The Debt Report

If you read nothing else this year, please read this report. It is available at:

http://camp.house.gov/webreturn/?url=http://republicans.waysandmeans.house.gov/UploadedFiles/Debt_letter_to_Camp.pdf

The US Department of Treasury is obligated by law to issue a debt report annually. The law reference is: 31 USC §3130. Here are highlights (frankly, there are no highlights in this report; the information contained within the report can only be described as “DEVASTATING”) provided by TheFundamentals (comments and emphasis are our own):

• Fiscal year 2009 (concluded 9/30/2009) debt increase was a record $1.4 trillion or $1,400,000,000,000.00! Never in the history of the world was so much borrowed by one country in a 365 day period.

• Government receipts fell 16.6% during the same year while their expenditures rose 17.9%!

• US net public debt rose to 49.0% of GDP in 1993 and then declined to 32.2% in 2001 (good news.) From that recent low it has risen to 52.9% (bad news) in 2009 and is projected to rise further to 73.1% (really bad news) by 2015!

• The interest cost of the actual net public debt in 2009 was $201.5 billion. That annual interest cost is estimated to rise to $653.6 billion in 2015 – more than TRIPLE in six years!!!

• The phenomenal increases in debt noted above are predominantly in short term (under 5 year) maturities. What does that mean? If interest rates rise, this debt will be refinanced quickly at higher rates adding even greater interest expense burden on the United States.

• Most of the increased debt holdings in the last eight years are by foreign or international sources. This simply means that our fate is in the hands of foreign entities, principally governments. In China we Trust should now be printed on the face of US currency and debt securities.

• The interest cost to amortize the current level of net public debt of $7.5 trillion at the current 30 year bond rate, over the next 30 years (this is simply a calculation wherein the current debt is turned into an amortizing obligation similar to a 30 year fixed rate mortgage) is a whopping --- $5.6 trillion. Interest cost only - $5.6 trillion!!!

America, we the people, cannot let this happen. We must come to our senses. We must stop the spending and stop the borrowing. We must commit to stopping this madness. We must make this topic – the devastating level of debt in our country, the top priority for all levels of government. We must only vote for candidates who will commit to implementing a program that will reduce entitlement spending by 5%, all government employment by 10% and all other government spending by 15%. We must start this program now. We must make a commitment to this program, implement the program and move toward first, stopping the debt increase and then starting to pay it down. It is our country. It is our future. This country is not about politicians and bureaucrats. It is about a free and responsible people who will do what is necessary to be fiscally responsible and give our children and grandchildren the same opportunities provided us by our parents and grandparents.

There is no way to sugar coat this situation. Either we take back control of our country or we let promiscuous individuals, protected classes of people and special interest groups line their pockets while destroying the nation.