Ten Trillion Debt

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Brother,

Can You Spare $9 Trillion?

This article was written by CBS News White House correspondent Mark Knoller, Sept 6^th 2007 before the 2008 financial collapses

Few took notice, but for the first time in U.S. history last Friday, the national debt hit an all-time high of $9 trillion.

To be exact, the total liabilities of the U.S. Government hit $9,005,648,561,262.70, according to the Bureau of the Public Debt at the Treasury Department.

Numerically, that’s in excess of the debt ceiling set by Congress, which stands at $8.965 trillion.

Some components of the national debt are excluded from the debt ceiling calculation.

But had it truly been reached, the Treasury Department would be barred from selling any more bonds, notes and other securities until Congress raises the limit.

Treasury Secretary Henry Paulson served notice on Congress in July that he expects the U.S. Government to bump into the debt ceiling in early October and that lawmakers need to raise the ceiling before then.

No official notice of the national debt milestone was taken by the White House. Understandably. It’s an embarrassingly large figure for a president who claims to be fiscally-conservative to have to explain.

Mr. Bush often boasts about his commitment to fiscal restraint, and trumpets his efforts to bring down the annual federal deficit from its all-time high of $413 billion in 2004. The Administration forecasts a deficit this year of $205 billion. The forecast from the Congressional Budget Office is lower still at $158 billion.

But Mr. Bush almost never mentions the national debt. On the day he took office, the debt stood at $5.727 trillion. That means it has increased by 57 percent on his watch. So far.

And it’s not just the size of the debt that’s historic. So too is the amount taxpayers must pay annually in interest payments on $9 trillion in borrowed funds.

Last year, the interest on the debt exceeded $405 billion dollars. This year’s interest payments will be even greater.

Lets Blame The National Debt & Financial Crisis On Events Beyond Our Control

Educational Editorials©

by William M Wright BBA, MBA

Yes, our government has faced recent national calamities that were beyond their control. But this is all the more reason to more carefully consider the unnecessary cost of many homeland defense grant give-aways and an Iraq foreign invasion and occupation.

There has never been a time in American history where all events were within our control.

For the same reason financial planners advise everyone to reduce spending and save money for a "rainny day".

The (R) Regan administration worked with democrats to restore some fiscal soundness to the social security system. His administration minimized America’s cost in foreign wars and middle-east troubles while

having to worry about defending againest the world’s most powerful military force (the U.S.S.R) and a nuclear WWIII holocaust.

But, the current administration has used the War-On-Terrorism (we all support) to convince us to spend billions more in military hardware and to spend a trillion to invade and occupy a country that had nothing to do with 9/11 or our national security. We are spending billions weekly in Iraq with no regard to any cost-benefit analysis. Some leaders want you to be obsessed with “Winning” so you give no thoughts to human and financial “Cost”.

Our Government used the same "must win at all cost" sales pitch in Vietnam. Vietnam accomplished nothing for America's national defense or world democracy. Instead it help give us a decade of stagflation.

In fact North Vietnam never honored the “Paris Peace Accord” they signed to hold free elections in South Vietnam in return for U.S. withdrawal. Now the American government that believed American soldiers needed to “defend freedom” against “communist” in Korea and Vietnam (where over 90,000 American’s died fighting China backed armies) has spent the last two decades making it easy for Communist China and now Communist Vietnam to capture American jobs and markets.

Yet, the same American government maintains a 45 year old policy of “No free Trade” with Cuba.

Is it any wonder so many Americans see little value in spending over a trillion dollars and spilling more blood in Iraq ?

Is Iraq worth expanding our National debt while we get the world to forgive most of their National debt? Was the value of Iraq oil (which has now quadrupled in price) used to repay American taxpayers as planned? No!

David Walker is America’s CFO and has worked for democrats and republican. Listen to his video’s above. He makes it clear that the long-term financial crisis facing every American greatly exceeds the short-term threat of any Anti-American terrorist to our financial freedom.

David Walker is a great American Patriot.

The Official I.O.U.S.A Movie Trailer

America's CFO says we're already bankrupt

David Walker our CFO provides the facts: Part-1

Part-2: The Numbers are all Big and they are all Bad

CNN & CFO discusses our Long Term Debt Time Bomb

Glen Beck explains the Fiscal Menu Of Delayed Pain

In The Red 31 out of The Last 35 Years

BBC - America In Decline

Putting a Million vs. a Billion vs. a Trillion in Perspective

Popular Minister Gives An Interesting Perspective -Part 1

Part 2 - Minister Gives A Perspective on Bankers

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A Trillion

Here

A Trillion

There...Soon It Will Add Up To Real Money.

by William M Wright BBA, MBA

The national debt now exceeds $9.8 trillion as of 9-25-2008.

You can check the debt to the penny every day at PublicDebt.Treas.Gov/opd

Neither Presidential candidate will talk much about the ticking time bomb called: National Debt for two reasons #1: No candidate’s strong suit is Economics or Balancing Budgets. #2: No one ever got elected telling people we need to fix that problem (just ask Ross Perot).

Fixing the problem involves spending less or taxing more. We all know no one wants less government benefits or to pay more taxes. The sad truth is the solution will need to involve less benefits and more taxes.

The debt is comprised of savings bonds, treasury bills and other bonds offered for sale by the US government at a specific interest rate established at the time the bonds were sold.

According to the US Treasury Department website, 57% of the debt is owned by the public and 43% is owned by US government agencies.

Public owners include banks, private investors, pension funds, mutual fund companies, insurance companies, and state, local or foreign governments.

Government agencies holding the debt include the Social Security trust fund, Federal employee retirement funds, and other trust funds (transportation, housing, etc). Like any other investor, these government agencies earn interest on the bonds and treasury bills that they hold.

You can look up the US National Debt for any date or time period at the same website link above. For instance, at the end of Jimmy Carter's presidency, in 1981, the debt was just under $1 trillion (and we thought that was a horrible economic period). But it was at $4.4 trillion when the first President Bush left office and at $5.7 trillion when Bill Clinton left office -even after three years of fat federal government budget surplus!

It is true that much of the debt is owed to Americans by Americans, but it does not cancel out. Those citizens and institutions that own the debt certificates (notes, bonds etc.) are gainers (savers) and those who do not are losers (debtors). Additionally, much of the debt is owned by the Social Security Trust Fund and other government agencies that the treasury does not even pay interest to. That's one of the reasons the social security trust fund is in trouble and another reason baby-boomers are upset with talk of more future social security cuts.

Japan, China, and Britain own most of the debt by lending us money through buying US Treasury Bonds. By buying the bonds, they loan us money that must be paid back with interest. We are relying heavily on other nations to maintain our economic stability in the face of tax cuts and record federal deficits. Congress and President Bush seem happy to continue postponing serious decisions about fiscal policy as long as foreign treasuries buy U.S. debt.

But the more unnecessary debts we pile up, the harder it will be to return to fiscal responsibility.

We owe Japan nearly $600 billion. We owe China over $500 billion and Great Britain nearly $300 billion. We even owe Brasil over $100 billion. Yes, Brazil the most indebted nation of the 70's with a decade of hyper-inflation.

Those who loan us money are not the enemy. In fact their faith in our economic stability and ability to repay debt help keep interest rates low for a generation of American debt borrowers.

But many baby-boomers who paid 8-12% for mortgage rates for over a decade (with a paid-in- full mortgage) are upset with a U.S. government monetary policy that is rewarding spenders with easy access to low 3-6% rates while penalizing savers with low 1-3% MMF rates.

The size of the national debt is one issue and the debt service cost is another. Today’s debt service to the lenders is the big concern. The debt service i.e., the interest the treasury must pay on the debt (like the minimum payment on your credit card bill). As the debt increases and the interest increases, the debt service rises as the product of the two.

The debt service is now about 10% of the federal budget. Those interest payments must be paid from your taxes and must come out of funds that would otherwise be available for social security, national infrastructure improvements and social services.

And remember much of the debt is owned by the Social Security Trust Fund and other government agencies that the treasury does not pay interest to!

Is it any wonder why baby-boomers and their employers who paid billions into social security are upset with the governments own fiscal irresponsibility?

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