Let me walk you through this:
This site has an interesting chart, showing you the National debt as a percentage of GDP.
Looking at the GDP of the nation in 1980 (when Jimmy Carter left office), it was $2.725 trillion dollars, or if you want to adjust them to the year 2000 inflated dollars, $5.221 trillion. Government spending that year was $531 billion, ($1.017 trillion in 2000 dollars), or about one fifth of the economy.
In 2000, the year Clinton left office, the GDP was $9.629 trillion and Federal spending was $1.8 trillion (still about 1/5 of the economy).
In 2008, the GDP was $14.373 trillion ($13.366 in year 2000 dollars) and the FedGov budget was $2.9 trillion (still 1/5 of GDP).
Now look at what we spent in 2008, by turning to page 90: Social Security and Medicare is 37% of the budget, Social giveaway programs like Medicaid, welfare, and food stamps were 29% of the budget, and the stuff that the FedGov is actually supposed to be doing (provide for the common defense, yada, yada) was less than 25% of the total budget.
This means that we are pulling dead weight in our economy to the tune of $2 trillion a year, and it makes me wonder how long before the whole thing simply stops working.
... makes me wonder how long before the whole thing simply stops working
ReplyDeleteAbout ten years. Sand will be obviously in the gears the entire time (starting last year), but Medicare goes first in about 2 years and then Social Security a couple years later. With the recession looking like it'll be running that entire time, each year will get harder and harder for the budget.
But the question is not "when will we be in the soup?" We're in it now.