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Subscribe to RSSUPDATED 4:09 p.m. ET -- The Congressional Budget Office projected Tuesday that the national debt will continue to grow over the next ten years even as the economy recovers, the unemployment rate falls, and tax revenues increase.
The report said, "At an estimated $845 billion, the 2013 imbalance would be the first deficit in five years below $1 trillion" and would be only half as large as the deficit was in 2009, relative to the size of the economy. But that improvement will be merely temporary: in the next several years, an aging population will drive entitlement spending higher at the very same time that rising interest rates increase the government’s debt-service costs, the CBO warned.
Recommended: Obama calls for at least short-term fix with cuts, revenue to avoid sequester
In its annual Budget and Economic Outlook, the CBO said debt held by the public will be bigger by 2023 than in any year since 1951 and will be at 77 percent of gross domestic product (GDP) by 2023, far above the 40-year average of 39 percent of GDP.
As a result, the CBO report said, the federal government’s interest costs “will be very high” and will be rising. Interest costs will more than double by the end of the ten-year forecasting period and will be at their highest share of GDP in the past five decades.
CBO director Douglas Elmendorf emphasized to reporters Tuesday that in the past several years, the federal government has benefited from “an extraordinarily long period of extraordinarily low interest rates.”
Elmendorf also stressed that the pressures on the federal budget continue to be driven by the cost of the entitlement programs for older Americans.
Even though the rate of increase in health care spending – including Medicare spending -- has slowed in the past few years, “we still see substantial growth in federal health care spending” over the next ten years and beyond, Elmendorf said.
He noted that in the next ten years the number of people eligible for Social Security retirement benefits will jump by 40 percent. Most of those people will be eligible for Medicare benefits as well.
“We are confronting now in our country changes of a sort we have not had to make in the past,” he said. If one looks at the 20 years before the 2007-2008 financial crisis, he said, “we had rising spending on Social Security and on the major health care programs that was offset as a share of GDP (gross domestic product) by a decline in defense spending.”
But “that’s not a strategy that can be repeated at that magnitude over the next 40 years, because defense spending has come way down as a share of GDP and because the demographic pressures” that are driving up Medicare, Medicaid and Social Security outlays “are so intense,” Elmendorf said.
“We have a large budget imbalance, we have large projected deficits, a debt that will remain at a historically high share of GDP and will be rising at the end of the coming decade. What that implies is that small changes in budget policy will not be sufficient to put the budget on a sustainable path,” he warned.
The CBO chief said a $4 trillion reduction in cumulative deficits over ten years would result in a balanced budget by the end of the ten-year period but to get that deficit reduction entirely from spending would require a two-thirds cut in all non-defense discretionary spending.
“The gap between spending and revenues is very large, and that means that changes you would need to eliminate that gap will be large relative to either outlays or taxes. It would even require large changes even if one split the impact between spending and taxes,” Elmendorf noted.
The CBO’s ten-year forecast assumes that the automatic spending cuts, or sequester, required by Congress and President Obama in the 2011 Budget Control Act, will remain in place.
But if Obama and Congress cancel the sequester’s spending cuts, the CBO said about $1.2 trillion more would be added to cumulative budget deficits over the next ten years.
The Budget Control Act’s spending cuts, which are scheduled to begin on March 1, will reduce defense outlays by about 8 percent and non-defense discretionary outlays by about 5 percent in the current fiscal year, the CBO report said.
On Tuesday Obama called on Congress to pass "a smaller package of spending cuts and tax reforms that would delay the economically damaging effects of the sequester for a few more months" while it comes up with a longer-term alternative.
If the Budget Control Act’s spending cuts are left in place, projected federal spending in the CBO’s forecast will average 22.1 percent of Gross Domestic Product over the period from 2014 to 2023, which is CBO's ten-year forecasting window.
That figure is less than the spending level in 2012, but it is high by the standards of the past 30 years, during which federal spending has averaged 21 percent of GDP.
The CBO estimates that tax revenues will increase by about $260 billion, or 11 percent, in the current fiscal year. About half of that increase in revenues is due to the Social Security payroll tax reverting to its normal 6.2 percent rate at the start of this year, after being cut to 4.2 percent as an economic stimulus measure in 2011 and 2012.
Elmendorf said the economy is growing stronger. “The good news is that the effects of the housing and financial crisis appear to be gradually waning,” he told reporters, predicting “a virtuous cycle of faster growth in employment, income, consumer spending and business over the next few years.”
But the tax increases enacted at the end of last year and spending curbs in the Budget Control Act will depress economic growth this year.
The CBO said the economy will grow at a real, inflation-adjusted rate of 1.4 percent this year and 3.4 percent next year, with the unemployment rate remaining high through 2014.
If the CBO forecast is correct, 2014 will be the sixth consecutive year with unemployment exceeding 7.5 percent, “the longest such period in the past 70 years.”
But the CBO forecast assumes that the jobless rate will fall to 5.5 percent by 2018. It was last at that level in the summer of 2008.
Each January, the CBO issues its budget projections for the next 10 years. The forecast is intended to guide Congress as it designs fiscal policy. The CBO projections assume that current law remains in place and that no new tax increases, spending cuts or fundamental restructuring of federal programs such as Medicare are enacted.
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Unemployment at 7.5% through 2014.Damn!
As a result, the CBO report said, the federal government’s interest costs “will be very high” and will be rising. Interest costs will more than double by the end of the ten-year forecasting period.
Do you hear that Keynesians? They want to increase the debt even more to get the economy growing but the truth is that high government debt robs the economy. America is fading fast thanks to big government.
The unemployed and employed will suffer in shared company by paying higher costs thru hidden inflation (portion size smaller on almost all products anymore) that none of us are better off. This news anymore is just a broken record for the last 6 years.
@satanick
Actually, there's a perfect picture of John Maynard Keynes in today's Wall Street Journal. He's seated between the (communist) Finance Ministers of the former USSR and the former Yugoslavia.
http://online.wsj.com/article/SB10001424127887324761004578283684195892250.html?KEYWORDS=currency+war
So glad Obama kept his promise and cut federal deficit spending by 1/2 during his first term. Oops! I forgot. He lied on that one as well.
The problem we face is that the "when" to pull the punch bowl from this party is when unemployment falls to 6.5%, as the Fed recently set as a level, and as long as high unemployment is here, high spending will continue.
However, the stimulus effect gets weaker as more money is pumped into the system. The stimulus of 2008 had greater effect on the economy the current stimulus. But to the pull current stimulus away now means higher unemployment, and a worsening debt problem because of less tax revenues.
This double edged sword is called a depression. Best get used to it.
When we have a government that feels it must spend about $3.5 Trillion a year (when tax revenue is only $2.5 Trillion) JUST to keep us from going into a depression we are screwed. Because we are borrowing money to spend money to keep the economy from collapsing.
But it gets worse. Where are we getting that $1 Trillion we borrow each year? China? No. Saudi Arabia? No. Dubai? No. Then where?
We are PRINTING it!! Even the world financial markets are not willing to lend us money (at least not at 1% to 2%) so the Fed is PRINTING $85 Billion a MONTH and lending it to the Treasury Department. History is clear: when a country must resort to printing money to cover bills the economic collapse is shortly thereafter.
Hold on tight because the economy WILL collapse. The question is no longer "if" but "when". And it is coming sooner than many want to realize. We are holding up GDP out of a depression with printed money we are lending to ourselves.
Nothing says %$^#ed more than that.......
The United States is poised for a major fiscal crisis, and not some pretend cliff. With as poorly as the economy is doing, just think what could happen if the fuse gets lit in the Middle East. A gallon of gas has been hovering around 4.00 since Obama took office, where do you think the price will be when Israel strikes Iran? With the amount of debt and spending going on in Washington, this country will be easier to take down economically then any military means could accomplish. Obama has the country just a quarter away from the start of another recession, and it will not take much for that to become a full blown depression.
I like analogies to explain to people what happens in the economy. Our current situation is like this:
A family makes $50,000 a year but has so much debt they need $70,000 a year to keep from collapsing and the bank takes the house and car. So they borrow $20,000 from a friend one year. The next they borrow $20,000 from a parent. The next year they borrow $20,000 from a neighbor. As long as they can borrow $20,000 it keeps them from losing everything. But each year their debt makes it that much more impossible to ever consider paying it back.
We are there. Our neighbors no longer want to loan us money. Neither do our friends. So now our country is resorting to printing our own money to pay our bills. Historically that is the last step before an economic collapse and occurs shortly thereafter.
We are screwed. I saw it coming about 6 years ago and have been planning according. I truly hope you have been planning too because it is very very close.............
no surprise -- the most corrupt and reckless admin money can buy. The voters ought to be ashamed for the votes cast for these dimwitted career politicians that are clueless. Even if you're on the taxpayer funded dole you will pay too -- that's my only comfort in these tragic times.
So, I guess given the historically high unemployment coupled with the historically high budget deficits and a mind-numbing national debt, it becomes an even greater idea to grant rewards and special treatment to over 10 million ILLEGAL FOREIGN NATIONALS, most of whom are lower wage workers with less education who consume far more in social welfare services than they pay in taxes and who will level a prohibitive and devastating CRUSH upon our budgets for years to come! (sarcasm!!!)
probusiness...... to add to your scenario if that same family had the same debt ratio as the govt, if they NETTED 50k the balance on their credit card would be $350,000.
We have 6 Trillion in debt in for 4 years. We are printing 1 Trillion per year. This Obama/Bernanke spending and printing fiasco is INSANE and we will pay for it dearly. All this candy (money printing) is going to make the coming bubble severe and will end up being poisen. They are keeping rates artificially low with the bond buying. When they stop the printing rates will rise rapidly and the interest on our massive debt will be well over a Trillion dollars.
The only thing i have seen for 4 years is trillion dollar deficit spending, raise taxes and print money.
Four year total of deficits and FED printing is over 10 Trillion dollars. TEN TRILLION DOLLARS in just 4 years. That my friends is going to lead to one helluva bubble in the dollar and the debt when this blows up. This will be much worse than the 2008 bubble. Much Much worse.
Hello folks, only in America. Our debt is at the point where we can never ever pay it back, but our economy is recovering! Wow! Talk about doublespeak!
WAR IS PEACE
FREEDOM IS SLAVERY
IGNORANCE IS STRENGTH.”
― George Orwell
Here's the REAL Teapublican plan:
1) Try to get sequester cuts in discretionary spending, with defense spending taken off the table.
2) Try to cut trust fund programs such as Medicare by cutting benefits and raising the age instead of looking for ways to save and preserve these programs.
3) Try to get even more spending cuts that will derail the recovery by continuing to protect the rich -- To protect capital gains/carried interest, dividends, estate taxes, etc. for the rich while the middle class and small business continue to pay high tax rates on earned income.
Constituents need to ask: Who do Teapublicans represent? The large majority of middle class and small business owners, or the few hedge fund managers and CEOs in the richest 1%? You know the answer, even hard core rightwingers.
President Obama was reelected based on a balanced approach of cuts AND revenue from the rich and corporations, based on the rich paying the same effective tax rates as the middle class, based on fairness -- And growing the middle class and improving upward mobility.
This is the mandate, and the GOP/TP are obstructing it still. Throw the Teapublicans out!
truepatriot you are smoking something. You must be from one of four states where that is legal. Obama is not taking a balanced approach. He just isn't approaching. If he was he would be focusing on real problems, but real problems aren't his thing. If you think he is the savior of the nation then you will get a rude awakening sooner rather than later.
Fortunately tax rates are low, defense spending is bloated, and medicare and social security can be reformed by restricting them to those who need them. We have lots of spending that can be cut and lots of revenue that can be raised. All we lack is political will.
The rally cry from the Progressives: "We didn't spend enough American taxpayer dollars on Mr. Obama's Stimulus Program."
Yep, should have spent more for those failed "Go Green" initiatives and to those Obama campaign supporters.
Meanwhile back in the real World, we continue to provide money to the United Nations financial terrorists (called IMF, G-7, G-8, and G-20) for World redistribution.
Wait a minute......Mr. "Pocket Veto" Progressive Reid wants to bypass Congressional procedures for any limits on the National Debt ceiling.
Here is the REAL Progressive agenda and mandate:
If you are reading my post its because none of the prior ones even hint that any of the posters are willing to give up their own medicare/social security benefits to cut spending. Lot's of finger pointing and name calling but no sacrifice. Well, let me start. I am in the 2% and retired. It's ok to means test me for both programs. Anyone else?
I sure hope that all our Washington politicians that got us into this mess are going to be okay when our nation collapses financially. I would hate to think that all they did for themselves could be lost. That would be tragic. After all, they work so hard for the American people.
True Patriot... Obama got his tax increases through no problem. I am not sure you can keep turning it around and putting this on the Right. This is the Presidents plan with no cuts...and the Reality of the CBO is telling you that this plan will cause the the debt held by the public to be bigger by 2023 than in any year since 1951 and will be at 77 percent of the GDP BY 2023, far above the 40 year average of 39 percent of GDP. The only way to reverse this stop this ...is to cut spending. Now ...that is what the GOP STANDS FOR IN THIS CASE ...The Dems say we can Tax and not cut spending to get there.......This article tells you that you can not even come close to this by taxing (the Dems way)There would never be enough money to do that...it says we have to cut spending.........How does that translate into the Republicans being the problem? Actually the Tea Party has been saying exactly what the CBO is telling us now for years. That is how the TeaParty came about ...Cut Government spending....The Dems dont want to hear it because it cuts into their Dead Beat Voting Block....You know the Voting Block that got this President Elected.
a fair and accurate assessment of our situation.
It's below a Trillion but the Fed is making up the difference.
Not adding in what the Fed is monetizing makes the deficit and debt numbers a joke.
True Patriot is the only liberal to even post on this article. And you see how ridiculous a liberal looks when he tries to combat facts. Quite frankly, I'm shocked MSNBC wouldn't just bury this story.
If interest rates climb and our debt grows as the CBO forecasts, our dollar will be so devalued and our economy so bad, that the interest alone on our debt will surpass our annual budget.
You can't solve this with immigration, gun control, gays in the military, gay marriage, abortion, or marijuana legislation. Enforce the laws we have. Send the 11 million illegal alien felons HOME. Get them out of here. We already have a pathway to citizenship, it is applying for citizenship like every other person has to, not sneaking into the country and demanding financial assistance and citizenship.
We need $500B budget surpluses each year for the next 20 years to cut our debt in half. Just to cut it in half.
We can't mess around with nonsensical issues. All I hear from Obama is "common-sense laws" on gun control and immigration. How about a common-sense approach to our debt and economy.
We need MASSIVE cuts to everything except the bare essentials. Phones and internet are not bare essentials. R&D for green energy and electric cars... no essential. Bailing out GM everytime they go bankrupt... NOT ESSENTIAL. By the way, they make 7 out of every 10 cars in foreign countries. Go GM.
Taxes cannot erase our trillion dollar deficit and generate a 500B surplus. We need 1T in budget cuts. We need to grow the economy by cutting taxes across the board.
Obama and Jack Lew's sequestration hasn't even kicked in. With just the non-sequestration military budget cuts that have kicked in and the fear of sequestration looming have created a contracting in the economy. Payroll tax increases have caused consumer confidence to plunge 15 points. What happens when sequestration kicks in and Obama gets what he has always wanted, a stripped-down military? The 500B in cuts will not create 500B in extra spending because military spending CREATES jobs in the private sector and boosts economic growth.
The only liberal argument in their arsenal is "Bush". Good luck trying to push that one on the American people, as even with your cooked unemployment numbers, the rate is ticking higher. Try counting the 3.5 million people that left the job-search pool. Probably closer to 15% unemployment. Go Obama.
djo...you are right on the money. I am very surprised this article was allowed to be published on MSNBC...
True Patriot pretty much demonstrated he has absolutely no clue about this subject.... I think he forgot what side of the argument he was on....he was just more interested in repeating The KOOL-AID he drinks...he made absolutely no sense....
I was going to rant about this and that, but, I can not put it any clearer than DJO_34 has done.
I totally agree with DJO_34.
I can retire, however, I HAVE to work just to keep a roof over my head. I WORK FOR THE GOVERNMENT, and with everything in the toilet, all of my fellow government workers, we're on our butts !
Cuts have to be made, and we're all in this together, unless they find a way that we can move to MARs.
We send this representatives to WA to do our work, and they are playing with our lives like a Tennis match. Back and Forth, Back and Forth.
We the public need to kick some serious BOOTY !
The funniest part of this article is when they say "even as the economy recovers." The last quarter was negative growth, if this quarter is also negative growth we will officially be in another recession. I am sure liberals will find someone else to blame if that happens.
"“The gap between spending and revenues is very large,....But if Obama and Congress cancel the sequester’s spending cuts, the CBO said about $1.2 trillion more would be added to cumulative budget deficits over the next ten years."
If the CBO had been absurd enough to support Obama's "lets keep borrowing and spending" idiocy this article would have been a huge headline at the top of the screen instead of buried in the business section.
When will U.S. media acknowledge the importance of reality rather than indulging the fantasies of Obama?
BigATC: You are correct. Not only are we borrowing $1 Trillion a year no other countries or investors are willing to LEND us the money (at least not at 1% to 2% which is needed so interest alone doesn't bankrupt us) so the Fed is PRINTING $85 Billion a MONTH and buying Treasury Bonds.
In other words, for those who don't understand what that means, we are printing $85 Billion a month (or about $1 Trillion a year) and lending it to ourselves. When a country resorts to printing money as the ONLY option remaining to pay their bills then it doesn't take long before the currency collapses.
Do liberals not understand that printing money to continue deficit spending WILL collapse the economy?
I hope many in this thread have been preparing for this because when the SHTF there will be a LOT of people scrambling to find something of value to buy food with because the currency will be worthless.
Djo: VERY WELL SAID!!
We have a massive wound and a massive bandage. We keep touching around the edges but what we need to do is rip this huge bandage of this huge wound. It will hurt. It will hurt A LOT!!
But this country cannot heal until we recognize what we have. Massive debt and massive unsustainable spending. MASSIVE cuts are needed. This is the analogy of "ripping off the bandage". These MASSIVE cuts WILL hurt. And they will hurt A LOT!! But that is the only way we can save this country.
We owe nearly $17 Trillion and rising. We are borrowing (actually PRINTING!!) $1 Trillion a year just to cover bills. We have about $125 TRILLION of unfunded liabilities. If we doubled EVERYBODY'S taxes that they paid last year it STILL would not cover the deficit last year.
We have a serious serious issue. It will hurt but we need to do the right thing: rip the bandage off and let's start the healing process. Yes it will hurt. And it will hurt A LOT!! But the alternative is much much worse. The alternative is an economic and currency collapse. And it is much closer than most can imagine.........
Unfortunately Pro, thats takes a huge political will, and we don't have even a teeny bit of that. I think our last shot at fixing anything was 2 summers ago on the debt fight when the house passed the 6 trillion in cuts. Of course Reid never even brought it up.
When our next 2 bubbles come to pass, the debt and the dollar, things will be waaaay worse than the 2008 bubble. I am preparing for it, i just wonder who the Dems will throw up for the blame game when it hits.
I don't think they do understand what the massive money printing and deficit spending is going to do. Even when it blows up they will blame it on Republicans.
The Republican Party caved on the fiscal cliff deal. They got very little of what they wanted. They wanted big spending cuts, they got zilch. They wanted the tax cuts for the rich to be permanent, they did not get that either. What they did get was the same thing that the Democrats wanted, tax cuts for low and middle income folks are now permanent.
What a Hoot!
That would be the Bush tax cuts correct? The ones the Democrats wouldn't make permanent in 2002,but now they think its a good idea.Idiot.
broker, that's a narrow portrayal and doesn't really reflect the truth.
As opposed to Mr. Marriott's narrow portrayal?
Also doesn't reflect the $260/month tax hit I (middle class) just took.
broker, your right. The Democrats led by Robert Byrd went along with the Bush tax cuts but only if the cuts had a 10 year expiration date.
It is going to take more revenue and it is going to take massive cuts, including corporate welfare, agriculture welfare, , mortgage interest deduction will be gone, , will be lucky to be able to keep even half of our military and all of those govt. pensions, no I don't think so. And nothing works as long as the cost of health care continues to increase faster than the growth of GNP 17% of our economy is health care. You all are stupid, blaming each other, Republicans, Democrats all while they pick your pocket. We have the best congress that money can buy stupid fools you fight over the crumbs.
The Republicans didn't cave on the fiscal cliff, they trusted the Democrats again. Just like Wimpy use to say, Democrats will gladly cut spending next Tuesday, for an increase in the debt limit today. Or Democrats will gladly cut spending next Tuesday for some tax increases today. It should be painfully obvious to Republicans by now, that Democrats don't have calenders with a Tuesday on them.
No they just lie to get what they want and when it's time to do what they said they'd do they renege just like the corrupt dems they are. Did the same thing to Reagan.
Wait one dang minute here, I thought that the "private sector is doing fine!"? Afterall, the government isn't "in the business of creating jobs". Hmm. Someone should have forwarded that memo to the IRS. I hear they are going to be hiring...big time. Great news, for someone that's NOT beholden to paying taxes (slight jab at some members of the current administration...). That's alright though, all we have to do to fix the problem is print more money! Nevermind the millions that are unemployed, under employed, and simply quit the workforce. What was that saying again..."It's the economy STUPID!". And they wonder why they are called the "tax and spend" party...
Wow..., the CBO is right on top of things, isn't it...
The GOP caused the debt bomb.
Two unfunded wars,med part D ,bush tax cuts ect
Yep,thats why Obama has a deficit of a trillion dollars a year while he's been in office.
And yet the Dems wanted and got the Bush/Obama tax cuts made permanant for those making under 400k which will add more trillions to the debt!!
I don't think the Republicans are worried about getting your particular vote. They would prefer having intelligent people who actually understand what the problem is vote for them with an eye toward stopping the madness.
Bulletman,
The Dems supported the bush tax cuts for all but the upper 2%, and the only problem they had with med part D was it didn't spend enough (i.e.; the doughnut hole). For the wars, the Dems actively supported going into Afghanistan, and didn't object to Iraq.
While I was against all of these from the start, I don't think the Democratic party can honestly say they tried to stop any of these under the Bush years.
No both parties caused it. And right now yours sure as h*ll isn;t willing to do anything to stop or reverse it. Anytime it is suggested we cut spending out comes the criers like yourself whining about cutting debt. It will come to a head in the near future and when it does folks like oyu will hand wrong and pint fingers. Just look in the mirror for the cause.
What a total surprise to read yet another liberal that is blaming Bush. Yet they claim Obama is the smartest person to ever sit in the Oval Office. Well Obama is at least smart enough to blame Bush, but certainly not smart enough to solve anything. Maybe after another four years of Obama even liberals will come to realize that blame and excuses don't solve problems, it takes a true leader for that to happen. So far Obama is a complete and utter failure, and he was re-elected only because liberals so enjoy the blame game.
Hey, I know, maybe we can mint a trillion dollar coin, and hold on to it for a few years, and our deficit will magically disappear! No? Hmmm, can't play the "race card", but can play the "blame Bush" card! Yeah, that should work! I wonder how much that "Nobel Peace Prize" medal is worth? Lmao!
As Obama cleans up the bush depression,it will a few more years to get it right.
Never ever vote Republicon again.
Hey libtard, even King Hussein has stopped blaming Bush, at least by name. When do you libtards take responsibility? The King said he'd fix all our troubles in one term, or no second term. Is that what we call lib-truth? Most people just call it lies.
Bulletman is delusional and always has been. You won't get him to admit the Democratic party is anything but perfect. All the worlds problems are casued by Republicans according to him.
Bulletman..., or BrainInjuredFromBullettothehead? Just askin'
You can still hear all the sheep "Obahahaha-ma".
I'm positive massive welfare spending and having 55% of the nation not paying taxes has NOTHING to do with the problem.
What we need is more welfare, more debt, more prograns to fund the lives of criminal invaders from south of the border and maybe a program to make imaginary fuels from grass clippings(ohhhhh we already have that as well).
Funny, taxing the rich while you sit on your butt stoned does not seem to make the economy better,,,,,,,,,,,,
So now it is the Bush depression? Well we are but a quarter away from the Obama recession, or will that one be Bush's fault as well? Democrats have announced the Summer of Recovery, the recession is over, we are on the right track, but if anything should happen then remember it is still Bush's fault. How special for liberals to be the party of no responsibility.
I'm beginning to suspect that "bulletman357" is David Axlerod. Or maybe Jay Carney. It's hard to tell exactly which one it is, except for being an obvious shill for the left...
Nope, no lib-agenda here. The unemployment went up and the economy contracted last month, but here at lib-central they call that "recovers". Something just doesn't seem right here. Stoopid libtards. Notice how few libtard comments there are on this story? Just goes to show what the average libtards cares about. Freebies for anyone who believes as they do, and furthering the libtard agenda. Economics? What's that? Stoopid libtards.
catlover, you can't measure these indocators by a single data point (month). It's the trends that are relevant.
chippy, I guess we'll just have to wait until next month, and the months after that. I'm guessing that we'll see more bad news now that King Hussein has been re-elected and he doesn't need to manipulate the numbers for the election. Stoopid libtards. Trillions and trillions added to our debt will not make the economy better. But that's okay to you libtards, right? There will always be "millionaires and billionaires" willing to give all their money for the cause. Stoopid libtards.
catlover, instead of levying your childish insults you should expect more from your Congress.
And your charge of "cooking the books" is totally baseless. It's funny to watch Congress play the "it's not me card" while not doing their job but shamelessly heaping everything at the feet of the administration.
Oh Great so we've been warned about this for the last umpteen years and it falls on deaf ears again . So when I get ready to retire , I will be paying more taxes to support idiots like Liz Warren and her gang , Obama , Harry Reid , Feinstein ( Grandstanding idiots ) including the republicans too , in the elected offices to do less .. Well I'm looking forward to this !!! Why can't these morons put down their party's personal vendetta's and get on with figuring this out ? Because the American people will see how really stupid they are and that they are incapable of fixing these problems that face our country !
Amazing to see Liberals still blame GWB- hey news flash, he has been gone now going on 5 years, Obama owns this economy. Read between the lines of the report, the path we are on will not work. Simply raising taxes, does not lead to prosperity, and increasing the size of Govt does not grow the economy. We have no budget, no plan for private sector growth, and very little leadership from the White House, Obama simply does not care about debts.
Bush will always be responsible for the Great Recession just as Bin Laden will always be responsible for 9-11.
Man Willard, hope you don't own any guns; you're obviously insane!
I give you that if you will let Obama take responsibility for adding 1 trillion a year in new debt, more Americans living below the poverty level than ever,more Americans receiving welfare than ever before, middle class income LESS than it was four years ago, unemployment at better than 7.8 for going on 5 years, I could go on....
850,000 jobs lost per month with Bush, I could go on....
Yep, Bush will always been the owner of the great recession and Obama the owner of the greatest Depression/Debt ever in the history of this country. Our debt is just a ticking time bomb that is exasperated by Obama's approach to fiscal policies. If the democrats were worried about our debt then they would readily agree with the republicans that seem to have better understanding of how to lower debt. You can't tax yourself into prosperity, and you can't get out of debt by spending more than you make. Both statements that are centerpieces of Obama's fiscal plan. Sounds great doesn't it?
clarification: Obama and Democrats believe that "Higher taxes= Higher Prosperity, Spending more= Decreases Debt"
Celtic, what say you re-write history for us so that the blame can lay elsewhere.
Oh, and put Pearl Harbor on Brazil. Give the Japanese a break.
And still, his legions of swooning admirers defend him. Seeing as how a vast majority of them are unemployed, I'm sure they have PLENTY of time to do so. "J.Willard", you were freaking owned!
Well Willard.. we've debunked your idiocy before... Fair Housing Act under Carter forced banks to give loans to bad risks, Glass-Steagall under Clinton let banks and Fannie and Freddie package the bad loans and sell them as securities, Dodd and Frank preventing Fannie and Freddie from being reigned in... all the pieces that let the Democrats give houses to people who couldn't pay mortgages... taxpayers getting killed to bail out Fannie and Freddie... then funnel the bad mortgages into our 401Ks... which lost huge value and decimated the housing/construction markets... one big Liberal wealth redistribution scheme... Libtards took the economy down... and only obtuse idiots like yourself are still squealing that it's Bush's fault....
A simple fix would of course be:
Drone strikes on Baby Boomers.
That would fix several budgetary concerns.
Drone strikes on Baby Boomers and the White House!
We Baby Boomers aren't too thrilled with your generation either!!!!!!
Yeah I wouldn't be either. My generation really doesn't know the meaning of work. Kind of sad actually.
These CBO reports almost always over estimate projected revenues and underestimate projected spending. The reality will most likely be much worse.
"Deficits don't matter"
And soon, "neither does the dollar"!
CBO forcasts growing debt even as economy recovers.......
This is news? We can't keep racking up close to a trillion dollars in debt every year with no budget voted on by the Senate and just expect rainbows and unicorns. Absolutely ridiculous report. Of course its bad. And getting increasingly worse. Economy is on life support not recovering.
The CBO report INCLUDES the $1.2 trillion in spending cuts due with the sequester.
So we are still screwed because obama will increase spending. Seeing that he already has with his executive orders a few weeks ago. So tell me again WHY you voted for Obama again?
Which just goes to show that we are overspending by a completely astronomical amount. Even the sequester isn't cutting government spending enough.
The president cannot increase spending with an executive order. Only the congress can spend money with an appropriation. You should read the Constitution.
J. Williard, you're asking an awful lot of them.
I read the constitution about 2 months ago. When did you read the executive orders. Granted they still have to go through congress, but he did propose increased spending. When was the last time you looked at both of those? BTW Obama proposes more spending increases than he does decreases. He's just a high roller like that.
Indeed, the president cannot increase spending with an executive order....though I doubt that would keep Obama from trying, but at any rate, the congress doesn't "spend" either. It's the individual departments that do. The congress (both the Senate and the House of Representatives) do appropriate the money, but those appropriations do not require the money to be spent. In fact, if the individual departments later determine they do not require all the funding appropriated to them, they are free to send the money back. The problem, too many federal departments spend every dime they get, whether it's necessary or not.
Is that $1.2T a year? Starting when?
We are screwed.
Actually, I think the LOW INFORMATION voters will get screwed the worst. They really think this spending and deficit crap will go on forever. When the S H I T hits the fan and Santa Claus runs out of goodies they won't have a clue about how to survive. It will go from "blame Bush" to "WHAT THE HELL JUST HAPPENED". Will be fun to watch.
We are bankrupt, financially and morally ...
Rob, the Republican Party?
Damn it Rob..I was going to say that!!!!
NO FREE TRADE WITHOUT FULL EMPLOYMENT!!
Most of us were left with "what the hell just happened ?" when the fit hit the shan in 07. Of course there were no conservatives then. No tea party. They only arrived with Obama. The corporations however have record profits, the stock market is back where it was prior to the depression. The debt doubled under Bush with deficits loaded at the back end with the tax cuts. No mistake the rich got richer, the poor poorer. The conservatives want to blame the poor people, the 47%. Any novice crime investigator will tell you to follow the money. Deficits didn't matter under Cheney. Tinkle down has ruined the American economy, you're just too partisan to admit it. Facts don't matter to you "spend and borrow" so called conservatives. Yes, we still blame Hoover for the great depression and we still blame Bush and the conservative oligarchs for turning surplus to deficit. Since you'all love a good conspiracy, how about the 07 depression was planned by the cons to restore the robber barons to their former status (again follow the money). Federal spending has gone down relative to GDP, deficits are lower than when Obama took office, and the debt you're talking about was already incurred before he took office in the form of tax cuts, wars, increased defense spending (also known as corporate welfare), and the goddam depression (which led to automatic federal spending increases for unemployment and food stamps and huge cuts to revenue) you cons left steaming on Obamas' front door. The plan all along has been to drown the govt. in a bathtub. The cons sold the government to the highest corporate bidders, right Delay, Abramoff
Anybody wanna bet that the Dems answer to this will be to spend even more money?
maxdog, how will they do that without the House?
Continuing resolutions, just as they have been for the last 3-4 years. duh.
Anyone wanna bet the Republick response will be to increase defense spending, give more tax cuts to those who don't need or deserve it, and cut so called "entitlement" programs that were paid for, while increasing corporate welfare for the "job creators".
Pat,
Can you actually think? Defense spending is already more than it should be. Maintaining is plenty fine. Entitlement programs only promote dependency on the government and for that reason alone they should be extremely restricted, and/or cut. Who gave you your job? I guess it was job-creator/savior obama. Great! when you own a business maybe you can worry about job creation and profit too!
What ever happened to those million or so "shovel ready jobs"? Oh yeah, this administration basically killed the Keystone pipeline (50K+ jobs), coal fired plant construction (u/k # of JOBS), and has extended unemployment benifits like there is no tomorrow. The solution is as simple as it is elegant: quit killing the job market, get people back to work, and generate extra revenue in the form of taxes. But alas, it does require something liberals absolutely hate, WORK. "pat in socal", you have to be one of the more clueless of the lefts posters. Keep trying though, your posts are entertaining if nothing else.
The ignorance that anyone would believe that the amount of money deducted to fund medicare is actually enough to pay the bills. A simple check of what medicare was suppose to cost versus what it actually has cost and you will see that medicare is far from "paid for". Social security disability is not "paid for" either.
The game will play on as long as others are willing to still keep accepting are worthless US currency for goods. Sooner or later, this whole house of cards will collapse and drastic changes will occur. The government spending is out of control (defense/SS/Medicare/etc etc)...but won't be cut because all that spending is jobs (good paying)... The war machine is all we have left to support are currency (the petrol dollar)... My guess is China will take the reigns after the US economy is flushed down the crapper.
Regardless of which party is driving the bus it is going to take a decade or more to achieve anything close to a fiscal balance between income and spending at the Federal levels. The Republican plan(s) might get there a bit faster but they do so while increasing defense spending with no clear reason to do so and try to get the cuts from discretionary spending and unspecified "reforms" to mandated spending. The Democrats are less likely to cut social safety net programs but cut defense significantly more than can be reasonably justified while increasing social spending and protecting mandatory spending from cuts.
If I read the numbers correctly, mandatory spending accounts for some 67-69% of the total budget if you include the interest on the debt. Within the mandatory spending are Military Pensions, Federal Pensions, Social Security and Medicare. I am not sure if SSID (disability) and Medicaid are considered mandatory or not. Cuts in mandatory spending cannot be made by simply passing a spending bill with less money they way discretionary spending can be cut. The underlying laws that mandate the spending need to be changed in terms of eligibility and payments but that can realistically only affect future entitlements and not current. That is why it is going to take so long to fix the problem. Even then, changes are political dynamite which is why it is so hard to rein in mandatory spending. I seriously doubt either party has a workable plan to solve that issue.
You're right that mandatory spending/ entitlements are the problem, and no one is willing to touch them because it would be the end of their political career. But it is the mandatory spending that needs the cuts the most. Entitlements just increase dependency on the government. Right now the Gov. is not so dependable.
Isa'dna,
How are the major entitlement programs of Military Pensions, Federal Pensions, Social Security and Medicare dependency on the Federal Government other than it is the Treasury who cuts the checks? Is a government funded pension any different than a private sector company's pension? Is SS and Medicare which workers pay into their entire working lives not an earned benefit as opposed to a hand out? I can see the issue with Medicare since costs there can vastly exceed what a worker has paid in over their working life but what is the alternative without a single payer all encompassing health care system that people can afford to pay premiums on? How many people do you know that can save and invest enough over a working lifetime to have amassed roughly $4 million which is what most financial planners estimate it takes to fully fund retirement and all medical expenses without the aid of SS and Medicare for a typical middle class wage earner?
You just answered your own question. How can the average person save enough to retire with the current rate cost of living and/or health insurance? It is the same as the SS except that personal retirement rests the responsibility on individual not government. Individuals will care more if they see the future is all of what they can make of it. It's the sink or float principle. I know it sounds harsh, but sometimes harsh is what needs to happen. Right now individuals have no incentive to save. They know the government will pick up the tab, so they spend everything they get. Frugality and responsibility are not qualities that are desired, but they once were. My proposal is to restrict entitlements greatly, and increase personal responsibility. In doing so the US debt will decrease.
Isa'DNA,
Just apply what you just said to the banks who were the only ones to get bailed out by the taxpayers and who now get their money for free. They're the ones who collapsed the economy, they held us hostage and not a single one has been prosecuted. Social Security has run a huge surplus, indeed it has been financing the wars, it is not an "entitlement" it was responsibly paid for. Increase corporate responsibility, they robbed the "private" retirement plans long ago. The depression also robbed the private retirement plans. Right now corporations have the best government they could buy. Wall Street, with the conservatives blessing, has taken all the money from thirty years of tinkle down and now want the workers to pay for their depression. "If you ask for a rise its no surprise they're giving none away"
I propose a way to increase personal responsibility and you have to go blame it on someone else. Let me ask you this who is taking care of your retirement? The government? The banks? The thing with all those options you take the risk of losing your money with all those options. It's not anyone's fault but your own. You took the risks and now you will pay for them. But go ahead and blame everyone else for your problems. I'm sorry you're not going to get any sympathy out of me. As it goes for the banks, they paid back their debt and with interest. Quit blaming everyone else and accept some responsibility.
ISDNA,
One wonders what your retirement would have looked like had you retired on 2009? Do you deny the corporations have something to do with the mess retirement is in? Were they the ones who raided these accounts that were owed to retirees? These pensions were negotiated in lieu of pay. Social Security was implemented precisely because of the corporate malfeasance which led to the great depression of the thirties. The banks took the risks with other peoples money, walked away with trillions but they didn't pay when it all came crashing down in 2007. To answer your question, I am taking responsibility for my retirement, by voting to keep Social Security, which I have paid into my entire working life, viable. There were plenty of responsible people in 1929 who lost everything through no fault of their own, because of corporate malfeasance. I'm sorry you think blaming the true culprits is inappropriate. As for myself, I have no problems, as my retirement is secure. I don't need any sympathy from you. Nobody has ever lost a dime in Social Security. The private pensions can't even come close. But go ahead and blame government for all your problems. The banks want to blame poor people for their screw up.
Uhh, I'm 25 and a small business owner. Would I ever trust my retirement in an entity outside myself, uuhhh, nope. But that is the risk you take when you don't do things yourself. Quit whining and take control of your life. See If and only If people would take control of their own lives maybe just maybe they wouldn't have half of the many problems that they have. Self inflicted wounds. Can't say I feel too sorry for you and your lack of foresight.
People work to make money. Corporations are in business to make money. Why do liberals insist on pointing the finger? How does that solve the problem? There should have been no bailouts... you are right about that. Including GM, which makes only 3 of every 10 cars in the U.S.!
We, as a country, have to decide what the government's responsibility is. Republicans want the people to pay taxes for the use of education, securing our borders and protecting our nation. But because the Republicans want less from our government, they require less taxes.
The liberals want more taxes for a government that provides for our every need. As you can see, this doesn't work so well. The problem is, once you try it this way, everyone stops working because now the government does everything for you. But when everyone stops working, who foots the bill, the working taxpayers. Now that it fails, how do you go back when all of the non-working leeches continue to vote for the liberal way of government?
You let the irresponsible, lazy people taste the forbidden fruit. Now they have a vested interest in government because it is their livelihood. Now they will surely turn up to vote to keep things as they are.
And the debt keeps piling up at record pace.
You need 20 years of $500B budget surpluses to cut the debt in half. Not eliminate it, just to cut it in half.
We currently have 1T in deficits each year. I would love to see one liberal concept to create a $500B surplus for the next 20 years. Let me guess, tax increases... to the tune of 50B a year... that should erase 1T in deficit and create 500B in surplus.
From CBO 2/5/2013 Report: “CBO expects that economic activity will expand slowly this year, with real GDP growing by just 1.4 percent. That slow growth reflects a combination of ongoing improvement in underlying economic factors and fiscal tightening that has already begun or is scheduled to occur—including the expiration of a 2 percentage-point cut in the Social Security payroll tax, an increase in tax rates on income above certain thresholds, and scheduled automatic reductions in federal spending. That subdued economic growth will limit businesses’ need to hire additional workers, thereby causing the unemployment rate to stay near 8 percent this year, CBO projects. The rate of inflation and interest rates are projected to remain low.”
“If the current laws that govern federal taxes and spending do not change, the budget deficit will shrink this year to $845 billion, or 5.3 percent of gross domestic product (GDP), its smallest size since 2008. In CBO’s baseline projections, deficits continue to shrink over the next few years, falling to 2.4 percent of GDP by 2015. Deficits are projected to increase later in the coming decade, however, because of the pressures of an aging population, rising health care costs, an expansion of federal subsidies for health insurance, and growing interest payments on federal debt. As a result, federal debt held by the public is projected to remain historically high relative to the size of the economy for the next decade.”
"real GDP growing by just 1.4 percent"
The bulk of that is due to the huge spending cuts in the sequester. If the sequester does not happen, they will revise that number up significantly.
The sequester is what Jack Lew cooked up for Obama. This is what Obama wants. A scaled down military that cannot get involved in any foreign affairs. Obama thinks that cutting military spending will increase his ability to spend money on his nonsensical handouts.
What he fails to understand is that military spending creates private sector jobs, massive revenue, and technology and products for private industries as well. If there is one area of the budget you don't want to cut too much too fast... it's military. And what does Obama target... the military.
Sequestration could have been avoided if Obama passed a budget. This was all put into play because of his failure to produce a budget that could pass. The Republican house passes a budget, but the Senate never bothered to look at it.
Companies are making profits by cutting their workforce. They are resilient. The government is not. So companies make money by cutting people. These people are now government dependents. But the government can't pay for them without taxing. So they will try to tax corporations more and the working class and wealthy people more.
7.9% unemployment, not counting the 3.5 million people not being counted that stopped looking for work.
But companies are still turning a profit. So everything is better? 16.5T in debt. And another trillion dollar deficit. Even if you cut the deficit ENTIRELY, you will have 250B in interest that gets tacked onto the debt each year.
Companies will not hire this year even as they grow and turn a profit. GDP may grow, but employment is not. Who pays for these people? Taxpayers. So the shrinking workforce has to pony up more tax money to support the rest.
The biggest mistake Republicans made was delaying the debt ceiling. This country needs to shut down. Like a space station with dying batteries, you keep only essential systems running.
I guess no one read the point made that if things remain the same.
Hopefully they won't and some balanced legislation will come out of Congress.
Well, well. I see that the regular conservative versus liberal attack is going on strong. First a little basic economics. No country can afford long term wars. We had two concurrent wars. Next, income tax can be increased without increasing the tax rates. 1. More people working, directly related to unemployment. 2. Higher wages. This is not happening. Large companies are focused to the bottomline and cheap labor helps the bottomline, no matter where you go to get that labor. And then spending cuts, they are not bad in general if they are cutting waste. But the all out attacks on social programs from the right and military spending from left, has it all out of balance. It takes a balanced approach to make this happen and right now, the Congress is incapable of having intelligent discussions. Until the citizenary moves away from ideology and starts voting for individuals who can work and compromise, then we will end up living in this disaster. Until the power of the vote is brought back to its original power, eliminate the power of lobbies and corporations in the election process, we will not get ahead. Also, the financial crisis was developing over the decades by both Democrats and Republicans by chipping away at the original Glass Steagal act.
For three decades now, the Republican Party has employed a tactic that they call "starve the beast". The idea is that if you deprive the federal government of revenue, that eventually the debt will get so big that congress will be forced to cut spending. The spending cuts have never happened (in fact when the Republicans controlled both Houses and the White House under Bush they increased spending over 50%!). The debt certainly did happen. This failed policy of intentionally running up the debt is what caused this.
Spending cuts are about to happen now. There no longer is any alternatives. Hold onto your seat! Its going to be a rough ride. The era of "big government" is on the way out!
Peter says who????? name me a country with the perfect economic model in the world. Its all THEORY. Japan has functioned for almost two decades with debt above 100% of GDP. Yet their long term debt sells for low rates, they are the third larget economy, and do not have masive inflation.
Explain that using your theoretical model
Our debt will have low rates of interest until it doesn't. Even the CBO is forecasting much higher interest rates in just a few years. At that point the debt is no longer sustainable as investors will demand higher and higher rates. The only answer is to cut spending, especially on entitlement programs. The federal government has made "promises" it cannot keep. Without much higher taxes on those in the middle class, similar to what we see in Europe, there is no way to make the math work. I don't see any way the middle class will support much higher taxes on themselves.
Cutting spending is NOT the only answer. Additional revenue WILL be in the mix, the size of the debt caused by the Republican "starve the beast" failure makes this inevitable. That failed tactic on the part of the GOP is blowing up in their face. There will be more taxes (mostly in the form of closed loopholes and reduced deductions) particularly on the wealthy.
Peter- I believe you are quoting Ross Perot from his 1992 campaign.
Name me a country that runs a "perfect" economy. Any of the social sciences are THEORY. In any of the physical sciences you can find a "normal" cell, a consistency of what you are measuring where you have a definite starting point.
You have your theories, I have mine. You CANT prove yours, same for me. But I can point to countries that have tried your approach( see Europe especially the UK) and the results are not good for your sides theories. Not conclusive proof but honestly look at Japan- how does it function using your theoretical understanding. Yet it does.
All theories are valid until reality tests its beliefs. Yours are not holding up well
The only place left to go for the amount of revenue needed is the middle class. How likely is that to happen?? The next election is in 21 months. Any politician up for election who proposes raising taxes on the middle class would be committing political suicide.
In Europe those in the middle class have long agreed to be a major source of funding for their governments through the VAT, a consumption tax. I don't see any chance of that happening here.
demtothebone - there is a finite amount of capital in the world available for investment. If it all goes to fund federal government debt, there is nothing left to grow the economy. The only alternative is to push up inflation to the point where you inflate your way out of the debt problem. That would crush those in the middle class.
Nonsense, there is plenty of money in the Cayman Islands that can be repatriated. Carried interest is only taxed at 15%, that should be 39.6% There is also plenty of room to increse taxes on capital gains which are still vastly under-taxed. The GOP messed this up with their failed "starve the Beast" tactic which caused most of the debt. Their true constituency (the very wealthy) will end up having the Bejesus taxed out of them before the middle class gives up a dime.
Peter- why do you chose to ignore the point I am making. Not a SINGLE country anywhere in the world has had economic growth using your austerity approach.
Not one of your beliefs is tested. Its all THEORY. So how do you know you are correct?
How can you explain Japan or why the US after a stimulus plan is having a better growth then Europe that followed your beliefs??????
The world is AWASH in capital- why do you think it is so cheap to borrow????????
Why are you afraid to answer my questions- you just go back to having to balance the budget NOW and how can we afford to do so. Who says we have to BALANCE and at what level.
Try the United Kingdom and other countries in Europe. At some point the debt becomes unsustainable. You can then either inflate your way out of the problem or go into austerity.
Here is a number for you. The unfunded liability of Medicare and Social Security combined is now estimated somewhere between $60-100 trillion. As I said, austerity is on the way. Lets hope we can do it in a way that does not throw us back into a deep recession.
The debt actually means nothing more than a political bouncing ball. High unemployment and low wages give it its perceived bounce. "demtothebone" above is quite correct. Japanese debt to GDP stands today at 240 %. Their debt yet sells at nominal rates, and they have just approved a national infrastructure stimulus of some 471 billion dollars. Best way to contain medical care costs is a version of universal health care/single payer system. Additionally, adequate federal spending must be targeted toward the establishment of full employment at appropriate wages. Once attained, the Federal Reserve can diminish the debt to manageable levels in ways appropriate to ongoing currency values and inventories. "Peter" as usual is wrong. He pushes the punishment model.
Peter- I am asking you HOW you KNOW this debt is not sustainable?????? You keep on avoiding. Look at Japan- how does it function. Per your theory the country should have devolved into a basket case 10 years ago yet here it is.
You have a THEORETICAL belief not a proven fact.
PS- the UK is entering its THIRD recession since Cameron imposed austerity. You call that a workable system!!!!!!!!!!!!! Europe has turned away from austerity- dont you KEEP up with FACTS. They have pretty much guaranteed the Greek debt and have issued bonds to support. See G8 meeting during the summer for details.
Keep UP
There is over $2.5 Trillion in the Social Security Trust fund. There is no "unfunded" liability in SS. Your estimate way, way off. So far off it is comical.
@J. Willard Marriott #20.12: There will be if the republicans can ever privatize it. That's why they complain about it so much. They wish to put those funds into the hands of their "Wall street" friends.
JWM: There is an unfunded liability. But, splitting hairs isn't going to make your statement correct. The breakdown of revenue generated by FICA is not enough to cover the cost of outlays for social security, medicare and social security disability. Since baby boomers are reaching the age of 65 at a rate of 10,000 per day, there isn't enough money (even factoring in an untouched social security trust fund receiving interest payments based on special treasury bonds) to cover the costs. The problem isn't so much social security as much as it is medicare and social security disability.
Willard's math challenged and has his Libtard glasses on... so seeing reality is not his strong suit... being able to extrapolate what the millions of boomers will be collecting from SS in the near future is beyond his ability to perceive... and his notion that anybody has "starved the beast" is laughable in the extreme... I guess borrowing 40% more than we take in and squandering it is "starving".... watch for the Libs to advocate "means testing" in the near future for SS, and Medicaid... ie turning programs that were supposed to be self-supporting (until Dems raided the trust funds), and turning them into more Welfare... you paid in, but you planned too well, so you don't get anything... deadbeats paid nothing in, but they get plenty... watch for it... and, watch for Obozo to really grab for the Liberal wet dream... looting 401Ks....
Demtothebone... Japan is a small island of homogeneous people who dedicate themselves to discipline, duty, honor and integrity. Their constitution states they have an OBLIGATION to work. They are not the U.S.
The US allows 11 million people to walk across the border illegally. Then we spend money on web sites that explain that "regardless of your status, you may be eligible for aid". Then we spend more money providing aid to the 11 million felons. Then we spend more money deciding if we should reward them with citizenship.
It isn't like any of these 11 million people are doctors and engineers. It isn't like they can speak the language or read or write. But hey... why not... let's give them our hard-earned tax money. Brilliant. Let my kid's education and healthcare suffer so they can get it free. Why not?
Can you imagine if we told people they HAVE TO WORK? What? Have to work? What about my free phone and internet? I need them!!!
Isa'dna - If I pay taxes on it my entire working life, and my employer is required by law to match said taxes, explain to me again how this is an entitlement? It is not an entitlement unless you expect something from a program you never paid any money into.
I know it isn't entitlement, but what if you did not pay any of that to the government and actually saved. You probably would get more out of it. Anyways entitlement is just a broad term for those programs, some actually feel they are entitled even though they don't pay much if any into it hence the name. Please tell me that you don't know people that actually do that. I do and they also live in different countries where they can live better on that monthly check they get from the government.
Every working person pays into those programs. Entitlement means you have earned it. If you paid into it, you earned it. It's the specific purpose of those deductions to fund those programs.
Like all gov. systems it is abused that is why gov. can't do better than what they private sector can. People just need to take responsibility for their own future and not wait for the government to do it for them. Because the government will fail.
the difficulty with an article like this is can anyone point to a given country who is running the perfect economic model? Who is to say that a 77% debt to GDP is too high? Or even too low? All we have are theories.
Japan functions quite nicely with a continual debt to GDP of well over 100% for going on two decades.
That 77% figure is only on the public debt. When you add in the debt that is in Intragovernmental Holdlings (which is where the SS Trust Fund resides), the number is closer to 105%. At some point there just will not be enough investors willing to buy U.S. Treasuries in the amount required. Economists generally consider 100% to be the red flag number. We are already past it.
I owe myself money is not the same IOU as I owe you money. Peter please see 20.5
Investors of various types own our debt. The government does now owe itself the money. U.S. Treasuries, or any form of debt for that matter, are simply IOUs. Countries, pension funds, individual investors, won those Treasuries. We will not default, and there is nobody big enough to bail us out. That is why countries like Germany and the UK put in austerity, the math didn't work any other way.
Peter- what are you talking about. You mentioned the inter govermental debt pushing us above the magical 100% figure and I say debt owed to ourself is not the same as debt owed to others
The debt is owned by many people and institutions. As that debt grows, more and more people and institutions must invest in that debt. At some point the bond vigilantes will take over and we become Greece. I believe that we will act before then and reign in government spending. That is gradually occurring now and will continue. Sooner or later we will fix Social Security and Medicare. There is no alternative.
If you are talking about Intragovernment Holdings, here is what those holding are.
On the Treasury website, there is a breakdown of the IGH. Some of the Government Account Series holders, as of 9/30/2012:
$2.573 trillion - Federal Old Age and Survivors Insurance Trust Fund (Social Security)
$812 billion - Civil Service retirement and Disability Fund
$431 billion - Military Retirement Fund, Dept of Defense
$214 billion - Federal Hospital Insurance Trust Fund
$190 billion - Medical Eligible Retiree Fund, Dept of Defense
$125 billion - Federal Disability Insurance Trust Fund
$45 billion - Postal Service Retiree Health Benefits Fund
Unless you plan on not paying out the funds when needed for Social Security or these other programs, the debt is just the same as owing it to individual investors.
@demtothebone#22.4: Hee, Hee, give Him hell there. Peter is spouting assumptions produced by the haints of greed. We could, as in 1945, just erase the debt, bury it in the trash, and begin with a fresh ledger.
Java Pour, all we have to do is wait them out. Those that are unable to provide for themselves will the first on the streets. Population control, natural selection, whatever..
I'm tiered of hearing about democrats, republicans, screw this side, screw the other side. Lets throw them all out, and start over from scratch.
Seven million will lose insurance under Obama health law
By Stephen Dinan - The Washington Times
February 5, 2013, 01:00PM
President Obama's health care law will push 7 million people out of their job-based insurance coverage — nearly twice the previous estimate, according to the latest estimates from the Congressional Budget Office released Tuesday.
CBO said that this year's tax cuts have changed the incentives for businesses and made it less attractive to pay for insurance, meaning fewer will decide to do so. Instead, they'll choose to pay a penalty to the government, totaling $13 billion in higher fees over the next decade.
But the non-partisan agency also expects fewer people to have to pay individual penalties to the IRS than it earlier projects, because of a better method for calculating incomes that found more people will be exempt.
Overall, the new health provisions are expected to cost the government $1.165 trillion over the next decade — the same as last year's projection.
With other spending cuts and tax increases called for in the health law, though, CBO still says Mr. Obama's signature achievement will reduce budget deficits in the short term.
During the health care debate Mr. Obama had said individuals would be able to keep their plans.
dont you love working for an employer that has your best interests at heart.
Especially Papa Johns that started this dialogue where he estimates he would need to increase the cost of a pizza by 11 cents and he choses to lay off full time to hire part time. What a creep
If the corporations, awash in cash, decide to cancel insurance coverage for their workers, because they had to revert to earlier tax rates that are lower than they were during Reagans' term, they will not do so because of the Affordable care act, they will be doing so out of unmitigated greed. The pigs are Rockefeller, Morgan, Carnegie wanna be's. Meglomaniacs and narcissists intent on a return to 1900 when they owned everything.
Dembone & Pat multiply that Papa Johns statement times every business in the U.S.. Businesses don't pay taxes. They figure them into the price of their product and pass them along to the consumer.
I'm not talking about the businesses, rather the end profiteers. Return their taxes to historical levels before tinkle down. All businesses make their money off of their employees labor, when they take too much of the profit, society suffers. Taxes keep greed in check. If businesses pay decent wages to their employees they have less to pay in taxes.
Pat, you have no clue how the economy or business works... calling business owners bad names just shows your ignorance even more. Businesses don't pay taxes... they just pass those taxes down to consumers in the form of higher prices... same as they do when any of their other costs go up. So taxes just raise product costs, kill consumers, suck up money that could be used for other goods and services, and slow the whole economy. Competition is what keeps costs low. Here's a clue for you... people start businesses to make profit... no profit, no businesses, no employees... if there is a lot of profit to be made in an area, then lots of people will start businesses... competition keeping the costs of product down, and employing a lot of people... pull your class envy head out of your butt and learn a thing or two...
Pat in SoCal, if I start a business and hire 100 people and grow and grow and now employ 10,000 people. What is my cap? How much am I allowed to make? Isn't capitalism all about making money? My employees are paid well. They're happy to have work and get a nice benefits package. Am I allowed to make 20M a year or 200M a year? Or is that too much because it is beyond your idea of necessary?
Bill Gates created a company to make money. But he did way more than that. Look at all of the education and technology and medical breakthroughs that he helped to create by delivering Windows and other products. But he was villainized because he was so rich and greedy... blah blah blah.
Now he is more involved with philanthropy and helping schools and every liberal is calling him a hero and a great man. Of course he did more for education and schools simply by producing Windows, Office and myriad other products than his philanthropy will ever produce. But for liberals, it is all about IMAGE.
This is why businesses are leaving California and going to Texas and other states.