Friday, January 9, 2009

Newest National Debt Statistics posted January 2009

Happy broke New Year! Here is the first National Debt report for 2009 - the "Year of Insolvency."

The National Debt as of 31 December 2008 (as reported on

Public Debt

Intragovernmental Holdings


Increase in Fiscal Year 2009 (Oct 1, 2008 - Dec. 31, 2008):

Interest payments:
December 2008

Fiscal Year 2009

Gifts to reduce the public debt:
November 2008

Fiscal Year 2009

Happy New Year!

$266.9B doled out from $700B bailout

The following Associated Press story appeared on page 2C of the January 9, 2009 issue of the St. Paul Pioneer Press.

The Treasury Department announced Thursday that it has disbursed $266.9 billion from the $700 billion financial rescue program.
In its latest update to Congress, the department said it closed $65.4 billion in transactions since its last report on Dec. 2. Under the law that Congress passed Oct. 3, Treasury must provide a report summing up its activities once its commitments pass certain milestones. The new report included $187.5 billion provided to banks in an effort to get them to resume more normal lending and $19.4 billion for the auto industry.

Concerns grow over Treasury's handling of $700B bailout

by David Barstow
New York Times
January 9, 2009

In a report scheduled to be released today, the congressional panel overseeing the $700 billion federal bailout has expressed growing concern about the effectiveness and execution of the rescue plan.
A draft of the report criticized the Treasury Department for its "shifting explanations" about the underlying purpose of the bailout, its failure to answer many of the panel's questions and its failure to require financial institutions receiving bailout money to fully account for how they are using the public's money.
"The recent refusal of certain private financial institutions to provide any accounting of how they are using taxpayer money undermines public confidence," the draft of the report said. "For Treasury to advance funds to these institutions without requiring more transparency further erodes the very confidence Treasury seeks to restore."
The 45-page report also asserted that the Treasury, in defiance of what the panel claimed was Congress' clear intent when it passed the bailout bill in October, had taken "no steps to use any of this money to alleviate the foreclosure crisis."
The Treasury declined to comment on the panel's latest findings with the bailout, known as the Troubled Asset Relief Program.
But in testimony to Congress and elsewhere, Neel Kashkari, the Treasury official overseeing the bailout, repeatedly has asserted that the rescue plan is in fact working as intended. While cautioning that its full effect will take time to register, he has argued that the rescue plan already has begun to reduce foreclosures while also providing crucial stability and liquidity to the financial system.
According to a New York Times running tally, the Treasury already has committed $359 billion of the $700 billion to banks, credit-card companies, automakers and insurance companies, among others. The oversight panel's latest assessments are likely to fuel the debate over how to spend the remainder of the bailout money.
The congressional oversight panel has three Democratic appointees and two Republican appointees. It is led by Elizabeth Warren, a Harvard law professor and expert on bankruptcy and credit-card issues. A spokesman for the panel declined to comment on the draft report.
The preliminary report raises new questions about the single biggest component of the bailout, the Capital Purchase Program, under which the government has invested tax dollars into scores of banks it judges to be healthy. According to the Treasury, the government has injected $177.5 billion in bailout money into 214 financial institutions.
The report, though, questioned whether the Treasury could accurately assess the health of these banks, especially given the collapses of several banks that once were deemed to be healthy.

Thursday, January 8, 2009

Budget deficit to reach $1.2 trillion

By Lori Montgomery Washington Post
Updated: 01/07/2009 10:59:53 PM CST

WASHINGTON — The nation's budget deficit will soar to an unprecedented $1.2 trillion this year, congressional budget analysts said Wednesday, a startling tide of red ink that could dampen enthusiasm on Capitol Hill for some of President-elect Barack Obama's most ambitious priorities.

In the first official estimate of the damage done to the nation's finances by a weakening economy and various financial sector bailouts, the Congressional Budget Office reported that the gap between government spending and available revenue will exceed 8 percent of the overall economy by the end of September, a yawning chasm not seen since the end of World War II.
The news drew a grim reaction from Congress, where the chairman of the Senate Budget Committee, Sen. Kent Conrad, D-N.D., called the figure "jaw-dropping." While lawmakers said they expect to dig this year's hole even deeper by approving a massive stimulus package aimed at pulling the nation out of recession, Conrad and his House counterpart, Rep. John Spratt, D-S.C., said they have warned Obama to limit the package to temporary measures that will not add to the deficit in future years.

The two Democratic budget leaders also cautioned Obama to find ways to pay for any other initiatives he pursues after taking office later this month, including expensive promises to expand access to health care for the uninsured, develop new sources of alternative energy and offer a bevy of new tax cuts to middle-class families.

"We should be very skeptical about any policy changes that add to the deficit and the debt that are permanent in nature," Conrad told reporters.

At a news conference in Washington, Obama greeted news of the mounting deficit by vowing to ensure that government dollars — either in the stimulus package or routine programs — are not wasted.

To that end, he announced the appointment of Nancy Killefer, an assistant secretary of the Treasury in the Clinton administration, to serve as "chief performance officer" in the White House budget office. In the newly created post, Killefer will be tasked with retooling budget practices and slashing unnecessary programs.

Obama once again declined to say how he plans to eliminate the growing budget gap, which is projected to narrow somewhat as the economy improves but explode again as the retiring baby boom generation sends the cost of the entitlement programs — Social Security, Medicaid and Medicare — skyrocketing. Obama said he will offer "very specific outlines" for addressing short- and long-term deficits when he submits his first budget proposal to Congress next month.
"We are beginning consultations with members of Congress around how we expect to approach the deficit," Obama said. "We expect that discussion around entitlements will be a part, a central part, of those plans."

So far, however, Conrad said Obama's team has been cool to requests to establish a bipartisan task force that would re-examine the entitlement programs, as well as the nation's tax system, and develop a long-term plan for bringing costs and revenue in line.

Wednesday, January 7, 2009

Where does the problem lie?

This graphic is courtesy of King Banian at SCSU Scholars I invite all interested readers to check out King's economic commentary at that site.

Monday, January 5, 2009

Editorial: Dems to Run the Country Like they Ran Their Blue States

Dems to Run the Country Like They Ran Their Blue States (Into the Ground)
By JB Williams, Right Side
January 4, 2009

As the nation braces for Democrats to take unbridled control of the federal government, some lessons about how big a mistake that really is are already coming to light. Just as no non-union manufacturer is asking for a government bailout, only Democrat run states are begging for federal funds to avoid the inevitable bankruptcy of the states they have run into the ground.
In addition to Bush's trillion dollar nationalization of the financial industry, and in addition to Barack Obama's trillion dollar "stimulus package" (aka affirmative action welfare initiative), another trillion dollars in new national debt is being demanded by a group of Democrat governors who have run their states into the ground.

Following the lead of Republicrat California Governor Arnold Kennedy, New York Democratic Gov. David Paterson, New Jersey Gov. Jon Corzine, Massachusetts Gov. Deval Patrick, Ohio Gov. Ted Strickland and Wisconsin Gov. Jim Doyle are asking the incoming resident-elect to print another trillion dollars to bailout Democrat run states.

"We are not crying wolf. This is one of the worst situations our states have faced," Strickland said. "This is a real crisis. These are real problems. And if we don't get some significant assistance many of those in our states will suffer greatly."

According to the Democrat governors, blue states are unable to manage themselves. In order to make up for the shortfalls, Jersey Democrat Corzine said the incoming Obama administration and Congress will need to free up $1 trillion in federal spending for state assistance. "We're all going to be Herbert Hoovers if we're not careful here," he said.

For those of you who are keeping track, combined with Bush's trillion dollar bailout of the financial industry and Obama's trillion dollar "stimulus" affirmative action, another trillion for blue state bailouts will bring the total to $3,000,000,000,000 (3 TRILLION) in new national debt over the next few months, and still counting.

Your "Fair Share"

Since taxpayers don't have the luxury of printing money on demand like the federal government, taxpayers must look at all of this more realistically. Just because you have not received the bill yet, doesn't mean the bill isn't coming due.

Based upon IRS reports regarding who picks up the national tab for everything in this country today, here's your "fair share" of the $3 trillion dollar Democrat debacle. Find your income level and see how much you owe to pay for this monstrosity we call a federal government "stimulus package."

Tax Bracket
Income & Up
Due from each Working American
% of Inc.
Top 1%

Next 4%

Next 5%

Next 15%

Next 25%

Bottom 50%

If you happen to be one of the fortunate American success stories making at or above $388k a year, your "fair share" of the $3 trillion in new debt is a minimum of $772,064.52, not counting interest if you can't right a check for that amount today. That's two years of your income...
If you are one of the top 5% of income earners that Obama has promised to tax into the bottom 50%, making at or above $108k per year, your "fair share" of the bailouts proposed will be $41.225.81, or 37.9% of your annual income, in addition to the taxes you already pay.

And even if you are one of the bottom 50% of income earners who voted Democrats into power, your "fair share" is $2314.84 or 7.2% of your income, not counting interest.

This is just to pay for the NEW spending, not including any of the existing national debt or related interest.

The Buck ALWAYS Stops with the Taxpayer

As if completely unaware of the fact that our federal government is so deep in deficit spending that China can own us if they just call in our loans, Democrat governors are issuing this warning to Washington DC, "that states across the country will be forced to make drastic budget cuts in the face of unprecedented deficits."

Ohio Democrat Strickland said. "This is a real crisis. These are real problems. And if we don't get some significant assistance many of those in our states will suffer greatly."

Strickland added that the situation facing the state of Ohio is so dire that in order to balance his state's budget, he would have to fund every state program at 75 percent of its current level. "If I were simply to flat fund the operations of this government, I'd end up with $7.3 billion in deficit," he said. "We're just trying to keep afloat."

What do they think the American taxpayer is doing right now?

This is Just the Beginning!

At the root of the mortgage crisis was a Democrat affirmative action lending policy required by Democrats in congress.

You remember Democrats blocking Republican efforts to remove federal gasoline taxes when gas was $4.00 a gallon. Now the same Democrats are proposing to double the federal gas tax while gas is at $1.65 a gallon. That should stimulate growth...

Non-union manufacturers are not seeking government bailouts. Union manufacturers are... all of which support Democrat politicians in election after election.

The 50% of voters who voted Democrats into unbridled power pay only 2.99% of all federal taxes collected. So of course, they are not the least concerned with the current runaway federal government threatening to bring America down to economic third world status.

It's the 50% who voted against Democrats, those who pay 97.01% of all federal taxes collected, and who live in or run RED states which are NOT seeking federal bailouts, who are up in arms over the ongoing nationalization of private industry after private industry.

That's because as you can see in the chart above, they will get the lion's share of the tab for all of this nonsense.

"Change" is Here!

Karl Marx sought the ultimate power of a proletariat (working class) government free to take from each according to his ability and redistribute to each according to his government defined sense of need. Blue state governments are a great example of the limited capacity of the proletariat class's ability to run things. In a couple weeks, they take unchecked charge of the nation.

This is the change which is now upon us.

For more than 230 years, personal freedom, individual liberty, the unalienable right to Life and the pursuit of Happiness reigned in the greatest nation known to mankind. The most prosperous, powerful, generous nation in human history was the result.

Throughout history, nations run by the proletariat class have gone bankrupt under the weight of endless social spending in a society increasingly unable to produce. Eventually, these nations have become unable to feed their people.

For more than 230 years, America has been the prosperous nation that has fed the millions unable to feed themselves around the globe. Who will feed Americans when they are no longer able to feed themselves?

"Change" - It's here... I fear for those who have not prepared. ---------------------------
JB Williams

"If there must be trouble, let it be in my day, that my child may have peace." - Thomas Paine, The American Crisis, No. 1, December 19, 1776

National Debt Clock