More signs that the economy is sluggish and that the American Century is over for real:
The Congressional Budget Office is projecting that the deficit for the 2010 budget year that ended Sept. 30 will total $1.29 trillion. That's down by $125 billion from the $1.4 trillion in 2009—the highest deficit on record.
But don't worry, America. The political class is dedicated to keeping America's record-setting-deficit record going:
The Obama administration is projecting that the deficit for the 2011 budget year, which began on Oct. 1, will climb to $1.4 trillion. Over the next decade, it will total $8.47 trillion.
And they've even got a secret weapon up their sleeve to make sure this happens: The imminent election of large numbers of Republicans who played such a key role in the massive 104 percent increase in inflation-adjusted government spending during the George W. Bush administration (which was signing the checks for most of FY2009).
Why are long-term, persistent deficits bad? For starters, every dollar the government spends has to come from somewhere (read: your pocket immediately or in the future), so it sucks money out of the part of the economy that generates growth. Interest on the federal debt (the accumulated total of annual deficits) is set to explode already and just wait until interest rates crank up a bit. Like all broken-down borrowers, the vigorish is going to turn into a bigger problem than the principal. And that will only heat up when lenders realize there's no serious plan to bring spending and revenues into line anytime soon and they start to get worried about their "investment" in the U.S. of A.'s government. But take it from your own experience (read: my experience) as a maxed-out borrower back in the salad days of your (read: my) youth. When you're deep in debt, you can't do very much and you feel lousy all the time. And at some point even your friends will stop lending you rent money, much less gettin' high cash. Always being in debt is no way to live.
For more on the deficit projections indented above, go here.
For serious plans to cut spending now—in 3D, no less!—read the November issue of Reason, which features 3D glasses that will also allow you to view special 3D Reason.tv videos too. Go here to buy it and get more info. And watch the 2D version of the vids below: