Technically, the debt hit the new high yesterday, but it was posted on the Treasury Department website just after 3:00 p.m. ET today. The exact calculation of the debt is a 16-digit tongue-twister and red-ink tsunami: $12,031,299,186,290.07
This latest milestone in the ever-rising journey of the National Debt comes less than eight months after it hit $11 trillion for the first time. The latest high-point is not unexpected, considering the federal deficit for the just-ended 2009 fiscal year hit an all-time high at $1.42-trillion – more than triple the previous year's record high.
Much of the increase in the deficit and debt is attributed to government spending outpacing revenue – both exacerbated by the recession and the government response to it – including hundreds of billions in bailouts and stimulus spending and tax cuts along with decreased tax revenues due to rising unemployment.
Obama and the Democrats in Congress and the Senate have spent like drunken sailors and now Obama tells the Asia Pacific Economic Cooperation summit that he intends to focus on the debt.
I said it the other day and I will say it again... that is like closing the barn door after the horse escapes.
It gets worse. The same document projects that by the end of the decade, the National Debt will hit $24.5 trillion -- exceeding the Gross Domestic Product projected for 2019 of $22.8 trillion.
The new debt number adds urgency to Treasury Department calls on Congress to quickly raise the statutory limit on the National Debt which now stands at $12.104 trillion. The debt ceiling was last raised in February as part of the $787 billion Recovery Act stimulus bill.
The debt also costs a fortune to maintain. In the fiscal year just ended, the National Debt cost taxpayers over $383 billion. And that amount means the government is only paying 3.3 percent interest. If interest rates go up, so does the amount paid on the debt.
And we're paying it to scores foreign countries which hold $3.5 trillion of the U.S. Debt.
China leads the pack holding nearly $800 billion in U.S. Government securities, followed closely by Japan with $731 billion.
Interesting. In order to allow themselves to spend as freely as they have been doing, Congress raised the the statutory limit on the National Debt and now could do it again.
Despite Obama's empty words about focusing on the deficit, there is already talk about passing yet another stimulus bill, but they prefer not to call it a stimulus bill.
Aware that the February stimulus bill has not prevented unemployment from reaching 10.2 percent and of public opinion polls showing the free spending measure is losing popularity with voters, Democrats are wary of putting a stimulus label on their new package.
"I wouldn't characterize it as a second stimulus," House Majority Leader Steny Hoyer said Tuesday. "I don't want to be as broad as that, I want it to be very targeted on jobs."
House Republican leader John Boehner of Ohio states "Americans are asking, 'Where are the jobs?' But all they are getting from out-of-touch Washington Democrats is more spending and more debt piled on our kids and grandkids. Instead of doubling down with more spending and borrowing, the American people want fiscally responsible solutions to get the economy back on track."
This isn't just an "idea" they are floating, the Democrats in the House and Senate are already making proposals.
Lawmakers are pushing for a second economic stimulus bill, and transportation advocates hope it will contain funding for infrastructure without further delaying a multi-year surface transportation reauthorization bill.
The so-called jobs bill would follow the American Recovery and Reinvestment Act to spur employment amidst stubborn jobless numbers.
Senate Environment and Public Works chairman Barbara Boxer, D-Calif., and ranking Republican James Inhofe, R-Okla., yesterday introduced a bill reauthorizing the Economic Development Administration at $500 million per year through 2013, to fund development grants in economically distressed communities.
Senate Majority Leader Harry Reid, D-Nev., “will be working with his [Democratic] caucus and the administration to put together such a package in the coming weeks so we can turn to it as soon as possible after completing health care,” said Regan Lachapelle, deputy communications director for Reid. “Although we believe passing health care will help our economy over the long haul, we feel we need to do something that will provide a more immediate boost.”
House Majority Leader Steny Hoyer, D-Md., said yesterday during a briefing with reporters that he intends to bring such a bill to the floor of the House by Dec. 18.
Empty promises from a man who in July had one of his advisers already floating the idea of a second stimulus package, before the Democrats decided calling it a stimulus package might not be the best idea.
Bloomberg:
The U.S. should consider drafting a second stimulus package focusing on infrastructure projects because the $787 billion approved in February was “a bit too small,” said Laura Tyson, an outside adviser to President Barack Obama.
So, they will raise the limit on allowable debt, they will keep on spending, rename bills so the word stimulus doesn't piss Americans off and Obama will keep making speeches claiming he is going to focus on our debt as they continue to spend like money grows on trees.
Change you can believe in.
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