Posted on 11/22/2009 7:38:50 PM PST by Steelfish
Wave of Debt Payments Facing U.S. Government
EDMUND L. ANDREWS November 22, 2009
WASHINGTON — The United States government is financing its more than trillion-dollar-a-year borrowing with i.o.u.’s on terms that seem too good to be true. Treasury officials now face a trifecta of headaches: a mountain of new debt, a balloon of short-term borrowings that come due in the months ahead, and interest rates that are sure to climb back to normal as soon as the Federal Reserve decides that the emergency has passed.
Even as Treasury officials are racing to lock in today’s low rates by exchanging short-term borrowings for long-term bonds, the government faces a payment shock similar to those that sent legions of overstretched homeowners into default on their mortgages.
With the national debt now topping $12 trillion, the White House estimates that the government’s tab for servicing the debt will exceed $700 billion a year in 2019, up from $202 billion this year, even if annual budget deficits shrink drastically. Other forecasters say the figure could be much higher.
In concrete terms, an additional $500 billion a year in interest expense would total more than the combined federal budgets this year for education, energy, homeland security and the wars in Iraq and Afghanistan.
The potential for rapidly escalating interest payouts is just one of the wrenching challenges facing the United States after decades of living beyond its means.
The surge in borrowing over the last year or two is widely judged to have been a necessary response to the financial crisis and the deep recession, and there is still a raging debate over how aggressively to bring down deficits over the next few years. But there is little doubt that the United States’ long-term budget crisis is becoming too big to postpone.
(Excerpt) Read more at nytimes.com ...
Cowabunghole dude
Today, the debt ceiling is at an all-time high of $12.1 trillion.
When President George W. Bush took office in 2001, our public debt amounted to 33 percent of our economy. Today, it is 60 percent of our gross domestic product. If we do nothing, our debt is projected to swell to over 70 percent by 2019.
To put those numbers in perspective: If you divided the debt equally among all Americans, every man, woman and child living in the United States today would owe more than $39,000.
http://www.cnn.com/2009/OPINION/11/19/bayh.debt.bipartisan.commission/index.html
And of course how many pay no taxes so someone else is or will be picking up the tab.
“The potential for rapidly escalating interest payouts is just one of the wrenching challenges facing the United States after decades of living beyond its means.”
How about, ‘after one year of living way, way beyond its means.’
“The potential for rapidly escalating interest payouts is just one of the wrenching challenges facing the United States after decades of living beyond its means.”
How about, ‘after one year of living way, way beyond its means.’
And the fun is just beginning. The Marxist-in-chief has BIG plans for us. A trillion here, a trillion there and pretty soon we’re talking big money.
Another stock market crash and Obamacare will be smoldering in ruins.
This is great news for Obama and Democrats who want to bankrupt the country.
[Cowabunghole dude]
Just now the NYT is figuring this out??
Our Government’s politicians past and present have betrayed us all and saddled this once great prosperous nation with a huge mountain of debt. May their names rot in history for what they did to this nation!
Do that a lot, however, and foreigners will not buy your paper. But since US government thinks in 4-year terms, it's never a concern. The US is ruled by transients who don't need to think ahead. Isn't it ironic that the only country that often plans far ahead is China?
"Show me just what Mohammed brought that was new, and there you will find only things evil and inhuman, such as his command to spread by the sword the faith he preached." - Manuel II Palelogus
Keeping the rate low won’t stop the slide toward small government, although it might slow it down a little. ...the road to shortchanging our Asian creditors. Raising the rate will only increase the speed toward small government. That’s the way to default.
Either way, the globalist economic regime and government by busybodies and bureaucrats against neighborly domestic competition are about to end. Don’t buy anything that you don’t really need.
Aaa Soo...
This is what happens when a child who believes in only TAX and SPEND Liberalism is in the seat of power.
America learned NOTHING from Jimmy Carter.
And so now they will have to get that lesson one more time...
thanks for the ping.
You forget interest, which over the next 20 years will be as much as the debt itself.
That's more like $80,000 per man, woman and child.
And where are they going to get that money? Guess whose door they're going to be knocking on?
So if you have a family of 4, the US government has already run your family $320,000 into debt. But the fantastic services they're delivering are worth it. Right?
Oh, I forgot to mention that THAT'S MONEY THAT'S ALREADY BEEN SPENT AND IS ON TOP OF THE TAXES YOU'RE GOING TO BE PAYING FOR ANY FUTURE ACTUAL GOVERNMENT SERVICES AT ALL.
Thank you for clarifying that I am going to save it so I can point that out to people.
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