On tonight’s Bill O’Reilly program we heard part of a report from Debt Commission Co-Chairman Erskine Bowles who was appointed by president Obama to conduct a review of our $13 trillion dollar debt and its impact to our economy. His marching orders was to come up with ways to confront this every growing time bomb.
Background. On Feb 18, 2010, President Obama Established a Bipartisan National Commission on Fiscal Responsibility and Reform. He “named former White House Chief of Staff Erskine Bowles and former Republican Senate Whip Alan Simpson as Commission Co-Chairs.”
The significance of this is that Mr. Bowles, a Democrat, is the former White House chief of staff under president Bill Clinton as stated above. In a meeting of governor’s on Sunday he stated “the accumulation of our annual deficits, is “like a cancer” that is “truly going to destroy our country from within.” Source. Dallas News. See link below.
For all those progressives in the blogosphere Mr. Bowles is not a right wing TV personality from FOX News.
This is a quote from the Washington Post: “Bowles said that unlike the current economic crisis, which was largely unforeseen before it hit in fall 2008, the coming fiscal calamity is staring the country in the face. “This one is as clear as a bell,” he said. “This debt is like a cancer.” Story link below.
http://www.washingtonpost.com/wp-dyn/content/article/2010/07/11/AR2010071101956.html
Emmy award winner and NPR host, liberal Juan Williams, a frequent guest on the FOX program, stated this debt is the “biggest threat to America.” He added that we cannot keep a policy of “spend, spend, spend. ” Mary Ham of the Weekly Standard chimed in to say that “denial is not just a river” in Africa.
The real test is what areas our president and Congressional leaders will agree on to control this cancer. Raise taxes, cut entitlement programs such as Social Security, push out retirement to age 70, etc. The choices are all above my pay grade.
What do Juice readers believe president Obama will take away from this candid assessment?
@Larry Gilbert:
The discussion on our National Debt requires the understanding of our TRUE National Debt that also includes ALL FUTURE UNFUNDED LIABILITIES…otherwise, we are not having a full transparent discussion. The GAO gives an annual report to the US Congress, but Congress likes to report the LOWER INCOMPLETE number.
Our True National Debt was around $54 TRILLION and NOT $13 Trillion (out of a total annual US economy of about $12-14 Trillion.)
To Learn More see:
a) The Peter Peterson Foundation – http://www.pgpf.org/
They have several articles on this…and is ran by David Walker former Comptroller General of the US
b) GAO Jan 2008 report – http://www.gao.gov/cghome/d08446cg.pdf
You will see the debt was around $53 TRILLION, and that the biggest components are Social Security & Medicare (about $40 Trillion)…and the exploding defense budget.
Since we will have about 75-80 million baby boomers retiring in the US, we should be thinking about how do we increase Medical Care or more precisely how do we create the Life Sciences jobs of the future to be able to provide the needed medical services but in the way that does not destroy the system.
So by creating JOBS in the Medical/Life Sciences we are helping our economy for the long-term, and our fiscal/national debt crises at the same time. I think we should have a national commitment at the level of a Sputnik, but focused on the Medical/Life Sciences.
Just some quick thoughts.
Francisco “Paco” Barragan
Santa Ana, CA
Paco. A trillion here a trillion there, it’s still more than anyone in his or her right mind would continue approving as members of congress and president Obama bury their heads in the sand as this snowball gets larger every minute.
Did I see a white flag flying over the White House? I hope they were only doing the laundry and had a sheet drying on the line.
I can see it now. Let’s move forward with Cap and Tax and while we’re at it let’s include a VAT.
We’ve tried everything else. I want my campaign promised entitlements protected at all costs. Even if it cost you your seat in Nov. Signed President Obama.
http://www.calculatedriskblog.com/2010/07/part-2-how-often-have-sovereign.html
FYI – a major correction.The Peter Peterson Foundation shows the TRUE National Debt at $61.9 TRiLLION vs the $54 Trillion I mentioned above. (Again, to put into perspective – The total US Economy is around $12-14 TRILLION.
larry i saw this tonight . but we have a guy in there as president who wants and belives in social justice . total redistrabution of wealth . at this pace this guy is going to b/k this country . in nov we can put a stop to this madness and take away 2/3 of his power . vote all the radicals out of here . pelosi , reid , boxer ,
here, here! YOU’RE PREACHIN’ TO THE CHOIR!
It is “Hear, hear.”
Great One Amen!
Some school math: Suppose you had the bucks and wanted to pay off the national debt with a stack of $1,000 bills. How high would that stack have to be? Considering 200 bills pressed together is about an inch, enough 1 grand bills to equal 13 trillion dollars makes a stack 1,000 miles high. Of course, you’d need to be careful where you put this stack, because the International Space Station orbits at just below 200 miles, and could whack it off at the bottom.
I wish all you fiscal conservatives had been around when Regan and Bush II were in office. Where you all BEFORE Obama?
Partisanship before pragmatism. You deserve what you get.
WE WERE- SPENDING BILLS START IN CONGRESS- YOU DO REMEMBER A FELLA NAMED TIP O’NEIL, DON’T YOU? ALSO, YOU’RE RIGHT ABOUT BUSH- HE SPENT $ LIKE IT WAS GOING OUT OF STYLE; THE WAR ABOUT BANKTUPTED US. BUT REAGAN, HE DID ABOUT AS WELL AS HE COULD HAVE WITH THE LIKES OF TIP O’NEAL & A VERY DEMOCRATIC CONGRESS TO CONTEND WITH. AT LEAST YOU SEEM TO SEE THE LIGHT- LIBERAL SPENDING HAS GOTTEN US IN A HELLUVA MESS.
WW.
What was our national debt in the Reagan years as a percentage of our GDP.
Same question for today please!
Let me help you out. When president Reagan left office we had a $2.6 trillion dollar debt.
The debt ration to GDP was 59.1%.
“President Obama’s fiscal 2011 budget will generate nearly $10 trillion in cumulative budget deficits over the next 10 years, $1.2 trillion more than the administration projected, and raise the federal debt to 90 percent of the nation’s economic output by 2020, the Congressional Budget Office reported Thursday.
In its 2011 budget, which the White House Office of Management and Budget (OMB) released Feb. 1, the administration projected a 10-year deficit total of $8.53 trillion. After looking it over, CBO said in its final analysis, released Thursday, that the president’s budget would generate a combined $9.75 trillion in deficits over the next decade.
“An additional $1.2 trillion in debt dumped on [GDP] to our children makes a huge difference,” said Brian Riedl, a budget analyst at the conservative Heritage Foundation. “That represents an additional debt of $10,000 per household above and beyond the federal debt they are already carrying.”
The federal public debt, which was $6.3 trillion ($56,000 per household) when Mr. Obama entered office amid an economic crisis, totals $8.2 trillion ($72,000 per household) today, and it’s headed toward $20.3 trillion (more than $170,000 per household) in 2020, according to CBO’s deficit estimates.
That figure would equal 90 percent of the estimated gross domestic product in 2020.” Source. Washington Times.
When Clinton left office we were on a course to pay down the debt, at least the reported one.
This has been an ongoing problem that has been growing for years under both Republican and Democratic Administrations and congresses.
The solutions will not be easy.
The immediate challenge is how to keep the slow recovery going. There is no way we are going to be able to tax and cut our way out of this without a growing economy to help. Right now we need to invest in the industries of the future and the education of our workforce. Like renewable energy, let us not forget we also have a massive trade deficit caused in large part by our dependence on oil from other countries.
We cannot continue to send massive amounts of money out to the rest of the world to pay for our energy needs. Conserve and invest for the future has to be the top goal if there is any hope at all of paying off our bills.
The national debt DID NOT go down during the Clinton years, it slowed down a bit. If you look at the yearn to year debt, even in surplus years, the national debt continued upward.
The government people have no intention of ever paying this debt.
Bluedog.
You are correct. “The solutions will not be easy.” There is no single item that pollsters can find that will remove this cancer. One point that I will make is that increasing taxes is not the solution.
Much crowing about nothing, as the national debt need not be repaid in the same sense that private debt must be repaid. Most government debt is in the form of short-term T-bills that mature every 90 days. When one set of T-bills matures, the government pays them off by selling more. With competitive rates of return on “safe” bonds, the government can refinance or “roll over” its debt indefinitely. And, we need not worry about burdening our children with repayment. They won’t repay the debt; but like us, they will refinance and pass it on.
The critical question is how spending the money raised by debt will benefit future generations the most–modernized cereal factories or new infrastructure. As long as the government spends its borrowed dollars on investments at least as productive as the private investments it crowds out, no damage is done.
anonymous.
How considerate of you to burden our grandkids with your blind spend and borrow policy.
Keep borrowing from China and printing money that in time will become as worthless as the FIFTY TRILLION DOLLAR note from the country of Zimbabwe that I carry in my wallet. As of last June it became WORTHLESS.
It’s all a scam, and sure there are some rightwing Clintonite Dems involved, but the rich are always just looking for an opportunity to cut down the programs that help the rest of us – Social Security, Medicare – which they contemptuously call “entitlements.”
They know people are hurting in the current economy and that it’s easy to convince them the recession has something to do with the “debt” and the “deficit,” which it absolutely doesn’t.
They’re always ready to take advantage of a crisis in order to screw over the rest of us – read Naomi Klein’s “The Shock Doctrine.”
What we need to get out of our recession is MORE deficit spending geared toward creating jobs – not less.
Vern. Here’s your answer to deficit spending. We need to send more money to Fannie and Freddie or GM and Chrysler.
Or how about these other institutions who we simply cannot allow to fail:
Date Financial Institution City State Amount
10/28/2008 Wells Fargo & Co. San Francisco Calif. $25,000,000,000
10/28/2008 State Street Corp. Boston Mass. $2,000,000,000
10/28/2008 Bank of America Corp.1 Charlotte N.C. $15,000,000,000
10/28/2008 JPMorgan Chase & Co. New York N.Y. $25,000,000,000
10/28/2008 Citigroup Inc. New York N.Y. $25,000,000,000
10/28/2008 Morgan Stanley New York N.Y. $10,000,000,000
10/28/2008 Goldman Sachs Group Inc. New York N.Y. $10,000,000,000
10/28/2008 Bank of New York Mellon Corp. New York N.Y. $3,000,000,000
11/17/2008 Regions Financial Corp. Birmingham Ala. $3,500,000,000
11/17/2008 UCBH Holdings Inc. San Francisco Calif. $298,737,000
11/17/2008 Bank of Commerce Holdings Redding Calif. $17,000,000
11/17/2008 Broadway Financial Corp. Los Angeles Calif. $9,000,000
11/17/2008 SunTrust Banks Inc. Atlanta Ga. $3,500,000,000
11/17/2008 Northern Trust Corp. Chicago Ill. $1,576,000,000
11/17/2008 Provident Bancshares Corp. Baltimore Md. $151,500,000
11/17/2008 U.S. Bancorp Minneapolis Minn. $6,599,000,000
11/17/2008 TCF Financial Corp. Wayzata Minn. $361,172,000
11/17/2008 BB&T Corp. Winston-Salem N.C. $3,133,640,000
11/17/2008 1st FS Corp. Hendersonville N.C. $16,369,000
11/17/2008 Valley National Bancorp Wayne N.J. $300,000,000
11/17/2008 KeyCorp Cleveland Ohio $2,500,000,000
11/17/2008 Huntington Bancshares Columbus Ohio $1,398,071,000
11/17/2008 Umpqua Holdings Corp. Portland Ore. $214,181,000
11/17/2008 First Horizon National Corp. Memphis Tenn. $866,540,000
11/17/2008 Comerica Inc. Dallas Texas $2,250,000,000
11/17/2008 Zions Bancorporation Salt Lake City Utah $1,400,000,000
11/17/2008 Capital One Financial Corp. McLean Va. $3,555,199,000
11/17/2008 Washington Federal Inc. Seattle Wash. $200,000,000
Larry Gilbert,
I’ve been struggling for years to pay off our WWII debt and its still holding our country back apparently at least in the area of modern economics education.
Larry. Without engagining in any research didn’t the AXIS losers in WWII pay us back while some of our allies did not? Let me suggest reading about the Marshall Plan where Germany paid us back their final installment in 1971