What's $2 Trillion Among Friends?

Weekly Standard ^ | 8/31/2009 | Irwin M. Stelzer

[SeattleBruce]

$2,000,000,000,000. That's the amount by which the Obama administration raised its ten-year estimate of the nation's budget deficit from the one it made only a few months ago. Now, $2 trillion is a lot of money. But even more significant is the fact that this revision represents almost a 30 percent increase -- no tiny percentage of the earlier $7 trillion figure. It seems that expenses are higher -- up 24 percent this year, the largest increase since the height of the Korean War -- than originally estimated, and revenues are lower. The resulting deficit, says Peter Orszag, Obama's budget director, is "higher than desirable". He might have added that the administration's critics had it right when they claimed that the earlier estimate represented a turn around the dance floor with that old seductress, Rosy Scenario.

[SeattleBruce]

"higher than disirable" +++++++++

Uh YEAH! What gave you your first clue?

[April Lexington]

Does anyone know at which point it won’t matter anymore?

[swain_forkbeard]

Why squander billions when you can squander...trillions?

[April Lexington]

Its like when you eat that last piece of pizza and you know you’ve gone too far....

[Tenacious 1]

Its like when you eat that last piece of pizza and you know you’ve gone too far....

Good analogy. You can always gag yourself into regurgitation to get back to where you should have been. It only hurts for a minute.

When is our government going to puke back the money, cut spending, give up power and shut down federal programs in wholesale fashion (the equivalent of puking back power and money)?

[April Lexington]

I've been rethinking my metaphor. With pizza you recover. Maybe its more like drinking until your body can't recover. It becomes too late. You keep drinking until you die. My point is, where is that point when we can't recover? If Joe the Plumber charged $45 billion on his credit cards, could he recover or would the party be over no matter what kind of reorganizing he attempted? I fear we are approaching that point in borrowing where we will not be able to recover...

[norraad]

Yes, I seen no real numbers on “how” repaying all this massive debt will ever balance, only talk, talk is cheap, this debt is not.

[SeattleBruce]

I fear we are approaching that point in borrowing where we will not be able to recover...
+++++++++++++++++

This the kind of topic that makes liberals nervous, because they hate to deal with numbers and facts.

The insanity I’ve been hearing about is our overall debt hitting 60 to 70% of GDP - and potentially exceeding the record deficit/GDP ratio of WWII - now a distinct possibility - and of course the annual service on that kind of debt becoming our largest budget item (larger than say the annual Defense Budget!) When the communists in China are warning us about our debt load, you know something is wrong in the world.

Yes, I’d say we’re binge drinking on the verge of poisoning the nation/commiting national suicide.

Do you suppose an INTERVENTION is needed?

[mojitojoe]

Do you suppose an INTERVENTION is needed?
_______________
Yes and immediately.

[Rick_Michael]

One of the few times I agree with mccains ole campaign promise to freeze spending on everything but necessary military spending.

[Natty Bumppo@frontier.net]

Short Answer: In less than 62 months the U.S. will make Zimbabwe look like an economic powerhouse.

Longer, more detailed answer, with proof:

The Federal Reserve produces a quarterly report entitled “Flow of Funds Accounts of the United States” also known as the Federal Reserve Statistical Release Z.1

The latest version was released on June 11, 2009. One set of statistics that are tracked is the “B.100 Balance Sheets of Households and Nonprofit Organizations” found on page 102 of the latest report. The Net Worth figures on that page basically give the Net Worth of the entire population of the United States.

Our Net Worth peaked in 2007 at $62.691 Trillion. At the end of the first quarter of 2009, it had dropped to $50.377 Trillion for a loss of $12.32 Trillion in about 15 months, or $821 Billion per month, or $27.4 Billion per day. The rate of loss has actually moderated slightly in the last quarter of 2008 and the first quarter of 2009.

There is a real time U.S. National Debt Clock at www.usdebtclock.org. This tracks the Loss of U.S. Household Wealth, but currently has it at $12.24 Trillion vice the $12.32 Trillion of the Z.1 report.

Either way, at current rates, U.S. Household Wealth will approach zero in less than 62 months. At that point it really will be “Game Over,” since the nation will lack the means necessary to dig itself out of the hole and rebuild.

If you are looking for “positive” news, the rate of loss slowed from $29 Billion per day to $27 Billion per day in the first three months of 2009. The change increased our national survival time by two months.

[SunkenCiv]

Now, $2 trillion is a lot of money. But even more significant is the fact that this revision represents almost a 30 percent increase -- no tiny percentage of the earlier $7 trillion figure. It seems that expenses are higher -- up 24 percent this year, the largest increase since the height of the Korean War

The solution is to dump Obama and his entire administration.

[April Lexington]

Thanks for ruining my day!

[April Lexington]

INTERVENTION? Heck, I'm ready for the British to invade and take the place back. Lizzy would NEVER allow this kind of craziness!