IMF: The U.S. has a debt problem

[30ashopper]

Earlier this week, the Bank of England Governor, Mervyn King, irked US authorities by pointing out that even the world?s economic superpower has a major fiscal problem -?even the United States, the world?s largest economy, has a very large fiscal deficit? were his words. They were rather vague, but by happy coincidence the International Monetary Fund has chosen to flesh out the issue today. Unfortunately this is a rather long post with a few chunky tables, but it is worth spending a bit of time with ? the IMF analysis is fascinating.

Its cross-country Fiscal Monitor is not easy reading and is a VERY big pdf (17mb), so I?ve collected a few of the key points. The idea behind the document is to set out how much different countries around the world need to cut their deficits by in the next few years, and the bottom line is it?s going to be big and hard (ie 8.7pc of GDP in deficit cuts around the world, which works out at, gulp, about $4 trillion).

But the really interesting stuff is the detail, and what leaps out again and again is how much of a hill the US has to climb. Exhibit a is the fact that under the Obama administration?s current fiscal plans, the national debt in the US (on a gross basis) will climb to above 100pc of GDP by 2015 ? a far steeper increase than almost any other country.

US faces one of biggest budget crunches in world – IMF – Telegraph Blogs

Change, glorious change.

 

[30ashopper]

Meanwhile, the CBO just came out and said that the health care reform was slated to cost $115 billion more than they said it would. Why? Because they didn't have time to calculate the effects on discretionary spending such as new administrative capacity, demonstration projects, and continuation of successful short-term initiatives. As my fiance notes, Olympia Snowe's demands to slow down the process suddenly seem a lot more reasonable.

Director's Blog ? Blog Archive ? Discretionary Spending in the Final Health Care Legislation

Woops!

 

[30ashopper]

At a House Ways and Means Committee hearing, Rep. Rahm Emanuel (D-Ill.) taunted Treasury Secretary John W. Snow about the rhetorical discrepancies.

"If you're looking for a crisis, I would suggest you look at a crisis that was self-made in just last year, because the crisis exists in what's happened to Medicare by weighing it down," Emanuel said. "Those of us who told you it was going to cost twice as much were right."

Medicare Drug Benefit May Cost $1.2 Trillion (washingtonpost.com)

Oh! The irony!

 

[30ashopper]

Lots of fodder today..

Nanci Pelosi: "Quite your job, slack off, we've got your backs. Just don't forget to vote for us!"

We see it as an entrepreneurial bill, a bill that says to someone, if you want to be creative and be a musician or whatever, you can leave your work, focus on your talent, your skill, your passion, your aspirations because you will have health care.

Hot Air ? Pelosi: Hey, quit your job – we’ll pay for your health coverage!

 

[AlphaCrab]

Hey, go ahead and enjoy your own thread--and don't let anyone stop you.

 

[LuciferSam]

30a, you keep contributing to your own thread and you'll go blind.