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.

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