Monday, March 29, 2010

CBO report: Debt will rise to 90% of GDP

For all his talk about his policies being budget neutral, his budgets show significant deficits in the next ten years and this is using the rosy scenarios and without the known deficits of ObamaCare and the Doctors' Fix. These numbers will skyrocket and are already in the critical stage. Expect to see the fix to be a VAT (Value Added Tax) that will hit all Americans, rich or poor.

The federal public debt, which was $6.3 trillion ($56,000 per household) when Mr. Obama entered office amid an economic crisis, totals $8.2 trillion ($72,000 per household) today, and it's headed toward $20.3 trillion (more than $170,000 per household) in 2020, according to CBO's deficit estimates.

That figure would equal 90 percent of the estimated gross domestic product in 2020, up from 40 percent at the end of fiscal 2008. By comparison, America's debt-to-GDP ratio peaked at 109 percent at the end of World War II, while the ratio for economically troubled Greece hit 115 percent last year.

In a worrisome development, CBO projects that federal budget deficits, after dropping sharply, then will begin to rise continuously from 4.1 percent of GDP in 2014 to 5.6 percent in 2020.

For the 2016-20 period, CBO estimates that deficits will average more than 5 percent of GDP, even while assuming the economy will be near full employment, with an average jobless rate of 5 percent during that same five-year period.

CBO report: Debt will rise to 90% of GDP

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