I’ve lost track of how many times I’ve blogged about public debt, but I can’t resist another installment. And I’m sure there will be more in the future.
As of today the national debt, exclusive of unfunded future liabilities, exceeds $11.1 trillion–an astonishing $1.7 trillion more than just one year ago. It we devoted 100% of the income tax paid in this country to repaying this debt, and used it for nothing else, it would take almost eleven years to pay it. It is simply not possible that a debt of this magnitude can ever be paid, unless we revalue our currency. In fact, it is increasingly clear to me that we will eventually default on this debt. More on that subject some other day.
But as mind-boggling as the sum $11.1 trillion is, it appears that Congress and the Obama administration are just getting started. Consider these alarming facts:
–The U.S. government usually consumes 21% of gross domestic product, but the current Obama budget proposal spends 28% in 2009 and runs a deficit of $1.75 trillion, or 12.7% of GDP. That is four times the largest deficit of George W. Bush and twice as large a share of the economy as any deficit run since World War II. This fact is particularly remarkable considering that Mr. Bush headed the most fiscally irresponsible administration in American history. Until now.
–Add the 28% of GDP spent by the U.S. government to the 12% spent by states, counties and cities, and government will consume 40% of the United States economy in 2009. With such an enormous drag on the economy, it is amazing that there is any life at all in the free market. Consider that in Hugo Chavez’s Venezuela government spending accounts for 41% of GDP. Zimbabwe spends 43%.
–In socialist France 53% of GDP is spent by the government. But the French government provides all health care as well as a national transportation system. If the 17% of GDP that Americans spend on health care were added to current government spending, our nanny state spending would exceed even that of France.
As Pat Buchanan has said, “We are not headed down the road to socialism. We are there.”