The United States government’s accumulated debts have grown by more than $7 trillion – with a ‘t’ – since Barack Obama became president on January 20, 2009.
The sad milestone was revealed on July 31 by the U.S. Department of the Treasury on a ‘debt to the penny’ website that calculates the debt at the end of every business day.
On Obama’s first day in office the debt stood at $10.626 trillion. Last Thursday it reached $17.687 trillion.
America’s first 43 presidents took 223 years to rack up the country’s first $7 trillion in red ink.
Obama has duplicated that dubious achievement in less than five years and seven months.
After the same number of days in office, former President George W. Bush had increased the national debt by a comparatively paltry $2.720 trillion.
Bill Clinton’s debt load at the same point in his presidency had increased by just $1,324 trillion.
The right-leaning Cybercast News Service was first to point out that Obama had cleared the $7 trillion hurdle in added financial obligations.
During a July 2008 campaign speech in North Dakota, then-Senator Obama ripped into the Bush administration for running up the federal debt by a total of $4 billion near the end of his second term.
‘The problem is,’ he said, ‘is that the way Bush has done it over the last eight years is to take out a credit card from the Bank of China in the name of our children, driving up our national debt from $5 trillion for the first 42 presidents – #43 added $4 trillion by his lonesome, so that we now have over $9 trillion of debt that we are going to have to pay back – $30,000 for every man, woman and child.’
‘That’s irresponsible,’ Obama said then. ‘It’s unpatriotic.’
The Republican Party ripped into the president on Monday with an email blast charging that after ‘[i]gnoring warnings from all corners, Obama has one of the worst records on the federal debt in U.S. history.’
The White House didn’t immediately respond to a request for a response.
In February the nonpartisan Congressional Budget Office estimated that ‘federal debt held by the public will equal 74 percent of GDP at the end of this year and 79 percent in 2024.’
At the end of 2008, that number was just 39 per cent. At current rates of spending, by 2019 the debt will be larger than the nation’s annual GDP.
‘Such large and growing federal debt,’ the CBO warns, ‘could have serious negative consequences, including restraining economic growth in the long term, giving policymakers less flexibility to respond to unexpected challenges, and eventually increasing the risk of a fiscal crisis.’
Debt held by the public makes up about 71 per cent of the total federal debt. The rest consists of ‘intragovernmental holdings’ – government-speak for gaps in the Medicare Trust Fund, the Social Security Trust Fund, and other revolving funds.
Those lines on Uncle Sam’s balance sheet totaled $5,036 trillion at the end of last Thursday, a number that represents how far behind the government is in meeting its long-term obligations to retirees and other benefit-takers.
Government spending has skyrocketed during Obama’s time in office due to a combinations of his policies, a spendthrift Congress and recession-related automatic stabilizers like unemployment insurance that can quickly drain the Treasury.
The annual deficit – a single year’s addition to the larger debt – was $1.413 trillion in 2009, Obama’s first year in the White House. He has steadily reduced it year-on-year, and the 2014 deficit is expected to be $492 billion.
That number, however, is still larger than any other annual deficit in the history of the U.S. before he became president.
WASHINGTON – An exhausted Senate approved its first budget in four years early Saturday, calling for almost $1 trillion in tax increases over the coming decade while sheltering safety net programs targeted by House Republicans.
Despite the fanfare — and the spectacle of senators lingering for hours into the weekend to vote on dozens of amendments before the final tally — the budget passed by the smallest of margins, 50-49. Four Democrats facing tough re-elections voted against it.
The resolution also stands no chance of passing Congress in its current form. The nonbinding but politically symbolic measure caters to party stalwarts on the liberal edge of the spectrum just as the House GOP measure is crafted to appeal to more recent tea party arrivals.
The vote, though, follows four years of pressure and taunting by House Republicans who excoriated the Senate for failing to approve a formal year-long budget throughout most of President Obama’s first term. The government has been limping by on a series of partial-year budget bills, the latest of which was approved this week to fund the rest of fiscal 2013.
The final vote early Saturday morning was preceded by a marathon session of votes on dozens of amendments to the 2014 budget proposal. Many of the proposals were offered in hopes of inflicting political damage on Democratic senators up for re-election in GOP-leaning states like Alaska and Louisiana.
The two main budget proposals produced by Senate Democrats and House Republicans are miles apart. The Senate plan does not attempt to balance the budget at all, though it does claim to reduce the deficit by imposing nearly $1 trillion in tax increases on top of more than $600 billion in higher taxes on top earners enacted in January. It also includes $875 billion in spending cuts, generated by modest cuts to federal health care programs, domestic agencies and the Pentagon and reduced government borrowing costs.
The House plan — by House Budget Committee Chairman Paul Ryan, R-Wis., his party’s vice presidential candidate last year — claims $4 trillion more in savings over the period than Senate Democrats by imposing major cuts in Medicaid, food stamps and other safety net programs for the needy. It would also transform the Medicare health care program for seniors into a voucher-like system for future recipients.
“We have presented very different visions for how our country should work and who it should work for,” said Sen. Patty Murray, D-Wash., who chairs the Senate Budget Committee. “But I am hopeful that we can bridge this divide.”
Congressional budgets are planning documents that leave actual changes in revenues and spending for later legislation, and this was the first the Democratic-run Senate has approved in four years. That is testament to the political and mathematical contortions needed to write fiscal plans in an era of record-breaking deficits that until this year exceeded an eye-popping $1 trillion annually, and to the parties’ profoundly conflicting views.
“I believe we’re in denial about the financial condition of our country,” Sen. Jeff Sessions of Alabama, top Republican on the Budget panel, said of Democratic efforts to boost spending on some programs. “Trust me, we’ve got to have some spending reductions.”
Though the shortfalls have shown signs of easing slightly and temporarily, there is no easy path to the two parties finding compromise — which the first months of 2013 have amply illustrated.
Already this year, Congress has raised taxes on top earners after narrowly averting tax boosts on virtually everyone else, tolerated $85 billion in automatic spending cuts, temporarily sidestepped a federal default and prevented a potential government shutdown.
By sometime this summer, the government’s borrowing limit will have to be extended again — or a default will be at risk — and it is unclear what Republicans may demand for providing needed votes. It is also uncertain how the two parties will resolve the differences between their two budgets, something many believe simply won’t happen.
Both sides have expressed a desire to reduce federal deficits. But President Barack Obama is demanding a combination of tax increases and spending cuts to do so, while GOP leaders say they won’t consider higher revenues but want serious reductions in Medicare and other benefit programs that have rocketed deficits skyward.
Obama plans to release his own 2014 budget next month, an unveiling that will be studied for whether it signals a willingness to engage Republicans in negotiations or play political hardball.
In a long day that began Friday morning, senators plodded through scores of amendments — all of them non-binding but some delivering potent political messages.
They voted in favor of giving states more powers to collect sales taxes on online purchases their citizens make from out-of-state Internet companies, and to endorse the proposed Keystone XL pipeline that is to pump oil from Canada to Texas refineries.
They also approved amendments voicing support for eliminating the $2,500 annual cap on flexible spending account contributions imposed by Obama’s health care overhaul, and for charging regular postal rates for mailings by political parties, which currently qualify for the lower prices paid by non-profits.
In a rebuke to one of the Senate’s most conservative members, they overwhelmingly rejected a proposal by Sen. Rand Paul, R-Ky., to cut even deeper than the House GOP budget and eliminate deficits in just five years.
The Democratic budget envisions $975 billion in unspecified new taxes over the coming 10 years. There would be an equal amount of spending reductions coming chiefly from health programs, defense and reduced interest payments as deficits get smaller than previously anticipated.
This year’s projected deficit of nearly $900 billion would fall to around $700 billion next year and bottom out near $400 billion in 2016 before trending upward again.
Shoehorned into the package is $100 billion for public works projects and other programs aimed at creating jobs.
An internal government email sent Monday instructed an official with a subdivision of the U.S. Department of Agriculture to make sure that sequester-related cuts inflict as much pain as possible to make sure “you are not contradicting what we said the impact would be.”
When Charles Brown of the Animal and Plant Health Inspection Service asked “if there was any latitude” in how officials might allocate sequester cuts to reduce negatively impacting fish inspections, Brown received the following reply:
“We have gone on record with a notification to Congress and whoever else that ‘APHIS would eliminate assistance to producers in 24 states in managing wildlife damage to the aquaculture industry, unless they provide funding to cover the costs.’ So it is our opinion that however you manage that reduction, you need to make sure you are not contradicting what we said the impact would be.”
Lawmakers say the email is further evidence that the Obama Administration is seeking to inflict maximum pain for the minimal $85 billion in cuts.
“This email confirms what many Americans have suspected: The Obama administration is doing everything they can to make sure their worst predictions come true and to maximize the pain of the Sequester cuts for political gain,” said Rep. Tim Griffin (R-AK).
The $85 billion in sequester cuts represents just .5% of the national debt.
More idiocy from that bastion leadership of Socialism.
Long-past overdue for Nancy Pelosi to step down. Even the spend-a-holics running the White House admit there is a big spending problem. White House counters Pelosi over claim DC does not have spending problem.
White House Press Secretary Jay Carney countered House Democratic Leader Nancy Pelosi after she claimed it’s a “false argument” to say the federal government has a spending problem.
“Of course, the president believes that we have a spending problem,” Carney said Monday, adding that the problem is “specifically driven” by health care spending. “And that’s just a fact.”
The gentle reminder of the nation’s bloated entitlement spending came after Pelosi, in an interview with “Fox News Sunday,” challenged those calling for more cuts.
“We have to recognize that, which cuts really help us and which cuts hurt our future? And cuts in education, scientific research and the rest are harmful, and they are what are affected by the sequestration,” she said on “Fox News Sunday.” “So, it is almost a false argument to say we have a spending problem. We have a budget deficit problem that we have to address.”
Though the White House countered the remark Monday, Pelosi was nevertheless aligning herself with Obama in calling for Washington to avert a looming round of budget cuts — by replacing them with a blend of cuts and tax hikes.
The cuts are set to kick in March 1 and will impact the Pentagon more than any other single department. Republicans want the package replaced with a less arbitrary slate of cuts. But Pelosi argued that more cuts would hurt the economy, and in turn do little to close the deficit.
Few would argue with Pelosi’s claim that the government has a deficit problem. The annual deficit exceeded $1 trillion for each of the past four years, adding $6 trillion total to the national debt during President Obama’s first term.
But Republicans argue that the gaping shortfall cannot be closed with tax increases alone — and that, indeed, Washington has a rather severe spending problem.
Even many in the Democratic Party concede that the growth in entitlement spending — on Medicare and other budget gobblers — needs to be checked.
Some kind of agreement, even a short-term one, needs to be reached in the next few weeks to avoid $85 billion in arbitrary spending cuts next month. Pelosi stressed that Democrats want to increase revenue by closing loopholes, including those for oil companies, as opposed to raising tax rates.
Her argument is similar to the one President Obama is expected to restate Tuesday during his State of the Union address.
However, Oklahoma Rep. Tom Cole said fellow House Republicans will “absolutely not” accept tax increases as part of a deal, which would trigger the cuts to federal defense and discretionary spending.
Cole told ABC News’ “This Week” that the president refused to agree to spending cuts during the recent, so-called “fiscal cliff” negotiations so Democrats are not getting revenue increases now.
“I think (sequester) is inevitable, quite frankly,” he said.
Arizona Republican Sen. John McCain also said Sunday that Republicans don’t want tax increases, considering they just agreed to end more than $1 trillion in income tax breaks, but suggested he might be open to closing some tax loopholes.
He also urged both parties to work together to avoid sequester, which will result in big cuts to the defense budget and roughly $1.2 trillion in total cuts over the next decade.
“I’ll take responsibility as a Republican, but we’ve got to avoid it,” said McCain, the top Republican on the Senate Armed Services Committee. “The world is a very dangerous place.”
President Obama and fellow Democrats are keeping up their argument that fiscal conservatives want set to slash entitlements for the country’s “greatest generation” to balance the budget for the country’s greatest generations, despite no apparent plan.
The most recent was Louisiana Sen. Mary Landrieu who last week acknowledged that entitlement spending on such programs as Medicare has contributed largely to a growing federal budget but continued to argue against steep cuts.
“The greatest generation that gave us the greatest nation the world has ever heard is dying and they need hospice care,” she said Tuesday on the Senate floor. “They need Social Security. They need hospitals. And if they want to cut them go right ahead. I’m going to be a little more gentle.”
Landrieu’s remarks echoed those by President Obama during his inauguration speech.
“We reject the belief that America must choose between caring for the generation that built this country and investing in the generation that will build its future,” Obama said to applause. “They do not make us a nation of takers. They free us to take the risks that make this country great.”
Republicans argue they have not put forth a plan to take away benefits to Americans already in the system and that has never been their plan – much like they did against similar attacks by the Obama campaign during the elections.
“No one is suggesting that Medicare and Social Security makes you a taker. These are people like my mom who worked hard, paid her taxes and now is collecting a benefit that she paid for. No one is suggesting people like my mom is a taker,” Wisconsin Rep. Paul Ryan, the House Budget chairman and the Republican Party’s 2012 vice-presidential nominee, told NBC a few weeks ago.
Ryan also argued against the suggestion that his budget includes “savage cuts” to food stamps, children’s health care and other services for the less fortunate.
“This is the straw man argument,” Ryan continued. “The president said … that we have suspicions about Medicare and taking care of the elderly and feeding poor children. When he sets up these straw men, which is to affix views to his adversaries that they don’t have, to win the argument by default, it’s not really an honest debate.”
The Wisconsin congressman, who as a teen received Social Security benefits when his father died, said Republicans simply want to make sure only those eligible for food stamps receive them.
He also argued Republicans want a budget with a “safety net” for the most vulnerable Americans and those struck by misfortune and hardship. But they don’t want a culture that encourages more dependency that “saps and drains people of their ability to make the most of their lives.”
Republican lawmakers during recent fiscal negotiations agreed to tax increases in exchange for Democrats cutting entitlement programs.
However, they said the next round will be about how to balance the federal budget in 10 years with just spending cuts — in exchange for them recently agreeing to a three-month extension of federal borrowing powers.
House Majority Leader Nancy Pelosi called the new Republican goal “Ryan on steroids,” according to The Los Angeles Times.
Ryan’s earlier budgets proposals called for converting Medicare into a “premium support program” in which the federal government would spend a specific amount for beneficiaries’ care, compared to the existing system in which the government helps pay for each of their doctor visits and medical services.
His proposals, which have the support of most House Republicans, also call for making states run Medicaid, the federal health-care program for the poor.
As President Obama faces pressure on the left to defend federal entitlement programs from the benefit cuts that the Republicans say are necessary to keep the programs solvent decades down the road, one part of Social Security could fall short of paying out full benefits within a few years — even while Obama is still president.
Over the long term, Social Security and Medicare have promised tens of trillions of dollars more in benefits than the nation can pay for under current policies. But Social Security’s disability trust fund is in even worse shape, and current estimates say by 2016 it won’t have enough money to pay full benefits.
“That’s three years from now,” Jim Capretta of the Ethics and Public Policy Center said. “And given the president’s rhetoric and his posture, it’s quite clear that he has no intention of doing anything about it.”
The fiscal security of the disability trust fund got rapidly worse as the unemployment rate rose. The number of applications has almost doubled in the last 10 years, from 1.5 million a year in 2001 to more than 2.8 million a year in 2012.
Obama has said little about how he would fix the fund’s finances.
“President Clinton talked about ‘mend it, don’t end it,'” Nicholas Eberstadt of the American Enterprise Institute said. “To judge by (Obama’s) remarks, there’s nothing that needs mending in our entitlement systems.”
In his first term, Obama took steps to make it easier for people to apply for disability payments, but nothing was changed to help the program pay even bigger bills as it accommodated more beneficiaries.
Even so, Obama took a swipe at Republicans in his inaugural address by saying, “the commitments we make to each other — through Medicare, and Medicaid, and Social Security — these things do not sap our initiative; they has strengthen us.”
Republicans have proposed reining in federal entitlement spending as a necessary step toward cutting the federal deficit, but Obama’s critics note that no one is opposing the programs themselves.
“It was sort of a straw man argument,” Eberstadt said. “I mean, I don’t know who wants to scrap Medicare, Social Security and Medicaid.”
Because the programs are funded through payroll taxes, money will continue to pour in as long as the country has workers. But with the country’s large aging population expected to collect more and more from the programs than younger workers are contributing, analysts are worried that at some point the programs will no longer be able to pay full benefits as promised — unless changes are made, presumably either raising taxes or cutting benefits.
“If we don’t work together to strengthen our entitlement programs, they will go bankrupt,” Senate Republican Leader Mitch McConnell said in a floor speech. “Automatic cuts will be forced on seniors already receiving benefits, rendering worthless the promises that they built their retirements around.”
Capretta faults Obama.
“Ironically, the president’s course, which is to essentially ignore the problem, is the course that will endanger these programs rather than protect them,” Capretta said.
Senate Democratic Leader Harry Reid, however, has argued that entitlement programs are much stronger than Republicans portray them to be, partly because of measures contained in Obama’s health care law.
Under that law, “savings from cutting wasteful spending and fraud will extend the solvency of the Medicare trust fund by an additional eight years,” Reid said in October in a Washington Post op-ed.