Our “Astronomical” Debt - Not really, at closer look.

National Review ^ | 6/9/03 | Bruce Bartlett

[Steven W.]

as they say, figures often lie and liars figure ;)

[AntiGuv]

Some very important & intriguing observations. Marked for later!

[Southack]

No doubt the gloom and doomers will rue this article!

[Thane_Banquo]

There are lies, damn lies, and...

[Blood of Tyrants]

Medicare... accounts for $37 trillion of the $44 trillion debt. Almost all the rest is accounted for by Social Security

The Rats have been squealing like stuck hogs over the $44 trillion number now it turns out that the cause of the debt is their programs.

[Tauzero]

"This fact puts a lie to the notion that recent tax cuts have somehow contributed significantly to a $44 trillion debt."

Umm yes.

"The imbalances in Social Security and Medicare are inherent in those programs and will not be cured except by fundamentally restructuring them. Raising taxes or rescinding recent tax cuts will not suffice. Payroll taxes would have to roughly double immediately and stay at that level forever to cover the deficit, or income taxes would have to rise by 70 percent.

Of course, if taxes did rise by such an amount, future economic growth would be affected. We would not get $682 trillion of GDP in the future, but considerably less. That will require even higher taxes to pay promised benefits, which in turn will further reduce growth."

Umm, yes. Bruce neatly summarizes exactly why this is worth worrying about.

[playball0]

Very well-reasoned. It's unusual to see a publish article on government taxes and finance so well thought out.

[Jack Black]

Hey, I resemble that. Medicare is a bipartisan program. Bush wants to add a prescription benefit. That'a major future budget buster, a major increase in the role of governemnt in all our lives and in the economy and another step towards both socialism and Hillarycare.

It appears there is a bipartisan coalition that agrees that anything the congress can pass and get signed is constitutional, the job of the Govt. is to do whatever a majority wants, and FedGov can do a better job of a lot of things than private enterprise and free markets. Oh, yeah they agree that a 50% tax rate on the productive is no big deal.

Those who don't agree are the fringe: Libertarians, Concord Coalitionists, some Perotistas, the RLC, Free Staters and Constitutional Conservatives. And Goldwater-era Repbulicans, who are declining as a percent of the party.

[E=MC²]

I've been wondering about prior posts comparing apples (today's economy) with oranges (net present value of the total U.S. debt in PERPETUITY). Finally, someone has pointed out this flaw.

[headsonpikes]

"Bruce neatly summarizes exactly why this is worth worrying avout."

There's nothing to worry about!

The $44 Trillion figure would only apply if the government kept its promises to the taxpayers and retirees.

Now, seriously, how likely is that?

[bjcintennessee]

Ping for later read.

[Tauzero]

"Now, seriously, how likely is that?"

It's not the keeping, but the trying to keep. :)

( And that's assured by the twin voting blocks of senior citizens and unfilial, barren, rapacious consumers.)

[Jack Black]

"unfilial, barren, rapacious consumers"

Please explain. Those are some weird adjectives and a strange noun. I would say "greedy, parasitical welfare recipiants of all types, corporate, minority, arts, special needs, etc." Unfilial? Barren? (I guess not having enough kids is a big problem w/ the Ponzi scheme, isn't that why we have virtually unlimited immigration compared to the rest of the world? Rapacious? Well you got that right- Dictionary: 1. taking by force, PLUNDERING. 2.Ravenous: greedy 3. RAPTORIAL

[WRhine]

When the size of the future economy is calculated the same way as the $44 trillion debt figure, it comes to $682 trillion. Thus this astronomical debt that so alarmed the editors of the Financial Times turns out to equal just 6.5 percent of the gross domestic product — something to be concerned about, but hardly a crisis in the making.

Great! Let's keep on spending.

[ContentiousObjector]

What do you think of the national debt?

I like cheese

What?

I said, I like cheese

What does cheese have to do with the national debt?

Nothing

So why are we talking about cheese?

Because I like cheese

The above is a perfect example of a pointless discussion, comparing the national debt to the GDP is like talking about how much you like cheese, it's absolutly irrelevant.

Comparing the national debt or deficit to anything other than government revenue or tresury holding is pointless, unless you happen to favor 100% taxation.

The debt and deficit are absolutly out of control, if Al Gore were in the white house and this was happening every other thread on free republic would be devoted to trashing his irresponsible economic policy.

[SamAdams76]

So on a personal scale, I guess this means I can run up a $600,000 debt because I'll be making $10,000,000 a year 75 years from now. Now I might not make it another 75 years but you younger Freepers will cover for me, won't you?

[IncPen]

self bump

[sourcery]

Key point: "When the size of the future economy is calculated the same way as the $44 trillion debt figure." The devil is in the details. Let's hope the reported projections of the size of the future economy are realistic, and not the product of Rosie Scenario.

Nevertheless, this would seem to be good news. And the identification of Medicare and Social Security as the main culprits would also seem to be good amunition against the Socialists.

[eno_]

Medicare entitlements are not easy to get rid of, but an entitlement is much easier to get rid of than a bond is to default on. Lumping all this into "debt" is nonsensical.

Plus, look at government assets. The government probably owns 10 trillion worth in land, mineral rights, and facilities, not even counting National Forests.

[gcruse]

Leave the gloom and doomers alone. A constant drumbeat against Congressional spending is a good thing. Maybe they'll even scale government back, if it gets loud enough. A $127 billion agriwelfare trough just encourages others.