Donald Trump

The Debt Clock Keeps Spinning

Federal debt now equals 78 percent of gross domestic product.

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In 1989, a New York businessman who was worried about chronic federal budget deficits erected the National Debt Clock in midtown Manhattan to keep a running tally of how much the U.S. government owes. The total had reached $2.7 trillion, and Seymour Durst wanted "to call attention to the soaring debt and each family's share of it."

For a long time, it kept rising. In 1998, though, the clock abruptly stopped working. "The computer couldn't take it anymore," said Douglas Durst, who had succeeded his late father as head of the Durst Organization. "The numbers were too high."

But eventually, things changed. The government began piling up budget surpluses, and the clock ran backwards. In 2000, Durst decided to retire the clock. "It's served its purpose," he said.

He was mistaken, and he soon recognized the clock was still needed. In 2002, with red ink again rising, the clock was switched back on—showing $6.1 trillion. In 2008, though, when the debt blew past the $10 trillion mark, it no longer had enough space to display it. An upgrade was done so the clock could keep up as the debt rose above $19 trillion in 2016 and above $21 trillion this year.

That extra space will not go to waste. In June, the Congressional Budget Office issued a grim forecast.

Federal debt now equals 78 percent of gross domestic product, the highest since we had just finished fighting World War II. The CBO says that under current policies, it can be expected to "approach 100 percent of GDP by the end of the next decade and 152 percent by 2048. That amount would be the highest in the nation's history by far."

The Trump administration pretends that its policies will unleash such rapid economic growth that the treasury will get a flood of new revenue. Larry Kudlow, director of the National Economic Council, bragged the other day that the deficit "is coming down, and it's coming down rapidly."

Later, he amended his false claim, saying that he "probably should have said future deficits." But that would also have been false. The CBO projects the deficit will balloon from $804 billion this year to $1.3 trillion in 2022.

What's wrong with running up more debt every year? It puts upward pressure on interest rates; it requires growing sums to service the debt; it pushes obligations off to future generations; and eventually, it runs the risk that the loans won't be repaid. Eventually, you become Puerto Rico.

Fiscal experts saw all this coming. Trump and the Republican Congress cooperated to cut taxes last year, but they have shown no stomach to cut spending. With a growing population of retirees, Social Security and Medicare outlays are on a steep upward trajectory. Federal outlays are expected to rise from 20.6 percent of GDP to 23.3 percent by 2028.

If that means bigger deficits, too bad. A spokesman for the conservative Club for Growth said in February, "We should not hold tax cuts hostage because Congress doesn't have the appetite to cut spending."

This failure maddens those conservatives who actually want to cut the budget. "Republicans were put on Earth to shrink government," wrote Manhattan Institute analyst Brian Riedl in National Review. "If they cannot do that, those who remain will soon find themselves having to raise taxes."

Democrats were not put on Earth to shrink government. And unlike Republicans, they don't mind raising taxes, at least on corporations and high-income households. But if you think a blue wave this November would wash away the red ink, you have not been paying attention.

The party sees nothing to be gained by vowing to cut federal programs—and victories to be won by promising to expand and add them. Among the items on the Democratic wish list is "Medicare for all." During his presidential campaign, Bernie Sanders proposed a version that he priced at $1.4 trillion per year.

Free college tuition, which Alexandria Ocasio-Cortez endorsed on her way to defeating Rep. Joseph Crowley in New York, would take $47 billion in federal funds per year under Sanders' plan. And the list doesn't end there.

How will they pay for it all? If Washington doesn't have enough money, it can always borrow, borrow and borrow some more.

At some point, the debt will grow so enormous that it will endanger our immediate economic health. But the people who maintain the debt clock will always have a job.

NEXT: Libertarian Party Rebuffs Mises Uprising

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  1. Open borders will fix it!

    1. Not if you keep demanding MORE entitlements for yourself. PROUDLY screwing your own father, children and grandchildren, so YOU can slurp at the gummint teat …the Moral Hypocrisy of the Authoritarian Right..

      ============

      loveconstitution1789|2.8.18 @ 3:08PM|#

      My retired father loves politics and we often discuss the nature of things.
      I cannot get him to openly discuss social security and medicare reform with cuts. He is just hoping to check out before our debt crushes the USA. Its selfish as shit.

      Alt-Right TROLL says more crushing debt is okay .. ONLY if it lines HIS pocket!
      loveconstitution (sic) Insults HIS OWN FATHER, “selfish as shit” … but DEFENDS his own sucking at the gummint teat! (OMG) …. claims that a multi-trillion debt increase (tax cut) is “giving my own money back ” …FROM WHERE, GOOBER?

      What kind of “fiscal conservative” DENIES federal debt is stealing from our future … from his own children?

      HE WOULD CUT HIS FATHER’S BENEFITS .. AND STEAL FROM HIS OWN KIDS … TO ENRICH HIMSELF, BECAUSE HE’S ……… “ENTITLED.” ……. And so self-righteous, like all the Authoritarian Right.

      Libtards borrow trillions for free stuff
      Conservatards borrow trillions for free tax cuts.
      BOTH “entitled” and BOTH marching America toward Hell … arm-in-arm

      Left – Right = Zero

      1. You’re the biggest defender of the welfare state in the entire comment section, fuckface Mary Stack.

        1. I’m making $80 an hour working from home. I was shocked when my neighbour told me she was averaging $120 but I see how it works now. I feel so much freedom now that I’m my own boss. This is what I do… http://easyjob.club

          1. $70 per hour of that should go to the government to reduce the debt line their cronies’ pockets.

        2. You’re the biggest defender of the welfare state in the entire comment section, fuckface Mary Stack.

          I PROVED him a teat-sucker,

          Now I PROVE you a crazy psycho. (A Mary Stack psychopath)

          Some prove EVERYTHING. Assholes lie and be infantile. (smirk)

          1. Why do you pretend to be Hihn?

            1. Anyone who clicks the link will see ABSOLUTE PROOF that you’re a total psycho.

              First they call me a lefty. So I jam that up their ass with PROOF (my published writing in Taxes, Health Care and Federalism … and the newspaper report on my platform as the Libertarian candidate for Washington State Insurance Commissioner. Here

              They have been PUBLICLY HUMILIATED by my achievements and my role in the movement .. so the ASSASSINS say. “Hihn is solid, but you’re not him.”

              The same link proves them even MORE bat-shit crazy!

              ONE MORE TIME. SHITLORD (means bigot) What have YOU achieved for the cause of liberty .. beyond your COWARDLY hiding behind a computer?

              PROVE IT
              (sneer)

    2. That is how you get on a troll’s list, boys and girls.

      1. By shitting on your own father and sucking the gummint teat?

  2. That’s a game for suckers.

    But eventually, things changed. The government began piling up budget surpluses, and the clock ran backwards. In 2000, Durst decided to retire the clock. “It’s served its purpose,” he said.

    Bullshit. There were no surpluses. Because the debt never decreased. (Table 475 at the source)

    And Clinton, who took office in the 22nd month of an expansion, left a recession.

    1. Uh no, there was no recession. There was a bubble in the stock market – big difference – because of the incredibly robust Clintonian economy.

      1. Excuse me, while I humiliate you, swampwiz

        These are the dates for all our Business Cycles since the mid-1800s. http://www.nber.org/cycles.html
        Recessions begin when the economy peaks. (PEAK column)
        Recoveries begin when the bottoms (TROUGH)

        Still with me?

        There are two key dates that prove you wrong.

        March 1991 — recovery. Clinton took office January 1993 — 21st month of a recovery (I said 22nd from memory)

        March 2001 – recession. You COULD blame Dubya, in office six weeks. and humiliate yourself

        PROVEN: Took office well into a recovery, left a recession. But my point was the bullshit of Clinton budget surpluses.

        Any questions?

    2. Curiously, one of the graphs in the link you provided clearly shows the four years of budget surpluses under Clinton. Apparently your problem is due to the fact that the public debt did not actually decrease over that span. Unfortunately, that latter fact does not disprove the first fact that for the last three years of the Clinton presidency, federal receipts were larger than outlays, and this carried over for a fourth year in the fiscal year that Clinton handed off to W Bush.

  3. Meanwhile, every dollar spent on the War on Drugs removes seven dollars from the (productive) economy.

  4. Perhap this is the fundamental (fatal?) flaw in a hybrid market-democratic society. We assume infinite elasticity between economic capacity and government spending.

    One potential fix: voting booths that require a credit card (irony recognized) and assess charges to the voter based on projected spending of the candidate selected.

    1. Perhaps we should just go to a single long term for all Federally elected officials. I don’t see it could be any worse than what we already have. It’s hard to buy a congressman when they have no need for the money to get re-elected.

    2. Uh no, what about the 24th Amendment?

    3. You want to change me $3 TRILLION to vote (however I vote)?.
      Well, that would pay of the debt quickly!

  5. An upgrade was done so the clock could keep up as the debt rose above $19 trillion in 2016 and above $21 trillion this year.

    PAID FOR VIA CREDIT CARD I BET

  6. The average maturity of the debt is something like 6 years.
    Interesting to see how the growing wedge of interest payments will crowd out other spending in coming years.
    Ok, it won’t (more debt!), but it will be interesting to watch it more up the list of top govt expenditures

    1. True, but when any given debt comes due, they pay it off, not with cash from the treasury, but with new debt.

      1. and people believe that strategy will work forever.
        cuz ‘murica is different than all those other countries that got into trouble once their debt went went above 80% of GDP. Why not just cut taxes to 0% and have the fed buy all the treasury debt?

        1. Japan’s debt has been above 80% for a while. Their economy has issues, but the hyperinflation that so many “experts” predicted has not happened.

      2. This is how Gov Brown “solved” California’s debt. interesting when Arnold did it it was the worst thing ever but when Jerry does it its okay now, when its never a good thing. But as we all know its not about what is done but by who does it that matters

        1. He passed tax increases that more than cover state spending. Tax receipts are coming in over projections.

          http://www.sacbee.com/news/pol…..03954.html

          1. They’re benefitting from Trump making America great again. In spite of Brown’s taxes.

    2. Japan is at about 200% of GDP in debt. We are better than this. I’m sure we’ll be able to reach 300%.

  7. Now I know why my anxiety is spiking. All the debt is making me dizzy.

  8. “approach 100 percent of GDP by the end of the next decade and 152 percent by 2048.”

    One might ask why these two projections are phrased entirely differently with regard to precision.

  9. What’s wrong with running up more debt every year? It puts upward pressure on interest rates; it requires growing sums to service the debt; it pushes obligations off to future generations; and eventually, it runs the risk that the loans won’t be repaid. Eventually, you become Puerto Rico.

    If you owe the bank a million dollars, you have a problem. If you owe the bank a hundred million dollars, the bank has a problem. Trump is a master of debt, remember? He’s already said his simple plan to fix the debt problem is just to repudiate the debt. But as anybody with a very good brain will tell you, if you’re planning on declaring bankruptcy you first max out all your credit cards. Eat, drink, and be merry, for tomorrow we diet!

    1. Actually, Trump said he’d pay off the debt entirely, in 8 years, cut taxes, increase spending and provide health insurance to all Americans,. His cult is even more gullible than Bernie’s cult!

    2. He’s already said his simple plan to fix the debt problem is just to repudiate the debt.

      Nixon already did that.

      -jcr

  10. Federal debt now equals 78 percent of gross domestic product, the highest since we had just finished fighting World War II. The CBO says that under current policies, it can be expected to “approach 100 percent of GDP by the end of the next decade and 152 percent by 2048. That amount would be the highest in the nation’s history by far.”

    And? What does this ratio purport to mean? All the “debt” the country has piled up during it’s entire existence and one year’s worth of productivity as a ratio shows what, exactly? Some countries have high debt/gdp ratios and some don’t. Is there a correlation between this ratio and negative effects for the country concerned?

    What’s wrong with running up more debt every year? It puts upward pressure on interest rates; it requires growing sums to service the debt; it pushes obligations off to future generations; .

    There is no “debt”. Think of it as savings accounts instead. People park their money there just like in a certificate of deposit from a bank. Do you worry about how much in savings your bank has collected? No? Then don’t worry about the “Federal Debt”. You don’t owe it to anyone, your kids will never pay it, their kids will never pay it. Just like your parents never paid it nor their parents. People have been worried about the “debt” since at least the 40s and when has it been a problem? Relax.

    1. and eventually, it runs the risk that the loans won’t be repaid. Eventually, you become Puerto Rico

      Well, no. Can Puerto Rico create it’s own money as needed? No it can’t. Can the Federal government? Yes it can. Big G can create as much money as it needs at any time for any purpose. Including paying off maturing bonds and the interest thereof. The Federal government cannot go broke. It has always paid it’s bills and it always will, barring a Congressional/POTUS tantrum that freezes up the entire edifice.

      The only thing to worry about is inflation and the Fed has been keeping that at 2-3% for a while now, which I think is too high and I think they should go lower but I don’t work there, so it’s not my call.

      So stop worrying about deficits and “the debt” as long as inflation is kept in check everything is fine. And this country has never had hyper-inflation and there’s no reason to expect it to happen anytime soon. So RELAX!

      1. I would add that we pretty much never see reporting on the assets owned by the federal government. Debt-to-GDP doesn’t tell us much, as you point out. The actual balance sheet of the federal government likely tells a different story.

      2. I would add that we pretty much never see reporting on the assets owned by the federal government. Debt-to-GDP doesn’t tell us much, as you point out. The actual balance sheet of the federal government likely tells a different story.

      3. Right. As long as inflation is kept in check. As long as you are checking your crystal ball, how long will this be?

      4. While the Union hasn’t experienced hyper-inflation since the Revolution and a few years afterwards the Confederacy did.

      5. The Federal government cannot go broke.

        Of course it can, and it did so during the Nixon administration. Ever since Tricky Dick decided to renege on the government’s treaty obligation to redeem the Fed’s scrip for gold, this government has been bankrupt.

        -jcr

        1. Nice way to confuse two separate and and opposite issues!

      6. Actually, a good jolt of inflation would be a good thing. It would depress, in real terms, the rentier high cost goods like housing (i.e., land), health care & education, while allowing the blue-collar worker to have his wages equalized to the Chinamen (OK, maybe not that much). The reason that folks are struggling is because of all these super-high cost items have soared in price while their wages have been stuck in neutral.

        1. You don’t understand inflation either? (plus Clinton;s economy)

    2. “Do you worry about how much in savings your bank has collected?”
      When banks fail the FDIC pays back your certificate of deposit (up to certain limits).
      I assume your replies are just sarc. OBL is much better at it

  11. Man do we need product liability for lawmakers. Congress designed our fiscally horrid systems, yet we should be concerned about “our share”? I don’t know anyone who wrote their congressman decades ago to demand automatic spending increases for various agencies [at twice the average rate of inflation], do you?

  12. “…and the Fed has been keeping that at 2-3% for a while now”.

    Pure fantasy.

    1. I tend to agree that the Fed has little control over inflation. We only have to look at the “success” of QE – where the Fed kept rates near zero in hopes that it would stimulate private sector lending and spending. Inflation barely budged.

  13. I bet bringing in more third world peasants who take more out than they pay in will totally fix this. Open borders, guys!

    1. Your sorry ass gets far greater subsidies — on average, the rich subsidize slightly over half the ENTIRE income tax burden for the core middle class ($40,000-99,999) … PLUS 40% of all Medicare.

      You’re just defending your own gravy train.

      1. I bet that I don’t but it’s cute to see you switch from moralfagging about sad brown people “just looking for a better life” to this.

        1. Now your “sad brown people” is an even bigger fuckup.
          Plus the ignorance of your own massive subsidies.
          Not one of your better days, but each morn is a new beginning!

    2. That doesn’t have much to do with the federal debt. Our debt is mostly due to existing entitlements; SS alone is more than half of it and civil and military retirements are 30% combined.

      1. Expect this to get worse before it gets better with the aging boomers and the drastic expansion in public sector employment.

      2. You’ve confused the federal debt with unfunded liabilities.

  14. Why do all you writers want to blame Social Security all the time. Why not try blaming the real culprits for a change. Namely corrupt politicians. I am on Social Security and I did not rob the fund of trillions of dollars and leave worthless IOUs. I did not refuse to allow government contractor’s to bid below union scale to secure the union vote. I did not give federal employees lavish pensions that anyone on Social Security would love to trade for. I did make our military a mercenary force for Multinational corporations. And I certainly did not agree to giving the Federal Reserve member banks a 6% yearly fee for managing our 21 trillion debt for money they print out of thin air. Just once I would like to see one of you idiots print the truth of why we are so far in debt instead of always blaming us old farts.

    1. I’m on SS too, and you will have taken all your FICA taxes in your late 70s.
      And the rich subsidize 45% of your Medicare.

      That doesn’t mean we’re to blame. It means you’ve been snookered.

  15. …and I think that’s as high as it needs to go because the 78% figure is probably severely understating the whole problem.

  16. The reason we need to eliminate Medicare, Social Security, Medicaid, Aid to Families with Dependent Children, Food Stamps, etc. is that we need more money for war.

    We’re trying our very, patriotic best to spread Christ’s message of peace to the world. What better way to do that than to obliterate those who refuse to see the Way, the Truth and the Light? We’ve made a good start, but there’s much, much more to do.

  17. The reason we need to eliminate Medicare, Social Security, Medicaid, Aid to Families with Dependent Children, Food Stamps, etc. is that we need more money for war.

    We’re trying our very, patriotic best to spread Christ’s message of peace to the world. What better way to do that than to obliterate those who refuse to see the Way, the Truth and the Light? We’ve made a good start, but there’s much, much more to do.

    Trump has complained that we spent $7 trillion in the Middle East and have nothing much to show for it.

    Rubbish! We need to spend $trillions more so our military can completely eliminate the muslim threat.

  18. Federal debt now equals 78 percent of gross domestic product

    Wrong. Debt is an amount of money. GDP is a rate of money over time. If you divide one by the other you get time, not a dimensionless number.

    It would be more legitimate and perhaps more informative to say the debt is 285 days of GDP.

  19. It looks like we will need the “tax & spend” Democrats to save the country’s finances. At least they pay for their spending.

    1. That’s even wackier than your Clinton economy.
      Or are they both satire?

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  21. Hi everybody! That’s unbelievable news. What can we do next? 78% of debt is more. From year to year, it has been increasing with upward pressure on interest rates. Then it requires growing sums to serve the debt. People are obliged to pay all the debts off and eventually it runs the risk that the loans won’t be repaid.To help people in needs or those who serve the war you can click here. Personal loans may be solutions in this case. Good luck with them!

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