Monday, August 1, 2011

National Debt – How To Understand It

The Federal Budget Deficit is the amount by which federal spending exceeds federal tax collections in a single year. For example, for the year 2010, the federal government budgeted tax receipts of approximately $2.4 trillion and expenditures of approximately $3.6 trillion, leaving a budget deficit of approximately $1.2 trillion. That means the federal government needs to borrow $1.2 trillion in order to meet all of its projected obligations in 2010.

The National Debt Clock

National Debt by President

The numbers below do NOT reflect the actual National Debt. Instead, they reflect the amount of the INCREASE in the National Debt during each presidential term.

> Ronald Reagan’s First Term – $656 billion increase

> Ronald Reagan’s Second Term – $1.036 trillion increase

> George H.W. Bush’s Term – $1.587 trillion increase

> Bill Clinton’s First Term – $1.122 trillion increase

> Bill Clinton’s Second Term – $418 billion increase

> George W. Bush’s First Term – $1.885 trillion increase

> George W. Bush’s Second Term – $3.014 trillion increase

> Barack Obama’s First “Year” – $1.573 trillion increase

To summarize, the National Debt increased by huge amounts under each of these presidents. The largest increase for a complete term occured during George W. Bush’s second term. The largest increse during a single year occurred during Barack Obama’s first year.

Current Obama administration projections indicate that the National Debt will increase by approximately $6.5 trillion during President Obama’s first term. If that happens, then he will obviously overtake President Bush’s record increase in the National Debt.

National Debt Per Capita

Each U.S. household’s share of the National Debt is just over $105,000.

Each U.S. resident’s share of the National Debt is just over $39,000.

These “per capita debt” figures are just one way of illustrating how serious the National Debt problem is in this country. If you are concerned about the growth in the National Debt, let your Congressman and Senators know how you feel.

What does a trillion dollars look like

The U.S. government spends more than the entire Gross Domestic Product (GDP) of Australia, China and Spain combined. If you laid one dollar bills end to end, you could make a chain that stretches from earth to the moon and back again 200 times before you ran out of dollar bills! One trillion dollars would stretch nearly from the earth to the sun. It would take a military jet flying at the speed of sound, reeling out a roll of dollar bills behind it, 14 years before it reeled out one trillion dollar bills.

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