$15 Trillion and Counting

[WillowTree]

On Wednesday, the federal government's total debt exceeded fifteen trillion dollars. That's $48,000 in debt per citizen and over $133,000 in debt per taxpayer. Adding in all U.S. debt, including personal (mortgages, credit cards, student loans), plus government at all levels, the debt is approaching an incomprehensible $55 trillion, representing almost $661,000 per American family.
If you want to see just how literally big these numbers are, take a look at this screen shot from USDebtClock.org taken a couple of seconds after the fateful $15 trillion national debt was reached.



U.S. National Debt Clock : Real Time












The American Spectator : $15 Trillion and Counting

 

[WillowTree]

Hey big spender!

 

[Sundial]

That's also $15 trillion worth of assets in the private sector - $15 trillion that would otherwise not exist.

The private sector needs those assets in order to fund private savings. Without them we'd be $15 trillion dollars poorer - that's $48,000 per citizen.

 

[expat_panama]

...the federal government's total debt exceeded fifteen trillion dollars. That's $48,000 in debt per citizen...

LOL!!

How about the fact that Americans own eighteen trillion dollars worth of real estate, that's supposed to mean the average man, woman, and child holds a deed worth $58,000 --on top of stocks, bonds and bank accounts of $132,000, plus other assets totalling up to a quarter million each.

If every citizen owes $48,000 then every family of four is a millionaire household.

 

[PoliticalChic]

...the federal government's total debt exceeded fifteen trillion dollars. That's $48,000 in debt per citizen...

LOL!!

How about the fact that Americans own eighteen trillion dollars worth of real estate, that's supposed to mean the average man, woman, and child holds a deed worth $58,000 --on top of stocks, bonds and bank accounts of $132,000, plus other assets totalling up to a quarter million each.

If every citizen owes $48,000 then every family of four is a millionaire household.

I like the optimism of your posts.

It would be helpful to me if you could provide the data that supports your figures.

 

[PoliticalChic]

Hey big spender!

The chart says each citizen owes $174 thousand in US debt....and $58 trillion in total household assets...or $180 thousand per household. If there are three in the household, then $540 thousand, minus the $174 thousand, is the household is $366 thousand to the good...if they have no other debts...

How's my drivin'?

 

[Wiseacre]

Check this out, from cnn.money.com:

NEW YORK (CNNMoney) -- Interest payments on the national debt could total $5.5 trillion over the next decade, or about 79% of the new debt estimated to accrue between 2012 and 2021.

And that's the optimistic scenario.

The CBO -- and everyone else for that matter -- assumes that interest rates will rise. Just how quickly is the question. The CBO assumes a gradual rise, and projects that the 10-year Treasury rate won't hit 5% before 2015, up from an average of 3.2% today.

But if interest rates end up being 1 percentage point higher than the CBO assumes over each of the next 10 years, interest costs could go up by another $1.3 trillion, putting total costs at $6.8 trillion.

What could push rates up sooner than the CBO anticipates? Among the possibilities:

-- The lack of a medium- or long-term debt reduction plan by 2013, said Jim Vogel, head of interest rate strategies at FTN Financial.

-- Greater-than-expected inflation, three leading economists told the Senate Budget Committee on Tuesday.

Of course, it's not just rising rates that could push up interest costs -- it's also the accumulation of more debt than expected.

For example, the future extension of some pricey policies on the books today, such as the Bush (now Obama) tax cuts or measures protecting taxpayers from having to pay the Alternative Minimum Tax. Such policy extensions on top of faster-than-expected rate increases could bump up interest costs to $7.5 trillion.

 

[PoliticalChic]

Check this out, from cnn.money.com:

NEW YORK (CNNMoney) -- Interest payments on the national debt could total $5.5 trillion over the next decade, or about 79% of the new debt estimated to accrue between 2012 and 2021.

And that's the optimistic scenario.

The CBO -- and everyone else for that matter -- assumes that interest rates will rise. Just how quickly is the question. The CBO assumes a gradual rise, and projects that the 10-year Treasury rate won't hit 5% before 2015, up from an average of 3.2% today.

But if interest rates end up being 1 percentage point higher than the CBO assumes over each of the next 10 years, interest costs could go up by another $1.3 trillion, putting total costs at $6.8 trillion.

What could push rates up sooner than the CBO anticipates? Among the possibilities:

-- The lack of a medium- or long-term debt reduction plan by 2013, said Jim Vogel, head of interest rate strategies at FTN Financial.

-- Greater-than-expected inflation, three leading economists told the Senate Budget Committee on Tuesday.

Of course, it's not just rising rates that could push up interest costs -- it's also the accumulation of more debt than expected.

For example, the future extension of some pricey policies on the books today, such as the Bush (now Obama) tax cuts or measures protecting taxpayers from having to pay the Alternative Minimum Tax. Such policy extensions on top of faster-than-expected rate increases could bump up interest costs to $7.5 trillion.

Oh, great...I was just starting to celebrate!

1. Consistent with your post, I, also, found such a relationship between spending and our rating, and the costs to borrow...

a. “In 2010, these interest payments (net of some interest income) will claim $209 billion, or about 6 percent of the budget.” Policy Basics: Where Do Our Federal Tax Dollars Go? — Center on Budget and Policy Priorities

b. Based on future ability to pay its debts, each nation is give a rating. “The big three agencies are Fitch, Moody's and Standard & Poors. What they do is assess how likely a borrower is to be able to repay its debts and help those trading debt contracts in the secondary market.” Credit ratings: how Fitch, Moody's and S&P rate each country . Visualised - with a spreadsheet | News | guardian.co.uk.

c. The big fear is that if no action is taken, investors might eventually punish the US for its fiscal laxity. That would raise borrowing costs for businesses and consumers, force severe austerity measures and risk social unrest. Not only America’s triple-A credit rating could be threatened; some point to consequences in foreign affairs and defence as well. Mike Mullen, chairman of the joint chiefs of staff, last year warned that the debt pile could limit the flexibility of the US in funding its military – in his eyes the “most significant threat to our national security”. - FT.com / Comment / Analysis - America: Paydown problems

d. The costs of borrowing are contingent on the rating. Currently the US is listed as AAA, Stable…and this keeps the interest costs of borrowing low. Recently, for example, Greece was downgraded to BB+, Negative, and the cost of its debt rose to over three time that of the US.

e. Moody’s warned that if the U.S. credit rating was at risk if economic growth was slower than the Obama administration projects. US credit rating at risk, Moody's warns - Telegraph


Greece was downgraded to BB+, Negative, and the cost of its debt rose to over three time that of the US


Buzz-kill.

 

[Sundial]

I know how much you guys like trashing the country (since Obama's in charge). But try to get your facts right.

The net worth of American households is approximately $60 trillion - Net, meaning Assets minus Liabilities. Net worth declined by about $15 trillion during the second Bush recession - yes, that's the same amount as all Federal debt combined - but we've recovered about $10 trillion since then.

Total assets are about $74 trillion, and total debts are about $14 trillion.

There's zero chance of the US ever defaulting involuntarily. There's a small (non-zero) chance of default because of Republican shenanigans, but even the Republicans (we hope) aren't that self-destructive.

Interest rates are approximately zero right now, and in inflation adjusted terms they're less than zero. What that means is that investors are effectively paying the US for the privilege of owning US bonds. If the US government were a private business (which, of course, it's not) it'd be borrowing every dollar it could get its hands on.

What S&P or any other rating agency says or thinks is irrelevant, because US bonds are the safest possible investment - literally, as safe as cash itself - and investors know that.

 

[expat_panama]

...Americans own eighteen trillion dollars worth of real estate, that's supposed to mean the average man, woman, and child holds a deed worth $58,000 --on top of stocks, bonds and bank accounts of $132,000, plus other assets totaling up to a quarter million each.

If every citizen owes $48,000 then every family of four is a millionaire household.

...if you could provide the data that supports your figures.

No problem.

This link has the US population, and this link is to a pdf of the Fed's Flow of Funds Report and on page 106 of the doc (page 113 of the pdf) you'll find "B.100 Balance Sheet of Households and Nonprofit Organizations" and here's a screen shot--

--and $18T of real estate is the right end of line 3, the "stocks, bonds and bank accounts" is line 8, and total assets is line 1.

 

[waltky]

Goin' deeper an' deeper inna hole...

Debt for First 11 Months of ‘11: $1.1 Trillion
December 1, 2011 - The federal government accumulated approximately $1.1 trillion in new debt in the first 11 months of calendar year 2011, according to data released by the U.S. Treasury on Thursday.

At the close of business on Dec. 31, 2010, the federal government’s debt equaled $14,025,215,218,708.52. At the close of business on Nov. 30, 2011, it equaled $15,110,498,560,876.77. The total increase in the debt for that 11-month period was $1,085,283,342,168.25--or approximately $1.1 trillion. The federal debt has now increased by more than $1 trillion in each of the last four calendar years.

In calendar year 2008, it climbed from $9,229,172,659,218.31 to $10,699,804,864,612.13 for an increase of $1,470,632,205,393.82. In calendar year 2009, it climbed from $10,699,804,864,612.13 to $12,311,349,677,512.03 for an increase of $1,611,544,812,899.90. In calendar year 2010, it climbed from $12,311,349,677,512.03 to $14,025,215,218,708.52 for an increase of 1,713,865,541,196.49.

As noted, so far in calendar year 2011, it has increased $1,085,283,342,168.25. Prior to 2008, the U.S. debt had never increased by a trillion dollars in any year. During World War II, when the federal fiscal year ran from July 1 to June 30, the federal debt in fiscal year 1943 climbed from $72,422,445,116.22 to $136,696,090,329.90—an increase of $64,273,645,213.68.

According to the Bureau of Labor Statistics' inflation calculator, that $64.27 billion increase in the federal debt, in a year at the height of World War II, would equal $841.21 billion in 2011 dollars. Although the fiscal 1943 debt was smaller in inflation-adjusted dollars than the debt has been in recent years, the annual budget deficit that year was larger as a share of GDP then that it has been in recent years. In 1943, according to the Office of Management and Budget, federal deficit spending was 30.3 percent of GDP. In fiscal 2011, it was 10.9 percent of GDP.

Debt for First 11 Months of