Thursday February 18, 2010

Thursday February 18, 2010
Article: ‘Nightfall in America’
NIGHTFALL IN AMERICA
It is economic evening in America as our nation's spending, government programs and deficits balloon. The federal deficit this fiscal year will be $1.6 trillion, or about 10.6 percent of gross domestic product (GDP). That is the largest deficit since World War II, and even President Obama's optimistic estimates show our deficits will not return to sustainable levels for at least the next decade, says Pete du Pont, Chairman of the National Center for Policy Analysis and a former Governor of Delaware.
• The administration's projection of total federal spending over those 10 years (2011-20) is $45.8 trillion, while expected taxes and other receipts will be $37.3 trillion.
• The $8.5 trillion deficit is about 20 percent of spending.
And all of these numbers are based on a full and lasting economic recovery, which, based on current experience, is a pretty optimistic projection, says du Pont.
Earlier this month, the Wall Street Journal's editorial page did an analysis of the federal government's debt that will be held by the public over the coming decade:
• When the Democrats took control of Congress in 2007, the debt held by the public was 36.2 percent of gross domestic product.
• It rose to 40.2 percent the next year.
• This year it will be about 63.6 percent, next year 68.6 percent, then 77 percent of GDP in 2020.
• And the Obama administration's budget estimates 218 percent in 2050.
The reason for these rising deficits is the huge increases in federal spending -- the intended growth of the federal government -- that Congress and the president are pushing, says du Pont:
• The deficit in 2007 was $160 billion.
• In the next year the Pelosi-Reid Congress took it up to $458 billion, and when President Obama came into office in 2009 it hit $1.4 trillion.
• The current 2010 projected deficit is $1.6 trillion, which will lead to a tripling of our national debt from 2008 to 2020.
To the White House and congressional Democrats, these large figures are not a surprise, a mistake or a worry. They are part of a strategy to Europeanize America, to make the government larger, broader and in charge of almost everything. And that would of course require broad and massive tax increases, says du Pont.
Source: Pete du Pont, "Nightfall in America; The Obama deficits portend a gloomy future," Online Journal, February 16, 2010.
For text:
http://online.wsj.com/article/SB10001424052748704431404575067350881049536.html
For more on Federal Spending & Budget Issues:
http://www.ncpa.org/sub/dpd/index.php?Article_Category=25