Wednesday, October 03, 2007

Congratulations, Your Credit Limit is Raised

I’m sure the Party of Government, those Republicans and Democrats with primary and possibly exclusive loyalty to their own reelection, just don’t care how much the financial irresponsibility of the present harms the future. Hell, the government owns the money printing presses. The Heritage Foundation looks at our congressional representative’s latest weaseling out of the hard adult decisions by increasing our credit card limit.

Increasing the National Debt Limit: In a flurry of business to close out the fiscal year, Congress raised the debt limit by $850 billion to $9.815 trillion. Without this move, the federal government's credit card would have maxed out on October 1 with an outstanding balance of $9 trillion. This staggering amount, also known as the national debt, is equal to $29,700 per American or $78,680 per household.

The total debt has two parts. The first part is debt held by the public, which is owed to individuals, corporations, the Federal Reserve, and state, local, and foreign governments that purchase bonds and other Treasury Securities. The public debt makes up $5.1 trillion of the overall debt. The second part is debt held by the government, which represents money that was borrowed by the government from surpluses in the Social Security Trust Fund and other government accounts. Government debt makes up the remaining $3.9 trillion of the total national debt.

I do admire this hubris. The government has an IOU for $3.9 trillion dollars it borrows from itself. It is ok to try this at home. Simply grab a piece of paper and write I owe myself $3.9 trillion dollars. Do you feel rich now? Time for the baby boomers to make their peace with inflation because there ain’t no real assets invested to pay the upcoming entitlement bills. I wonder how long it takes to print out 10 Trillion intricately designed counterfeit resistant pieces of fancy paper.