The Growing U.S. Federal Debt (in Pictures)

27 04 2011

Following are some images from the data base of the St. Louis Federal Reserve Bank that help to describe the U.S. economy and other key economic variables.  This info is extremely relevant given the information from the statements of Ben Bernanke and the U.S. fed. The info can be found at the following web address:

http://research.stlouisfed.org/fred2/

A. The U.S. Federal Surplus / Deficit (1895-2010)

Note the explosive growth in U.S. government deficits since 2008, with U.S. recessions represented in shaded areas.  Deficits reached 1.4 trillion in 2009 and 1.3 trillion in 2010.  The previous record deficit had been 460 million in 2008.  Any thinking person will recognize that a continuation of these deficits will lead to financial catastrophy for the U.S. if allowed to continue.

B. The U.S. Federal Government Debt (1895-2010)

The ceiling for the amount of U.S. federal government debt is the issue that will be voted upon within weeks in the U.S. congress.  U.S. government debt has moved from approximately 10 trillion to 14 trillion since early 2008, at the time when the U.S. was in a recession and the Obama administration came into office.  Will the current U.S. congress allow the U.S. government to borrow over approximately 14.2 – 14.3 trillion U.S. dollars or not?   But then, what is the size of the U.S. economy? Are we able to service such large amounts of debt? See the information below….

C. U.S. Gross Domestic Product (1895-2010)

How has or can the U.S. government service 14 trillion in national debt when the national GDP is also 14 trillion dollars (and we are being merciful and measuring GDP in nominal rather than real inflation adjusted dollars)?  Well, we could either a) reduced spending and promote economic growth through responsible government leadership, or b) attempt to avoid fiscal responsibility and “monetize the debt” by devaluing the U.S. dollars it is denominated in (i.e., see the current quantitative easing policies of the Ben Bernanke fed).

The conservative Heritage Foundation provides a much more comprehensive overview of the budgetary challenges facing the U.S. at the following web address:

http://www.heritage.org/budgetchartbook/

Here in the U.S. we are at a point of decision regarding whether we will responsibly deal with our fiscal problems.  Lets take responsibility for the issue and address it for the sake of our and our kids future.





Recognizing (my) government subsidies

25 04 2011

The list of government subsidies that I benefit from is pretty lengthly.  Here are just a few of the DIRECT government subsidies that I can think of…

1) Tax deduction for interest paid on my house loan

2) Government payments on the small amount of farmland that my wife and I own

3) Crop insurance subsidies for a proportion of our crop revenue coverage as a crop share land owner

4) Income tax deductions for each of my children

5) State matching support for my government employee retirement account

6) Tax deductions for my church / religious charitable giving

On the surface, all else being equal, my family and myself have benefited financially from each of these elements of tax support.  But in a macro economic, wholistic systems sense, this level of government support is unsustainable (with millions of U.S. citizens all involved in receiving similar tax subsidies).   In my desire to protect my own government subsidies, am I unwilling to recognize the that the broader U.S. economy and the economic livelihood of my children for decades to come is put at risk by this much government support? Am I myself a “tragedy of the commons” in regards to my lack of recognition of how my portion of the government “pie” is a significant part of the cumulative budget problem here in the U.S.?

My contention is that we in the U.S.  (me first) have to recognize that without the elimination or at least more effective targeting of these government subsidies (or changing them to a true safety net for the most needy instead of an entitlement program for all), the economic future of the country is at risk.  I want my children to have an opportunity to make an honest living in the future.  The subsidies for my house, my farmland, my crop insurance, my charitable giving, and yes, even my child tax credits likely need to go.  IF I had a lower tax rate with equitable application across the U.S. tax payer base, I may end up better off financially.  These subsidies from the government have made us weak, timid and fearful —- scared to independently take responsibility for our own finances apart from government support.





Time for this economic/social conservative to reengage…

25 04 2011

With other activities in life and work I had shifted attention away from this blog.  Now it is time to reengage.  With the 2012 elections coming up, over wrought environmental policies damaging the U.S. economy, a long term budget crisis facing the country, and assorted other maladies, it is time for all freedom loving economic and social conservatives to have a voice.  On we go….