.3% exceeding the ceiling of 3.5% stipulated for 2016-17 by the 14th FC  under FRBM legislation. 
• Under UDAY scheme, against Rs 8,931.51 crore borrowed through UDAY bonds during the year, the state government released Rs 7,500 crore only to Discoms at the end of the yearand has been booked under capital expenditure as equity. 
• The government utilised 34.74% of borrowed funds in 2016-17 for repaying its existing debt which increased by 18%. The CAG warned the state government that it will have to borrow further to repay its loans. 
• CAG said that the interest payments was 10.4% of revenue receipts against the normative rate of 8.22% prescribed by the 14th FC.
• The total debt in 2016-17 was Rs 1.21 lakh crore, which is 31% more than Rs 91,985 crore in the previous year. The state used 7.12% of its tax revenue to repay the debt in 2015-16, it had to allocate 32.16% of tax revenue for the same during 2016-17.
• The aim of Mission Kakatiya is to restore all 46,531 tanks in the state in five years. The restoration of 21,670 tanks by August 2017 was proposed; however, only 28% of them, 7901 tanks, were restored. The removal of silt is an important component of the restoration works. The state government said that farmers were not interested in taking the silt because it was not useful for agriculture. The CAG said that this was not acceptable as guidelines prescribed priority to be given to tanks where farmers agreed to transport silt. The restoration works are supposed to irrigate 10 lakh acres of gap ayacut. The CAG observed that there was no mention of the gap ayacut in the estimates for the individual works.

KCR of TRS has successfully converted Telangana, a revenue surplus state in 2014 (Rich state) into a revenue deficit state (Poor state) with his mindless borrowing and senseless spending and bring the state to the brink of debt trap (borrowing to pay old debts). In the process KCR and TS had violated all accounting norms, bypassed rules, bungled the books, FC rules ignored, FRBM limits violated. In these matters, KCR is neither the first nor the last. Most states and Centre violates norms and rules, at will, and doesn't really care for CAG reports. Corruption is the key element.

With most of its spending on non revenue generating projects, Telangana will sink into deep debt trap very soon. With most of its revenues going for debt servicing - education, health care and welfare will take severe hit. The debt will be shifted for as long as possible… but eventually, someone will have to come to terms with it. The black hole totals up to huge sums of money; no one can pay; and the system gets bankrupted, or services rendered become inadequate and farcical. The future is austere if this equation isn’t balanced out.

Notwithstanding tall development and financial management claims of the Gujarat state, the CAG's five audit reports on the last leg of Narendra Modi's rule as the Gujarat Chief Minister after a 12-year stint has fished out in all disputed transactions worth Rs 25,000 crore that points to fiscal profligacy and rising debt burden.

Read the CAG report dated July 2014

Trump

Donald Trump

• Sanctimony is not foremost among his sins.
• He provokes no moral disappointment, because he creates no moral expectations.
• His business career was characterized by mob-connected cronies, racial bias, aggrieved contractors, dubious partners, byzantine lawsuits, and tabloid sensation.
• His Presidency dispenses with ethical pretense. Human rights in foreign affairs, compassion for the disadvantaged in domestic affairs, and truth in public statements are objects only of disdain.
• Trump's most prominent character trait is shamelessness, suffers little damage among his core supporters for his daily trespasses. 
• 
  

Pablo Escobar - Wealthiest criminal

No one disputes that Pablo Escobar was a murderer, a torturer, and a kidnapper. But he was loved by many in Medellín, Colombia. and he is an object of fascination abroad. At his zenith, he was the most notorious outlaw on the planet, with control of some 80% of the cocaine entering the U.S. and of a fortune estimated at $30 billion. In many respects, he remains Colombia’s most famous citizen, a charismatic entrepreneur of boundless ambition who delighted in his Robin Hood image, even as he killed thousands of people to subvert the government. 

Pablo Emilio Escobar Gaviria (1949-1993)

• Pablo Escobar was a Colombian drug lord and narcoterrorist. His cartel supplied an estimated 80% of the cocaine smuggled into the United States at the height of his career, turning over US $21.9 billion a year in personal income. 
• He was called "The King of Cocaine" and was the wealthiest criminal in history, with an estimated known net worth of US $30 billion by the early 1990s (equivalent to about $56 billion as of 2017), making him one of the richest men in the world in his prime.
• It was estimated that 70 to 80 tons of cocaine were being shipped from Colombia to the U.S. monthly. His drug network competed with rival cartels domestically and abroad, resulting in murders of police officers, judges, locals, and prominent politicians.
• On December 2, 1993, police traced a phone call between Escobar and his son. Colombian special forces swooped in. Escobar was killed at the house, felled by three bullets as he stood on its roof. 
• His two brothers believe that he shot himself through the ear. The duo stated that Pablo "had committed suicide, he did not get killed. During all the years he would say that if he was really cornered without a way out, he would 'shoot himself through the ear'.
• Escobar made it to Congress in 1982, and began working to build a political constituency in and around Medellín. His electoral ambitions did not go very far. He was denounced as a gangster by Colombia’s justice minister. Escobar fought back, falsely accusing the minister of being in the pocket of narcos. But a newspaper editor dug up an old news story showing that Escobar had been arrested, seven years before, for the possession of thirty-nine pounds of cocaine. Escobar was ejected from Congress, and the FBI began investigating him. He went underground, and a long hunt began. Escobar spent seven years as a fugitive.
• He had killed innocent people, and cut victims into pieces, but had done so because his enemies had done that to his people, too. In those days he had been fighting what he thought was a war against a corrupt state and its extradition treaty with the United States.
• Escobar was held directly responsible by various media publications for the 1985 storming of the Colombian Supreme Court by left-wing guerrillas, known as M-19. The siege, which was in retaliation for the Supreme Court studying the constitutionality of Colombia's extradition treaty with the U.S., resulted in the murders of half the judges on the court M-19 and burn all papers and files on of cocaine smugglers who were under threat of being extradited to the U.S. by the Colombian government. Escobar was listed as a part of Los Extraditables. 
• Escobar was a hero to many in Medellín (especially the poor people). He was a natural at public relations, and he worked to create goodwill among the poor of Colombia. Escobar was also responsible for the construction of houses and football fields in western Colombia, which gained him popularity among the poor. He worked hard to cultivate his Robin Hood image, and frequently distributed money through housing projects and other civic activities, which gained him notable popularity among the locals of the towns that he frequented. Some people from Medellín often helped Escobar avoid police capture by serving as lookouts, hiding information from authorities, or doing whatever else they could to protect him. 
• At the height of his power, drug traffickers from Medellín and other areas were handing over between 20% and 35% of their Colombian cocaine-related profits to Escobar, as he was the one who shipped cocaine successfully to the United States.
• 13 Unbelievable Facts About Pablo Escobar.
• Pablo Escobar - Biography - Drug Dealer (1949–1993)
• At the height of Escobar’s power, he built himself a paradise: La Hacienda Nápoles, a 7,000 acre estate three hours from Medellín. Escobar spent years converting the property from an isolated wilderness to a refuge, with paved roads, artificial lakes, and a private zoo stocked with zebras, hippopotamuses, and giraffes, as well as a series of life-size dinosaur sculptures. Guests had the use of swimming pools, a party house, stables, a bullring, a vintage-car collection, and a fleet of speedboats. After Escobar’s death, the compound was abandoned, its structures ransacked by memento seekers and by treasure hunters. After being repossessed by the state, Hacienda Nápoles was reopened in 2007, as a theme park with a zoo, a water park, and several family-friendly hotels.
• A journalist Alonso Salazar suggested that he had merely been a conduit for the country’s bigotry and violent impulses. He said that Pablo Escobar’s legacy had profoundly altered political and social life. Narcotrafficking came along and just overwhelmed everything. Escobar débuted the instruments of terror, and afterward everyone used them.
• Psychopaths are loving with their kids and murderers. A woman insisted that she had not wanted to make Escobar a hero since he had kidnapped her mother and killed her uncle. But a  person that was able to do what Escobar did, has also a normal face. And people have to learn that that’s the way people are, they have two sides.
• Narconovelas set up an alternative moral political structure in which the state, government, politicians, law enforcement, bureaucrats, and soldiers are seldom portrayed as the good guys. The heroes are always either lone rangers or misunderstood drug dealers.
• Álvaro Uribe, former President of Colombia. bemoaned the appeal of antiheroes: “People love bandits, no matter what we do.” In a profoundly unequal country, Escobar represented a form of economic mobility. “When there are no regular paths to get out of where you are, the bandit is the one who makes it -- the one who can jump ahead.”  
• Escobar also appealed to a perverse sense of patriotism. The oath of Los Extraditables “Better a tomb in Colombia than a cell in the United States” resonated with Latin Americans sensitive about Yankee intervention.
• In 2009, Escobar’s son, Juan Pablo, appeared in a documentary called “Sins of My Father,” in which he contacted victims of his father and apologized on behalf of his family. 
• Juan Escobar, his mother, and his sister Manuella, at first fled to Mozambique. Juan Pablo chose the name "Sebastián Marroquín" from the telephone book and adopted it as his new name since he needed a new identity as he believed his original name was cursed. Manuella now lives in Central North Carolina under an alias. 
• “I know about everything my father did, and I will go to each and every one of the families of his victims to ask forgiveness. But I’m not legally culpable. My personal slogan is ‘I inherited a mountain of shit. So what am I supposed to do with it?’ ”
• A professor wrote, “We live the culture of drug trafficking, inaesthetic, values, and references. We are a nation that took on the narco idea that anything goes if it will get you out of poverty: some tits, a weapon, corruption, trafficking coca, being a guerrilla or a paramilitary fighter, or being in government.” He was careful to note that the narco aesthetic was not merely bad taste. It was a way of life among the dispossessed communities that look to modernity and have found in money the only way to exist in the world.
• Escobar left behind a model of success: build support among the disenfranchised by providing them with money and power they would not otherwise have; in return, they will be your loyalists, your spies, and your gunmen. For the middle class, use your wealth to corrupt policemen, generals, judges, and politicians.

He showed us the path we must never take as a society because it's the path to self-destruction, the loss of values and a place where life ceases to have importance ...  Pablo Escobar's son Sebastián Marroquín

A novelist described Escobar as a monstrous Pied Piper: “At the height of his splendor, people put up altars with his picture and lit candles to him in the slums of Medellín. It was believed he could perform miracles. No Colombian in history ever possessed or exercised a talent like his for shaping public opinion. And none had a greater power to corrupt. The most unsettling and dangerous aspect of his personality was his total inability to distinguish between good and evil.”

After Escobar, the idea of rebellion based on ideology was largely supplanted by the remorseless pursuit of profit and power. In places along his supply chain, including Mexico and in Central America, the remnants of his operation have grown into insurgent gangs, and states have succumbed to corruption and internal conflict. Today’s youth still see narcotrafficking as a way to make quick money. Society doesn’t change, really. And those with the greatest responsibility for this are those in the media, with their television series and their books.

I want India to be a happy country ... JRD Tata

JRD Tata (1904 - 1993)

JRD wished India to be a happy country before it becomes a great country and had conveyed his view to his friend and the country's first Prime Minister Jawaharlal Nehru.

JRD always believed that before one could excel in his chosen sphere, that person should be a good man. And a good man must have great credibility. He was always very sympathetic towards the needy, and there are umpteen anecdotes on how he helped families, particularly children. - JJ Irani

JRD's always aimed for excellence or even perfection. That drive was clearly reflected in his leadership of Air India. When JRD was its chairman, the carrier was recognized as one of the top three airlines in the world.

On the fire accident of March 3, 1989 that broke out during the Founder's Day programme inside Tata Steel plant, JRD was with Ratan Tata in Geneva but when he was informed about the unfortunate incident, he rushed back on March 5 (1989) and personally visited the victims undergoing medical treatment in TMH. JRD viewed the fire mishap as a personal loss and insisted on quality medical care to the victims regardless of the cost of the treatment.

On one occasion a senior executive of a Tata company tried to save on taxes. Before putting up that case, the chairman of the company took him to JRD. Mr. Vyas explained to JRD: "But sir, it is not illegal." JRD asked, softly: "Not illegal, yes. But is it right?" Mr. Vyas says that during his decades of professional work no one had ever asked him that question. Mr. Vyas later wrote in an article: "JRD would have been the most ardent supporter of the view expressed by Lord Denning: ``The avoidance of tax may be lawful, but it is not yet a virtue.'"

When JRD rang us in the office he would first ask: "Can you speak?" or "Do you have someone with you?" Except when he was agitated, he would never ask you: "Can you come up?" He was always polite.

Towards the end of his life he often said: "We don't smile enough." 

JRD said about his dealings with his colleagues: "With each man I have my own way. I am one who will make full allowance for a man's character and idiosyncrasies. You have to adapt yourself to their ways and deal accordingly and draw out the best in each man. At times it involves suppressing yourself. It is painful but necessary... To be a leader you have got to lead human beings with affection.''

In a speech in Madras in 1969 he called on the managements of industries located in rural or semi-urban areas to think of their less fortunate neighbours in the surrounding regions. "Let industry established in the countryside `adopt' the villages in its neighbourhood; let some of the time of its managers, its engineers, doctors and skilled specialists be spared to help and advise the people of the villages and to supervise new developments undertaken by cooperative effort between them and the company."

He never bent the system for his benefit. LK Jha recalled in 1986 that whenever JRD came to him when he was a Government Secretary, he came not on behalf of a company but the whole industry. He wanted no favours, only fairness.

He wrote in his Foreword in 1992: "I believe that the social responsibilities of our industrial enterprises should now extend, even beyond serving people, to the environment.''

When he was awarded the Bharat Ratna in 1992, Tata employees arranged a function on the lawns of the National Centre for Performing Arts in Mumbai. A gentle breeze was blowing from the Arabian Sea. When JRD rose to speak, he said: "An American economist has predicted that in the next century India will be an economic superpower. I don't want India to be an economic superpower. I want India to be a happy country.''

Read the source article

If I were to attribute any single reason to such success as I have achieved, 

I would say that success would not have been possible without a 

sustained belief that what I did or attempted to do would serve the needs and interests 

of our country and our people and that I was a trustee of such interests ... JRD Tata

The economy, which is a network of material relations, can always be revived, but the society, which is a network of human relations based on trust, may not be repaired so easily once damaged. The events of the past year can leave us without the slightest doubt that the sections who feel most threatened in India today are our Muslim and Christian compatriots. Historically, there have been other groups that have long felt marginalised.

Modi's speeches - style without substance UNLIMITED

Modi’s penchant for talking big and doing nothing has a chilling similarity with Mussolini’s Fascist Italy is that in the Mussolini regime, politics starts to be less concerned with the act of governing people in an efficient way, for instance, in solving their economic problems. Instead, it is focused more on the spectacle of power, on the visual and impressive display of symbols, myths and rituals and impressive speeches. In terms of everyday life this takes the shape of a domination of form of visual appearance, effects over the content. It also means that politics ceases to be measured by political criteria. Politics itself assumes the form of an artistic act; to govern means to Mussolini to create a new Nation and a new Empire and Mussolini views himself as the creative soul of the nation, the propeller of new ways of living.

What Modi has talked about is not understandable to me despite being highly educated. What ever he has talked for somebody else should do it but not himself. He has done different things and none of the anything he spoke - during his past 4 years as PM and 14 years as Gujarat CM. Modi thinks something, speaks something else and does altogether differently being a hypocrite by default. India has no future with this type of emotionless hypocrites at the top. Writing about him goes on and on for several pages and endless and not worth it. 

Telangana: TDP - Kingmaker 2019

• TDP vote bank still remains at 7% in Telangana, as assessed by TRS and Congress but it could be much more at 10-12%. In Hyderabad city it could be as much as 20%. 
• If TDP fights elections alone, its gains will be far less in multi cornered contests.
• 2019 General elections will be bitterly fought between TRS and Congress. While BJP will be happy to align with TRS. That leaves TDP option-less to support 35 year rival Congress.
• TRS gestures towards TDP are always hot and cold. It is never trustworthy for anyone.

For 2019 elections TDP might have to get aligned with TRS or Congress only for the purpose of seat sharing to gain maximum seats. For that, it must focus on party organisational structure and rejuvenate it, right now. AP's diaspora in Telangana is very large at 20% of population and their well being is always be a concern of TDP.