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Politics : Foreign Affairs Discussion Group -- Ignore unavailable to you. Want to Upgrade?

To: Neocon who wrote (140750)	7/17/2004 1:20:34 PM
From: jttmab	Read Replies (1) \| Respond to of 281500

Using the numbers for during the Clinton years? Surely there must be more current numbers. The debt limit has been raised three times since Bush came into office and it will have to be raised again before the end of the year [to $8T]. The national debt is now over ~$7.2T, a 31% increase in the national debt. Rather than your $20K per person; it's now $24K per person. digitaleconomist.com In the above linke you'll notice the trend on Interest; it's dropped dramatically but that's due to the exceptionally low interest rates with T-Bills running at an average rate of ~1.5%. Interest on the national debt, which is now 5.5 trillion dollars, has risen to 10 percent of federal spending. It's nearly double of that, ie., 19%. Again at 40 year low interest levels. If you look at the table at: digitaleconomist.com Compare the debt columns and interest colums for 2002 and 2004. When the interest rates return to the levels in 2004, you can multiply the interest on the debt by at least a factor of 2. The current national debt is equal to about 55 percent of GDP. Make that 60%. President Clinton sent the first balanced budget to Congress in 30 years, thanks to a strong economy. No doubt the strong economy was a significant contributor. But it wasn't strictly the economy. Federal spending per taxpayer went down during the Clinton Administration [The only Administration since Kennedy when spending per taxpayer went down.. In the Bush Adminsitration it's gone up considerably. Note that the chart only goes through 2002. heritage.org Then there's the issue of the SS surplus which becomes a deficit when the baby boomers start collecting more than is going into social security. payable to owners of Treasury bonds, 87 percent of them Americans. "Foreign ownership of US assets has reached a peak not seen since Christopher Columbus planted his flag. As the chart shows, foreigners now hold a third of all US Treasury bonds and close to 15% of equities*. " [Note: the comment on Columbus was kind of cute..] thisismoney.com jttmab

To: Neocon who wrote (140750)	7/17/2004 4:47:41 PM
From: Noel de Leon	Read Replies (1) \| Respond to of 281500

More relevant is what Reagan, Bush I, and Bush II have done. A source which shows the problem in a form you prefer. www.econ.ucdavis.edu/faculty/ bergin/ECON101/mankiwch15.pdf More important is your use of statistics to prove "Clearly, debt is within historically manageable proportions." You use WWII to prove your case which is statistically dishonest. Reagan and Bush I and Bush II were and are not in a WWII situation. "The current national debt is equal to about 55 percent of GDP." Which is double that of the national debt when Reagan took over. 25% in 1980, 49% in 1993 due to Reagan tax cuts, increase in defense spending(wow, and Osama got some of it), and entitlements. Debt ratio fell to 32% thanks to boom, increased taxes, and rapid growth. This is called fiscal responsibility. Deficit returned thanks to tax cuts and slowdown. This is called fiscal irresponsibility. I repeat: you are dishonest when you claim that a 55% debt ratio is "...is within historically manageable proportions." The result today(thanks to Bush II and Greenspan) is a triple threat. 1) GDP ratio at historically high peace time levels. 2) Historically high consumer debt 3) Historically high current accounts deficit.