Wednesday, October 13th, 2010 - 16:56
Wednesday, October 13, 2010 - 16:21
As the new fiscal year starts, cost-cutting is taking the driver’s seat in the federal government. This started in state and local governments two years ago, and in recent weeks, it has sweep Washington like a summer thunderstorm.
A new website, called “The U.S. Debt Clock” shows the different contributing factors to the rising federal deficit.
So what are we facing? Using international approaches to calculating national debt, the U.S. federal debt-to-GDP ratio is 93 percent (the official figure as calculated by the Congressional Budget Office as 62 percent). It is estimated to reach 100 percent in 2012. The last time the U.S. debt-to-GDP ratio was this high was in 1944 during WWII. By comparison, the United Kingdom – which has committed to slash its budget by 25 percent over the next five years --is at 68 percent.
The current annual deficit of $1.4 trillion, as the AARP, notes, comprises one-third of total federal spending. This is equivalent to borrowing to pay for the entire Defense budget and total spending on Social Security each year.
There is a growing consensus that something needs to be done, and that all segments of society will have a role. Following are the three most reliable sources of information on the long-term debt and the annual deficit. Read them, but not before bedtime. Some think this kind of reading will put you to sleep, but I think it’ll keep you awake.
Resources. There are lots of places trying to market the facts and figures, and some solutions, but they don’t seem to be getting traction among the general public:
Let me know what you think.