Don't Worry! The 2011 Deficit Should Be The Biggest Ever!

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:

Comments

[Justin Benoider]

Wow, if that is not a scary thought I dont know what is. Wow.

http://www.total-privacy.au.tc

[sage]

Phew. Now I feel better.

[???]

I (read: you) loved getting high with my (read: your) friends back in the day.

[Enjoy Every Sandwich]

Woo-hoo! They'll show those amateurs in Zimbabwe how it's done!

[P Brooks]

You know what will fix this? Tariffs!

[Douglas Fletcher]

The imminent election of large numbers of Republicans who played such a key role

Not to put on a pollyanna hat but at least the new Republicans who get elected will at least have the virtue of not having been in the Congress when all that happened.

[Legate Damar]

But they will be herded by those who were. Ah, the seniority system...

i would love (LOVE) for the Tea Party class to keep their anti-establishment fervor once sworn in, but I strongly suspect that most (or maybe even all) will be standard-issue Team Red clones no later than 2012.

[Tman]

I think that depends on what happens when they get elected. People seem to think that the Tea Parties started the second Obama took office, but the reality is that they started before that, many in reaction to the TARP bailouts. And more importantly, Tea Party folks are less partisan than the media makes them out to be. The Republican establishment is just as scared of them as the Democrats are.

There are few political things more enjoyable than watching the entreched elites from both parties roundly denouncing the Tea Parties as the ungrateful proletariat, whilst their power dwindles right in front of them.

Good times.

[Mainer]

The one bright spot in this article was seeing someone use the term "salad days" correctly.

[Jeffersonian]

Was it directed by Sam Peckinpah?

[BakedPenguin]

And at some point even your friends will stop lending you rent money, much less gettin' high cash.

Nick, I don't care how much you owe. Someone who won't lend you gettin' high cash is not your friend.

[Tim]

Obi-Wan: That's no moon. It's a budget defecit.

[fresnodan]

Whoo-Hoo!
We're number one!
We're number one!
We're number one!

My heating bill is high every winter, so I am looking forward to spending less by burning worthless dollar bills, maybe even 20$ bills!

Motorized wheel barrow, bitchez!
http://www.northerntool.com/sh.....la=Grounds Maintenance>Wagons + Yard Carts&cm_ite=365030?ci_src=14110944&ci_sku=365030

[Paul Krugman]

will total $1.29 trillion

This is a relatively small amount.

[Spiny Norman]

Always being in debt is no way to live.

You got that right. I did that for more than a decade. It was the dot-com bubble that got me out of debt, because I used my increased revenues to pay off my debts, rather than to spend more.

It almost seems like there's a lesson in this somewhere.

[Edgar99]

the George W. Bush administration (which was signing the checks for most of FY2009)

Incorrect. FY2009 began October 1, 2008 and ended September 20, 2009. President Obama was inaugurated on January 20, 2009. President Bush was signing checks for only 4 months, not "most" of the year. And one of the biggest checks that year, by the way, was the American Recovery and Reinvestment Act signed by President Obama in February 2009. The Bush Administration actually reduced the annual deficit from the prior year in FY's '05, '06, and '07. Not much glory to be sure, but in no way comparable to the current administration's excess.

[hsr0601]

Equation :

Depression : New Deal = Great Recession : Stimulus Package (Groundwork) + Incomplete Energy Independence or A Jobs law

The Problem = The destructive war & military waste + Stimulus Package
Therefore = Incomplete Energy Independence or A Jobs law - The destructive war & military waste
Criticism = Stimulus Package (Groundwork)
Conclusion = Gambling on Iraq Oil + weapon sell Again + Double-dip Depression

Cure = Slashing the destructive war & military waste + Completion of Energy Independence or A Jobs law

Anger at These :
?
Gambling on Iraq Oil Again : A Drop in the Bucket Vs. Growing Population & Demand World-wide. The Age of Cheap Oil = A Thing of the Past.
?
1. At this time, it looks like the oil-friendly country is gambling on Iraq oil again, citing a big government & deficit, and therefore the world-wide stimulus package worth trillions and health care reform in America are now at stake.
?
2. Of the money by the money for the money is getting a society nowhere near prosperity.
Gambling on party of "no idea" is sure to be much like Throwing an Egg of Economy Against a Rock.
?
The outcome of government take-over :
?
1. In banking industry, the result of government take-over is big bonus parties backed by the tax-payer's invaluable cash.
?
2. In healcare reform, the outcome of government take-over is to dump ill children when needed most.
?
3. In oil spill, the administration should be held responsible for its deregulation, urging a big government
?
Chanting deficit :
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1. Amid chanting deficit, the same old failed policy.
?
2. Amid chanting deficit, hands-off approach over huge trade deficit from oil money spill & trade imbalance with China from remorseless health care premium.
?
3. Unfortunately, as a direct consequence of remorseless health care premium, numerous folks have no choice but to hang onto affordable offerings, since one in two households is said to face a hard decision between necessity & drug.
?
4. Inaction cost in relation to health care reform totals $9trillion over the next decade.
?
5. Over the next 10 years, total Bush tax cut costs will equal $3.9 trillion, .... the tax cuts would increase deficits by nearly $4 trillion between 2005 and 2014.
?
The most critical debt : Personal Bankruptcy
?
1. The current recession came from Personal Bankruptcy largely as a consequence of the relentless health care costs, pain at the pump, and the subsequent subprime mortgage crisis.
?
Facing huge trade deficit from oil money spill & trade imbalance with China, the primary economic policy of previous administration was " spending baby "to the great delight of republicans' sponsors.
?
2. By comparison, the recovered stock market value alone, around $1.5 trillion, is nearly twice as much as the stimulus package, set aside all the other benefits.
?
As always, the republicans and unqualified media let folks locked in a box. ruling out the positive effects.
?
?
The most promising deficit-cut of government : Slashing the destructive war & military waste
?
1. Slashing the destructive war & military waste alone supposedly could be enough to balance the budget.
?
?
Energy Independence : An Only Way to Desperately-Needed Job Growth
?
1. My response to the question : where are jobs ?
In the trade deficit, exactly in the severe and persistent oil money spill, taboo of " do not add to the deficit" party.
?
2. Under the existing Bush tax cut for lavish bonus parties, a sole job plan for the republicans, the country already saw millions of job cuts.

[AndyJ]

FY 2009 began on Oct 1, 2008. Nancy and the Dems took control of the budget on Jan 20, 2007... Seems that that spending binge wuz a Democrat binge that continues to this day and forever more... Details, details, details... "The Mind of God is in the details" ~Mise van der Rohe sed that

[East Bay Jay]

And Bush was gone by January 2009. It's also hard to blame Bush for F09 when he NEVER SIGNED ANY SPENDING BILLS. Just CRAs to keep things going as a concession to an incoming Democratic administration (this will be heavily on the Dem Congress' mind, and the MSM's, in December in some universe but not ours).

His hands are sullied by TARP. Unforgivable. But the Dem Congress specifically held back all spending bills for F09 so that Obama could sign them. The Dems bought the farm in F09. They may have road the short bus to that decision but that's not my problem.

[Bryan C]

I wasn't really worried. Not after that nice lady from Detroit explained how they had an infinite supply of money available for any project her vast intellect could conceive. And, hey, DC manages money almost as well as Detroit, so we should be fine.

[mick]

The last time the budget was balanced was when thoroughly right wing Republicans took over Congress and shut it down until Clinton caved into their demands. It was ruthless and the media howled like they never howled before, but in the end the budget was balanced.

Dick Morris was crafty enough to promote a revisionist history where Clinton wanted to balance the budget the entire time. This revisionism, however, does not change the fact that electing hard right Congressmen gets results. This fight is to important for centrism.

[Steve Thompson]

In complete contrast, here's a look at China's debt and foreign reserve situation. I wonder how much pressure the United States can really afford to put on China to force them to revalue the yuan?

http://viableopposition.blogsp.....paper.html

[MichaelG]

Except that if you go to the U.S. Treasury site "Debt to the Penny", this is not the right number.

The increase in the external debt last year was $1.511 trillion. Total debt went up by $1.690 trillion.

That is better than last year, which was $1.655 trillion and $1.796 trillion.

I don't understand why the "official" numbers always seem to be lower than the U.S. Treasury numbers.

[mae]

Thanks for this article, even though it makes me anxious to think about all of the debt America has incurred recently. If we are ever made to be held accountable for our debt I don't know what is going to happen to our seemingly thriving country. http://www.wholesalepowertools.com/generac/