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I’m going to pull rank here.

Small and occassional deficits do not matter. Big and continuing deficits matter a lot.

Basically, when the financial market perceives that a country will have difficulty servicing its debt, it will begin to require a default or inflation-risk premium. When this kicks in, it is probably already too late to do anything.

When Cheney said what he did, the natioanl debt was maybe 30 percent of one year’s GDP. It has now suddenly increased to 70 percent. We were in the safe zone when he said what he did. We are now risking default or inflation.

I trust what I said is plain old common sense. You can my word for it, there is very good economic theory and experience to support what I said.

Not only what you have said in your post in 100% true, a 'B' student from high school with slightly above average intelligence and one economic course can figure out the results from our continued long term debt.

'Reported' data doesn't mean squat when numbers are constantly massaged and polished, then argued over by 'the highly educated'. Then, it usually, at some point, easily simplifies down to:

Cash Inflow versus Cash Outflow and bankruptcy being defined as an individual or business that cannot pay its debts in a timely manner.

Global economic theory is just that...way too many variables w/ regards to greed and human nature, unstable governments, war, etc., to accurately rely upon.

RE :”You can my word for it, there is very good economic theory and experience to support what I said.’

It's called selling “Your government is free”, but it is NOT free and we have seen where it ends, 2009, disaster!.

But it is BAD political theory. Once you break the piggy bank lock all hell breaks loose. Then everyone wants theirs, and if it destroys the country, voters might as well get theirs before it's too late. MSNBC showed polls yesterday showing the polled would rather have more spending on health care and education, than control deficit, DUHHHH

When Cheney said what he did, the natioanl debt was maybe 30 percent of one year’s GDP. It has now suddenly increased to 70 percent.

Well said!

Another way to put the difference for those that think money grows on trees is in 20 months 0's deficits will exceed those that were incurred during 8 yrs of the Bush admn. Also, every trillion represents about 50 billion of interest that has to be paid every year.

The more immediate question is what % the fed govt budget is of GDP.

Small and occassional deficits do not matter. Big and continuing deficits matter a lot. Basically, when the financial market perceives that a country will have difficulty servicing its debt, it will begin to require a default or inflation-risk premium. When this kicks in, it is probably already too late to do anything. When Cheney said what he did, the natioanl debt was maybe 30 percent of one year’s GDP. It has now suddenly increased to 70 percent. We were in the safe zone when he said what he did. We are now risking default or inflation. I trust what I said is plain old common sense. You can my word for it, there is very good economic theory and experience to support what I said.

It is common sense.

When it comes to money matters - AMOUNTS MATTER. And the amount that matters is the level of burden on the economy.

Our concern should be over the ability to service the future debt created from our deficits. Whether a deficit is a concern is based on the level of the deficit, and whether we are able to grow our way out of it.

Obama's plans to have huge deficits through his massive spending increases - COMBINED WITH ECONOMIC POLICIES THAT WILL STUNT GROWTH - will lead to a large increase in the economic burden of debt service.

Reagan's deficits in the end were not a detriment because under Reagan the economy grew by one-third. The debt burden was not significantly higher at the end of his term (relative to the economy) than at the beginning.

With Obama, this will be starkly different, and the reason is that Obama is both racking up deficits far beyond what any prior PResident has done, AND he is proposing tax increases, cap-and-trade regulations, bailouts and subsidies and the worst sorts of welfare-system increases ... that combined will stunt the economy.