White House Reports it will Borrow 40% of Expenditures in 2010

[carpro]

http://www.cnsnews.com/news/article/53246

Federal Government Will Borrow 40 Percent of the Money It Spends Next Year, Says White House Report

Monday, August 31, 2009
By Matt Cover

President Barack Obama (AP Photo)(CNSNews.com) – According to the Obama administration’s mid-session budget update, the federal government will have to borrow nearly 40 percent of its total expenditures in 2010, a level not seen since World War II.

SNIP

This level of borrowing is unprecedented even during recessions. During the long recession of the 1970’s, federal borrowing never rose above 20 percent of total expenditures despite nearly a decade of sluggish economic growth, high inflation and an international oil crisis.

snip

...The White House thinks growth is going to rebound pretty quickly … which I find unrealistic, given some of the anti-growth policies that are a part of the president’s budget.

“Tax increases, cap-and-trade, health care, all of these are going to harm the economy, and they’re going to reduce the growth rate long-term,” he added.

 

[donnA]

this gets more stupid and unwise all the time.

 

[carpro]

As has been noted, Obama is an economic illiterate. A complete dunce.

 

[OldRegular]

Apparently it is not just next year but the next 10 years!

 

[SeekingTruth]

And this is what people voted for. It seems the change he is bringing is changing the country into a penniless and degenerate third rate country, despised by all.

 

[billwald]

For the last dozen years half of all Americans have been borrowing money for 40% of their expenditures. This is what has caused the latest crash.

How much smarter than the people who elect them can we expect our congress to be?

 

[targus]

For the last dozen years half of all Americans have been borrowing money for 40% of their expenditures. This is what has caused the latest crash.

How much smarter than the people who elect them can we expect our congress to be?

I don't know where you got your 40% figure - I tend to doubt it.

However to make a comparison Americans would have to be borrowing $4 for every $6 that they earn - or an amount of about 67% of their annual earnings.

Then they would have to spend that money on things that will retain no value - not assets that could be resold - just services and perishable things. So that at the end of the year there is nothing left to show for it other than debt.

I don't know anyone that spends like that - other than Obama.

And yes, we should expect more from our elected officials.

 

[billwald]

Add mortgage debt and car loans to credit card debt and I suspect it approaches 40% of many family incomes.
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From http://www.money-zine.com/Financial-Planning/Debt-Consolidation/Credit-Card-Debt-Statistics/

Federal Reserve Debt Statistics

Another good source of credit card and other debt statistics is the Federal Reserve. Current statistics on debt gathered by this US government agency include:

The size of the total consumer debt grew nearly five times in size from 1980 ($355 billion) to 2001 ($1.7 trillion). Consumer debt in 2008 now stands at $2.6 trillion.
The average household in 2008 carried nearly $8,700 in credit card debt.
As of the twelve months ending June 2006, there were 1.5 million consumer bankruptcy filings, including 1.1 million Chapter 7 filings, 0.1 million filings for Chapter 11 and 0.3 million Chapter 13 bankruptcies.

Credit Card Projections

According to latest information gathered by the US Census bureau, there were 164 million credit card holders in the United States in 2005 and that number is projected to grow to 176 million Americans by 2010. These same Americans own approximately 1.4 billion cards - an average of nearly nine credit cards issued per credit card holder.

In addition, Americans charged approximately $2,052 billion dollars to their credit cards in 2005 - that's just over $12,500 in charges each year per cardholder. This information includes all credit card types including bank cards, phone cars, as well as credit cards issued by oil companies and retail store.

Finally, this data tells us that Americans carried approximately 832 billion dollars in credit card debt and that number is expected to grow to a projected 1,091 billion dollars by the year 2010. This works out to approximately $5,000 in credit card debt per cardholder (not household as mentioned in the Federal Reserve statistics mentioned earlier.) And that number is expected to increase to nearly $6,200 by 2010.

 

[targus]

Add mortgage debt and car loans to credit card debt and I suspect it approaches 40% of many family incomes.

At least with a mortgage one is buying a physical asset that one can live in.

All this money borrowed and spent by the government is just that spent - with nothing to show for it at the end other than debt.

BTW - I still doubt your 40% number. In my case it is under 15% for my mortgage and two car payments. I doubt that we are exceptional in that regard.