Can you please address my post?
Could have re-stated the question instead of making me search for it. I'm assuming you're referring to this post:
it's not about blaming parties. it's about where the deficit came from. I'm going to show you some historical budget numbers to illustrate what I'm talking about:
There's something that I don't understand, because I don't much about politics. I'm currently looking at Bill O'Reilly (Very Conservative) and Sen. Kucinich (Dem) gave different different numbers accrediting Pres. Clinton as setting up the country with success with less than $2 trillion (?) in debt and that Pres. Bush increased it by a trillion and now Pres Obama has done the same.. So what am I missing?
Frankly, I'm still not sure what your question was, much less how it related to the data I was presenting, or the point I was making, but I'll take a stab at it anyway (and give a lesson on debt calculations in the process. Yay!).
The problem is that "debt" can be calculated several different ways. National debt is the total amount of outstanding treasury bills. Some people will use that number as though it has something to do with how far "in debt" we are, but that's not really accurate (and it makes the issue confusing because people are using different numbers). National debt comes in two parts: Intergovernmental Debt and Debt Held by Public. Intergovernmental Debt
is not "real". It's an accounting measure. Each year, the government passes a budget. That budget includes funds that are mandated (non-discretionary), and estimates of discretionary spending for various areas of government spending. This money is pre-allocated because a budget bill is law. When it's passed, the government must provide those programs with that money. This is most relevant for non-discretionary spending areas, since those represent past laws which mandate specific spending for various things. So you might have a federal budget for "school lunch programs" (just an arbitrary example btw). And we might have passed a law which mandates that this program must receive 100 Million in funding each year. But what happens if we only spend 80M? Well, the government accounting office periodically audits government programs and compares their projected spending (or mandated spending) to their actual spending. And when there is a surplus, it takes the money out of the programs account and puts it in the treasury. But since that money is given to that program by law, they can only de-allocate the money by law. We can't pass a law every time this is done (literally thousands of times each year), so what the treasury does is put treasury bills into the account for that program in the amount of the surplus. That way, the treasury owes that program that money, so it didn't really take it. In the meantime though, we can spend that money on other things (like costs that pop up throughout the year that we didn't anticipate when we passed that years budget).
The point is that it's not "real debt" because all we did was move it from one place to another. The program was over budgeted in the first place. It didn't need the money, and next years budget will allocate another batch of funds, so it's never going to miss it. It's just like shifting money from your checking account to your savings account. You didn't actually lose any money, and you don't "owe yourself" money. The need for printing of treasury bills is purely because of the legality of the move, it doesn't represent money we actually owe. Now obviously, if we spend that money it counts as money that was spent. But it was budgeted to be spent, so aside from an accounting measure, it doesn't affect the total amount of spending at all.
Over time, the amount of intergovernmental debt can become quite large (in fact, during the middle of the Bush administration it accounted for about 2/3rds of the national debt). So congress periodically passes an accounting bill which erases this debt from the books (remember when I said it can only be done by passing a law?). Of course, the money isn't real, and the debt isn't real, so this is all a formality. Of course, some ignorant people will inevitably claim that the government is cheating somehow by just "erasing debt" by passing a law to make it disappear. The reality is that there never was any actual debt in the first place, so there's nothing untoward going on. Debt Held by Public
is real debt. When the government actually spends money it doesn't have, it must borrow it. So after borrowing money it already has from programs that don't need it (see above), if there still isn't enough revenue coming in to cover costs, the government has the treasury print up treasury bills and offer them for sale to the public (this process actually goes on all the time, but I'm trying to simplify things here). The public (which is anyone *not* the US government) buys the bills. This is how we managed deficits. If the government spends 200B more than it took in revenue that year, it must sell 200B worth of treasury bills to cover the difference. It gets the money it needs to operate, and the people who paid that money get a bill that will hopefully pay them back with interest later.
This debt has to be paid off eventually (with interest). Congress can't just erase this with a stroke of the pen. This is the debt figure I've been talking about. You can look at it simplistically as the cumulative value of all past deficits
. It's not quite that simple since we're constantly paying off those debts to those holding t-bills and then borrowing more, but you can view it as just a cumulative number since it more or less works out that way. What this means is that if you run a 200B deficit in one year, your total debt will increase by 200B (both national debt and "debt held by public" obviously).
It's debt held by public that is the problem. If that debt gets too high, then the nation may suffer negative effects, just as if you borrow too much. Of course the question is "how much is too much?". This is why the only sane way to measure that debt is to compare it to GDP. Since GDP represents the total "size" of the nations economy, it's the best yardstick to measure the total public debt.
I have no clue why numbers given by various pundits may differ. I can only show you the historical data I use and go from there. The numbers I presented come from the CBO and since they are historical, they are accurate (ie: not projections or predictions). These are accountings of how much we actually spent and how much we borrowed, and how much we owed on that debt at the end of each year. IMO, it's the best method to view government spending trends, and that's why I use them.
Was there a specific question you had? As I just said, my position and opinions on this issue are based on looking at the actual data from the cbo and doing math. I don't just listen to what some pundit said (in fact, I generally ignore their numbers because they are almost always wrong on both sides). I look at the actual data and make up my own mind. And what I'm doing in this thread is posting those numbers and attempting to show how they don't match up with the claims being made right now. It's why I don't put stock in pundits. They tend to focus on one set of numbers that benefit their point of view while ignoring the "big picture". What I'm showing is that big picture. No cherry picking. No clever math. Nothing even particularly complex. Here's what we spent. Here's what we got in revenue. Here's what we borrowed. Here's the resulting debt figure. From that you should be able to draw some easy conclusions.
At least I hope people can. To me, these numbers aren't that complex.