$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
Sat, 02-21-2004 - 11:02am
Thanks, that was an interesting. I have two comments.

First, the statement “When the budget projections are updated for the recent deterioration in tax collections..” brought to mind a recent "Frontline" program entitled "Tax Me If You Can" which investigated schemes such as LI/LO (Lease In/Lease Out) which international corproations are using to defraud the government of tax dollars. Essentially, they are using the "tax line" as a profit center. Billions are being lost. http://www.pbs.org/wgbh/pages/frontline/shows/tax/

Second, “Most troubling, however, is that the projected deficits remain so large that they drive up the accumulated debt faster then the economy.” Of course, we know this at some level, but it is a shock to see it in print. In addition, the deflating dollar and the awareness that interest rates are at a record low, certainly causes concern.



Avatar for independentgrrrl
iVillage Member
Registered: 03-26-2003
Sat, 02-21-2004 - 11:29am
<>

Keep the tax cuts permanent. JFK and Reagan followed this priciple. They both understood that when people spent more, the economy benefited. Tax people to death and they will hold on to their money even more.

Reduce the pork in bills and use that money to fund worthwhile programs. Do you honestly believe that raising taxes will reduce the debt? Do you honestly believe that our congress won't converge on this *new* source of revenue like vultures to a carcass and get *their* cut first and leave next to nothing for the worthwhile programs?

iVillage Member
Registered: 04-16-2003
Sat, 02-21-2004 - 5:12pm
<>

Supply economics or trickle down economics is an invention of the Reagan era--where did you get JFK? Also, you should know that the big tax cuts did not go to people who will spend it. Its going to the investment crowd who is delighted to be buying foreign luxury items. Did you visits URLs metrochick and I posted? By the time GWB supporters realize how destructive Bush's policies are, it will be to late.

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