Posted on 07/03/2009 12:49:31 PM PDT by BenLurkin
the debt stands today at a staggering $11.5 trillion -- equivalent to over $37,000 for each and every American. And it's expanding by over $1 trillion a year.
The mountain of debt easily could become the next full-fledged economic crisis without firm action from Washington, economists of all stripes warn.
"Unless we demonstrate a strong commitment to fiscal sustainability in the longer term, we will have neither financial stability nor healthy economic growth," Federal Reserve Chairman Ben Bernanke recently told Congress.
Higher taxes, or reduced federal benefits and services -- or a combination of both -- may be the inevitable consequences.
The debt is complicating efforts by President Barack Obama and Congress to cope with the worst recession in decades as stimulus and bailout spending combine with lower tax revenues to widen the gap.
Interest payments on the debt alone cost $452 billion last year -- the largest federal spending category after Medicare-Medicaid, Social Security and defense. It's quickly crowding out all other government spending. And the Treasury is finding it harder to find new lenders.
The United States went into the red the first time in 1790 when it assumed $75 million in the war debts of the Continental Congress.
Alexander Hamilton, the first treasury secretary, said, "A national debt, if not excessive, will be to us a national blessing."
Some blessing.
Since then, the nation has only been free of debt once, in 1834-1835.
The national debt has expanded during times of war and usually contracted in times of peace, while staying on a generally upward trajectory. Over the past several decades, it has climbed sharply -- except for a respite from 1998 to 2000, when there were annual budget surpluses, reflecting in large part what turned out to be an overheated economy.
(Excerpt) Read more at finance.yahoo.com ...
Nice. A hit piece on the Founders.
What do they mean “may be.” Idiots!
Thay can’t blame Hussein — that would be racist.
Golly, gee, AP, you don't suppose that Barack and his Democrat stooges have anything to do with CAUSING this scary debt crisis, do you?
With their porkulus bill that does nothing to create jobs or stimulate the economy but doubled the debt, and a TARP bill that is used to keep the bad times rollin' and more subprime mortgages goin'? And the nationalization of Chrysler and GM purely to bail out the Auto Workers.
If you ever read their stories, they are incredibly biased towards the left. Never report anything bad about ODUMMA HUSSIEN. They would prefer to blame anyone else. Kind of like Odumma himself.
Obama Spending Trends Charted
http://blog.heritage.org/2009/05/12/obama-spending-tax-trends-charted/
Bernanke Threatens Economic Collapse If Fed Audited
http://digg.com/business_finance/Bernanke_Threatens_Economic_Collapse_If_Fed_Audited
>What do they mean “may be.” Idiots!
Exactly my thoughts.
The national debt has been growing all of my lifetime and it looks like it will never stop or reverse; IOW, it’s like those negative-amortization loans where your payments will NEVER touch your principal but your debt will grow, and grow, and grow. *sigh*
Please do not trouble yourselves with this. Gosplan-on-the-Potomac is in the process of addressing any imbalances and will shortly announce a New Economic Policy. This new initiative will permit small shopkeepers to operate and seek modest profits while retaining state control of the commanding heights of finance and production. Thank you.
“May” be. There is no maybe to it; it is already upon us; only its harshest ramifications are not exposed in the personal economic lives of everyone yet.
Something tells me these warnings will be adhered to just like the warnings from 2001-2008 made repeatedly about getting control of Fannie Mae and Freddie Mac as it could cause a collapse in our financial infrastructure...
Nice. A hit piece on the Founders.
WASHINGTON (AP) — The Founding Fathers left one legacy not celebrated on Independence Day but which affects us all. It’s the national debt.
So, its due to the “legacy of the Founding Fathers” that Obama is spending us into a hole. Its everyone’s fault but his—especially if “everybody” is Dead White Men.
Yeah, like the I-bonds I have now which are currently yielding 0% because there is no inflation. Great investment, that.
I know about TIPS, but thanks!
They can’t pay it back. They can’t cut spending enough to pay it back. They will have to monetize it. Look for inflation.
parsy, who is waiting for his future “Citizen’s Stipend” to pay for utilities, food, housing, health care, auto fuel, clothing, and comic books.
The shocking reality is that the national debt cannot be payed back without extinguishing the U.S. money supply. That is because coins + government debt (federal reserve notes) + private debt = U.S. money supply. Government cannot create money without borrowing it into existence (from the Federal Reserve) and the amount that it has borrowed + interest is always greater that the amount of money in circulation. The only way to have enough to pay it back is to borrow more.
don't want to loose them benefits.
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