The Treasury Dept. website showed the debt at $15.99 trillion Thursday afternoon but then closed for the Labor Day weekend. The $16 trillion mark will be hit Sept 4 just as the Democratic Convention convenes in Charlotte N.C.
The GOP convention in Tampa played up the national debt theme. They even had a clock showing the amount of debt during the convention. It turned out that only a mere $8.5 billion was added during the four day convention.
During the last two presidencies the U.S. debt has more than tripled and now stands at 104% of the U.S.economy. The debt is growing at a rate of about a million a minute or $3.5 billion a day. Twelve years ago the debt was $5.6 trillion just before George Bush was elected. This grew to $9.6 trillion before Obama took office. Since Obama took over there has been the largest debt increase ever to the present record.
Jeff Sessions of the Senate Budget Committee said:“This is a grim landmark for the United States. Yet the president seems strangely unconcerned.” No doubt Obama and the Democrats are more concerned with jobs and getting the economy growing and themselves elected. Democrat adviser David Axelrod said:“You can’t balance the budget in the short term because to do that would be to ratchet down the economy."
Almost 30 per cent of debt however is one governmental unit owing money to others. One glaring example is the borrowing from Social Security's trust fund!
This is a graph of U.S. gross federal government debt from 1981 to 2012 (est), as a percentage of GDP, color coded by congressional control and highlighting presidential terms. The data is from the U.S. Office of Management and Budget
Robert Bixby executive of an NGO that promotes a balanced budget noted:“The national debt is certainly a ticking time bomb. There’s no question that if we don’t do something about it, it’s going off...We’re spending about $200 billion on interest now. That’s much more than we’re spending on operations in Afghanistan, more than we’re spending on Medicaid.” This debt time bomb is ticking just as many baby boomers are reaching retirement. At the same time the government is borrowing from Social Security Trust funds!
Whoever wins the elections will also face the fiscal cliff. The fiscal cliff refers to the results if tax cuts are allowed to expire and mandated cuts(sequestrations) to budgets are allowed to take place. No matter who wins the election there is little doubt that Americans will face austerity measures. However, unlike countries such as Greece and Spain who face huge interest charges on borrowings the United States can continue to float debt at very low interest rates. Even though the ratio of debt to GDP is quite high the U.S. ratio is a little more than half that of Japan!
This opinion article was written by an independent writer. The opinions and views expressed herein are those of the author and are not necessarily intended to reflect those of DigitalJournal.com