ClydeR
10-06-2022, 10:04 AM
With the start of the new fiscal year, the national debt is a hot item in the news. Below are the introductory paragraphs to an article and Steve Ratner's charts released today.
Interest on the national debt in the last fiscal year that ended September 30, 2021, was 5% of revenues collected. At that time, interest rates on US government deb t were at historic lows, practically zero. With rising rates, that percentage will increase dramatically, leaving insufficient money for other expenditures, unless the government decreases spending or increases revenues. At the same time, the long awaited Social Security crisis in looming nearer. And the global labor supply is shrinking. Those three things -- deficit pressure, Social Security fund depletion, and shrinking labor supply -- will shape the economy and politics for the nex15 years. Can you predict what will happen? What should you do, if anything, to prepare?
WASHINGTON -- The nation's gross national debt has surpassed $31 trillion, according to a U.S. Treasury report released Tuesday that logs America's daily finances.
Edging closer to the statutory ceiling of roughly $31.4 trillion — an artificial cap Congress placed on the U.S. government’s ability to borrow — the debt numbers hit an already tenuous economy facing high inflation, rising interest rates and a strong U.S. dollar.
And while President Joe Biden has touted his administration's deficit reduction efforts this year and recently signed the so-called Inflation Reduction Act, which attempts to tame 40-year high price increases caused by a variety of economic factors, economists say the latest debt numbers are a cause for concern.
Owen Zidar, a Princeton economist, said rising interest rates will exacerbate the nation's growing debt issues and make the debt itself more costly. The Federal Reserve has raised rates several times this year in an effort to combat inflation.
Zidar said the debt “should encourage us to consider some tax policies that almost passed through the legislative process but didn't get enough support,” like imposing higher taxes on the wealthy and closing the carried interest loophole, which allows money managers to treat their income as capital gains.
More... (https://abcnews.go.com/Politics/wireStory/us-starts-fiscal-year-record-31-trillion-debt-91004017)
https://pbs.twimg.com/media/FeYjExkXgAUGGp6?format=jpg
https://pbs.twimg.com/media/FeYokh0WYAAzhiF?format=jpg
https://pbs.twimg.com/media/FeYsALKWIAAFbB6?format=jpg
https://twitter.com/SteveRattner/status/1577987287794810880
https://twitter.com/SteveRattner/status/1577993330234998784
https://twitter.com/SteveRattner/status/1577997103028207616
Interest on the national debt in the last fiscal year that ended September 30, 2021, was 5% of revenues collected. At that time, interest rates on US government deb t were at historic lows, practically zero. With rising rates, that percentage will increase dramatically, leaving insufficient money for other expenditures, unless the government decreases spending or increases revenues. At the same time, the long awaited Social Security crisis in looming nearer. And the global labor supply is shrinking. Those three things -- deficit pressure, Social Security fund depletion, and shrinking labor supply -- will shape the economy and politics for the nex15 years. Can you predict what will happen? What should you do, if anything, to prepare?
WASHINGTON -- The nation's gross national debt has surpassed $31 trillion, according to a U.S. Treasury report released Tuesday that logs America's daily finances.
Edging closer to the statutory ceiling of roughly $31.4 trillion — an artificial cap Congress placed on the U.S. government’s ability to borrow — the debt numbers hit an already tenuous economy facing high inflation, rising interest rates and a strong U.S. dollar.
And while President Joe Biden has touted his administration's deficit reduction efforts this year and recently signed the so-called Inflation Reduction Act, which attempts to tame 40-year high price increases caused by a variety of economic factors, economists say the latest debt numbers are a cause for concern.
Owen Zidar, a Princeton economist, said rising interest rates will exacerbate the nation's growing debt issues and make the debt itself more costly. The Federal Reserve has raised rates several times this year in an effort to combat inflation.
Zidar said the debt “should encourage us to consider some tax policies that almost passed through the legislative process but didn't get enough support,” like imposing higher taxes on the wealthy and closing the carried interest loophole, which allows money managers to treat their income as capital gains.
More... (https://abcnews.go.com/Politics/wireStory/us-starts-fiscal-year-record-31-trillion-debt-91004017)
https://pbs.twimg.com/media/FeYjExkXgAUGGp6?format=jpg
https://pbs.twimg.com/media/FeYokh0WYAAzhiF?format=jpg
https://pbs.twimg.com/media/FeYsALKWIAAFbB6?format=jpg
https://twitter.com/SteveRattner/status/1577987287794810880
https://twitter.com/SteveRattner/status/1577993330234998784
https://twitter.com/SteveRattner/status/1577997103028207616