U.S.’s $13 Trillion Debt Poised to Overtake GDP

[katty]

more: http://www.bloomberg.com/apps/news?pid=20601109&sid=aa0cI64Gx.4E&pos=15


U.S.’s $13 Trillion Debt Poised to Overtake GDP: Chart of Day
Share Business ExchangeTwitterFacebook| Email | Print | A A A By Garfield Reynolds and Wes Goodman

June 4 (Bloomberg) -- President Barack Obama is poised to increase the U.S. debt to a level that exceeds the value of the nation’s annual economic output, a step toward what Bill Gross called a “debt super cycle.”

The CHART OF THE DAY tracks U.S. gross domestic product and the government’s total debt, which rose past $13 trillion for the first time this month. The amount owed will surpass GDP in 2012, based on forecasts by the International Monetary Fund. The lower panel shows U.S. annual GDP growth as tracked by the IMF, which projects the world’s largest economy to expand at a slower pace than the 3.2 percent average during the past five decades.

“Over the long term, interest rates on government debt will likely have to rise to attract investors,” said Hiroki Shimazu, a market economist in Tokyo at Nikko Cordial Securities Inc., a unit of Japan’s third-largest publicly traded bank. “That will be a big burden on the government and the people.”

[jtuck004]

1. And if we would invest in American education and manufacturing

rebuild, the additional employment could pay down that debt.

Or, we could worry about the debt, leave 27 million (or more) unemployed people to founder, and watch the debt rise anyway.

Cap the deficit. The BP approach.

[NC_Nurse]

4. +1

[Ruby the Liberal]

9. Repeal NAFTA, add tariffs on "American" companies outsourcing labor

and repeal Glass-Steagall.

Lets start with the fundamentals of the Greatest Generation and go from there.

Those who don't learn from history are doomed to repeat it

[katty]

12. yep - good plan - start with the obvious as there is so much of that

[girl gone mad]

11. +13,000,000,000,000

[AndyA]

2. I can think of a couple of wars that could end. That would save a ton of money.

Then there's subsidies for the petroleum industry. That would save a lot, too.

Perhaps someone could find those millions that Bush sent to Iraq that just disappeared.

Halliburton could be billed for its shoddy work in supporting the troops. That should be good for a few hundred million.

That's just a start. But those things alone would bring the deficit down substantially.

[DJ13]

3. Two choices

Either the deficit gets reduced by slashing government spending in the midst of the most serious recession since the depression, and we accept people in need suffer without government aid while the new "normal" for unemployment is around 10% (in good years)....

or

We try to increase government revenues that will shrink the deficit by a combination of increased tax rates on the top 20% and getting people back to work in good paying jobs.


Which approach is the right way to reduce the deficit?

[bhikkhu]

5. Most federal spending goes to the military

...that's well worth pointing out in any discussion of our debt problems. The repugs still seem to think that most spending goes to welfare mom's and illegal immigrants, and avoid any discussion of the obvious and necessary solution, which is end the wars, draw down the military, shut down the foreign bases and bring 'em all home.

[bergie321]

6. A good tool

http://www.nytimes.com/interactive/2010/02/01/us/budget.html

Defense is the majority of the non-mandatory spending.

Or, we could just follow the Republican plan and strip all assistance programs and save a ton of money while poor and old people die in our streets like animals.

[Scuba]

7. Not to worry...

...after the Gulf disaster is over BP will owe us $13 Trillion.

[Ruby the Liberal]

8. But that is $13T in NEW debt

[girl gone mad]

10. A country that can print its own currency..

doesn't actually need to "attract investors".