Bush killing US financially - heading for $8 trillion debt

Over 47% of the personal income taxes (but not of total tax revenue) collected in 2003 was spent on paying interest on the debt.

And in 2004 we're adding another half a trillion to the debt.

We're almost 7.5 trillion into the hole.

This crap has to be paid off. We can't default on payments or the US dollar will be worthless.

Why can't the CEO of the country realize the country should be debt free and in the black?

This is a 'war president' too dumb to realize strong defense relies on sound economics? Or will he borrow more money from China to fund the US military?

www.brillig.com...

$7,295,201,494,830

You (American citizen) owe $24,827!!

Have a nice day!

Many of the corporations who benefit from the American marketplace, through accounting gimckry are moving their incomes to untaxed countries in the Bahamas. Their tax burden is vanishing, adding to the billions they spend on lobbyists and campaign contributions to manipulate and corrupt all legislation.

Add to that babyboomers retiring and finding the Social Security funds borrowed away. I think we may have serious economic and social/political earthquakes in the US, with repercussions world wide.
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With so many expert economists at ATS telling me that the job figures are looking good and there is some sustained economic growth (*God knows where outside the no-bid contracts to destroy and rebuild Iraq*), I simply cannot believe the headline of this topic. It is just unthinkable.

*Sarcasm off*.

Amazing, isn't it? How could such an idiot enjoy so much support? Is the average American this stupid?

What a shame. I'm embarassed to admit my nationality anymore. What a cryin' shame ...

I understand if the debt was just canceled it would kill the US dollar. But could you not just revalue our currency base it on a metal like silver or gold something like England has with silver which would make it really strong. mexico revalued there peso with the new peso when I went there years ago 1 dollar was worth like 3500 pesos and now 1000 old pesos equal 1 new peso

Yeah Russia revalued it's money too, but look at the economic conditions of those countries. Their revaluing did little more than allow a person to fit enough money in their wallet to buy bread.

but if you backed it with a metal or something eles it would hold great value. That one thing russia and mexico did not do

I dunno, maybe the whole plot is to use the debt to buy trillions in military hardware, then default on the payments, crash the US dollar, and start a new government with the established military. There's usually a method to the madness and even a simple household keeps itself in the black, nevermind a corporation or a country. The debt really exploded in 1981 when it hit a trillion, now 23 years later it's 7.3 trillion with no end in sight...

Although it's All Bush's Fault(tm), the 535 members of Congress who insist on pushing through pork and increases in spending regardless of deficits probably deserve an honorable mention for their tireless efforts.

Remember, we're still at least a few years away from a full-blown monarchy, despite the wishes of some citizens to accelerate the process.

Doesnt America have the biggest gold reserve in the world. Not even counting the gold other countries keep in america? Maybe something like you said is planned and they plan to keep all that gold to start a new and very strong gold back currency.

Well, ShadowXIX, having a secret plan to bankrupt the US and then re-establish a new currency seems kind of un-American.

Oh wait, so does pre-emptive invasion of a sovereign country.

Nevermind!

Sure, blame it on Congress. Bush signed all those pork and spending bills. Someone correct me if I'm wrong, but I don't believe Bush has vetoed a single appropriations bill in four years. So, yes, it is Bush's fault.

More importantly, it is Bush's fault because of his fiscally irresponsible tax cuts. He must share the blame with Ronald Reagan. The following graph shows clearlly the effects of large tax cuts.

external image

Notice that for every President from Truman through Carter, the national debt as a percentage of GDP declined. Then we had the large tax cuts of Reaganomics, AKA voodoo economics, which resulted in twelve years of sharp increases of the burden of the debt on the national economy. After Clinton's tax increases, the graph resumes its normal downward course.

Then the Smirking Chimp repeats Reagan's mistakes by pushing through large tax cuts. Guess what, the debt as percentage of GDP starts increasing again.

This graph gives the lie to the Republican nonsense that tax cuts are the solution to economic problems. The graph makes it quite clear that tax cuts create long-term problems for the economy.

donguillermo

Very nice post.

Picture is like 1000 words indeed.

I.

Rasing taxes for the American people Hmmm thats a good platform to run on during a election year. The American people just love that

While Carter was rasing Taxes my Parents could not buy a House but when Reagen got into office they could. Whats the point of lowering the debt if people cant by houses to live in

[edit on 29-7-2004 by ShadowXIX]

Actually, we voted for the other guy...an archaic elections system (electoral votes), idiots in a certain FL county, and a crooked governor (the pres's brother) and elections supervisor, GAVE the country to Bush.

You need to actually start analyzing the issues instead of just blindly accepting that raising taxes is bad, and lowering taxes is good. The graph shows clearly what the effect of cutting taxes is. Continuing the policies of the Bush administration will bankrupt the federal government.

The facts do not bear out the claim that raising taxes is bad for the economy. After Bill Clinton raised taxes, the economy went on a prolonged boom, resulting in the creation of 22 million jobs. Meanwhile, the federal budget went from a deficit of over $200 billion to a surplus of over $200 billion. Projections were that the national debt would be paid off in less than 20 years. Then the economically illiterate George Bush and the Republican-controlled Congress passed multiple tax cuts, resulting in record deficits and the prospect of trillions of dollars added to the national debt.

What is the point of lowering the debt? Right now, the federal government is paying $318 billion a year just on the interest on the national debt. If the debt were paid off, that would mean a tax cut we could actually afford.

First step to the solution is bomb 'K' street (the home of all the lobbyists), since that is where all the horrific legislation is written. How can a congressperson be expected to read a thousand pages for every bill? But if they are going to vote for them they or their personal staff darn well better. The patriot act was passed totally unread, many other bills are virtually unread before voting. That is irresponsible in the extreme. They get paid good salaries, they pass themselves off as concerned and engaged, but this is pure negligence. If you talk the talk you aught to walk the walk.
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Long-term deficit spending is fraught with problems, although there can be positive effects from a moderate amount of public debt (moderate being pretty small in my book).

Ultimately, when heavy deficits mount without some responsible plan for resolving them, all sorts of trouble follows.

My preference in addressing deficits is to reduce spending. However, spending reductions must be planned and executed cautiously, lest the law of unintended consequences beat us about the head and shoulders.

The incestuous nature of the two ruling parties, where one hand traditionally washes the other in budget negotiations, ensures that spending will continue to grow.

At some point, the revenue base will be unable to support the level of desired spending, and deficit spending is limited as excessive debt ultimately drives away potential creditors.

Fortunately, while catastrophe is always a possibility, there is a certain degree of robustness built in to the U.S. economy, much of which arises from the presence of heavy foreign investments.

While that is alarming to some Americans, it should bring comfort, because no one likes to lose money. Consequently, foreign investment generally encourages beneficial policies from foreign nations. But I digress.

The current deficit spending spree reflects negatively on both parties. Sooner or later, the trough will start to become empty.

Hopefully before then, our politicans and their greedy constituents (i.e., us) will consider a more balanced diet.




[edit on 7/29/2004 by Majic]

I am a retired professor of Economics. The U.S. is not going broke. Here are the most basic of facts.

As a percentage of GNP, our debt is not as great as in past decades. For 60 years until Richard Nixon became president, the U.S. had run a deficit. So Nixon, saying he was doing it just so it could be done and admitting that it would serve no purpose whatsoever, balanced the budget for one year.

For a few decades thereafter, the government was satisfied that balancing the budget on a federal scale served no purpose and continued to spend more than they took in. The difference between a federal budget and a household budget is that a collector cannot call his debt due. The debt is owned by American citizens who buy bonds. We make money off the government's debt.

A household or corporate budget is completely unlike a governmental debt. Stop worrying. The US will not collapse. Every presidential candidate and his advisors are completely aware of this but complaining about the debt makes good press and gets votes from ignorant citizens.

Just in case you believe, for example, that the current candidate wanting to win the presidency will balance the budget, listen to what he says. He wants to spend more, not less. That won't break us either.