What's all this fuss about the deficit?

[Ian Gills]

I don't see what all the fuss is about.

The public debt is about $14 trillion.

The economy earns about $14.7 trillion per year.

So your debt to income ratio is about 95%.

That's hardly a big deal. My debts, including my mortgage, are about three times my salary (300%).

So chill out. America is big and it ain't going anywhere so it can afford to build up a little debt to pay for its future and a few Government employees.

I say we've got a little bit of room to spend a bit more. Starting with the roads and bridges, which are appauling.

[arfeller]

It sounds like you are talking about two different things. The debt and the deficit should be looked at independently. I think the biggest problem is that we cannot run a deficit indefinitely. We must “pay as we go”.

Whether or not we are willing to pay the taxes for the services we believe we need is a whole other issue. Once we decide as a nation what services we need and then find the funding to make that possible we will then need to start attacking the debt and bring it down to a manageable level.

At 14 trillion dollars assuming 3% interest we are paying 420 billion a year on this debt. This is $1,400 for every man woman and child in the USA each year. Assuming 300 million population.

This is just the interest on the debt. Now add the taxes to sustain our current level of services to balance the budget and you start to get the idea of the problem. We know that every man women and child don't pay these fees. So it is much larger.

The big different with the USA and you is when you don't pay they come and take your house. What exactly does China come and take when we don't pay??

I know I don't understand this as well as I should, and probably should not be writing all this.... but that rarely stops me.

[arfeller]

"The big different with the USA and you is when you don't pay they come and take your house. What exactly does China come and take when we don't pay??"

My wife suggested the answer to this question might be "Taiwan"

[Tom Sawyer]

I actually agree with Ian on this one. 14 trillion is a non number. It has no real meaning and furthermore if you gathered all the cash in the entire world you could not come up with 14 trillion dollars. It's a meaningless number that gets bandied about by whomever wants to use it for political gain. If governments could only spend real dollars we'd have been out of business a hundred years or so ago.

[geniescience]

It's 1/6th in China+Japan hands, and more than 1/2 in local hands. The debt is not owned by hostile parties.

[Ian Gills]

All very good points, thank you.

One of the things I laugh at is that the politicians that hate the deficit the most often cite fears of passing on debt to America's children and grandchildren.

Well, permit me the liberty to speak on behalf of the children for a second here.

Forget the debt, and provide them with decent Government-funded eductation and universal healthcare.

Debt is easy to deal with if you live long enough and have a good enough job to pay it back.

Long live the kids in America. And long live America's debt!