Debt gone by 2021!

[Adrian II]

I thought we were talking about national debt, i.e. the amount of money owed by a national government. A useful measure of national debt is percentage of GDP.

U.S. national debt stood at 120% of GDP in the last year of WWII. Truman pushed it back to 90% of GDP. Ike lowered it to 50%, Kennedy to 40%. Johnson, Nixon and Carter kept it there. Reagan raised it to 65% again, Bush Sr and Clinton brought it down to 60%. Under Bush Jr it stands at 65% again.

Debt follows deficit. That is: national debt increases because of successive budget deficits, and it does not necessarily decrease in the wake of budget surpluses. Since budget deficits in U.S. history have always been war-related, national debt is more or less war-related as well.

Reagan seems to have been an exception, but he considered the Cold War as if it were a hot one and began a policy of outspending (out-arming) the Soviet Union. Bush Jr's deficits are clearly war-related as well.

This is the simple version. I am sure there is a much more complete and complex version, but I have other plans for Christmas.

[Louis VI the Fat]

So we are talking about the same thing after all. I do remember us disagreeing over it but I can't quite remember about what exactly. And as it is getting rather late, I'm not going to bother trying to figure it out.

This is the simple version. I am sure there is a much more complete and complex version, but I have other plans for Christmas.

While I don't have a more complex version I do have a complete one!

Numbers and stuff. Relevant information on page 130-131.

I'm going to stare at this report all the way 'till Christmas to satisfy my need for numbers, stats and percentages.



While simultaneously satisfying my need for foreign-subsidized cheese and wine. And when I'm done the national reserve of Fourme D'Ambert will be down from 80% to an historical all-time low of 45%. The national reserve of the finest white mellow(?) (= 'moelleux') Sauternes from Château Yquem will get completely depleted in the process.

[Adrian II]

I'm going to stare at this report all the way 'till Christmas to satisfy my need for numbers, stats and percentages.

Oh yeah! Throw in current accounts, trade and services balance, balance of payments, gold and currency reserves and comparative interest rates, and you'll have enough to chew on till Christmas next year!

Better chew on the Fourme D'Ambert while those Dutch subsidies last, mon pote.

That White House budget link you provided gives a nice rundown (page 5 and beyond) of recent developments. It shows that U.S. debt and budget trends, if measured as a percentage of GDP, are no reason for great panic.

After peaking at $290 billion in 1992, deficits declined each year, dropping to a level of $22 billion in 1997. In 1998, the Nation recorded its first budget surplus ($69.3 billion) since 1969. As a percent of GDP, the budget bottom line went from a deficit of 4.7% in 1992 to a surplus of 0.8% in 1998, increasing to a 2.4% surplus in 2000.
An economic slowdown began in 2001 and was exacerbated by the terrorists attacks of September 11, 2001. The deterioration in the performance of the economy together with income tax relief provided to help offset the economic slowdown and additional spending in response to the terrorist attacks produced a drop in the surplus to $128.2 billion (1.3% of GDP) and a return to deficits ($157.8 billion, 1.5% of GDP) in 2002. These factors also contributed to the increase in the deficit in the following two years to $413 billion and 3.6% of GDP in 2004, falling to $318 billion and 2.6% of GDP in 2005. Debt held by the public, which peaked at 49.4% of GDP in 1993, fell to 33.0% in 2001 and increased to 37.4% in 2005.