Tuesday, January 25, 2005

Debt? Who Cares!

Deficit continues to grow, while GOP continues to ignore it:

The Congressional Budget Office predicted this morning that the federal government will run a deficit of $368 billion this year, a figure that does not include a request that administration officials are preparing for $80 billion more in funds for the wars in Iraq and Afghanistan.
The figure also does not include the cost or savings from any of the proposals President Bush is expected to make in the budget he will submit to Congress shortly.
The deficit for the 2004 budget year was $412 billion.


Representative John Spratt of South Carolina, a member of the House Budget Committee, issued a statement today deriding President Bush's assertion that he would cut the deficit in half.
"Republicans control the House, the Senate and the White House, but they can't control the budget, and they can't escape responsibility for its dismal condition," he said.

But Brian Reidl, a budget analyst with the conservative Heritage Foundation, said the figures were much less alarming when measured against the size of the economy.
"In terms of the effect on the economy, the deficit is not as important as the size of the federal debt" as a percentage of the gross domestic product, Mr. Reidl said.


"It's the same as in a family," Mr. Reidl said. "What matters is how much you owe as a percentage of your income."

This is what the Bush administration is going to do about the debt...........nothing. Absolutely nothing. Just ignore it, and let another (preferably Democratic) administration deal with it.

This is the great brain trust that is running our country. Even the G7 countries are pushing for us to do something about our account deficits.

Asked about what could be done to induce the United States to take steps to stem the slide of the dollar, Noyer said: "There is an overall vision that we are soon going to re-affirm in London and which is consensual.
"The task now is to put it into practice, which is always complicated."
"Each country has reforms or improvements to carry out in its own domain, in its own economy," the French central bank governor said.
Economists have repeatedly warned that the United States cannot maintain its huge budget and current account deficits, which make foreign investors uneasy and reluctant to support the dollar.
"The United States cannot continue with such a deficit, it must work to balance savings and investment," Noyer argued.

The risk is that if the US continues to expect everyone else to prop up our economy, eventually they will give up and leave us to sink in our own debt. What then?


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