Thursday, January 08, 2009


The budget that Barack Obama is inheriting includes a $1.2 trillion deficit. That means that the government will have to borrow over a trillion dollars more than its income. This does not include Obama's stimulus plan which is usually described as $800 billion (for a total deficit of an even two trillion) but he admits that the upper end of the stimulus could be more like $1.3 trillion. That means a deficit of $2.5 trillion.

Obama insists that without his stimulus the economy will never recover. I don't know about that but the size of the numbers being tossed around just make me feel queasy.

Congress is balking at the tax cut portion of the stimulus which could bring the total cost down a bit. But maybe not since we are talking about Congress. More likely they will just spend the money elsewhere.

Obama insists that earmarks will not be allowed. The Democrats said the same thing when they took over Congress after the 2006 election. So far their track record hasn't been very good.

And none of this includes the trillion dollars of bail-out money that a few states have requested. That brings the grand total to 3.5 trillion dollars.

The national debt (the total amount that the US government owes on all borrowing since the country was founded) is currently around $10.5 trillion. Obama could double that in his first term.

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