Debt to Rise to 90% of GDP

[boedicca]

"That figure would equal 90 percent of the estimated gross domestic product in 2020, up from 40 percent at the end of fiscal 2008. By comparison,America's debt-to-GDP ratio peaked at 109 percent at the end of World War II"

This is from the article

We're not in a World War right now.

War Time spending was specific to that effort, and ramped down once the war was over. Our current debt levels fuel permanently expanding Big Government - it's structural.

That's the difference and the danger - not that I expect you to understand it.

 

[beowolfe]

And yet, even when faced with facts, there will be those that defend this administration!

What is wrong with you guys. Obama is working with what he was given. Two wars - three trillion, a drug bill from 2003 that's anywhere from 2 to 15 trillion. It's astounding how you blame Republican mess on him.

The GDP of the US is 14.5 trillion. The GDP of the European Union is over 18 trillion. We could start with pulling our troops and bringing them home. We could rebuild America's crumbling infrastructure.
What are Republican ideas? None. Look at their own party finances. 22 million, then they get 96 million in donations, and they end up with less than 10 million. Yea, so "fiscal".

This President has spent more in one single year than any other President in U.S. history & on WHAT? 787 billion so-called stimulus bill that has failed MISERABLY. Then the next week while he was stating that we were in the greatest economic crisis since the great depression he signed off on another 450 BILLION for 9000 EARMARKS and political goodies.

This President is the most "fiscally" irresponsible empty suit ever.

View attachment 9866

What do conservatives want? To STOP this insanity.

What did you think the stimulus bill was supposed to do?

 

[Truthmatters]

We are in two wars right now and remember the WOT you guys always talk about?

 

[Care4all]

What interest rate are we currently paying?

I bet its much less than the rate we paid when Ronald Reagan ran up the debt

It's low - but heading higher. The recent Treasury Auction pushed close to 4%.

The estimates of $700B to $900B of annual interest payments are very reasonable (a big increase from the $260B or so we paid in 2008).

Boe....how does what we owe social security debt fit in to this picture?

since we are NOW having to cash in what was loaned, so to pay for the above expectations of seniors having to retire, coupled with also pulling in less in SS taxes due to more unemployed or retired?

Is what we have to pay back to SS, in that figure of annual interest payments of $700-900 billion? Will drawing on SS verses surplus of SS make those figures higher or do you think SS shortages are included somehow, and my concerns of a 1 trillion dollar or a 1.2 trillion annual interest payment as the possible outcome?

 

[beowolfe]

Who thinks that in 2020 we'll still be operating under Obama's budgets?

 

[Care4all]

Who thinks that in 2020 we'll still be operating under Obama's budgets?

for most of it, we will NOT be operating under it,

with exceptions of legislative changes to entitlements,

whether it be reform that decreases future obligations or changes that increases future obligations.

entitlements are much harder for future congresses to change....don't ask me why, there are multiple reasons and the politicians aren't the only ones to blame, we as society tends to like them...believe it or not!

so entitlement changes seem to stick for a bit, before either side gets the votes to change them....from looking back on things...and in my opinion.

care

 

[Truthmatters]

No one whos sane, beowolfe

 

[boedicca]

Boe....how does what we owe social security debt fit in to this picture?

since we are NOW having to cash in what was loaned, so to pay for the above expectations of seniors having to retire, coupled with also pulling in less in SS taxes due to more unemployed or retired?

Is what we have to pay back to SS, in that figure of annual interest payments or $700-900 billion? Will drawing on SS verses surplus of SS make those figures higher or do you think SS shortages are included somehow, and my concerns of a 1 trillion dollar or a 1.2 trillion annual interest payment as the possible outcome?

The SS lock box is stuffed with IOUs that have to be repaid. As long as there is a surplus, those IOUs can be held. But once we need that money to cover current retirees, it has to be redeemed.

Given that this money has already been spent, there are two alternatives: Raise Taxes or Borrow More Money. The latter involves taking these IOUs Treasuries and selling them in the external market, which requires real interest payments to third parties. As such parties are concerned about the U.S.'s growing debt burden, they are demanding a bigger risk premium in the interest rate.

The increase in total annual interest, to my understanding, is the cash interest to be paid out externally. It is based on the huge increases in deficit spending in the current administration's budget, as well as the increased interest rate on the recycling of outstanding debt. As this is cash related, I don't think it covers the IOUs in the lockbox. (If someone else has different info, I'd appreciate seeing it - as well as a source link.)

Your concerns that annual interest will exceed $1B are Very Valid. The Obama forecasts assume incredibly optimistic GDP growth (which is why the CBO predicts worse deficits, it lowered those estimates). A decade of total deficit spending each year combined with cumulative debt and higher interest rates makes $1B the likely scenario.

 

[boedicca]

Who thinks that in 2020 we'll still be operating under Obama's budgets?

The portion that represents permanent entitlements will be worse, so we'll most likely see even worse deficits.

 

[Xenophon]

"That figure would equal 90 percent of the estimated gross domestic product in 2020, up from 40 percent at the end of fiscal 2008. By comparison,America's debt-to-GDP ratio peaked at 109 percent at the end of World War II"

This is from the article

And most of the world had been devastated by world war, had no production capacity, and owed teh USA huge amounts of money.

Still think its the same thing?

 

[Care4all]

Boe....how does what we owe social security debt fit in to this picture?

since we are NOW having to cash in what was loaned, so to pay for the above expectations of seniors having to retire, coupled with also pulling in less in SS taxes due to more unemployed or retired?

Is what we have to pay back to SS, in that figure of annual interest payments or $700-900 billion? Will drawing on SS verses surplus of SS make those figures higher or do you think SS shortages are included somehow, and my concerns of a 1 trillion dollar or a 1.2 trillion annual interest payment as the possible outcome?

The SS lock box is stuffed with IOUs that have to be repaid. As long as there is a surplus, those IOUs can be held. But once we need that money to cover current retirees, it has to be redeemed.

Given that this money has already been spent, there are two alternatives: Raise Taxes or Borrow More Money. The latter involves taking these IOUs Treasuries and selling them in the external market, which requires real interest payments to third parties. As such parties are concerned about the U.S.'s growing debt burden, they are demanding a bigger risk premium in the interest rate.

The increase in total annual interest, to my understanding, is the cash interest to be paid out externally. It is based on the huge increases in deficit spending in the current administration's budget, as well as the increased interest rate on the recycling of outstanding debt. As this is cash related, I don't think it covers the IOUs in the lockbox. (If someone else has different info, I'd appreciate seeing it - as well as a source link.)

Your concerns that annual interest will exceed $1B are Very Valid. The Obama forecasts assume incredibly optimistic GDP growth (which is why the CBO predicts worse deficits, it lowered those estimates). A decade of total deficit spending each year combined with cumulative debt and higher interest rates makes $1B the likely scenario.

If our economy can only turn around, we would have less seniors retiring and with jobs paying in to SS instead of drawing SS at 62...

we lost 9 years of projected SS surpluses and are DRAWING on what was loaned this past year....a shortage that was not suppose to occur until 2018 on their last projection, all due to the crash/economy....and if the trend continues with 62 year olds retiring verses staying in the workplace, this is only going to make this worse.

Where we differ, is that I can not soundly blame Obama and Obama solely for all of this, or even for the majority of this....the recession began in 2007 and even if mccain were in his position, it still would be a Presidency facing huge deficits, as far as the eye can see, with or without health care reformif the republicans had won and there was a president Mccain, I'd bet my bottom dollar the public would still lack confidence and be down and out.... and the crash and the consequences of such...all would still be there to deal with....

This is one of the HARDEST presidencies ANY of our Presidents have ever had to face, from day one of the job....it ain't a picnic, that's for certain!

 

[Annie]

Boe....how does what we owe social security debt fit in to this picture?

since we are NOW having to cash in what was loaned, so to pay for the above expectations of seniors having to retire, coupled with also pulling in less in SS taxes due to more unemployed or retired?

Is what we have to pay back to SS, in that figure of annual interest payments or $700-900 billion? Will drawing on SS verses surplus of SS make those figures higher or do you think SS shortages are included somehow, and my concerns of a 1 trillion dollar or a 1.2 trillion annual interest payment as the possible outcome?

The SS lock box is stuffed with IOUs that have to be repaid. As long as there is a surplus, those IOUs can be held. But once we need that money to cover current retirees, it has to be redeemed.

Given that this money has already been spent, there are two alternatives: Raise Taxes or Borrow More Money. The latter involves taking these IOUs Treasuries and selling them in the external market, which requires real interest payments to third parties. As such parties are concerned about the U.S.'s growing debt burden, they are demanding a bigger risk premium in the interest rate.

The increase in total annual interest, to my understanding, is the cash interest to be paid out externally. It is based on the huge increases in deficit spending in the current administration's budget, as well as the increased interest rate on the recycling of outstanding debt. As this is cash related, I don't think it covers the IOUs in the lockbox. (If someone else has different info, I'd appreciate seeing it - as well as a source link.)

Your concerns that annual interest will exceed $1B are Very Valid. The Obama forecasts assume incredibly optimistic GDP growth (which is why the CBO predicts worse deficits, it lowered those estimates). A decade of total deficit spending each year combined with cumulative debt and higher interest rates makes $1B the likely scenario.

If our economy can only turn around, we would have less seniors retiring and with jobs paying in to SS instead of drawing SS at 62...

we lost 9 years of projected SS surpluses and are DRAWING on what was loaned this past year....a shortage that was not suppose to occur until 2018 on their last projection, all due to the crash/economy....and if the trend continues with 62 year olds retiring verses staying in the workplace, this is only going to make this worse.

Where we differ, is that I can not soundly blame Obama and Obama solely for all of this, or even for the majority of this....the recession began in 2007 and even if mccain were in his position, it still would be a Presidency facing huge deficits, as far as the eye can see, with or without health care reformif the republicans had won and there was a president Mccain, I'd bet my bottom dollar the public would still lack confidence and be down and out.... and the crash and the consequences of such...all would still be there to deal with....

This is one of the HARDEST presidencies ANY of our Presidents have ever had to face, from day one of the job....it ain't a picnic, that's for certain!

Every presidency is difficult, since George Washington's time. Only the difficulties differ. The question we must ask ourselves is whether or not the administration is making things better or worse. IMO growing the deficit, already out of control, is an abuse of future generations. Because of this and the past administrations, the chance of the economy 'coming around' as we've known it is basically wishful thinking.

 

[boedicca]

If our economy can only turn around, we would have less seniors retiring and with jobs paying in to SS instead of drawing SS at 62...

we lost 9 years of projected SS surpluses and are DRAWING on what was loaned this past year....a shortage that was not suppose to occur until 2018 on their last projection, all due to the crash/economy....and if the trend continues with 62 year olds retiring verses staying in the workplace, this is only going to make this worse.

Where we differ, is that I can not soundly blame Obama and Obama solely for all of this, or even for the majority of this....the recession began in 2007 and even if mccain were in his position, it still would be a Presidency facing huge deficits, as far as the eye can see, with or without health care reformif the republicans had won and there was a president Mccain, I'd bet my bottom dollar the public would still lack confidence and be down and out.... and the crash and the consequences of such...all would still be there to deal with....

This is one of the HARDEST presidencies ANY of our Presidents have ever had to face, from day one of the job....it ain't a picnic, that's for certain!

I don't blame all of this on Obama. We have a long term structural problem that is the result of years of bad government overseen by both parties.

Obama has, however, made the problem much worse. Yes, Bush left him with a deficit - which Obama has more than quadrupled. The Stimulus Package, $450B more of discretionary spending in the budget...and then ObamaCare.

The only way out of this mess is to decrease the size of government, remove the burdens that are weighing down economic growth, and restructure entitlement programs ala the Chilean Model of private accounts with a safety net for the truly unfortunate.

 

[Truthmatters]

Bush left him a deficit, two wars , the cost of those wars for the years he wasnt even pres yet (bush had it off budget and now its on budget), a WOT that you people insist keeps going, A crashed world economy and a bunch of Americans who STILL think the answer to EVERYTHING is a tax cut.

 

[boedicca]

The two wars are not what is increasing the deficit, you dim bulb.

 

[Titanic Sailor]

Let's be completely honest. Bush sucked, and primed us for this all out attack by Obama. Our nation is failing because our government failed us, and will continue to fail us until we take back our government from these thieves.

 

[Care4all]

The SS lock box is stuffed with IOUs that have to be repaid. As long as there is a surplus, those IOUs can be held. But once we need that money to cover current retirees, it has to be redeemed.

Given that this money has already been spent, there are two alternatives: Raise Taxes or Borrow More Money. The latter involves taking these IOUs Treasuries and selling them in the external market, which requires real interest payments to third parties. As such parties are concerned about the U.S.'s growing debt burden, they are demanding a bigger risk premium in the interest rate.

The increase in total annual interest, to my understanding, is the cash interest to be paid out externally. It is based on the huge increases in deficit spending in the current administration's budget, as well as the increased interest rate on the recycling of outstanding debt. As this is cash related, I don't think it covers the IOUs in the lockbox. (If someone else has different info, I'd appreciate seeing it - as well as a source link.)

Your concerns that annual interest will exceed $1B are Very Valid. The Obama forecasts assume incredibly optimistic GDP growth (which is why the CBO predicts worse deficits, it lowered those estimates). A decade of total deficit spending each year combined with cumulative debt and higher interest rates makes $1B the likely scenario.

If our economy can only turn around, we would have less seniors retiring and with jobs paying in to SS instead of drawing SS at 62...

we lost 9 years of projected SS surpluses and are DRAWING on what was loaned this past year....a shortage that was not suppose to occur until 2018 on their last projection, all due to the crash/economy....and if the trend continues with 62 year olds retiring verses staying in the workplace, this is only going to make this worse.

Where we differ, is that I can not soundly blame Obama and Obama solely for all of this, or even for the majority of this....the recession began in 2007 and even if mccain were in his position, it still would be a Presidency facing huge deficits, as far as the eye can see, with or without health care reformif the republicans had won and there was a president Mccain, I'd bet my bottom dollar the public would still lack confidence and be down and out.... and the crash and the consequences of such...all would still be there to deal with....

This is one of the HARDEST presidencies ANY of our Presidents have ever had to face, from day one of the job....it ain't a picnic, that's for certain!

Every presidency is difficult, since George Washington's time. Only the difficulties differ. The question we must ask ourselves is whether or not the administration is making things better or worse. IMO growing the deficit, already out of control, is an abuse of future generations. Because of this and the past administrations, the chance of the economy 'coming around' as we've known it is basically wishful thinking.

i agree that it is an abuse of future generations annie, as it was with the last administration deficit spending!

i have not seen fiscal responsibility since 2000, from either side.

president bush began his presidency in a much, much, much better fiscal state than obama's presidency....and this can not be discounted, as it seems many, many,many here on this site do....and even though i have never been an obama supporter...i don't put this on one single ENEMY, one single person....i think it is irrational to do such!

and yes, some predict for various reasons the health care bill will not reduce the deficit as the cbo scored, but we do NOT know this for certain yet, it is still speculation, not all is said and done....

looking at our history, the pill bill, cbo scored such at $400 billion before the vote, one week after it was $560 billion due to manipulations of the republicans to hide the true cost of their bill.....

so who knows how this one will actually end up?

care

 

[boedicca]

It's a pretty safe bet that it's going to be Much More Expensive in reality than the fiction the CBO had to score.

 

[Vast LWC]

This President has spent more in one single year than any other President in U.S. history & on WHAT? 787 billion so-called stimulus bill that has failed MISERABLY. Then the next week while he was stating that we were in the greatest economic crisis since the great depression he signed off on another 450 BILLION for 9000 EARMARKS and political goodies.

This President is the most "fiscally" irresponsible empty suit ever.

View attachment 9866

What do conservatives want? To STOP this insanity.

When adjusted for inflation, several wartime presidents have in fact spent much more than Mr Obama.

Of course you folks seem to now think that we are no longer involved in the 2 wars that you started, because your president's not in charge anymore.

 

[Vast LWC]

In 1945, for instance, the deficit was 21% of the GDP.

In fact, in most major wartime situations, starting with the Revolutionary war, the US has run a larger deficit, as a percentage of GDP, as it is currently running.