Sunday, June 8, 2008

Can We Afford Another Republican President?

Our national debt is at an all time high ... nearly 9.5 Trillion dollars, which will be close to double what it was ($5,727,776,738,304.64) by the time George W. Bush leaves office January 20, 2009.

National Debt by President

The data is from the historical tables in the 2006 OMB Budget as downloaded from Historical Tables. The data are plotted without modification. Here is the relevant two page Table 7.1 in PDF format. The data and graph are available in this Excel spreadsheet.

The National Debt as a percentage of Gross Domestic Product (GDP) was actually declining until the Reagan and George H. Bush years when it rose dramatically. During Clinton's term, it once again began to decline. However, during George W. Bush's term, it's risen to 66% of GDP.

According to the
National Treasury, our government is spending money faster than it's coming in. All of us normal folks know that you can't reduce your debt if you're spending money faster than you're receiving it. If you want to reduce the debt, you have to tighten the purse strings, cut the waste, stop spending more than you make and start paying off your debt. Apparently, government bureaucrats haven't learned that lesson.

If you really want to keep tabs on just how fast the government is spending in terms of the National debt, the best site I've found is "
The Skeptical Optimist." Widgets on that site update the Total National Debt, the Gross Domestic Product (GDP) and the ratio of National Debt to GDP twice each second.

The National Debt is in the Trillions! That's kind of hard to wrap your head around. $9,500,000,000,000 ... that's a lot of zeros, so let's see if we can make that number a bit more personal. Let's look at that number in relationship to the
U.S. Population, which is estimated to be 303,824,646 by July 2008. If we divide the population number into the debt, that means every man, woman and child in the U.S. is in debt to the tune of $31,268 each.

Now, if we look at the two presumptive candidates and where they want to take us economically, McCain wants to extend the Bush tax cuts, and Obama wants to end them (which means that some folks are going to see some tax increases ... an unpopular concept in an election year). Given where we're at today ... the housing market in crisis, the mortgage industry in crisis, gas prices are through the roof, the energy policy is in conflict with the farm policy and food prices are skyrocketing ... do you honestly think the Reagan/Bush economics policies of yet another Republican presidency would somehow turn everything around, reduce the National Debt to GDP ratio and make things just hunky-dory? I, for one, don't think so. I'm also concerned that should Democrat Obama prevail, he'd better take a good hard look at a large number of government programs and cut or scrap programs that no longer make good economic sense, especially if he intends to add additional spending for a national health care program. Adding health care funding to an already bloated governmental budget will do anything but reduce the Debt to GDP ratio.

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