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shotgunner · 02-15-2009, 10:50 AM

Here's an uplifting article

Federal obligations exceed world GDP

FinanceDude · 02-18-2009, 08:15 AM

Quote:

Originally Posted by shotgunner

Here's an uplifting article

Federal obligations exceed world GDP

He's a real cheery guy, huh? This kind of articles are skewed to give a doomsday scenario.

Let's face it, the federal government has NEVER followed GAAP......

Exxon doesn't have to provide social programs to the general populace............

OAG · 02-18-2009, 08:27 AM

Using either method the National Debt has DOUBLED in the last approximate 10 years. Personally I would not want a mortgage to do that. I wonder how many people in the USA has done EXACTLY that with their personal DEBT LOAD - Guess we will know when all of the BAIL-OUTS are finished.

Independent · 02-18-2009, 08:55 AM

Remember that the $65 trillion is a present value over a 75 year time horizon. The PV of the GDP over the same period is about $768 trillion. So the deficit is 8.5% of GDP.

That is a big number and we should be looking to eliminate it, but comparing to a snapshot of world GDP isn't very relevant. OAG is correct in saying that the real concern is the trend line - things are getting worse instead of better.

Much of the shortfall is in Medicare, and much of the projected Medicare problem comes from the assumption that medical costs will grow faster than the GDP. The biggest single thing we can do to reduce the $65 trillion is to find a way to reduce US medical costs. This ought to be possible, we spend more than other rich countries and we don't seem to live a lot longer or a lot healthier.