The amount of US debt is already staggering as is our dependence on foreigners to lend us money: $6.4 trillion in public Treasury securities are outstanding now, and 71% of the recent purchases have been by foreigners. So who will buy the new American debt debt required to fund the $10 trillion in projected Obama deficits? Soaking the rich won’t pay the bill. And foreign purchases of sovereign US debt have only been $2 trillion in this decade, so it is difficult to see that foreigners have the ability to pick up the tab (even if they wanted to, which they don’t).

It appears that the $10 trillion bill cannot be paid in a conventional way; something’s got to give. Either spending must be curtailed or the Fed has to monetize the debt by printing money, generating Carter-era malaise (high interest rates, high inflation, tanking dollar), because Obama’s numbers just don’t add up. It’s that simple.

Again: an additional $10 trillion in deficits are projected in the plans of President Obama. In the entire history of the US, $6 trillion in deficits have been incurred, and now an additional $10 trillion are planned in the next few years by Obama, which will almost triple debt outstanding.

This $16 trillion in debt is well over the total $14 trillion GDP of the USA, and adds substantially to the $550,000 debt per person in government debt that currently exists. The press won’t ask hard questions, but someone ought to be questioning — before it is too late — who will buy the debt necessary to fund the ambitions of the Obama administration.

This entry was posted on Wednesday, June 3rd, 2009 at 3:21 am and is filed under business, Democrats, General, Republicans. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.