I'm trying to shake off a feeling of numb disbelief at the latest figures from our Government. They show that for every $1 the US government will spend this year, a full 50c will be funded by borrowing. According to one report:
OMB [Office of Management and Budget] Director Peter Orszag announced Monday that a $90 billion increase in the estimated deficit for each of the next two years would bring the deficit for fiscal year 2009 to $1.8 trillion and for 2010 to $1.3 trillion. President Obama's proposed budget for 2010 is $3.6 trillion. The 2009 budget was set at $3.1 trillion.
Those numbers are up from February's estimates. The budget deficits will be 12.9 percent and 8.5 percent of gross domestic product in those two years, Orszag said. The budget deficit for fiscal year 2009, which ends Sept. 30, is four times the record set last year.
. . .
Annual deficits would never dip below $500 billion and would total $7.1 trillion over 2010-2019. Even those dismal figures rely on economic projections that are significantly more optimistic than those forecast by private sector economists and the Congressional Budget Office. They rely on a 1.2 percent decline in GDP this year and a 3.2 percent growth rate for 2010.
That's just mind-blowing! Even working with much smaller numbers, if you and I tried to finance our private lifestyles by borrowing 50% of what we spent, we'd be bankrupt within a year or two. It's simply not possible to sustain such a level of expenditure unless one has capital to draw on - and we as individuals, and this country as a whole, don't have that capital.
I didn't have high hopes for President Obama when he took office. I'm now beginning to suspect that his financial illiteracy, ideological blindness and catastrophic incompetence will condemn America to two or three generations of impoverishment, as we fight our way out of the monetary morass he'll leave behind him.
(By the way, that has nothing to do with the fact that he's a Democrat. Given the GOP's spending record over the early part of this century, I daresay Republican Presidential candidate Senator John McCain wouldn't necessarily have been an improvement!)