US NOT Drowning in Debt

[inchhigh]

http://moneyland.time.com/2011/07/15/the-u-s-is-not-drowning-in-debt/?hpt=hp_t2


Yes, the federal debt has grown by nearly $3 trillion dollars in the past three years. And yes, the dollar amount of that debt is quite large (in excess of $14 trillion and headed toward $15 trillion should the ceiling be raised). But large numbers are not the problem. The U.S. has a large economy (slightly larger than that debt number). And, crucially, we have very low interest rates.

Because of those low rates, the amount the U.S. government pays to service its debt is, relative to the size of the economy, less than it was paying throughout the boom years of the 1980s and 1990s and for most of the last decade. The Congressional Budget Office estimates that net interest on the debt (which is what the government pays to service it) would be $225 billion for fiscal year 2011. The latest figures put that a bit higher, so let’s call it $250 billion. That’s about 1.6% of American output, which is lower than at any point since the 1970s – except for 2003 through 2005, when it was closer to 1.4%

The Cut and Paste provided the following URL, not the same as the actual site I was reading......


Read more: http://moneyland.time.com/2011/07/15/the-u-s-is-not-drowning-in-debt/#ixzz1TbCnpCuP

[spanone]

1. phony crisis

[inchhigh]

2. The DEBT crisis is phoney...

but the Default crisis will not be.

[spanone]

4. no but it will be caused by a bullshit crisis...and could be prevented easily

[inchhigh]

5. Right, and the frustrating thing is not that it could have been

avoided, but that we actually went out of our way to create the problem

[Oceansaway]

3. k & r..nt

[Chimichurri]

6. It's a game and I'm so sad Obama and the Dems are actively participating in it. They

should be countering it with these facts.

[DinahMoeHum]

7. The money IS there. . .it's just not doing useful work.

n/t

[Gregorian]

8. I usually believe much of what I read. I don't believe this.

It's not 1955, and the rest of the world is now in competition with us. We are never going to be what we were. We don't even have the resources we had. America was a monopoly.

Paying back 13 trillion, which I'm guessing is an artificially low figure, is going to now take an additional amount above and beyond the things mentioned in the article. All while global economies are faltering.

I don't know what I'm talking about. I guess it's truthiness talking. My gut feeling says we're headed in the wrong direction with little break in sight.