US DEBT greater than GDP
Remember this day, August 4th, 2011. It is Barack Obama’s birthday, and his gift to you, was insurmountable debt.
Today, our debt has soared past our GDP.
Thank you Barack Obama.
WASHINGTON — US gross debt shot up $238 billion to reach 100 percent of gross domestic product after the government’s debt ceiling was lifted, Treasury figures showed.
On Tuesday, the Treasury had to add more than $200 billion of commitments immediately after President Barack Obama signed into law an increase in the debt ceiling.
The liabilities had been temporarily taken off the federal government’s balance sheet since May 16, when the Treasury reached the $14.29 trillion official cap.
It then used extraordinary measures to remain under the legal limit while deeply polarized Republicans and Democrats battled over raising the debt ceiling and reining in the country’s massive deficit.
The new borrowing took total public debt to $14.58 trillion, over end-2010 GDP of $14.53 trillion, putting the United States in a league with highly indebted countries like Italy and Belgium.
THIS is the pivotal message we need to get across to voters:
Ratings agencies have warned the country to reduce its net debt-to-GDP ratio quickly or facing losing its coveted AAA debt rating.
Moody’s said Tuesday that the government needed to stabilize the ratio at 73 percent by 2015 “to ensure that the long-run fiscal trajectory remains compatible with a AAA rating.”
Let’s do some quick math: for us to get do that ratio of 75% debt to GDP, assuming NO growth or shrinking of the economy, we need to get down to $10.64 TRILLION in FOUR YEARS. That means we have to cut $3.93 trillion over that period, or $1.6 trillion every year.
Every year. Including 2012.
The deficit alone (which adds to the standing debt every year) for 2011 was $1.6 TRILLION. In order to get to those recommended ratios, we’ll need to cut the ENTIRE deficit every year, AND cut an additional $1.6 trillion EVERY year. This is $3.6 trillion cut in the budget we need to do RIGHT NOW.
Which political party is taking this seriously?
If Obama and the Democrats actually thought the threatened bond rating increases were going to destroy America, then WHY aren’t they putting forth plan to get to this debt to GDP ratio?
The answer is that they AREN’T serious, they don’t care a whit about ratings, they are demagogues and ideologues that just want to push their agenda through. Instead, they’re calling the Tea Party terrorists for taking this problem seriously.