“We Owe How Much?”: Waiting for The Big Splatter

Article posted on February 28th, 2011 by WhatAmIMissingHere

Scrapping National Debt by Paresh Nath, The Khaleej Times, UAEBy Gonzalo Lira

Last week, a bit of news came out that—weirdly—didn’t garner the attention or the reaction one would have thought it would:

Ink Splash in BrownThe U.S. Federal government deficit for fiscal year 2011 was revised to $1.645 trillion. That revision was up from the previous estimate of $1.4 trillion, which itself was a revision just a couple-three weeks ago by the Congressional Budget Office from the White House’s earlier projection of $1.267 trillion in December.

The additional $378 billion in deficit spending comes from loss of tax revenue: Both from the fall in tax receipts due to the ongoing depression we’re experiencing, as well as from the idiotic budget deal with the Republicans, whereby the Bush-era tax cuts were extended.

These deficit numbers are huge. Huge. HUGE.

As for the total debt, as of January 2011, the U.S. Treasury had $8.965 trillion in outstanding securities, plus an additional $5.166 trillion in “non-marketable” securities—that is, intra-government debts. The total outstanding debt of the U.S. Federal government is $14.131 trillion.

The U.S.’s gross domestic product in 2009 was $14.29 trillion.

So this current deficit is over 11.5% of 2009 GDP. Even if we take Office of Management and Budget (OMB) rosy predictions for 2010’s GDP, the deficit is still 10.9% of GDP.

As to the rolling debt? It’s just about 100% of GDP.

These are Third World numbers: Deficits that are in the double-digits vis à vis the gross domestic product—and total debts that equal tha GDP—are numbers that Argentina—Greece—Zambia gets:

These numbers aren’t supposed to happen to the good ol’ U.S. of A.!

Oh, but they are happening. (my emphasis)

Read the rest of Gonzalo’s informative article.

By Gonzalo Lira

By permission Gonzalo Lira

http://gonzalolira.blogspot.com

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