The President has some bold goals that are based on some major economic growth, thus a major increase in federal revenue.
Is it OK for our debt to go from roughly 10T to close to 23T in the next 10 years? Do you understand that 23T is the sum of our GDP today. I would really like to hear from the liberals? Please defend this.
Don’t have time to dive into this so I’ll take a cheap shot and go.
Is Obama’s plan any worse than the one we’ve been following for the last 8 years…I know I know, Bush isn’t a Republican, he bowed to the Dems at the end, blah, blah, <insert another Republican excuse for the last 8 years here> blah blah blah.
The previous administration set us down this road, Obama is just trying to put the brakes on…
"Record Surpluses to Record Deficits. Republicans have turned President Clinton’s projected 10-year $5.6 billion surplus into a nearly $3 trillion deficit. When this Administration took office, it inherited a projected ten-year surplus (2002-2011) of $5.6 trillion. Based on a realistic estimate of the President’s policies, that surplus has now become a $3.3 trillion deficit over the same period of time, a dramatic fiscal reversal of $8.9 trillion. "
You can criticize Obama all you want, the old man your party nominated wouldn’t be doing anything better.
When I was making similar comments about the Bush plans about 6 years ago, many of the responses that came around at the time were that the deficit projected then was at an acceptable level when compared to GDP. Surely someone has run the deficit/GDP numbers going back 30 years and then compared them to projections for the next 10. I would be interested in seeing those numbers.
Me, I’ve always abhored deficit spending. It is acceptable in times of war and economic calamity. But when the times are good, we need to be socking away money. But I’m not gonna listen to someone who was ok with big deficit spending when Reps ran the WH and Congress. I know, they tokenly spouted that they didn’t like them but then voted nearly unanimously for them.
In my lifetime, it would appear that the best situation economically is for there to be a Dem. President and Rep. Congress.
Clinton actually repeatedly approved budgets with deficits, but the dot.com boom was enough of a driver to erase those. He did do a good job of cutting military costs.
I just want to make one correction to your post. The US GDP for 2008 was about 14 trillion dollars, not 23 trillion.
Somebody also asked for the GDP numbers going back 30 years. If you go to this page:
http://www.bea.gov/national/index.htm#gdp and click on the Current-dollar and “real” GDP link link you’ll get those numbers back to 1929.
Thanks for the link. That gets us part way there. Still trying to find a good listing of annual deficits over the years. I’m sure it is out there, but I keep hitting news sites that don’t do historical numbers.
And then if we can compare that to projections to 2019. For example, in 2004 the deficit was $605 billion, which was 5.3% of GDP. What is a $712 billion deficit in 2019 in relation to projected GDP?
Don’t have time to dive into this so I’ll take a cheap shot and go.
Is Obama’s plan any worse than the one we’ve been following for the last 8 years…I know I know, Bush isn’t a Republican, he bowed to the Dems at the end, blah, blah, <insert another Republican excuse for the last 8 years here> blah blah blah.
The previous administration set us down this road, Obama is just trying to put the brakes on…
"Record Surpluses to Record Deficits. Republicans have turned President Clinton’s projected 10-year $5.6 billion surplus into a nearly $3 trillion deficit. When this Administration took office, it inherited a projected ten-year surplus (2002-2011) of $5.6 trillion. Based on a realistic estimate of the President’s policies, that surplus has now become a $3.3 trillion deficit over the same period of time, a dramatic fiscal reversal of $8.9 trillion. "
You can criticize Obama all you want, the old man your party nominated wouldn’t be doing anything better.
Yep, Bush screwed up on the budget. So, does that make it okay for your man to plunge us deeper?
Maybe that’s what is wrong with voting public. We tell our politicians that as long as they don’t do too much worse than the previous administration - they can do whatever they want. What happened to expecting politicians to accomlish something positive. You sure set the bar low for your candidate. I would hope that you would expect more.
here is my favorite line from your post - **The previous administration set us down this road, Obama is just trying to put the brakes on… **
Spending a gazillion dollars is putting the brakes on?
Thanks for the link. That gets us part way there. Still trying to find a good listing of annual deficits over the years. I’m sure it is out there, but I keep hitting news sites that don’t do historical numbers.
And then if we can compare that to projections to 2019. For example, in 2004 the deficit was $605 billion, which was 5.3% of GDP. What is a $712 billion deficit in 2019 in relation to projected GDP?
You have to be very careful with the yearly deficit numbers. If the accounting practices that the government uses were used by a company, the CEO and CFO would be cellmates with Jeffrey Skilling and Bernie Ebers.
I don’t understand it all, but from what I do understand, a lot of tricks are used to make the deficit seem lower than it really is. For example, Bush never included the cost of the Iraq and Afghanistan wars in the official budget deficit. So if you read the press releases, they say that the US deficit for FY2008 was 455 billion dollars. However, if you go to the link at the end of this post, you’ll see that the governments own numbers show a deficit of 1 trillion dollars for FY2008(which ended September 30, 2008).
I think the most accurate numbers can be found with this site from the Treasury Department. You’d have to do some subtraction to get the numbers for whatever fiscal year(which runs from Oct 1 through Sept 30) you want.
http://www.treasurydirect.gov/NP/BPDLogin?application=np
I’m not an accountant and if anybody here is, they’d probably be able to give you a better explanation of why and how the deficits are underreported.
Thanks for the link. That gets us part way there. Still trying to find a good listing of annual deficits over the years. I’m sure it is out there, but I keep hitting news sites that don’t do historical numbers.
And then if we can compare that to projections to 2019. For example, in 2004 the deficit was $605 billion, which was 5.3% of GDP. What is a $712 billion deficit in 2019 in relation to projected GDP?
Here are a couple of articles about how the government manipulates the budget deficit numbers.
http://www.washingtonpost.com/wp-dyn/content/article/2007/09/03/AR2007090300880_pf.html
http://www.foxnews.com/story/0,2933,493124,00.html
I think the interesting part is this:
"Officials say the budget blueprint to be released this month will also attempt to make public the full extent of the dire fiscal situation, by not repeating some of the accounting used in crafting President George W. Bush’s budgets.
Recent budget blueprints excluded from deficit projections the long-term costs of wars in Iraq and Afghanistan. Those budgets also didn’t include the cost of preventing the alternative minimum tax – instituted in 1969 to ensure the rich didn’t escape taxation – from hitting the middle class."
Three things are bankrupting the feds: SSI, medicare ($2+ tril.) & defense ($1 tril.). Those things amount to $3 trillion of the $3.6 trillion fed budget.
Only drastic changes and cuts in all three will work. Now how, exactly will we do this? I don’t know.
(For the people who say defense is less than that, simply count military benes & pensions, debt on past wars, the cost of 2 current wars, Homeland Security, NASA & EPA stuff related to defnse, black budgets & intel. in defense spending and its over $1 trillion).
Plus if you add the long-term liability from things like social security and medicare to account for those that will be on the system in the future, the deficit soars. I think I’ve seen numbers the put the total estimate close to $50 trillion.
Thx for the correction…I made a guess…the number today is one thing (it sucks) but the number in 10 years is even worse.
If we look at history…the govt takes in 18% of GDP regardless of what the marginal rates are (can’t find the source but we discussed this months ago on the LR)…so using that as a historical guide, should spending be based on those figures?
I really don’t want to argue anymore about what we spend money on…I just want to discuss a plan that keeps our nation healthy. Obama could have won a lot of support if he would have maintained spending, increase taxes on the wealthiest (even though I disagree because this will not increase dollars to the Tresury - remember they collect 18% on average) and then wait to see how we would recover…then based on the recovery, he could present a plan to remake how govt spends.
But the most troubling thing is this plan only increases our debt at an ever increasing rate (and its based on a rosey economic forecast).
I agree with you that the Reps presented ridiculus budgets, and now we have something even worse.
And you forgot interest on the debt which is the other thing…
Defense: We should freeze spending now and ask others (Japan, Europe to spend more)
SSI: Increase retirement age NOW, people are living longer (Buys us time to come up with a better option)
Medicare: This is the one that is out of control the most, you need to increase the age to qualify to buy more time
Interest: If you could balance the budget, this item would get smaller over time
All the other discretionary spending is peanuts.
If we look at history…the govt takes in 18% of GDP regardless of what the marginal rates are (can’t find the source but we discussed this months ago on the LR)…so using that as a historical guide, should spending be based on those figures?
I really don’t want to argue anymore about what we spend money on…I just want to discuss a plan that keeps our nation healthy. Obama could have won a lot of support if he would have maintained spending, increase taxes on the wealthiest (even though I disagree because this will not increase dollars to the Tresury - remember they collect 18% on average) and then wait to see how we would recover…then based on the recovery, he could present a plan to remake how govt spends.
But the most troubling thing is this plan only increases our debt at an ever increasing rate (and its based on a rosey economic forecast).
I agree with you that the Reps presented ridiculus budgets, and now we have something even worse.
Here’s a reference to the 18% figure which they claim is the average over 5 decades.
http://www.taxpolicycenter.org/briefing-book/background/numbers/revenue.cfm
I think you bring up an excellent point. We can all disagree on what programs the government spends money on. We should have a legitimate debate about that.
The thing I keep wondering about is what are the consequences of an ever increasing national debt(that is growing as a % of GDP), the baby boomers just beginning to retire, etc? I’m not an accountant or an economist. It just seems that common sense would say that at some point something is going to crash.
There was an engineer who worked on the solid rockets before the Challenger explosion who wrote the following memo.
http://www.onlineethics.org/CMS/profpractice/exempindex/RB-intro/Erosion.aspx
I saw him interviewed a year or two ago and he mentioned that the culture inside NASA back then was going “away from the direction of goodness.” That is the same feeling I have about the US government under the leadership of both Bush and Obama.