How the Greek economy is like ours

Greece has racked up a huge national debt and has such low economic growth that it is impossible to service that debt.  Economics columnist Robert J. Samuelson points out that the situation in Greece is just an extreme case of what the American economy is up against.  (Our national debt is now 105% of our Gross Domestic Product.)  In fact, he says, that’s what a big number of the world’s nations are up against. [Read more...]

When the worst case is that nothing bad happens

Charles Krauthammer is another candidate for best sequester commentary:

“The worst-case scenario for us,” a leading anti-budget-cuts lobbyist told The Post, “is the sequester hits and nothing bad really happens.”

Think about that. Worst case? That a government drowning in debt should cut back by 2.2 percent — and the country survives. That a government now borrowing 35 cents of every dollar it spends reduces that borrowing by two cents “and nothing bad really happens.” Oh, the humanity!

A normal citizen might think this a good thing. For reactionary liberalism, however, whatever sum our ever-inflating government happens to spend today (now double what Bill Clinton spent in his last year) is the Platonic ideal — the reduction of which, however minuscule, is a national calamity.

Or damn well should be. Otherwise, people might get the idea that we can shrink government and live on. [Read more...]

Debt as a new form of currency

I knew it would only be a matter of time before the newly-ascendant left applied some postmodern linguistic constructivism to make our problems go away.  From Zachary Karabell in the Washington Post:

Debt is simply a new form of currency that is issued, bought, priced and sold like any other currency, [Read more...]

$1.2 trillion in automatic cuts might kick in

Remember the “sequester,” the automatic budget cuts that were supposed to go into effect on January 2 but were kicked down the road to March 1?  The result of last year’s agreement on the national debt and the recent “fiscal cliff” deliberations?  Since the cuts would hit Republican causes (the Pentagon) and Democratic causes (social programs) alike, it was assumed that Congress would get rid of them.  Well, it looks like they may go into effect after all. [Read more...]

Republicans go along with raising debt limit

House Republicans decided to adopt a “no drama” policy in regards to raising the debt ceiling:

A measure to suspend the nation’s legal limit on borrowing for nearly four months cleared a key vote in the House Wednesday, as Republicans broadly endorsed a new tactic that would temporarily remove the threat of a potentially calamitous government default from their ongoing fight with Democrats over government spending.

The measure, which would set aside the legal debt ceiling and allow the government to borrow as needed to meet spending obligations through May 18, was adopted on a 285 to 144 vote. [Read more...]

Government debt now greater than the whole economy

Factoid buried in a Washington Post graph caption:

The federal debt of the United States — including debt owed to the public and to parts of the government itself, such as the Social Security Fund — climbed to $15.22 trillion on Dec. 30. That marked the first time since the 1940s that the national debt was larger than the American economy, as measured by the gross domestic product. Since Dec. 30, the debt has increased an additional $4 billion.

via New year, more debt – The Washington Post.


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