Budget deficit tops $1 trillion for first time

Quote :

" WASHINGTON — The federal deficit has topped $1 trillion for the first time ever and could grow to nearly $2 trillion by this fall, intensifying fears about higher interest rates, inflation and the strength of the dollar. The deficit has been widened by the huge sum the government has spent to ease the recession, combined with a sharp decline in tax revenues. The cost of wars in Iraq and Afghanistan also is a major factor. The soaring deficit is making Chinese and other foreign buyers of U.S. debt nervous, which could make them reluctant lenders down the road. It could also force the Treasury Department to pay higher interest rates to make U.S. debt attractive longer-term. "These are mind-boggling numbers," said Sung Won Sohn, an economist at the Smith School of Business at California State University. "Our foreign investors from China and elsewhere are starting to have concerns about not only the value of the dollar but how safe their investments will be in the long run." The Treasury Department said Monday that the deficit in June totaled $94.3 billion, pushing the total since the budget year started in October to $1.09 trillion. The administration forecasts that the deficit for the entire year will hit $1.84 trillion in October. Government spending is on the rise to address the worst financial crisis since the Great Depression and an unemployment rate that has climbed to 9.5 percent. Congress already approved a $700 billion financial bailout for banks, automakers and other sectors, and a $787 billion economic stimulus package to try to jump-start a recovery. Outlays through the first nine months of this budget year total $2.67 trillion, up 20.5 percent from the same period a year ago. There is growing talk among some Obama administration officials that a second round of stimulus may eventually be necessary. That has many Republicans and deficit hawks worried that the U.S. could be setting itself up for more financial pain down the road if interest rates and inflation surge. They also are raising alarms about additional spending the administration is proposing, including its plan to reform health care. President Barack Obama and Treasury Secretary Timothy Geithner have said the U.S. is committed to bringing down the deficits once the economy and financial sector recover. The Obama administration has set a goal of cutting the deficit in half by the end of his first term in office. In the meantime, the U.S. debt now stands at $11.5 trillion. Interest payments on the debt cost $452 billion last year — the largest federal spending category after Medicare-Medicaid, Social Security and defense. The overall debt is now slightly more than 80 percent of the annual output of the entire U.S. economy, as measured by the gross domestic product. During World War II, it briefly rose to 120 percent of GDP. The debt is largely financed by the sale of Treasury bonds and bills. Many private economists say the administration had no choice but to take aggressive action during the financial crisis. "We have a deep recession hammering tax revenues and forcing the government to provide a lot of help to the economy," said Mark Zandi, chief economist at Moody's Economy.com. "But without this help, the downturn would be even more severe." History shows the dangers of assuming too soon that economic downturns have ended. President Franklin D. Roosevelt made that mistake in 1936. Believing the Depression largely over, he sought to reduce public spending and to balance the federal budget, but that undermined a fragile recovery, pushing the economy back under water in 1937. Japanese leaders made a similar mistake in the 1990s when they temporarily withdrew government stimulus spending, prolonging Japan's recession into one that lasted a full decade. Republicans in Congress are seizing on the deficit — and the persistence of the recession — to attack Democrats. "Washington Democrats keep borrowing and spending money we don't have," said House Republican Leader John Boehner of Ohio. So far, interest rates have remained low. This is partly because the Federal Reserve has kept a key short-term rate at a record near zero. Also, all the economic troubles in housing and the rest of the economy have depressed demand for credit by the private sector, meaning the government's borrowing costs are relatively low. The benchmark 10-year Treasury security has risen by about a percentage point in recent weeks, but analysts note it is still trading at historically low levels of around 3.35 percent. Geithner travels later this week to Saudi Arabia and the United Arab Emirates, where he is expected to face questions about the U.S. deficit. As he did during a visit to China last month, Geithner will try to reassure investors in the Middle East that their U.S. holdings are safe from a calamitous bout of inflation. The deficit of $1.09 trillion so far this year compares to an imbalance of $285.85 billion through the same period a year ago. The deficit for the 2008 budget year, which ended Sept. 30, was $454.8 billion, the current record in dollar terms. Revenues so far this year total $1.59 trillion, down 17.9 percent from a year ago, reflecting higher unemployment, which cuts into payroll taxes and corporate tax receipts. Under the administration's budget estimates, the $1.84 trillion deficit for this year will be followed by a $1.26 trillion deficit in 2010, and will never dip below $500 billion over the next decade. The administration estimates the deficits will total $7.1 trillion from 2010 to 2019. "

http://news.yahoo.com/s/ap/20090714/ap_on_bi_go_ec_fi/us_economy_deficit

7/14/2009 12:07:29 AM

i could use some change, my pockets be empty

7/14/2009 12:08:49 AM

it was all obama's fault

7/14/2009 12:08:55 AM

black lipped snake

were doom'd with this jellyfish at the helm

7/14/2009 12:12:44 AM

^^Ok... let me sum up for you. The current deficit through this fiscal year so far is over twice that of the previous year which was a record setting year. And we still have 3 months to go...

Tax rate the next few years after 'recovery' is going to be stupid high.

[Edited on July 14, 2009 at 12:13 AM. Reason : .]

7/14/2009 12:13:16 AM

I believe in the change my nips go thru when I become excited.

7/14/2009 12:19:08 AM

i can believe in that

7/14/2009 12:20:46 AM

Quote :

"I believe in the change my nips go thru when I become excited."

well i sure as hell dont!

7/14/2009 12:21:47 AM

Vote for my nips!

7/14/2009 12:22:21 AM

FTN

7/14/2009 12:22:51 AM

The sad part is we have to deal with this for 8 years before we replace him with some other clown who makes more stupid choices.

7/14/2009 12:23:15 AM

^^^ no dont!

[Edited on July 14, 2009 at 12:23 AM. Reason : .]

7/14/2009 12:23:24 AM

remember when all of the people blaming Bush were countered with people blaming clinton and then people blaming bush

same shit different day

7/14/2009 12:24:24 AM

Rat Soup...hi hater

7/14/2009 12:26:10 AM

sup

7/14/2009 12:30:31 AM

Kinda bored and should be sleeping.

7/14/2009 12:45:50 AM

go to bed

7/14/2009 12:58:54 AM

7/14/2009 12:59:32 AM

im no obama fan but this is boarder line retarded

7/14/2009 1:01:01 AM

dont blame me, i voted mccain

7/14/2009 1:01:42 AM

^ i voted against your boobs

7/14/2009 1:02:29 AM

I like how the OP conveniently forgot to highlight this part of the article:

Quote :

"Many private economists say the administration had no choice but to take aggressive action during the financial crisis. "We have a deep recession hammering tax revenues and forcing the government to provide a lot of help to the economy," said Mark Zandi, chief economist at Moody's Economy.com. "But without this help, the downturn would be even more severe.""

I'm not saying Obama's economic strategy is definitely going to be successful but let's not pretend like he inherited an economy in awesome shape. I for one, am willing to see if an economic strategy other than "hey let's cut taxes significantly for the extremely wealthy, while giving marginal tax cuts to the working class to appease them" will be successful.

7/14/2009 1:02:57 AM

Obey your thirst

7/14/2009 1:03:50 AM

some times I wish the Republicans would win so I wont have to hear their constant bitching.

7/14/2009 1:09:03 AM

politics brother. it's about as real as a leg drop off the top rope!

7/14/2009 1:22:05 AM

Quote :

"I for one, am willing to see if an economic strategy other than "hey let's cut taxes significantly for the extremely wealthy, while giving marginal tax cuts to the working class to appease them" will be successful."

only the wealthy pay significant amounts of income taxes

7/14/2009 7:18:21 AM

Social change, not fiscal.

^^^Ha. I know, right? It's almost the exact sentiment many Republicans had toward the Democrats after the 2000 and 2004 presidential elections. I guess it eventually worked out for them. Maybe it will work out the same way for the Democrats in 8 years or so.

[Edited on July 14, 2009 at 7:27 AM. Reason : -]

7/14/2009 7:26:59 AM

Quote :

"I like how the OP conveniently forgot to highlight this part of the article:"

Quote :

""We have a deep recession hammering tax revenues and forcing the government to provide a lot of help to the economy," said Mark Zandi, chief economist at Moody's Economy.com"

Are you aware of Moody's direct involvement in the financial crisis? Of course someone speaking on behalf of Moody's would say this. They're one of the fucking companies that put us in this mess.

7/14/2009 7:33:10 AM

Quote :

"im no obama fan but this is boarder line retarded"

so is misspelling border

Quote :

"Many private economists say the administration had no choice but to take aggressive action during the financial crisis. "We have a deep recession hammering tax revenues and forcing the government to provide a lot of help to the economy," said Mark Zandi, chief economist at Moody's Economy.com. "But without this help, the downturn would be even more severe."

To put it nicely, most economists are idiots. Alan Greenspan, supposedly the best in the nation, helped create this whole mess by preventing market corrections in the 90s.

Even assuming that the confiscation of money from society, the processing of said money through the channels of government, and the redistribution of it by politicians did work . . . the money would still have to be redistributed. It hasn't. Less than 3% of the $7.8B dedicated for stimulus has been spent. Why the hold up? What happened to "shovel ready jobs" that were going to jump start our economy?

The truth is, this money has been confiscated for the purpose of redistribution to political allies of those in power when it comes close to election time. Both parties do it, this is just happening on a scale beyond anything we've seen before.

There are other issues here like the drastic increase in the money supply (110% in the last 12 months) that are in play, but suffice to say, the money Barack Obama is calling for and the Democratic congress is authorizing have very little to do with actually fixing the economy.

7/14/2009 7:46:50 AM

Quote :

"some times I wish the Republicans would win so I wont have to hear their constant bitching."

Is that a joke? I voted for McCain but was a little relieved that I would not have to hear 4 (or 8) more years of bitching. God that got old.

7/14/2009 7:53:20 AM

there's gonna be whining no matter what in this country

7/14/2009 8:01:37 AM

if jesus were in office they'd want to hang him from a cross






...oh wait







[too soon?]

7/14/2009 8:08:47 AM

^^

Quote :

"there's gonna be whining no matter what in this country"

That's because our system allows the election of candidates that are opposed by too many voters. With a very simple switch from one-person-one-vote to an approval vote, the chance of a large percentage of the voting public getting "shafted" is minimized. After all, what's more important in a democratic election than finding the most approved candidate?...isn't that the best way to find consensus? [ibtdl]

Example:
There are candidates A, B, C, and D. This is the how the approval vote vs. the one-person-one-vote might look:
(Approval vote: voters vote y/n on each candidate. One-person-one-vote: voters vote y on only one candidate.)
person 1: A=y, B=y, C=n, D=n (approves of A and B, but would choose B)
person 2: A=n, B=y, C=n, D=y (approves of B and D, but would choose D), etc.
person 3: A=y, B=n, C=y, D=n
person 4: A=y, B=n, C=y, D=n
person 5: A=y, B=y, C=y, D=y
person 6: A=y, B=n, C=n, D=y
person 7: A=y, B=n, C=n, D=n
person 8: A=y, B=y, C=y, D=n
person 9: A=n, B=y, C=y, D=y
person 10: A=n, B=n, C=y, D=n
person 11: A=n, B=y, C=n, D=y
person 12: A=y, B=y, C=y, D=y
person 13: A=y, B=n, C=n, D=y
person 14: A=y, B=n, C=n, D=y
person 15: A=y, B=n, C=y, D=n
person 16: A=n, B=y, C=y, D=n
person 17: A=n, B=n, C=y, D=n
person 18: A=n, B=y, C=n, D=y
person 19: A=n, B=y, C=y, D=n
person 20: A=y, B=n, C=y, D=y
person 21: A=y, B=y, C=y, D=n
person 22: A=n, B=y, C=y, D=n
person 23: A=y, B=n, C=y, D=y
person 24: A=n, B=y, C=n, D=y
person 25: A=n, B=y, C=y, D=n
person 26: A=y, B=n, C=n, D=y
person 27: A=y, B=n, C=y, D=n
person 28: A=y, B=n, C=y, D=n
person 29: A=n, B=n, C=y, D=y
person 30: A=y, B=y, C=y, D=n

The one-person-one-vote results would be:
A=9
B=10
C=6
D=5
...but the approval vote results would be:
A=18
B=15
C=20
D=14

The most approved candidate is candidate C, so that's who should be elected -- the largest number of people approve of that candidate. According to the imperfect one-person-one-vote results, candidate B would win, followed closely by candidate A. But neither of them are approved as much as candidate C. The polarization between candidates A and B create irrational results - if A or B were elected with the one-person-one-vote system, they'd only have about a third of the total vote, but if candidate C were elected with the approval vote system, they'd be approved by two-thirds of the vote. Much better. Much more rational. A clearly much better way to determine voter consensus.

[Edited on July 14, 2009 at 9:30 AM. Reason : ]

7/14/2009 9:24:43 AM

Quote :

"some times I wish the Republicans would win so I wont have to hear their constant bitching."

get used to it

7/14/2009 9:29:19 AM

Quote :

"dont blame me, i voted mccain "

7/14/2009 9:29:37 AM

Quote :

"dont blame me, i voted mccain "

loser

7/14/2009 9:29:59 AM

^^^^that sounds like it'd work, but it's too complicated for the average american to figure out. sad, but true.

you have to remember that amurricans like to pick one candidate and glorify and worship him while they shit all over all the others. there is not middle ground for them.

i know me and you, as rational thinkers, could use a system like you suggest, but not the idiots i encounter every day.

[Edited on July 14, 2009 at 9:34 AM. Reason : s]

7/14/2009 9:33:49 AM

High levels of idiocy ITT.

A majority of the policies enacted which have led to this deficit were started by Bush. This includes the wars in Afghanistan and Iraq as well as the stimulus package of which Bush was a major initiator (McCain backed this as well)

The resultant deficit would have reached the same level regardless of who won the 2008 election based on the initial development that began with the Bush administration policies which were not fully enacted until after the new term..

7/14/2009 9:34:16 AM

people expected "change" to happen instantaneously. change takes time.

7/14/2009 9:35:01 AM

but but

i want somewhere to point my finger

7/14/2009 9:35:04 AM

[Edited on July 14, 2009 at 9:46 AM. Reason : also, if I wanted to get annoyed by political crap, I'd go to the Soap Box...]

7/14/2009 9:44:54 AM

Quote :

"but it's too complicated for the average american to figure out"

I'm not so sure...
Ranking systems of voting are too complicated, sure.... but this is simply checking y/n for each candidate. How hard would it be to put up PSAs and posters everywhere saying, "With our new and better voting system, you may vote yes for as many candidates as you wish." That is not difficult. Voting place volunteers could remind people as they are about to cast their ballot, "Excuse me, before you cast that, you do know that you may vote for more than one choice, right?" We could start teaching it a decade before we change to it. I just don't see a problem, except of course, with any change there are a few kinks that can't be avoided....

Quote :

"you have to remember that amurricans like to pick one candidate and glorify and worship him while they shit all over all the others. there is not middle ground for them."

And the education campaign behind the voting system change would make it clear to everyone that it's fine to have a favorite and/or least favorite, and that they'd be free to only vote for that one candidate should that be the only one they decide that they approve of. But it would also be made clear to them that they may pick more candidates if they happen to approve of them. You could be a huge Obama fan, but maybe you're not opposed to Nader, so you can vote yes for both. Or not. Voter's choice.

Quote :

"deficit .... started by Bush"

I really wonder if they did that on purpose. The dems and the repubs are simply two sides of the same socialist coin. I mean, really -- what have the repubs done to prevent the slide towards socialism? Almost nothing -- in fact, they seem to take an active role creating the mandate for liberals to come in and make the government larger. 3rd parties ARE OUR ONLY HOPE, PEOPLE.

Quote :

"if I wanted to get annoyed by political crap, I'd go to the Soap Box"

The Soap Box is mother-fucking worthless. Political/debate threads are 10000% times better in Chit Chat or even the Lounge. Fuck the fucking Soap Box mother-fuckers.

7/14/2009 9:51:04 AM

pretty sure the soap box has a lower fuck density per post than your stupid ass is bringing in here

7/14/2009 9:52:38 AM

Kimbo choked out the guy that knocked out tim sylvia faster than Fedor defeated Tim

so kimbo is legit


no seriously, kimbo is a decent fighter, anyone can be caught and petruzzeli is an experienced fighter

7/14/2009 9:53:39 AM

^^
That's a bad thing?

[Edited on July 14, 2009 at 9:53 AM. Reason : ]

7/14/2009 9:53:43 AM

fuck is a spice, kid

nobody eats salt and pepper for dinner

7/14/2009 9:54:48 AM

^^^wrong thread?

[Edited on July 14, 2009 at 9:56 AM. Reason : ^]

7/14/2009 9:55:50 AM

Quote :

"fuck is a spice, kid nobody eats salt and pepper for dinner"

There's no salt or pepper in your food? Wow... boring.
Spice is good.

....or were you implying that my post is: "fuck fucking fuck fucking mother-fucking fucker fuck mother-fucking fucker fuck fuck fucking mother-fucking fuck fucking mother-fucking fucker fuck fucker fuck fuck fucking mother-fucking fucker fuck fuck fuck fucking mother-fucking fucker fuck fucking mother-fucking fucker fuck fuck fucking mother-fucking fucker fuck"???...because it's not. You should read it again -- it's not just a bowl full of salt and pepper.

7/14/2009 10:01:37 AM

Don't even worry about the debt, we will never pay it off! Just think of it as Monopoly money. Save us now, print moar green!!

7/14/2009 10:02:01 AM

Quote :

"The Soap Box is mother-fucking worthless. Political/debate threads are 10000% times better in Chit Chat or even the Lounge. Fuck the fucking Soap Box mother-fuckers."

you are very bad at the wolf web

7/14/2009 10:03:44 AM