Best of Dennis – Should We Worry About Government Deficit?
Guest Post by Dennis Miller at Miller On The Money
Best of Dennis…
Dennis is taking some much-deserved vacation time, and will be back writing soon. This article was posted originally on October 25, 2018, and it is still relevant. Just take a look at the US federal debt number mentioned in the original article and compare it to today….
If our elected leaders are not concerned about the government deficit, should the citizens be worried?
Governments worldwide spend more than their total revenue and borrow to make up the difference.
The U.S. Debt Clock shows the US federal debt to be $21.6 trillion, averaging $177,283 per taxpayer.
The government now pays interest on $21.6 trillion. Below is a graph tracking the 10-year interest rates on US treasuries.
My brokerage website shows 10-year treasuries are currently paying 3.22%.
Since December 2016, interest rates have roughly doubled, from 1.5% to 3%. The 1.5% increase adds $324 billion in interest cost to the deficit annually and will continue to rise.
The New York Times (NYT) reports, “As Debt Rises, the Government Will Soon Spend More on Interest Than on the Military”:
“The federal government could soon pay more in interest…than it spends on the military, Medicaid or children’s programs.
The run-up in borrowing costs is a one-two punch brought on by the need to finance a fast-growing budget deficit, worsened by tax cuts and steadily rising interest rates that will make the debt more expensive.
…. But the tax cuts passed late last year have created a deeper hole, with the deficit increasing faster than expected.”
The NYT publishes select facts to push their political bias.
I wrote about Nobel Prize-winning economist Paul Krugman’s columns in the NYT. Prior to the election, anticipating a Clinton victory, he wrote, “We should probably be running bigger, not smaller deficits in the medium term.… Yes, we may face some hard choices a couple decades from now…and in any case, there aren’t any choices that must be made now.”
Less than 80 days later, after Clinton lost, he wrote “Deficits Matter Again.”
The media ignores or screams about deficits when it suits their political agenda. We’ve heard this crap for generations.
Click this link for the original source of this article.
Author: Dennis Miller
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