$7,000,000,000 in the red

iVillage Member
Registered: 03-31-2003
$7,000,000,000 in the red
23
Thu, 02-19-2004 - 9:40am
The national debt topped $7 trillion on Tuesday. Just one year ago we hit our debt ceiling (sort of our national "credit limit") of $6.4 billion and had to raise the ceiling to $7.384 trillion. Now we're almost up against that.

U.S. NATIONAL DEBT TOPS $7 TRILLION FOR FIRST TIME

http://news.moneycentral.msn.com/breaking/breakingnewsarticle.asp?feed=OBR&Date=20040218&ID=3408316


from Feb 20, 2003 GOVERNMENT HITS NATIONAL DEBT CEILING

http://www.cnn.com/2003/ALLPOLITICS/02/20/debt.limit.ap/



U.S. National Debt Tops $7 Trillion for First Time

February 18, 2004 6:09:00 PM ET


By Jonathan Nicholson

WASHINGTON (Reuters) - The U.S. government's national debt -- the accumulation of past budget shortfalls -- totaled more than $7 trillion for the first time as of Tuesday, according to a Treasury Department report.

In its daily financial statement released on Wednesday, the Treasury said the U.S. debt subject to a congressionally set limit totaled $7.015 trillion, up from $6.983 trillion on Friday. The government was closed on Monday for the Presidents Day holiday.

While passing the $7 trillion mark itself has little practical significance, not unlike a car's odometer rolling over, it may signal some tough political times for President Bush's administration on fiscal policy.

The government debt ceiling stands only a few hundred billion dollars ahead at $7.384 trillion, and Treasury would need Congress's blessing to borrow beyond that. Treasury officials say they expect the limit to be hit sometime between June and October.

And in this election year, Democrats may also use the $7 trillion figure to assail Bush's tax policy and the federal deficits on his watch. Budget shortfalls are met by borrowing. In 2003, the federal budget gap was a record $374.25 billion and a larger one is expected this fiscal year. Bush blames the deficits on a sluggish economy and needed spending on security and defense.

Rep. Baron Hill of Indiana, part of a centrist group of Democrats said, ``It is simply immoral to run a national debt exceeding $7 trillion, every penny of which our children and grandchildren will be responsible for paying back.''

A Treasury spokeswoman said there was ``no special significance'' to the number.

The last time that debt subject to the limit passed a trillion-dollar milestone was on June 28, 2002, according to Treasury records.

To give some idea of the size of the debt, U.S. gross domestic product -- the sum of goods and services produced inside the United States -- totaled about $11 trillion at the end of 2003, according to the Commerce Department.

The debt includes that held by investors and Treasury securities in trust funds for government programs such as Social Security and Medicare.


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iVillage Member
Registered: 04-16-2003
Thu, 02-19-2004 - 10:44am
<>

This is probably true, but by the time it is significance we won't be able to do anything about it. Combine this with the fact that we are repaying the debt with a dollar that is worth 40% less, I wonder how much longer our creditors will support our spending. Two very bad trends as far as I'm concerned: Falling dollar and increasing debt.

iVillage Member
Registered: 03-31-2003
Thu, 02-19-2004 - 12:43pm
<> A good point that I hadn't even considered.

iVillage Member
Registered: 07-25-2003
Thu, 02-19-2004 - 12:54pm
It's still a managable debt in relation to GDP.

Renee

iVillage Member
Registered: 03-31-2003
Thu, 02-19-2004 - 1:24pm
At what percentage of GDP does it become unmangaable?
iVillage Member
Registered: 03-18-2000
Thu, 02-19-2004 - 2:12pm



GDP weaker than expected



Fourth-quarter rate of growth in broadest measure of economy healthy at 4%, but half of 3Q's pace.


See link for article & graph...........


http://money.cnn.com/2004/01/30/news/economy/gdp/

cl-Libraone~

 


Photobucket&nbs

iVillage Member
Registered: 03-26-2003
Thu, 02-19-2004 - 2:13pm
Using whos accounting methods....the real world, or the Federal Government?
iVillage Member
Registered: 03-25-2003
Thu, 02-19-2004 - 2:23pm
Several years ago I attended a legislative conference in Washington where Senators and Representatives from both sides of the aisle moaned and groaned about the size of the debt and how it was detrimental to the economic well being of the nation. Subsequently it was broght under control. Now Bush and Co. have let it grow to a new high. Some Conservative economists and wanna' be economists have decided it doesn't matter. Hmmm.
iVillage Member
Registered: 07-25-2003
Thu, 02-19-2004 - 3:38pm
Well, the largest debt in relation to GDP, which is the only meaningful measure, was in the eighties, and by the mid nineties it was retired.

The same rhetoric that is going around now about our grandchildren having to eat cat food to pay off our debt was at vitriolic levels back then.




Edited 2/19/2004 4:25:04 PM ET by wrhen

Renee

iVillage Member
Registered: 01-29-2004
Thu, 02-19-2004 - 4:02pm


Just more apocalyptic predictions from the emotional Left.
iVillage Member
Registered: 07-25-2003
Thu, 02-19-2004 - 5:46pm
The amount isn't important. The debt is measured in relation to GDP. Bush, like many economists, has always said that deficit spending is only justifiable when there is a recession, during times of war, or when their is a national catastrophy, and now here we are having gone through all three at the same time our economy is transitioning from an industrial one to an information one and with the increased productivity and outsourcing that entails. It's a miracle that we are in as good as shape as we are.

Renee

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