The CBO reports today that ‘without action’ (meaning real debt reduction, not simply raising the debt ceiling), the national debt will exceed our GDP by 2021.
The national debt will surge to 101% of U.S. GDP, a measure of the economy's size, in 2021, the CBO said. That's up from last year's 10-year forecast of 87% of U.S. GDP in 2010. The higher, projected, 10-year total would add about $2 trillion to the national debt, if action is not taken on Capitol Hill and by the White House to reduce it before then.
In addition, the CBO -- Congress' official nonpartisan budget tabulator -- underscored the negative consequences both a large budget deficit and a huge national debt would have on the economy, commercial activity, and, ultimately, U.S. citizens.
"Large budget deficits and growing debt would reduce national saving, leading to higher interest rates, more borrowing from abroad and less domestic investment, which in turn would lower income growth in the United States," the CBO report said.
Further, the rising national debt level "would increase the probability of a fiscal crisis for the United States" the CBO added, repeating a warning it made in July 2010.
The piece goes on to illustrate the divide between Democrats, who’d accept watered-down deficit reduction proposals that include tax increases which would cripple an already struggling citizenry, and Republicans, who have proposed the arduous, but necessary, cuts required to resurrect our fiscal footing, arguing that “the deficit and national debt largely stem from excessive government spending, not inadequate revenue.”
And the statist Democrats want the American People to believe that if those Republicans who won’t submit to an unaccountable increase in the debt ceiling, meaning without significant spending cuts, the same spending cuts that are REQUIRED by the CBO’s account to avoid another fiscal crisis, they, Republicans, will be the ones who ‘cause’ a default? Au contraire…folks, when accounting for this brand of reckless inaction, the ones responsible for not only a default now or the not-so-distant future, but a catastrophic collapse, will be the ones who obstruct the responsible action of significantly reducing our debt and deficits, making cuts across the board. Yes, for the Republicans, that will include defense budgets; but likewise, for the Democrats, that will include entitlements (which exceed defense spending).
The endless handouts and wealth redistribution of the welfare state is a utopian concept alone, because the reality of such a society simply can’t survive its own existence. Compounded by a jobless situation that is in dire straits and has earned the dubious right of being compared to any time since the Great Depression, as well as a $450 billion glitch in the Obamacare legislation that grants the perfectly able-bodied American eligibility for Medicaid payouts, which the chief actuary equates to 'food stamps for the middle-class', it is time for Washington, and the the growing dependent class, to understand that self-reliance, while perhaps not as posh, is more beneficial to individual liberties than addictive dominion.
UPDATES: Oh look, Reuters reports that the Democrats came up with an idea...SPEND MORE MONEY! What tha...what money?! This is their idea after the CBO gives this damning report, on top of a Medicare trustee confirming today that Democrats' inaction will result in eating away workers' contributions and ending the program altogether for the coming seniors that have planned for it in a mere 13 years? How's that for 'Mediscare'?!
Congressman Paul Ryan tells National Review that our window of opportunity to avoid falling off the credit cliff is closing rapidly!
"The shadow of an oncoming debt crisis is hindering job growth today and threatening our fiscal and economic future. The latest warning came today from “The Long-Term Budget Outlook”...This year’s news is grim. We are on the verge of leaving the next generation with an unsustainable debt burden and a less prosperous nation.
Despite the current leadership deficit in Washington, I am optimistic that we will avoid the most predictable crisis in our history. Americans are well-aware of the dangers of out-of-control spending and rising debt, and they have been for some time. They are demanding leaders who will be honest about the solutions required.
...our window of opportunity is closing quickly. Let’s work together now, before it’s too late, to put America’s budget on a sustainable path, grow the economy, and leave the next generation with a better country than the one we inherited."
Simultaneously, The American Spectator reports that conservative lawmakers, including Mike Lee, Jim DeMint and Rand Paul, held a press conference on the Hill today supporting the Cut Cap Balance Pledge, which provides an allowance for a debt limit increase, or I should say the LAST ceiling increase, only under the conditions of serious spending reductions, enforceable spending caps, and a strong balanced budget amendment to set the current and future congresses on a sane fiscal path. This action will provide an automatic lowering of the debt, thus responsible economic governance at last!
