DEBT PARTY USA -- $13 Trillion National Debt Poised To Overtake GDP; Obama Increasing Debt At 3X The Rate Of Bush
The federal debt is now growing by $5 billion each and every day.
Don't let the headline fool you. Both parties are to blame. Republicans have proven equally adept at stealing your children's future.
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For more background on this video, see the following story:
I Pledge Allegiance To Americaʼs Debt, And To The Chinese Government That Lends Us Money...
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Video: Debt Crisis USA from the Peterson Foundation
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National Debt Tops $13 Trillion For First Time
The National Debt topped $13-trillion for the first time in U.S. history - reflecting the surge in government spending that will push the Debt to increasing highs through the rest of the decade.
Posted on the Treasury Department website this afternoon, the National Debt hit $13,050,826,460,886.97 as of June 1st.
Tallied against the nation's Gross Domestic Product, the latest Debt number amounts to nearly 89.4 percent of the total economy.
It's not often that President Obama mentions the debt, but 90 minutes before the latest number was posted, it was part of his speech on the economy delivered at Carnegie Mellon University in Pittsburgh.
He was making the case that the record high federal deficits on his watch were not really his fault.
"We took office amid a crisis, and the effects of the recession put a $3 trillion hole in our budget before I even walked through the door," he explained to his audience.
Without mentioning his predecessor by name, he argued that blame for the expanding Debt reflected the policies of President George W. Bush.
"By the time I took office, we had a one-year deficit of over $1 trillion and projected deficits of $8 trillion over the next decade," he said. "Most of this was the result of not paying for two major tax cuts skewed to the wealthy, and a worthy but expensive prescription drug program that wasn't paid for."
Mr. Obama says that if these were "ordinary times," he would have acted more aggressively to reduce the annual federal deficits.
"But we took office amid a crisis, and the effects of the recession put a $3 trillion hole in our budget before I even walked through the door."
He said the "economy is still fragile," and it would be risky to "put on the brakes too quickly."
The National Debt has so far increased $2.4 trillion on Obama's watch. The Debt stood at $10.626 trillion on the day he took office. It increased $4.9 trillion during Pres. Bush's 8-years in office.
Both Mr. Obama and Congress expect the Debt to continue to soar. On February 12, Mr. Obama quietly signed legislation that raised the Debt Limit to nearly $14.3 trillion.
It's likely that figure will have to be raised in less than a year.
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President Barack Obama is poised to increase the U.S. debt to a level that exceeds the value of the nation’s annual economic output, a step toward what Bill Gross called a “debt super cycle.”
The CHART OF THE DAY tracks U.S. gross domestic product and the government’s total debt, which rose past $13 trillion for the first time this month. The amount owed will surpass GDP in 2012, based on forecasts by the International Monetary Fund. The lower panel shows U.S. annual GDP growth as tracked by the IMF, which projects the world’s largest economy to expand at a slower pace than the 3.2 percent average during the past five decades.
“Over the long term, interest rates on government debt will likely have to rise to attract investors,” said Hiroki Shimazu, a market economist in Tokyo at Nikko Cordial Securities Inc., a unit of Japan’s third-largest publicly traded bank. “That will be a big burden on the government and the people.”
Gross, who runs the world’s largest mutual fund at Pacific Investment Management Co. in Newport Beach, California, said in his June outlook report that “the debt super cycle trend” suggests U.S. economic growth won’t be enough to support the borrowings “if real interest rates were ever to go up instead of down.”
Dan Fuss, who manages the Loomis Sayles Bond Fund, which beat 94 percent of competitors the past year, said last week that he sold all of his Treasury bonds because of prospects interest rates will rise as the U.S. borrows unprecedented amounts. Obama is borrowing record amounts to fund spending programs to help the economy recover from its longest recession since the 1930s.
“The incremental borrower of funds in the U.S. capital markets is rapidly becoming the U.S. Treasury,” Boston-based Fuss said. “Do you really want to buy the debt of the biggest issuer?”
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Federal debt tops $13 trillion mark
The federal government is now $13 trillion in the red, the Treasury Department reported Wednesday, marking the first time the government has sunk that far into debt and putting a sharp point on the spending debate on Capitol Hill.
Calculated down to the exact penny, the debt totaled $13,050,826,460,886.97 as of Tuesday, leaping nearly $60 billion since Friday, the previous day for which figures were released.
At $13 trillion, that figure has risen by $2.4 trillion in about 500 days since President Obama took office, or an average of $4.9 billion a day. That's almost three times the daily average of $1.7 billion under the previous administration, and led Republicans on Wednesday to place blame squarely at the feet of Mr. Obama and his fellow Democrats.
"A $13 trillion debt is an alarm bell and a wake-up call combined, but Democrats are not even trying to pass a budget," said House Minority Leader John A. Boehner, Ohio Republican. "How out of touch can Washington Democrats get? Instead of continuing to pay lip service to this issue, President Obama should call on congressional Democrats to pass a budget that provides the fiscal discipline economists say is needed to create jobs and grow our economy."
The White House would not comment for the record, but an official speaking on the condition of anonymity said the administration is "committed to restoring fiscal responsibility."
Spokesmen for the Democratic chairmen of the House and Senate budget committees didn't return messages Wednesday.
In the budget he submitted to Congress in February, the president acknowledged that his plans are not enough to reduce annual deficits to sustainable levels, which he said amounted to a yearly shortfall of 3 percent of gross domestic product. Mr. Obama called for a fiscal commission to make recommendations to close the gap, and commission members at their meeting last week said even that may not be enough.
"I think we've got to be more ambitious than that," said Alice Rivlin, former director of the Congressional Budget Office. "We really have to pick a trajectory that has the debt coming down. And there's probably no magic of whether it comes down 1 percent a year or 2 percent a year or whatever. But it's got to come down over time."
Underscoring the challenge of finding balance, Congress has not been able to pass a fiscal 2011 budget. The Senate Budget Committee has approved a proposed budget, but it has not been debated on the Senate floor, and House Democratic leaders have indicated that they may give up debt reduction altogether this year.
Several unofficial debt clocks had shown the debt crossing the $13 trillion threshold a week ago, though Treasury said those numbers were not official. Those clocks regularly recalibrate using Treasury numbers, but estimate growth rates in order to provide a per-second update on websites.
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DailyBail
Updated with new video.
Reader Comments (5)
Cameron lambasted the Labour administrations of premiers Tony Blair and Gordon Brown, saying their "total irresponsibility" had left a "terrible" legacy that meant everyone's lives would be affected by the cutbacks.
In a speech laying out the scale of Britain's "debt crisis", Cameron said if urgent action was not taken, the consequences would be much worse as interest payments stacked up.
Cameron's new Conservative-Liberal Democrat coalition is to present an emergency budget on June 22 as it bids to tackle the deficit.
"Today, our national debt stands at 770 billion pounds," Cameron told an audience in Milton Keynes.
"Within just five years it is set to nearly double, to 1.4 trillion pounds. That is some 22,000 pounds for every man, woman and child in the country."
The Conservative leader said if no action was taken, Britain would be paying a "staggering" 70 billion pounds a year interest on its debt by 2015.
http://www.breitbart.com/article.php?id=CNG.c44390c50c9adb01cd1b30e8494bfbf2.5d1&show_article=1
Public sector workers face average wage cuts of 5 percent for this year and a freeze for 2011 as part of a plan to cut the budget deficit to 9.3 percent of gross domestic product this year, from 11.2 percent in 2009, and then to 6 percent in 2011.
"Tuesday's action is without a doubt a marketing exercise to gauge the support for a possible general strike," said University of Navarra political communications professor Carlos Barrera.
http://www.alertnet.org/thenews/newsdesk/LDE65407Z.htm
http://apnews.myway.com/article/20100607/D9G6D6NO0.html
I think we'll save more of that...young people will disavow the debt...