The federal debt ceiling is now 14.3 trillion dollars, an increase of $1.9 trillion in order to continue a bloated federal budget of government expenditures, the bulk of which goes to support wealth transfer programs.
Just under a year ago, I provided images in attempt to improve our grasp of just how large that deficit is. Current government spending is unprecedented, even compared to WWII--a time of total global war. The numbers are so large it is difficult to wrap one's mind around them in order to understand their true meaning--but it is crucial that we do so. Failure to understand the seriousness of the situation prevents proper outrage and action.
First, let's visualize a bit of historical perspective.
The first graph illustrates the accumulation of debt in nominal dollars. The second illustrates the trend in government spending in constant (2000) dollars, removing the distortions that inflation causes when attempting to compare costs from year to year. Below is a graph which takes a closer look at the national debt since 1940 (also in constant Y2000 dollars) but the last year shown is only 2007.
National debt at the end of 2007: 9.0 trillion
National debt at the end of 2008: 10.0 trillion
National debt at the end of 2009: 11.9 trillion
Current National debt: 12.36 trillion
or "to the penny" as of 9:00 AM PST 02/05/2010: $12,354,041,054,846.90
That's just over $40,000 per U.S. citizen: man, woman and CHILD!
A statutory limit was first placed on the national debt in 1917. A history of the debt ceiling is presented in a 2008 report for Congress, "The Debt Limit: History and Recent Increases." This limit has been raised and lowered (mostly raised) several times since then. Most recently, the debt ceiling was 9.815 trillion in Sept. 2007, and then raised to 12.4 trillion in December of 2009. Because our current debt (12.36 trillion) is rapidly approaching that limit, Congress has just increased it again (just 2 months later!) to 14.3 trillion.
Why call it a limit? It doesn't seem to be limiting anything.
Another way to try and get a handle on the burden that government spending is placing on us is to compare the size of the debt to the size of the economy as measured by Gross Domestic Product. From this point of view, the federal deficit (the annual imbalance between revenue and spending) is not as bad as during WWI or WWII. But, when ALL government debt is accounted for (federal, state, local) we are rapidly approaching the debt burden of the years of WWII and the Great Depression.
When I first looked at these graphs, I thought there must be some error. How could our debt be over 100% of the GDP? But it is.
From the Bureau of Economic Analysis, our current GDP is around 14 trillion.
The federal government debt is 12.36 trillion--
but that figure does not include the debt held by state and local governments. Total government dept is now over 120% of the GDP.
Here's a graph showing the break down:
And for a final bit of perspective, let's visualize just how much is a trillion.
First, here's one million in a stack of $100 dollar bills:
Now one billion:
And here's one trillion. (Remember to look for the man in the lower left corner for perspective.)
And then, just for fun, here's 14 trillion:
Don't forget the little man--because that's you!
Great post Beth. I think the government will come up with a plan to shrink paper money so that we tower over $14 trillion just like the picture of the man over the $1 million. That way everything will seem OK.
And, to the debt, one might add the debt-like "entitlement programs" under which retirees will be owed certain amounts (many trillions under-funded).
Then, add amounts by which Federal, State and local pension-funds are under-funded... because tax-payers are on the hook for that too. (Estimates vary from about $300 billion to about $2 trillion.)
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