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| Topic: Federal Debt - Fiscal Crisis | |
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Here we go again, boiz 'n grrlz ... all the 'usual suspects' are gonna gather 'round to do their 'irate villagers with torches and pitchforks' routine and defend 'The UN', but that ain't gonna change the facts of this matter one little bit ... This is HIS tar-baby that's bankrupting the country, and all the 'But he's a GOOD boy!' HLJ stuff ain't gonna matter when the economy's in the toilet and the user's hittin' 'flush' ... 'Hope' ... 'Change' ... yeah, baby - you got it ... These are the results of YOUR boy's flawed premises and 'command-and-control' wet dream ...
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ http://www.cbo.gov/doc.cfm?index=11659 FEDERAL DEBT AND THE RISK OF A FISCAL CRISIS JULY 27, 2010 Economic and Budget Issue Brief SUMMARY Over the past few years, U.S. government debt held by the public has grown rapidly—to the point that, compared with the total output of the economy, it is now higher than it has ever been except during the period around World War II. The recent increase in debt has been the result of three sets of factors: an imbalance between federal revenues and spending that predates the recession and the recent turmoil in financial markets, sharply lower revenues and elevated spending that derive directly from those economic conditions, and the costs of various federal policies implemented in response to the conditions. Further increases in federal debt relative to the nation’s output (gross domestic product, or GDP) almost certainly lie ahead if current policies remain in place. The aging of the population and rising costs for health care will push federal spending, measured as a percentage of GDP, well above the levels experienced in recent decades. Unless policymakers restrain the growth of spending, increase revenues significantly as a share of GDP, or adopt some combination of those two approaches, growing budget deficits will cause debt to rise to unsupportable levels. Although deficits during or shortly after a recession generally hasten economic recovery, persistent deficits and continually mounting debt would have several negative economic consequences for the United States. Some of those consequences would arise gradually: A growing portion of people’s savings would go to purchase government debt rather than toward investments in productive capital goods such as factories and computers; that “crowding out” of investment would lead to lower output and incomes than would otherwise occur. In addition, if the payment of interest on the extra debt was financed by imposing higher marginal tax rates, those rates would discourage work and saving and further reduce output. Rising interest costs might also force reductions in spending on important government programs. Moreover, rising debt would increasingly restrict the ability of policymakers to use fiscal policy to respond to unexpected challenges, such as economic downturns or international crises. |
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Watch us leave the Chinese holding the bag!
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The Chinese are WAY ahead of 'The UN' ...
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