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Please explain this - liberal or conservative

Cowpuncher

Well-known member
Everyone says that the Clinton years were remarkable in that budget surpluses were common. The following table shows the balance of the national debt at the end of each fiscal year from 1950 through 2005.
If you look at the numbers, only two years show the debt declining - 1951 and 1960.

It seems to me that if there were years of large surpluses in the 1990's when Clinton was president, the national debt would have declined. No so,
the debt increased from 3.665 trillion in September, 1991 to 5.656 trillion 8 years later.



Date Amount

09/30/2005 $7,932,709,661,723.50
09/30/2004 $7,379,052,696,330.32
09/30/2003 $6,783,231,062,743.62
09/30/2002 $6,228,235,965,597.16
09/30/2001 $5,807,463,412,200.06
09/30/2000 $5,674,178,209,886.86
09/30/1999 5,656,270,901,615.43
09/30/1998 5,526,193,008,897.62
09/30/1997 5,413,146,011,397.34
09/30/1996 5,224,810,939,135.73
09/29/1995 4,973,982,900,709.39
09/30/1994 4,692,749,910,013.32
09/30/1993 4,411,488,883,139.38
09/30/1992 4,064,620,655,521.66
09/30/1991 3,665,303,351,697.03
09/28/1990 3,233,313,451,777.25
09/29/1989 2,857,430,960,187.32
09/30/1988 2,602,337,712,041.16
09/30/1987 2,350,276,890,953.00
09/30/1986 2,125,302,616,658.42
12/31/1985 1,945,941,616,459.88
12/31/1984 1,662,966,000,000.00 *
12/31/1983 1,410,702,000,000.00 *
12/31/1982 1,197,073,000,000.00 *
12/31/1981 1,028,729,000,000.00 *
12/31/1980 930,210,000,000.00 *
12/31/1979 845,116,000,000.00 *
12/29/1978 789,207,000,000.00 *
12/30/1977 718,943,000,000.00 *
12/31/1976 653,544,000,000.00 *
12/31/1975 576,649,000,000.00 *
12/31/1974 492,665,000,000.00 *
12/31/1973 469,898,039,554.70
12/29/1972 449,298,066,119.00
12/31/1971 424,130,961,959.95
12/31/1970 389,158,403,690.26
12/31/1969 368,225,581,254.41
12/31/1968 358,028,625,002.91
12/29/1967 344,663,009,745.18
12/30/1966 329,319,249,366.68
12/31/1965 320,904,110,042.04
12/31/1964 317,940,472,718.38
12/31/1963 309,346,845,059.17
12/31/1962 303,470,080,489.27
12/29/1961 296,168,761,214.92
12/30/1960 290,216,815,241.68
12/31/1959 290,797,771,717.63
12/31/1958 282,922,423,583.87
12/31/1957 274,897,784,290.72
12/31/1956 276,627,527,996.11
12/30/1955 280,768,553,188.96
12/31/1954 278,749,814,391.33
12/31/1953 275,168,120,129.39
06/30/1953 266,071,061,638.57
06/30/1952 259,105,178,785.43
06/29/1951 255,221,976,814.93
06/30/1950 257,357,352,351.04



I guess I don't understand why the debt didn't decline with all those surpluses.

Gosh, I sure hope they are not lying to us!!!!!!! :shock:
 

jigs

Well-known member
simple explanation...it is called siphoning off the profit. the crooked fool robbed us blind!!!! we were so upset over him using one hand to hold Monicas head, that we never saw the other one in the cash register !!!

the man was a brilliant crook, I gotta hand it to him.
 

sw

Well-known member
Besides paying for the dry cleaner bills, we got wolves, about 16 million, locked up lands, the Missouri River, Grand Escalante, all of the national forests, that no longer produce income but require beaurocrates to run them at a loss, a billion dollar lawyer bill fighting the TNC and the other enviro groups, only to concede to them in the end. Gee I forgot how good we had it then. Silly me :oops:
 

Cowpuncher

Well-known member
The numbers are from the U S Department of Treasury.

http://www.publicdebt.treas.gov/opd/opd.htm

I think that a good part of the discrepancy is due to money being appropriated in one fiscal year and spent later. I did expect that there would be an acutual decline in a few years, however.

In any case, it doesn't generate a great amount of comfort.

What one has to do is to arrange his affairs so that you take advantage of inflation rather than suffer from it.
 

Steve

Well-known member
Everyone says that the Clinton years were remarkable in that budget surpluses were common.

actually it seems only liberals stand by that claim...

The rest of saw right thru thier numbers game.....
 

aplusmnt

Well-known member
Clinton was so good at illusions. But then when you have the powers of the Liberal Media behind you it might not be that hard versus the Powers of the Liberal Media Microscope on you as Bush does now.

Raising the debt ceiling is nothing new. We last raised it during the Clinton era, despite that administration's claims that the budget was balanced each year. This can be refuted quite simply, because the national debt continued to rise throughout the 1990s. Obviously, if federal spending truly was being outpaced by revenues, the debt would not have increased. So how did the Clinton administration make it appear that annual spending did not exceed annual revenues? Mostly by using Social Security revenues to cover the difference, even though Social Security taxes are supposed to be held in a trust fund and not spent on other federal programs. Yet few Americans know that their Social Security taxes are never segregated or saved by the federal government, but rather spent immediately as general funds. Your Social Security benefits are nothing more than IOUs that are completely dependent on future revenues
 

Econ101

Well-known member
Cowpuncher said:
The numbers are from the U S Department of Treasury.

http://www.publicdebt.treas.gov/opd/opd.htm

I think that a good part of the discrepancy is due to money being appropriated in one fiscal year and spent later. I did expect that there would be an acutual decline in a few years, however.

In any case, it doesn't generate a great amount of comfort.

What one has to do is to arrange his affairs so that you take advantage of inflation rather than suffer from it.

I would agree. "Deficit" has many meanings---at least by politicians trying to lie to us. It is important to note that our current deficit does not include spending on the war after a decree by Pres. Bush. They are cooking the books for sure. Backed by the full faith and credit of the American people. It was Enron who learned from them, not the other way around.

Senator Phil Gramm's (Dem-Texas then Rep-Texas) wife was on the board of Enron. That is the real reason he didn't or couldn't run for Senator again and retired. Gramm was an economics prof. at Texas A&M. His wife Wendy was too. Wendy was also on the board of IBP during the Pickett fraud on the feeder market. They knew what they were doing on those boards and knew what they were doing to the country. Gramm's wife was also on the Commodities board.

Wendy Gramm went to the hotty totty private school with Hilary Clinton.
 
A

Anonymous

Guest
Cowpuncher said:
The numbers are from the U S Department of Treasury.

http://www.publicdebt.treas.gov/opd/opd.htm

I think that a good part of the discrepancy is due to money being appropriated in one fiscal year and spent later. I did expect that there would be an acutual decline in a few years, however.

In any case, it doesn't generate a great amount of comfort.

What one has to do is to arrange his affairs so that you take advantage of inflation rather than suffer from it.

There is another set of figures coming out of the government that need to be taken with a grain of salt-- inflation figures...

I don't know where they are looking when they keep saying for the last few years that there is little or no inflation-- ain't what the folks on the street around here are seeing or saying...
Not with gas/fuel/heating costs going up over 100% in one year- with all products rising accordingly due to shipping costs...Maybe its because we're so isolated with no local manufacturing/production and everything has to shipped in from far distances that we see it more here-- but everything has risen- food, clothing, machinery, lumber, etc. etc....

Several of us were shipping cattle the other day, and were looking at and comparing different restaurant prices - where all meals have gone up $1-$2-$3 a meal in the last year, with some going up much more than that...And the poor old retired guys that like to slip into the water hole for a beer (not me, I drink whiskey) and play whist got a double whammy- the breweries raised their prices, and then the distributors added on a surcharge because of the trucking cost....

Makes you wonder who you can trust anymore....
 

Econ101

Well-known member
Here is a graph of the debt:

http://www.data360.org/graph_group.aspx?Graph_Group_Id=32

Here are a few definitions:

http://eh.net/encyclopedia/article/noll.publicdebt

I think the confusion comes with the definition of the deficit. The deficit is generally defined as government spending over what it brings in. Unfortunately, some time ago, the government included the SS tax income with the overall deficit numbers. This means that when there is a surplus in the SS taxes, it just goes into the general fund and gets taken off of the deficit spending. The liability is still there, although it is a paper liability where the government owes itself. This also means that surplus social security funds are really spent as part of the overall revenues. SS taxes are therefore funding things other than SS liabilities.

The debt figures you posted probably separated the SS debt out to get the true debt that is owed, even to the SS system.

As you can tell, we have been lied to about SS and the Congress has raided the fund. All that is left is a paper trail of U.S. treasuries the government owes to itself.

Without this accounting, the real deficit would have still been there during the Clinton years. He benefited from the SS surplus decreasing the debt. The encouraging thing under Clinton was that government spending seemed to taken seriously by our elected officials and they decreased its rate of growth. The stock market responded to this decrease in the govt's part of the economic pie and increased because of those policies. It hasn't under Bush in real, inflation adjusted terms and in inflation adjusted terms has really gone down.

Government can pay its debts in a couple ways. One is it can borrow (U.S. treasuries) another is that it can print money (we do this indirectly in a complicated way).

"Any deficit must, ultimately, be repaid, either through taxation, or seignorage. The Ricardian equivalence hypothesis states that this means a public deficit is exactly the same as a tax rise."

You are right that inflation is a problem and it is directly related to monetary policy (how much money printed to pay for deficits or made up relative to the goods produced).

If there was no more money made or printed, we would probably have deflation (not a good thing for the economy and we got off the gold standard because of it).

Inflation eats away at what you are able to buy because there is more money out there relative to the goods available. An easy money policy can and often does lead to inflation. A tight money policy will lead to less inflation. These are just terms that we apply to how much money the government allows to be out there and what their stance is on monetary policy.

Deficit spending can be useful in an economy especially when the velocity (how fast money is used in the economy) is hampered because of exogenous events like stock market swings and wars. In these instances, the velocity of money usually decreases because people are scared and hold onto their money. Spending money by the government can get the economy kick started and infuse money in the economy. It should be decreased when people start spending their money again. Most of the time the govt. incurs more debt during these times (buying back their own securities) and thus infuse more money in the economy instead of spending more money themselves.

The equation for the money supply is:

Monetary exchange equation

Money supply is important because it is linked to inflation by the "monetary exchange equation":

Velocity X Money Supply = Real GDP X GDP deflater

where:

* velocity = the number of times per year that money changes hands (if it is a number it is always simply nominal GDP / money supply)
* real GDP = nominal Gross Domestic Product / GDP deflator
* GDP deflator = measure of inflation. Money supply may be less than or greater than the demand of money in the economy

In other words, if the money supply grows faster than real GDP growth (described as "unproductive debt expansion"), inflation is likely to follow ("inflation is always and everywhere a monetary phenomenon"). This statement must be qualified slightly, due to changes in velocity. While the monetarists presume that velocity is relatively stable, in fact velocity exhibits variability at business-cycle frequencies, so that the velocity equation is not particularly useful as a short run tool. Moreover, in the US, velocity has grown at an average of slightly more than 1% a year between 1959 and 2005.
 

Econ101

Well-known member
The complexity of it is what allows politicians to get away with inflationary fraud. It doesn't fit in a soundbite unless it is way out of control.

In short, all deficit spending is either financed or they print more money to pay for it. If it is financed, it sucks up resources the private sector could use to grow. If they print money for it, we get inflation.

Inflation, as you rightly identified, is the silent tax but so is an increase in interest rates due to over borrowing.

Deficit spending can be helpful at times, but it is way abused by politicians who want to spend more money than they take in (give more of our money than they receive of our money). We all pay for it in the end. It comes as a silent tax, as you have observed.
 

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