NationStates Jolt Archive

http://www.brillig.com/debt_clock/

Discuss. I also saw this on CNN ( I think it was CNN) tonight, hence why I checked it out.

Holy Motherfucking Christ!!

What about the money that comes back in?

My "share" of the debt is a bit more than what I made last year--quite a bit more now that I look at my tax returns. It's also a bit less than a fourth of what I owe in student loans. Yikes.

What about the money that comes back in?

It seems like more is going out than coming in.

On CNN's website they had an artice about how the deficit is only going to get worse. It was udner 'CNN Money'.

What about the money that comes back in?
That's after all the money that comes in has been spent--since World War II. We've been building this puppy for 60 years now.

:eek: :eek: :eek: :eek: :eek: :eek: :eek: :eek: :eek: :eek:

That's so freakin' scary!!

mmmmmm 60 year old national debt

hehehe...hes a Bush alright. managed to take the biggest surplus in history and turned it into the biggest deficit in history. Daddy would be proud ( and jelous, since the prvious record for deficit had belonged to George H.W.Bush)

But didn't we have a large surplus during Clinton's last year or so?

Good god, I'll take $25,074.44 right freaking now.

yeah it's a weird situation, no other country could possibly rack up that much debt

the us gets away with it because the US$ is a de facto international currency and the treasury can, literally, print money... so in theory at least they could print $7trillion and pay off all the debt

they'd have to do it really quickly though before anyone found out...

no-one really knows what kind of problem this'll be in the future, especially if/when the US is no longer the only superpower around

fun times ahead!

*moves to Canada*

I was wrong, I saw the televised report on MSNBC.

The CNN money report on the other hand should still be up there, but I'm too lazy to go digging for it.

I have always been wondering.

How does a national debt actually affect the economy?

I'm watching MSNBC, it has a real time counter, going up like 100,000 a second.

But didn't we have a large surplus during Clinton's last year or so?
It was big in terms of previous surplus years (which had been rare for wuite some time), but in terms of the overall debt, it was a pittance. Something like $233 billion if I recall, and our debt was, at the time, around $6 trillion. So we weren't in any danger of paying off the national debt any time soon, but by keeping the debt stable, we would have been able to prepare for large future expenditures like the retirement of the baby boomer generation. Ain't gonna happen now, and don't let Bush kid you--taxes are going up even if he wins, no matter what he says and no matter what Tom Delay says. The only real question is who are they going to pop the hardest.

It was big in terms of previous surplus years (which had been rare for wuite some time), but in terms of the overall debt, it was a pittance. Something like $233 billion if I recall, and our debt was, at the time, around $6 trillion. So we weren't in any danger of paying off the national debt any time soon, but by keeping the debt stable, we would have been able to prepare for large future expenditures like the retirement of the baby boomer generation. Ain't gonna happen now, and don't let Bush kid you--taxes are going up even if he wins, no matter what he says and no matter what Tom Delay says. The only real question is who are they going to pop the hardest.

Thanks for the info!

Yeah, you know it's bad when even Greenspan says we're fucked.

It was big in terms of previous surplus years (which had been rare for wuite some time), but in terms of the overall debt, it was a pittance. Something like $233 billion if I recall, and our debt was, at the time, around $6 trillion. So we weren't in any danger of paying off the national debt any time soon, but by keeping the debt stable, we would have been able to prepare for large future expenditures like the retirement of the baby boomer generation. Ain't gonna happen now, and don't let Bush kid you--taxes are going up even if he wins, no matter what he says and no matter what Tom Delay says. The only real question is who are they going to pop the hardest.


the middle and middle-lower class, definitely, I mean, c'mon, their republicans, the lst time a republican hurt a rich person was when lincoln screwe over all those plantation owners.

I have always been wondering.

How does a national debt actually affect the economy?

I'm watching MSNBC, it has a real time counter, going up like 100,000 a second.
It eats up a lot of our available tax income in the form of interest payments. We're not paying anything on the principal of the loans right now, but we pay a shitload in interest each year just to keep the loans from being in default. Every penny that goes to them is a penny that can't be used for anything else--social services, national defense, Social Security, new roads, you name it. I was going to include tax refunds in there, but not having the money hasn't stopped this President from giving them.

Here's the other thing that both the debt and annual deficits do to the economy--banks make money by lending it out, but they can only lend out a certain percentage of their overall assets. If the government is borrowing more and more money, then they don't have it to lend to small businesses, consumers, etc. But if the government isn't borrowing money, or is at least borrowing less, then that money gets sent out into other ventures, and consequently boosts the economy. It was one of the reasons for the dot-com boom--banks and other venture groups took chances on startups because they needed to make some sort of returns on the money they had sitting around.

hehehe...hes a Bush alright. managed to take the biggest surplus in history and turned it into the biggest deficit in history. Daddy would be proud ( and jelous, since the prvious record for deficit had belonged to George H.W.Bush)

Well if your talking about the actual deficit it was raised under Clinton too. What you are talking about is the government payments deficit. Every year the government has so much money on the budget. Clinton during his years came out black on that budget.

But the US has been running a balance of payments deficit for quite some time now. Balance of payments deficits have to do with how much money the citizens of the US make minus how much is spent. This deficit has been going red for quite some time now and shows no sign of letting up. Quite a large chunk of the deficit is from this.

So Clinton had the previous record for the national deficit. He didn't engage in deficit spending... but that does not mean that there was an overall surplus.

I need economics classes

mmmmmm 60 year old national debt

Try 215 years of debt...

It eats up a lot of our available tax income in the form of interest payments. We're not paying anything on the principal of the loans right now, but we pay a shitload in interest each year just to keep the loans from being in default. Every penny that goes to them is a penny that can't be used for anything else--social services, national defense, Social Security, new roads, you name it. I was going to include tax refunds in there, but not having the money hasn't stopped this President from giving them.

Here's the other thing that both the debt and annual deficits do to the economy--banks make money by lending it out, but they can only lend out a certain percentage of their overall assets. If the government is borrowing more and more money, then they don't have it to lend to small businesses, consumers, etc. But if the government isn't borrowing money, or is at least borrowing less, then that money gets sent out into other ventures, and consequently boosts the economy. It was one of the reasons for the dot-com boom--banks and other venture groups took chances on startups because they needed to make some sort of returns on the money they had sitting around.

It also de-values the dollar and raises inflation. This happens because all debts are loans that the US has made in the form of bonds. To make the bonds more attrative they have to raise the interest rates on the bonds. This in turn creates inflation of the dollar.

It also makes the dollar less fungible. For instance in Thailand they were taking on huge deficits during the Asian Economic crisis. When the private investors saw the bank was running low on dollars and the currency was plummeting in relation to the dollar they backed out. This led to a economic crisis in Thailand.

Fortinately for the US the dollar is the current standard *almost* all currencies are weighed against. *The Euro is weighed against the mark which is weighed against the dollar, so it is technically weighed against the dollar* So it is unlikely that we are in as much trouble as Thailand. Though if the debt continues and the dollar falls to the Euro as it has been lately who knows the Euro might replace the dollar standard.

I need economics classes
Hehe, I know how that feels.

I'll tip my hat off to you guys, you sure know your shit. Your knowledge of economics is quite impressive.

I'll tip my hat off to you guys, you sure know your shit. Your knowledge of economics is quite impressive.
My knowledge of economics is nothing--I only know what I know through having read tons of columns from economists in newspapers and from having lived through a lot of it--I started working during Reagan's economy. But there's nothing that I've learned that anyone who's observant and curious couldn't pick up on their own.

Well if your talking about the actual deficit it was raised under Clinton too. What you are talking about is the government payments deficit. Every year the government has so much money on the budget. Clinton during his years came out black on that budget.

But the US has been running a balance of payments deficit for quite some time now. Balance of payments deficits have to do with how much money the citizens of the US make minus how much is spent. This deficit has been going red for quite some time now and shows no sign of letting up. Quite a large chunk of the deficit is from this.

So Clinton had the previous record for the national deficit. He didn't engage in deficit spending... but that does not mean that there was an overall surplus.I think you're getting deficit and debt mixed up. The deficit is the year to year figure, (except in the rare cases where we have a single year surplus) while the debt is the overall number.

The debt did go up during Clinton's tenure, although not as much as it did during the tenures of other Presidents, largely because he managed to lower the year to year deficit until eventually he was running a surplus. The debt has grown larger during Bush's administration, but so have his year to year deficits--there's the difference.

My knowledge of economics is nothing--I only know what I know through having read tons of columns from economists in newspapers and from having lived through a lot of it--I started working during Reagan's economy. But there's nothing that I've learned that anyone who's observant and curious couldn't pick up on their own.

But still, most people here wouldn't have the time nor patience to research as much as you have.

I think you're getting deficit and debt mixed up. The deficit is the year to year figure, (except in the rare cases where we have a single year surplus) while the debt is the overall number.

The debt did go up during Clinton's tenure, although not as much as it did during the tenures of other Presidents, largely because he managed to lower the year to year deficit until eventually he was running a surplus. The debt has grown larger during Bush's administration, but so have his year to year deficits--there's the difference.

The national debt is a combination of two deficits. The government expenditure deficit and the balance of payments deficit. When you add two deficits together it equals a national deficit-- you can call it the national debt its the same thing. My point is that when you tally two deficits together it makes a larger deficit. There is no need for diff. terminology but you may use it.
The national debt is primarily made up by balance of payments deficits. Look to my above post if you are confused as to what this is. The national debt went up in red during the Clinton years largely because of the balance of payments deficit. (We have been running this deficit year to year for a long time. There isn't much Washington can do about it either short of abolishing credit.)

If you think that the combined deficit can not be called a national deficit then Foreign Affairs a well known group of intellectual thought must be wrong in their terminology.

I think you're getting deficit and debt mixed up. The deficit is the year to year figure, (except in the rare cases where we have a single year surplus) while the debt is the overall number.

The debt did go up during Clinton's tenure, although not as much as it did during the tenures of other Presidents, largely because he managed to lower the year to year deficit until eventually he was running a surplus. The debt has grown larger during Bush's administration, but so have his year to year deficits--there's the difference.

Clinton as I pointed out never had a surplus. He had a government expenditure surplus... there is quite a diff. given balance of payments deficits make up the majority of it.

SEVEN FREAKING TRILLION???

Good god. Somebody should go calculate how long we'd all have to work 80-hour weeks to pay that off.

The national debt is a combination of two deficits. The government expenditure deficit and the balance of payments deficit. When you add two deficits together it equals a national deficit-- you can call it the national debt its the same thing. My point is that when you tally two deficits together it makes a larger deficit. There is no need for diff. terminology but you may use it.
The national debt is primarily made up by balance of payments deficits. Look to my above post if you are confused as to what this is. The national debt went up in red during the Clinton years largely because of the balance of payments deficit. (We have been running this deficit year to year for a long time. There isn't much Washington can do about it either short of abolishing credit.)

If you think that the combined deficit can not be called a national deficit then Foreign Affairs a well known group of intellectual thought must be wrong in their terminology.
Most people I read--and remember, I'm not reading textbooks here, I'm reading newspaper and magazine stories and columns--differentiate between the national debt (what you are calling the balance of payments deficits) and the deficit (the government expenditure deficit) because it's simpler to understand that way. People get confused enough with the difference between the debt and the deficit--imagine what would happen if you asked them to differentiate between two different types of deficit. We get each other here, though--just using different words to say the same thing.

I don't want to talk about this too much because my blood pressure will skyrocket.....Deficits like this do matter, and they matter a lot...A temporary deficit isn't necessarily a bad thing. People go into deficit all the time, and it's okay. Families borrow money to buy a car, or a house, or to send a kid to college. But when you borrow money to go to college today, you have a reasonable expectation it will improve you financial situation....Even a car or a house can be a "good" deficit if it's getting you a job that pays more. And in each of those cases it is clear that debt will be paid off in a prescribed timeframe. It is when the deficit is large, long lasting, and your future financial situation is uncertain then a deficit beomes a bad thing. Thats where America is.....When the government borrows money today, we are not borrowing against some future windfall or to earn more money later, in fact it's the opposite. We're borrowing money now with the retirement of the baby boom coming later. About 77 million will be entering retirement soon. Today there are 3.6 worker contributing to the support of each of the 39 million retirees, by 2020, there will be 2 workers supporting each of an estimated 76 million.....If there's a light at the end of this deficit tunnel, it's an oncoming freight train.......I would bash the tax cuts and Bush's "economic plan"...but I got to do other things....maybe later.....

[QUOTE=Automagfreek]But still, most people here wouldn't have the time nor patience to research as much as you have.

Or anywhere else, unfortunately.
Disturbingly, people can't even be bothered working out their own mortgage, must less govt debt. I was a debt collector for several years, and it still disturbs me how many people managed to bankrupt themselves by ignoring the effects of compound interest.
And people don't seem to be learning. Maybe balancing a credit card should be included in school maths, and you can't graduate until you can prove that you can do a personal budget...

After reading through this all I can say is this.
You poor poor Americans. Why not come to New Zealand?

It was big in terms of previous surplus years (which had been rare for wuite some time), but in terms of the overall debt, it was a pittance. Something like $233 billion if I recall, and our debt was, at the time, around $6 trillion. So we weren't in any danger of paying off the national debt any time soon, but by keeping the debt stable, we would have been able to prepare for large future expenditures like the retirement of the baby boomer generation. Ain't gonna happen now, and don't let Bush kid you--taxes are going up even if he wins, no matter what he says and no matter what Tom Delay says. The only real question is who are they going to pop the hardest.

Traditionally, the demographics hit hardest are the ethnic lower class and college students, the two demographics with the lowest percentage voter turnout.

Pietas, Fidelis, Gloria.

here is a nice article that discusses this issue over the past 40 years

http://www.cato.org/research/articles/rahn-040205.html

Traditionally, the demographics hit hardest are the ethnic lower class and college students, the two demographics with the lowest percentage voter turnout.

Pietas, Fidelis, Gloria.
It's always that way, though. George W. Bush inadvertently let out a bit of truth a few weeks ago when he noted that the wealthiest Americans don't pay much in taxes because they're rich enough to find ways around them--it's the poor slob who's trying to scratch by that always gets hammered the hardest. Why? Because if the government stops spending money, the rich guy's got enough to make up the slack, regardless of whether or not he wants to spend it. The poor guy, though, sees prices for everything go up while his income stays stagnant (sound familiar?). I tell you, the rich people in this country have done a very good job of figuring out how to keep the poor just placated enough so they don't rise up with torches and pitchforks--and before anyone screams "class warfare," let me tell you--the upper class declared war on the poor long long ago and has won convincingly thus far.

I often wondered about these figures. If you went into the IRS and offered to pay your share, would that mean you would be exempt from tax for a few years?

Deficits like this do matter, and they matter a lot.
<snip>

I would bash the tax cuts and Bush's "economic plan"...but I got to do other things....maybe later.....

The part that gets me is how he's dishing out countless billions to Iraq, and all the while our national debt is skyrocketing. Bush hasn't done anything but add to the problem greatly.

Don't worry about the national debt. With half-competant people running the budgets in boom times the debt should be reduced by budget surplus's, and in times of recession the debt gets added to. Overall the effect is an increase in the overall debt, but the amount of dept with respect to growth is really important.

For those who think that some of the debt belongs to them or similar. The debt is government borrowing. It borrows by issuing bonds promising to pay a certain amount in the future. The price of the bonds depends on the interest rate. Anyway, unless you own one of these bonds (in which case the govt is in debt to you) it's not really your concern.

So long as the country keeps growing, the debt is not really a problem.

So long as the country keeps growing, the debt is not really a problem.


Wrong, because some day those trillions of dollars are going to come back and bite us in the ass. That's a typical American attitude: if it dosen't affect me now, fuck it.

The debt is a problem, a big one that nobody is doing anything about.

Debt is always made out to be evil, something to be eliminated. But from what I understand, it's a fundamental part of capitalism.

The thing is, with personal debt, you have to work it off in your lifetime. With a national debt, its a bit different. Not that ti should all be ignored, but it's not neccessarily bad just because it's a large number. And who are these debts to, anyway? Other countries, many of whom are also in debt... nations pay back when they feel like it.

Will it bite us in the ass later? Sure, along with ten million other things. Humans in general don't look beyond this lifetime, and thats why the middle east is largely desert and that ozone thing is going going gone. Ah well.

And the average income is $40,000.

GrowthDebt.com

So long as the country keeps growing, the debt is not really a problem.

Normally a debt is not a problem. It's even a undesirable to work without debt. However, debt is dangerous when it becomes unmanageable, when paying interests make up a large part of the budget and you have to take more debt just to keep up.

I don't know if the US has reached that point. Although the debt is a large number, it's also a large economy. It would be good to know how big the debt is when compared to the GDP and what the interest payments are, when capitals are due and, very important, the assets the US has. Knowing that is the only way to know if the debt is too big, too small or just right.

Otherwise it's just a meaningles, though impressive, number.

After reading through this all I can say is this.
You poor poor Americans. Why not come to New Zealand?

Hey! Be careful, they might... I like the 4million we've got, don't want 300 million Americans rocking up on our beaches in their Amphibious Landing Vehicles with their guns and their politicians and their $7 trillion debt...

No offence to Americans of course, you are more than welcome to do your own part in contributing to your national debt by bringing your money here and spending it. Our shy, yet endearing, hobbits are renowned throughout the world as a "must-see" tourist attraction. As is the Auckland Opera House, Hakuna Matata the King of the Forest, the Ohakune carrot and the Milford Sound which can only be heard during a full moon. Being in the Southern Hemisphere however, we of course cannot see the moon as it is on the wrong side of the planet.

Normally a debt is not a problem. It's even a undesirable to work without debt. However, debt is dangerous when it becomes unmanageable, when paying interests make up a large part of the budget and you have to take more debt just to keep up.

I don't know if the US has reached that point. Although the debt is a large number, it's also a large economy. It would be good to know how big the debt is when compared to the GDP and what the interest payments are, when capitals are due and, very important, the assets the US has. Knowing that is the only way to know if the debt is too big, too small or just right.

Otherwise it's just a meaningles, though impressive, number.

The U.S. has a $10.44 trillion economy, as I recall. How insignificant the debt is!

The Department of the Treasury has a big budget on the scale of Defense and HHS - if you include interest payments on the debt. Otherwise, It's a small budget department on the scale of Agriculture or Veterans' Affairs.

how much of the debt though is owed to

1) other countries
2) american citizens
3) banks
4) whoever else

cos if heaps of it is borrowed from americans thru savings accounts, it probly isn't so bad???

how much of the debt though is owed to

1) other countries
2) american citizens
3) banks
4) whoever else

cos if heaps of it is borrowed from americans thru savings accounts, it probly isn't so bad???
Most of our debt is owned by China, Japan, and Saudi Arabia. In China's case, they're doing it because it helps their economy. They've pegged their currency to ours, so that means that no matter how weak the dollar gets, they'll still be able to make goods more cheaply than we can, and thus keep the balance of trade in their favor.

And in response to earlier comments about the size of the debt, the last country to have a balance sheet like ours was Argentina in 1999--huge debt as percentage of GDP, huge trade imbalances, deficit spending with no end in sight. Their economy melted down because their currency didn't have the rep that the dollar does, but that's literally the only thing saving our asses right now--our reputation--and sooner or later unless we get our shit together, that rep will run out and you will see economic havoc that will make the Great Depression look like the 1990s.

http://www.brillig.com/debt_clock/

Discuss. I also saw this on CNN ( I think it was CNN) tonight, hence why I checked it out.


http://www.click-smilies.de/sammlung0304/ernaehrung/food-smiley-023.gif

The part that gets me is how he's dishing out countless billions to Iraq, and all the while our national debt is skyrocketing. Bush hasn't done anything but add to the problem greatly.

The problem is not necessarily that he's waging war in or spending money in Iraq. The problem is that he refuses to levy the taxes that are necessary to support such endeavors. Instead, he simply pulls out the Mastercard o' Doom and swipes. The reason why he does this is simple: new taxes hurt his popularity with his base, and the Mastercard doesn't. While the Mastercard (and especially the overuse thereof) might and probably will cause an economic meltdown, it won't be on his watch, or at the very least won't be when he risks not getting reelected. Instead, it's the Martin Van Buren who follows him who's going to suffer when the fecal matter hits the proverbial rotary impeller.

As a side note on taxes, if I recall my 2003 1040 handbook correctly, 12% of the federal budget is currently spent on interest payments. In layman's terms, that means that 12 cents out of every dollar we pay in taxes are sent directly into the pocketbooks of the people who buy U.S. Bonds simply to ensure that the principle on our debt doesn't increase, to say nothing of actually trying to buy back some of those bonds.

My "share" of the debt is a bit more than what I made last year--quite a bit more now that I look at my tax returns. It's also a bit less than a fourth of what I owe in student loans. Yikes.
Holy f-ing water, you owe $100k in student loans and don't make $25 bones a year? What did you study, a triple major in Basket Weaving, Ghetto Philosophy and Latin?

As I recall you work in a brewery, no? Is that a temp gig? Are you the brewmeister? Should make alot more than that if so (Unless you work at Black Lable - haha)

Really, what did you study and when did you grad?

The problem is not necessarily that he's waging war in or spending money in Iraq. The problem is that he refuses to levy the taxes that are necessary to support such endeavors. Instead, he simply pulls out the Mastercard o' Doom and swipes. The reason why he does this is simple: new taxes hurt his popularity with his base, and the Mastercard doesn't. While the Mastercard (and especially the overuse thereof) might and probably will cause an economic meltdown, it won't be on his watch, or at the very least won't be when he risks not getting reelected. Instead, it's the Martin Van Buren who follows him who's going to suffer when the fecal matter hits the proverbial rotary impeller.

As a side note on taxes, if I recall my 2003 1040 handbook correctly, 12% of the federal budget is currently spent on interest payments. In layman's terms, that means that 12 cents out of every dollar we pay in taxes are sent directly into the pocketbooks of the people who buy U.S. Bonds simply to ensure that the principle on our debt doesn't increase, to say nothing of actually trying to buy back some of those bonds.

Compared to the typical homeowner who spends about 30% of their income on interest, and another 20% on tax.

As I remember, the debt was at its lowest during Andrew Jackson's Presidency. Only 38,000$. He lowered it though the power of the veto. So far Bush has not vetoed a single thing, another reason for the 7 trillion dollar debt today.

Holy f-ing water, you owe $100k in student loans and don't make $25 bones a year? What did you study, a triple major in Basket Weaving, Ghetto Philosophy and Latin?

As I recall you work in a brewery, no? Is that a temp gig? Are you the brewmeister? Should make alot more than that if so (Unless you work at Black Lable - haha)

Really, what did you study and when did you grad?
I'll do better than that this year, between my fellowship and my part-time job at the brewery (I'm on the bottling and keg-filling end of the business, not the brewing end, alas). Last year I was finishing my graduate studies, so the first half of the year I was still on grad student wages--$9,200 a year plus tuition. I took the summer off to move and only got a third of my first year fellowship money before FY 2004 started, so the income is a bit low on paper.

I do okay at the brewery--$15/hour is the starting wage, but I live in San Francisco, so that's about at the ekeing by level, but in combination with the fellowship, I do okay. I'm getting out of credit card debt for now, and I'll get a little ahead sometime early next year.

But my degrees are in English with an MFA in Creative Writing and a Stegner Fellowship. I finished my MFA in May 2003 and will finish my Fellowship next June.

While yes, we do have a massive national debt, you have to look at what other countries owe us. I read an article in Time a a couple of years ago dealing with the national debt (2001?) and if I remember correctly, if we called in all of the debts that are owed to us, we could easily pay off our national debt, and then almost half as much again. I dont know how much that has changed, but I'd bet the ratios are still almost identical. So national is a problem that we could technically "solve", but we'd cause the economic collapse of a lot of the world.

I say we go for it. Call your hands gentlemen, the US is collecting.