Economy Alarm: Americans See Red as Democrats Rack Up the Federal Deficit

Americans See Red as Democrats Rack Up the Federal Deficit

$1.35 Trillion Shortfall as Democrats Charge Full Speed Ahead With Their Big-Spending Crusade

Democrats Once Promised Fiscal Responsibility

“With the recovery package, we not only created jobs – about 2 million saved or created with more being rolled out – but pulled us back from the brink of even deeper recession. In his [President Obama’s] budget, which we passed one hundred days after his swearing-in, he had a blueprint for how we go into the future, create jobs, stabilize the economy [and] do so as we reduce the deficit – [it’s] very central to everything we do – reduce the deficit.” (Matt Cover, “Pelosi Says Jobs ‘Permeated’ Congressional Actions in Year of 10 Percent Unemployment,” CNSnews.com, 1/25/10)

“The only thing certain is that Obama is on track to boost a federal debt that stands at $10.7 trillion. Clearly mindful of that, Obama said: ‘We will need to do everything in the short term to get our economy moving again’ as well as ‘begin restoring fiscal discipline and taming our exploding deficits over the long term.’” (The Associated Press, “Obama: Stimulus lets Americans claim destiny,” 02/17/2009)

Credibility Crash: What Responsibility? Federal Deficit Skyrockets as Democrats Continue Runaway Spending Spree

New deficit estimates Tuesday project a $1.35 trillion shortfall for the coming year even as Congress debates creation of a bipartisan commission to propose long range steps to relieve the mounting debt facing the nation.

The 2010 deficit projection is only modestly less than the $1.4 trillion wave of red ink that the government experienced in 2009, as revenues continue to lag with the slow economic recovery forecast by the Congressional Budget Office

Even in 2011, the Congressional Budget Office is projecting a nearly $1 trillion shortfall, and that picture could well be worse depending on the costs of the war in Afghanistan and what Congress decides on long term tax policy.

CBO projects that unemployment will average slightly above 10 percent in the first half of 2010 and then turn downward in the second half. But the building debt carries with an added burden. Once the economy improves, CBO says, higher interest rates will come back and bite the Treasury trying to finance the accumulated deficits.

“Interest payments on the debt are poised to skyrocket,” CBO says. From 2010 through 2020, it projects the annual costs will triple in nominal terms from $207 billion to $723 billion and more than double as a share of GDP. (David Rogers, “More red ink: CBO projects $1.35 trillion deficit,” Politico, 1/26/2010)

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