We're doomed.

[Richard Cranium]

http://www.youtube.com/embed/VtVbUmcQSuk

[PocketThunder]

They say our children and our grand childrens futures are being spent down the crapper, but our own future is already screwed!!!!!

[mikesbbody]

Wow! unbelievable here's a link I found to show how much these amounts look like.

http://www.pagetutor.com/trillion/index.html     

[doctor4766]

If Boss Hogg were President I'm sure he'd have Rosco printing day and night til the debt was paid off

[440]

That episode was on yesterday with Boss Hogg and the confederate lock box 

[Patronus]

Someone help me. How is it possible we go from surplus under Clinton to this? Honestly, who the fuck did this and got away with it? 

[PocketThunder]

Someone help me. How is it possible we go from surplus under Clinton to this? Honestly, who the fuck did this and got away with it? 

A Democratic controlled Congress did it..   

[Brock Samson]

http://www.rollingstone.com/politics/news/the-real-housewives-of-wall-street-look-whos-cashing-in-on-the-bailout-20110411

http://www.rollingstone.com/politics/news/the-real-housewives-of-wall-street-look-whos-cashing-in-on-the-bailout-20110411?page=2

perhaps too deep for the finger pointers who think they know all about it,.. But what ya' gonna do?.. 

[440]

One word - Obamination

[nh_mopar_fan]

Someone help me. How is it possible we go from surplus under Clinton to this? Honestly, who the fuck did this and got away with it? 

Even with this supposed surplus, the national debt went up each and every year under Clinton. There was some creative accounting to get to that surplus, like counting social security funds into the budget numbers.

[tricky lugnuts]

In reference to the Rolling Stone link above, the Federal Reserve is not directly responsible for the U.S. national debt, and has little to do with the large escalation of debt we've seen, from say $8 trillion a few years ago to the $14.1 trillion or so now.

I'd look more at the eight years of two overseas "wars" funded with off-budget emergency resolutions . . . The national debt is nothing more than the accrual of year-to-year budget deficits. Blaming it all on Obama is ridiculous. Granted, he has been running record budget deficits - projected to hit $1.6 trillion this year (FY 2011), a new record, after $1.4 trillion last year (FY 2010). And that certainly adds up fast - $3 trillion in two years.

Also granted, the Federal Reserve significantly expanded its balance sheet over the last three years, buying up questionable "assets" and such, hence the Rolling Stone article on TALF.

The most nefarious role the Federal Reserve has been playing IMHO - aside from the ongoing, essentially zero interest rate lending to formerly troubled banks that are now posting record profits and still not lending to American citizens and businesses - is how it has enabled Washington to spend more than it takes in by buying hundreds of billions of dollars worth of the treasury bills needed to finance the federal government, i.e. this latest round of $600 billion of "quantitative easing."

That easing, coupled with zero percent interest rates, essentially allows the Federal Reserve to monetize the debt: buy debt, issue debt, buy debt, issue debt, and keep the borrowing costs for the U.S. government artificially low. Hence why you should be starting to read about people like Bill Gross with PIMCO who say they are getting out of treasuries because the yields aren't where they should be. When those yields get where they should be - hence the questions of when the Fed going to raise its interest rates and stop buying loads of treasuries - watch what happens to the national debt then.

We're paying a quarter trillion dollars on the national debt every year - just in break-even interest payments - at 2-3% interest. That's a fixed part of the federal budget that can't be stopped, absent defaulting or paying off the debt.

Watch what happens to those interest costs and the national debt if those borrowing costs go up because nobody views treasury bills as a safe, bankable asset anymore, i.e. Portugal, etc. With such big numbers, even a 1-2% increase in borrowing costs adds up big.

If you think the national debt's freaky, unfunded liabilities are where it gets really awesome: Social Security, Medicare, Medicaid obligations over the next 50 years.

http://www.usatoday.com/news/washington/2007-05-28-federal-budget_N.htm

And that aspect has only gotten worse with the latest recession, especially at the state and local level. Massachusetts has major pension problems, to name one state, so does California. And look at Illinois, one of the most populous states: they're borrowing $3 billion just to make the payment on their pension obligations this year.

And as to the Clinton surplus and how we get here from there, that surplus was just a one or two year budget surplus - i.e. for the first time in 50 the federal government actually spent slightly less than it collected in revenue for the year. There was still a national debt.

[Mopar440+6]

[TK73]

Tricky,

We have to ask you to leave. We can not have somebody who actually knows what they are talking about post on this forum.




One question before you go:

"And as to the Clinton surplus and how we get here from there, that surplus was just a one or two year budget surplus - i.e. for the first time in 50 the federal government actually spent slightly less than it collected in revenue for the year. There was still a national debt. "

If you spend less than you bring in and pay off debt, eventually that debt will lower... right?

[nh_mopar_fan]

One question before you go:

"And as to the Clinton surplus and how we get here from there, that surplus was just a one or two year budget surplus - i.e. for the first time in 50 the federal government actually spent slightly less than it collected in revenue for the year. There was still a national debt. "

If you spend less than you bring in and pay off debt, eventually that debt will lower... right?

Bingo. But, the debt went up every year. So what happened to that supposed surplus?

[TK73]

His budget "surplus" was in the last year or two.

This graph is interesting (Clinton years started to level off at the end of his years):

http://cedarcomm.com/~stevelm1/usdebt.htm

[69CoronetRT]

Someone help me. How is it possible we go from surplus under Clinton to this? Honestly, who the fuck did this and got away with it? 

Balancing a budget and creating a surplus is simple and easy. Clinton proved it. You don't have to cut spending, you just raise taxes (increase revenue) to cover the spending. There's a problem with this model though.

[69CoronetRT]

In reference to the Rolling Stone link above...There was still a national debt.

Very nice post!

[TK73]

There's a problem with this model though.

Less problem with Tax and Spend than Borrow and Spend...

[bull]

Someone help me. How is it possible we go from surplus under Clinton to this? Honestly, who the fuck did this and got away with it?  

There was no real surplus as far as our national debt is concerned. All they did back then was balance the budget for a year or two which means they spent the same or less than they took in. That's fine and dandy but it's like running up a $20,000 credit card bill and then deciding to scale back on your spending to match your income while the huge debt remains unpaid and accruing more interest. Some people try to say there was a surplus that reduced our debt but if you look at the debt history there's no point during the Clinton years (or pretty much any other year since Andrew Jackson was president) that the national debt went down.

Debt = the amount you owe.
Deficit = the amount you spent above what you make.
Surplus = the amount you make above what you spend.

The last time the US had zero national debt was 1836. National debt isn't necessarily a horrible thing unless your debt-to-GDP ratio gets too out of whack. When that happens you run the risk of losing your sovereignty as a nation and your largest debtor (China in our case) can really start screwing with you.

[bull]

There's a problem with this model though.

Less problem with Tax and Spend than Borrow and Spend...

The problem is the "spend" part of the model. Taxing to spend or borrowing to spend; either way you've got to get a handle on the spend or things get worse.

[440]

Funnily enough many of our Chargers end up looking like that chart  

[RallyeMike]

Our Govt has been acting like a teenager with a new credit card for the last 30+ years, and with no end in sight.

We're pretty much f@cke'd at this point, so I say party on. Somebody pour me another.

   

[Mike DC]

                
Empires have a habit of doing this.  Military expansion works great to grow the empire's wealth and power at first.  But diminishing returns from continued expansion --> borrowing money from other nations -->  currency inflation to reduce the value of the debt -->  crumbling empire. 

[TUFCAT]

Our Govt has been acting like a teenager with a new credit card for the last 30+ years, and with no end in sight.

We're pretty much f@cke'd at this point, so I say party on. Somebody pour me another.
 

Hell, as long as Obamass is buying, ...I'll take another!

[Mike DC]

 
I'd be curious to see an inflation-adjusted chart of the debt over the decades.  

Although it would be hard to get those kinds of figures because the official CPI stats are a joke.