debt

After almost a year of big, new spending proposals - to say nothing of the tab that will come along with government run health care - the White House is signaling that this year's one and a half trillion dollar deficit might be a political problem that needs to be dealt with after all. 

It's a good bet that what this really represents is their recognition of what's happening in elections in Virginia, New Jersey and New York - and their trying to inoculate themselves against similar political damage in the future.

From the Washington Times... 

Anxiety about the deficit has fueled the anger of the conservative "tea party" activists, riled by government spending and debt, and it has seeded reservations about the long-term price tags of signature items on the president's agenda...

A speech last week by Christina D. Romer, chairman of the president's Council of Economic Advisers, looked at the reasons for the deficit and at how it relates to health care reform. Treasury Secretary Timothy F. Geithner appeared on NBC's "Meet the Press" on Sunday to make clear that the administration recognizes the deficit is growing too large.

"Well, it's going to have to come down. Now it's too high, and I think everybody understands this," Mr. Geithner said. "The president's very committed to bring down these deficits."  read more »

Few people know the facts on America's current economic situation.

The National Debt is by any stretch of the imagination, staggering. Currently, every man, woman, and child in America owes 12 trillion doallrs. That is 12 followed by 12 zeros. It's very hard for the average mind to comphrehend this staggering number. In the next 10 years, that number is projected to become 22 Trillion or higher, almost doubling.

12 Trillion doallrs national debt at 4% interest = $480 billion/300,000,000 Americans = $6400 dollars paid by a family of 4, every year on just the interest alone and the debt goes up every year. There is no principle paid on the debt the way you would pay down the principle on your mortgage.

In 2020, if the deficit is lucky enough to be just 22 trillion (which is the conservative estimate the 22 trillion at 4% (modest return) = $880 billion/300,000,000 Americans = $11,800 (rounded) paid by a family of 4, every year.

What we all know is that 50% of working Americans pay almost all the taxes that in turn pay the interest on the debt, which means they shoulder the burden of interest on the debt, paid out of their pockets. However, the burden is returned to the 50% of Americans who do not pay those taxes, in the form of higher prices and stagnant or as in the case these days, lower wages, and unemployment.  read more »

A tax-policy expert says instead of trimming spending and balancing the budget, Congress is poised to agree to the Obama administration's request to raise the federal debt limit again.

Treasury Secretary Tim Geithner pleaded with Congress on Friday to increase the $12.1 trillion federal debt ceiling. In a letter to lawmakers, Geithner wrote: "It is critically important that Congress act before the limit is reached so that citizens and investors here and around the world can remain confident that the United States will always meet its obligations."

Chris Edwards, director of tax policy at the Cato Institute, says the federal debt, which was about $8 trillion in 2005, will jump to about $19 trillion by 2015 under the Obama administration's plan...

Washington -- U.S. Treasury Secretary Timothy Geithner asked Congress to increase the $12.1 trillion debt limit on Friday, saying it is "critically important" that they act in the next two months.

Mr. Geithner, in a letter to U.S. lawmakers, said that the Treasury projects that the current debt limit could be reached as early mid-October. Increasing the limit is important to instilling confidence in global investors, Mr. Geithner said.

The Treasury didn't request a specific increase in the letter...