[Willie Green]

"Deficit as a % of GDP" is an irrelevant and misleading statistic. It ignores all other forms of debt that must also be serviced by our nation's domestic economic activity. This includes not only our National debt, but also debt accrued by state and local governments as well as private debt incurred by businesses and individuals.

It is more appropriate to view federal deficit spending in the same manner as any other institution, organization or individual that is borrowing money to finance expenditures that exceed current income. In addition to revenue and expenses, one must consider the amount of debt already incurred and the proportion of revenue that must be allocated to service the interest on that debt.

For FY 2002, interest paid on the National Debt was $332 billion, or roughly 18% of federal revenue for that year.
Interest paid for FY 2003 dropped slightly to $318 billion, but has mushroomed to $115 billion for just the first 3 months of FY 2004.

[NMC EXP]

"Deficit as a % of GDP" is an irrelevant and misleading statistic

Absolutely.

The govt is fond of quoting top level stats to paint a rosy picture.

Another favorite is "Per Capita Income" (GDP divided by population). It would mean something only if income were evenly distributed.

Regards

J.R.

[Ciexyz]

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