Federal debt Archive

Putting It in Perspective

By James Schaefer This snapshot of federal spending recently crossed my desk, and it is worth sharing.  It simply converts the federal numbers into an equivalent household budget.  The numbers are approximately correct for 2012, though they don't have to match exactly to make the point.   Why the U.S. was downgraded: • U.S....
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Contagion and Eurosclerosis

By John Lumbard. The debt of Portugal has fallen in value so much that a buyer can now get a yield of 16% on long term, ten year bonds.  Portugal won't have to actually pay 16% until it has to borrow again (most likely when an old bond issue matures and...
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Balanced Budget Amendment Poll

A July poll, conducted by CNN, shows that 74% of Americans are now in favor of a balanced-budget amendment to the Constitution.  It wouldn't be surprising to see that the numbers have ticked a bit higher in August, because the debt-ceiling debate revealed that Congress is far from mustering the...
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About That Trust Fund . . .

By James Schaefer Mr. Obama recently stated that he couldn't guarantee that Social Security checks would go out in August if America's debt ceiling weren't raised (Obama's Debt-Ceiling Scare Tactics).   America's taxpayers have paid $2.5 trillion in FICA taxes over the past several decades to create the Social Security trust fund.  It isn't enough...
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Problems With a Balanced Budget Amendment?

In yesterday's Wall Street Journal Senators Snowe and DeMint wrote an opinion piece (subscription req'd) which points out that none of today's budget negotiations offer anything like a long-term cure for the fiscal irresponsibility that has become the norm in Washington, DC.  They argue that this goal is best achieved...
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Building a Prosperous Future

By Tim Munsell.   Our National Debt is over $14 Trillion dollars, and growing by $1.5 trillion dollars a year.  That’s $47,500 per second! And the Congressional Budget Office says that unfunded liabilities for future payments of Social Security, Medicare and Medicaid add tens of trillions more.  This gigantic debt will have enormous consequences...
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The Farmer and the Lottery

By James Schaefer.   The farmer wins the lottery and is being interviewed by a news reporter.  "What are you planning to do, now that you've got all this money?"  Replies the farmer,"Well, I guess I'll just keep farming 'til the money's gone." Today farmers enjoy so much taxpayer support that it's fair...
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The Keepers of the Flame

By James Schaefer.   At long last, the topic of entitlement reform  -- "the topic" -- has been broached (see Weekend Interview with Paul Ryan). These entitlements -- Social Security, Medicare, Medicaid, and the Prescription Drug Benefit -- are the promises that politicians have made to American citizens for decades.  We think of them...
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The Scott Adams Challenge

By James Schaefer.   Scott Adams, the author of Dilbert, recently had a feature article in the Wall Street Journal, entitled "How to Tax the Rich", and he asked readers to think up incentives that might allow our biggest taxpayers to feel a bit better about dropping hundred-thousand-dollar checks into the ravenous maw...
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Let’s have a real fight about deficits if it leads to real answers

by Michael Smith. In a letter to the Washington Post this week, I pointed out that the national debt has been a bipartisan project. The only real disagreement between the parties has centered on how to spend borrowed money. The taming of the debt—assuming our politicians don’t wait for a global economic...
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