US Borrowing Reaches 100% of GDP

We raised the debt limit and feasted on 60% of it in the same day.

The graphic above represents $1 Trillion dollars in $100 bills, stacked on pallets piled two high.

Washington Times:

U.S. debt shot up $239 billion on Tuesday — the largest one-day bump in history — as the government flexed the new borrowing room it earned in this week’s debt-limit increase deal.

The debt subject to the statutory limit shot way past the old cap of $14.294 trillion to hit $14.532 trillion on Tuesday, according to the latest the Treasury Department figures, which are released on the next business day.

That increase puts the government already remarkably close to the new debt limit of $14.694, which means one day’s new borrowing ate up 60 percent of the $400 billion in space Congress granted the president this week.

Yahoo News:

US debt shot up $238 billion to reach 100 percent of gross domestic project after the government’s debt ceiling was lifted, Treasury figures showed Wednesday.

Treasury borrowing jumped Tuesday, the data showed, immediately after President Barack Obama signed into law an increase in the debt ceiling as the country’s spending commitments reached a breaking point and it threatened to default on its debt.

The new borrowing took total public debt to $14.58 trillion, over end-2010 GDP of $14.53 trillion, and putting it in a league with highly indebted countries like Italy and Belgium.

Check out the Memeorandum conversation here and here.

 

  • That those who voted in favor of the so-called Budget Control Act of 2011 claim it is a good first step merely offer ordinary citizens the opportunity to remain apathetic about the single largest crisis in our lifetime.

    The lack of concern demonstrated by ordinary citizens I talk to on a daily basis is only exceeded by the grand failure of elected or appointed officials who downplay the significance of the ‘debt deal’ signed into law by President Obama this week.

    Some commentators suggested most Americans are unable to understand the difference in magnitude of billions versus trillions. The simple explanation is that trillions are 1000 times larger than billions. If you have difficulty wrapping your intellect around that simple fact you have no intellect at all.

    Personal considerations about our nation’s finances have no place in the current debate. That we must, as a nation, confront and solve the problem is a thousand times or more important than it once may have been.

    To maintain the idea that we can continue to postpone rational solutions to this problem defies logic no matter an individual’s inability to grasp the critical nature of the problem.

    For your own sake Americans, wake up and smell the reality. This situation cannot continue with no adverse effect. The crippling effect of government’s inability to correct failing economic policy will harm everyone. Ignoring it is not an answer that will allow our nation to survive.

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