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108 votes

Why does the EU care so much about the UK divorce payment?

The sum is quite small compared to the EU GDP, but that is not what you should be comparing it to. It would make more sense to compare it to the EU budget (as there the additional money would ...
Communisty's user avatar
  • 1,643
98 votes
Accepted

Are there any details as to where the $5,710,357,000 to fund part of Trump's wall would come from?

You can think of the treasury of a government as a big pot of money. There are various streams of inputs (taxes, fees, fines, tariffs, new debt...) and lots and lots of streams of outputs (subsidies, ...
Philipp's user avatar
  • 77.9k
75 votes
Accepted

Why does the EU care so much about the UK divorce payment?

First off, per the other answers so far, €50 billion (or €100) is by no means peanuts. More importantly, this article gives, I think, a reasonably level-headed breakdown of what the Brexit bill is ...
Denis de Bernardy's user avatar
67 votes

Why does the U.S military use mercenaries?

The US public opinion is highly sensitive to casualties among US troops. They are much less concerned about casualties to contractors, especially if they are not US citizens. At times the US ...
o.m.'s user avatar
  • 112k
65 votes

Why does Germany have such a rather small defense budget?

The 2% goal for defense spending of all NATO countries originates from the Wales Summit of 2014. However, the people who made that commitment are heads of governments, many of which don't actually ...
Philipp's user avatar
  • 77.9k
56 votes

Why does the USA have such a large military?

A lot of this has to do with the geopolitical state of the world. World War II changed a lot for the US. The US had been reluctant to enter World War I. President Wilson was reluctant to enter World ...
Machavity's user avatar
  • 50.4k
54 votes

If the eurozone budget deficit limit is 3%, why is the European Commission telling Italy it must revise its 2.4% deficit budget?

It appears the problem isn't the deficit (the loss from an individual budget) but the size of the existing debt itself. From a report in the Guardian Italy’s public debt is worth more than 130% of ...
origimbo's user avatar
  • 21.4k
54 votes
Accepted

How is Switzerland able to maintain low tax levels?

Comparing taxation across nations is not trivial, because different nations use different means of taxation; just because the VAT is low doesn't mean that the overall tax burden is. Since you asked ...
meriton's user avatar
  • 5,213
53 votes

Why does the U.S military use mercenaries?

The reason is the same for any country, not just the US. And it is rarely money. It can be roughly grouped like this: public opinion damage control: the population of a country cares about the death ...
Salvador Dali's user avatar
48 votes

Why does Germany have such a rather small defense budget?

Absolute and relative amounts Germany has come much closer to the 2% goal due to the COVID crisis -- the GDP went down, the defense budget stayed the same, so the percentage went up. Similarly, good ...
o.m.'s user avatar
  • 112k
47 votes
Accepted

Why does Poland receive more in gross and (far more in) net EU funding than any other member state?

A combination of: 1. Low per capita income While not among the very poorest countries in the EU, Poland is far from being the richest. Per capita income in Poland is $12680, compared with $43660 in ...
Royal Canadian Bandit's user avatar
45 votes

How can President Biden claim his Build Back Better Agenda costs zero dollars?

IT DEPENDS ON WHAT YOU MEAN BY 'COST.' In politics, the words are often moulded to have meanings beyond what they would mean in common, conversational contexts. Here, the word 'cost,' is being ...
William Walker III's user avatar
44 votes
Accepted

If the eurozone budget deficit limit is 3%, why is the European Commission telling Italy it must revise its 2.4% deficit budget?

Italy is not just planning a high budget deficit, it has a very high level of national debt. (As of 2017, it was 131.8% of their GDP, second only to Greece) This makes their deficit riskier than it ...
CoedRhyfelwr's user avatar
  • 5,846
42 votes
Accepted

Why are European countries increasing their defense budgets if they are members of a nuclear-armed NATO?

Nuclear deterrance doesn't avoid war. India and Pakistan are both nuclear powers yet they fought a war in 1999. Countries would always want to avoid the nuclear option - they will try to achieve their ...
whoisit's user avatar
  • 6,128
36 votes
Accepted

How did the European Union reach the figure of 3% as a maximum allowed deficit?

The 3% deficit floor and the 60% Debt-to-GDP ratio were part of the Euro convergence criteria of the Treaty on European Union (Maastricht Treaty). The framework is developed in Article 104c, with the ...
James's user avatar
  • 1,345
36 votes
Accepted

How does the government purchase things?

I understand that the government collects taxes, sells bonds, etc. but regardless of the income portion, I'm more curious about the spending portion. Does the US Treasury simply print the ...
ohwilleke's user avatar
  • 83.2k
33 votes
Accepted

Why does Trump want to increase military spending?

Bottom Line Upfront: If you don't allow the military to plan for maintenance, but keep them working, then it will cost more to fix them when you start giving them money. Part of it is most certainly ...
Drunk Cynic's user avatar
  • 10.2k
33 votes
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The DUP have threatened to “vote down the budget” - but what does this mean?

The convention in the UK House of Commons is that the budget vote also works as a confidence vote in the government. So losing a vote on the budget is taken as a vote of no confidence in the ...
PhillS's user avatar
  • 7,547
33 votes

Why are European countries increasing their defense budgets if they are members of a nuclear-armed NATO?

Several reasons, and a correction to this assumption: Russia's nukes have been helpful in keeping out direct Western involvement. They have however utterly failed to modify battlefield circumstances ...
Italian Philosophers 4 Monica's user avatar
31 votes
Accepted

Is there any fiscal responsibility merit to Congress's plan to use IRS funds to pay for Israeli relief?

No, there is no merit to this idea and it would actually cause the deficit to increase. MEMORANDUM: Cuts to IRS tax enforcement would increase the deficit October 17, 2023 - CBO estimated that an ...
Joe W's user avatar
  • 17.5k
30 votes
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How can the U.S. government ensure that the black budget is spent appropriately?

Such a budget will, inevitably, fall under an executive department, headed by either a Cabinet Secretary, or the President himself. The budget for that department is scrutinised by Congressional ...
Joe C's user avatar
  • 28k
30 votes

Why is it considered controversial to reduce budget deficits instead of raising the debt ceiling?

The debt ceiling is an accounting technicality that is being hijacked by the Republicans to gridlock the political process. First, Congress authorizes a budget with spending programs and tax laws for ...
o.m.'s user avatar
  • 112k
29 votes

Why was Australia willing to pay $3.0 B/unit for the French diesel-electric submarines?

I don't have all the accounting details, but one reason supposedly was that 60% of the money was earmarked to go to the local Australian suppliers. Unlike many of the other examples you gave, which ...
got trolled too much this week's user avatar
27 votes
Accepted

Why does Germany have such a rather small defense budget?

The main factor has to be the fear of public debt and symbolic importance of balanced budgets (schwarze Null) in the German political discourse. The notion that the state should avoid building up debt ...
Relaxed's user avatar
  • 31.2k
25 votes

Why does the USA have such a large military?

Since Lyndon. B. Johnson's time, the US forces were calibrated to be able to fight 2-"2.5" wars at once. In Bush's time, Rumsfeld articulated that (before 9/11) as The current strategic ...
got trolled too much this week's user avatar
24 votes

Do any nations have in place formal mechanisms to "save in good years/spend in bad years"?

California has something like this, though it's not a nation (although it is bigger than most). The California Constitution was amended in 2004 and 2014 to create a Budget Stabilization Account (BSA), ...
divibisan's user avatar
  • 26k
23 votes
Accepted

Long term, does Trump's wall cost more than it saves per year?

Best-case scenario? Fox News thinks the Wall will save lives by making it more difficult for cartels to bring drugs into the USA. Middle-of-the-road scenario? Stanford put an actual monetary figure ...
Carduus's user avatar
  • 17.3k
23 votes

Why are European countries increasing their defense budgets if they are members of a nuclear-armed NATO?

Nuclear weapons do not substitute for conventional military power There are many reasons why European countries want to improve their military power versus where they were before the Russian invasion ...
matt_black's user avatar
  • 3,901
23 votes

Why is it considered controversial to reduce budget deficits instead of raising the debt ceiling?

Complaining about budget deficits, by the Reps, seems to be height of hypocrisy. How the 2017 Tax Act Affects CBO’s Projections (note those are Trump 2017 tax cuts): What Are the Act’s Projected ...
Italian Philosophers 4 Monica's user avatar

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