Posted on 02/03/2012 1:16:00 PM PST by SeekAndFind
The president devoted just 189 words to the deficit and our growing national debt, but the fact is that once again this year we will borrow 32 cents out of every dollar we spend. Overall, our national debt now tops $15.2 trillion (with Congress raising the debt ceiling to $16.4 trillion last week). And that doesn’t count the unfunded liabilities of Social Security and Medicare. Throw those in, and our total indebtedness exceeds $120 trillion.
That means that if one counts only the official national debt, every man, woman and child in America owes $48,700. Include the unfunded liabilities of Social Security and Medicare, and every one of us is in debt to the tune of $189,000.
Or look at it another way. One can’t pick up a newspaper these days without reading a story about the debt crisis in Europe. France, for example, just had its credit rating downgraded. Yet, measured as a percentage of GDP (the value of all goods and services produced in a country over a year), our budget deficit is roughly a quarter larger than France’s. In fact, among European countries, only Greece and Ireland have larger deficits this year than we do.
The debt figures paint an even grimmer picture. If one includes all the unfunded liabilities of pension and health-care systems, Greece’s total debt equals 875% of its GDP. France, the next-most insolvent country in Europe, owes 570% of GDP. The United States, however, now owes 885% of GDP, more than any other industrialized country.
We have been able to avoid disaster so far only because, as the world’s preferential currency, other countries have been willing to lend us money cheaply. But that is not going to continue forever. And if our creditors begin to hike interest rates, we will be facing the same economic consequences facing so much of Europe today.
The president, when he deigns to mention the issue at all, suggests that this problem could be solved if only the rich pay their “fair share.” Of course some might suggest that the rich already pay their fair share, since the much-reviled 1% earn 16% of all income in this country, but pay 36.7% of all federal income taxes. More important, however, in this context, you simply cannot tax the rich enough to solve our debt crisis.
Michael Tanner is a senior fellow at the Cato Institute and author of Leviathan on the Right: How Big-Government Conservatism Brought Down the Republican Revolution.
More by Michael D. Tanner Take the much-discussed Buffett Rule that the president focused so much attention on during the State of the Union address. Whatever one thinks of how investment income should be taxed compared to wage income, the president’s proposal would raise less than $37 billion per year. That amounts to less than 3% of this year’s deficit. In fact, if we were to confiscate — not just tax, but confiscate — every penny owned by every millionaire and billionaire in America, it would pay barely one-tenth of our government’s total indebtedness.
That is because the debt is only a symptom of the underlying disease — a government that is growing ever larger, more intrusive and more costly. We tend to think of Europe as the home of big government. Indeed, on average, European governments consume roughly 49% of their country’s GDP. That means that roughly half of everything produced in that country is consumed by government.
However, we are not that far behind. Today, our federal government alone consumes roughly 25% of GDP. State and local governments take another 10% to 15% of GDP. And, the Congressional Budget Office projects that the federal government is currently on course to grow to 43% of GDP by mid-century. Add in state and local spending, and we will have a bigger government then than any European country except Ireland has today. One only has to look to the chronically high unemployment rates and slow economic growth in most of Europe to see what a government that size would mean for us.
Yet, as we hurtle towards a Greek-style calamity, the president offered us a laundry list of new government spending — for health care, student loans, green energy, job training, hiring veterans, more teachers and so forth. That may have made for a good campaign tactic, but it bears little resemblance to economic reality.
That reality is very simple. We’re broke. Mr. President, are you paying attention?
So if I pay off my share, what benefits will I receive?
Warren Buffet can pay my share
do they take credit cards? /sarc
Don’t come to me....I gonna declare bankruptcy...BTW, where do I apply for EBT, EITC, AFDC, WICs, SCHIP, SNAP, Section 8 housing, SSI, SSDI and all that stuff?
How is this moral or just in any way shape or form? Have a democrat try to explain that!
I remember when it was $40,000 and I thought we might have a prayer of a chance to dig out then. Now, there isn’t a Chinaman’s chance.
The dream that once was the United States is ending.
The shots that killed the Republic were fired long ago when unlanded persons received the vote and we became a democracy.
The nation has become ruled by the mobs or soon will be and it does not matter who is elected president. obastard will merely accelerate the inevitable
What you have saved and worked for all your life will be worthless or taken from you in the names of socialism and fairness.
We are entering that time when hard work and achievement will be a fool’s errand.
The collapse is nearly at hand, we are on borrowed time.
Oh sure, there is a chance things could be OK. There is also a chance that the earth could stop its revolutions, reverse and the sun come up in the West. Both events are highly unlikely.
Gold will not help, stocks of food will not help, bullets will only push back the wolves at the door for a short time.
In the early 1960s (before the “Great Society”) the average U.S. Citizen’s share of the national debt was less than $100.
It’s hard to tell, since the details of the numbers being used aren’t plain, but I’m guessing it’s even worse than that: I suspect the numbers are just the Federal debt and the Federal debt plus Federal unfunded liabilities. Some states are allowed to run deficits, and lots of state and local governments have unfunded liabilities (mostly for defined benefit pension plans).
“unexpected”
Good luck Barry! You can’t get blood out of a turnip.
Divide the debt by the actual number of taxpayers (the ones who ultimately will be paying it off) and the numbers are much more frightening.
>>How is this moral or just in any way shape or form? Have a democrat try to explain that!
Believing that only democrats are to blame is at least 1/2 the problem....we need to hold EVERYONES feet to the fire, no matter what party. By-and-large Republicans have been more than willing to go along with year-after-year-after-year of out-of-control deficit spending (with very few exceptions).
That’s an excellent point.
As a retiree I went from paying a lot of taxes to collecting on SS and Medicare and there’s a tidal wave of folks my age.
I am starting to view tax avoidance as a moral obligation.
Add to that the amount many of us are underwater on our homes, and it gets even worse.
Something tells me we won’t be “paying this off” with just money.
If you are a net taxpayer and you have children, etc. that don’t make much money but have kids, encourage them to apply for these benefits, because they won’t be there much longer. It will likely be money that you’d have to front them to help out anyway. This government and the people that installed this imposter in office are corrupt. When the government checks start bouncing or they don’t get their ‘checks’ on time, then we’ll see what happens. Helping use up the money they steal from us is an obligation. That’s my idea of ‘fair’; getting some of what’s been stolen from you.
Get back to me when you’ve paid $30-50K in federal taxes for the past two decades, and have gotten spit-all for it......
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.