Oct. 10 (Bloomberg) -- The global financial crisis is turning into a bigger drain on the U.S. federal budget than experts estimated two weeks ago, increasing the deficit and the national debt.
It would be well worth your time to read this exclusive story from Bloomberg. It talks about not just what we've spent so far, but what we're going to spend like it or not. The numbers this comes up with are truly frightening.
For example, take in this quote
The 2009 budget deficit could be close to $2 trillion, or 12.5 percent of gross domestic product, more than twice the record of 6 percent set in a wider lead, according to the CNN/Opinion Research Corporation poll released Monday afternoon,1983, according to David Greenlaw, Morgan Stanley's chief economist. Two weeks ago, budget analysts said the measures might push deficit to as much as $1.5 trillion.
In case you missed it, that's "Trillion" with a big fat "T". Had enough? No? Well chew on this
The additional borrowing could push the national debt well past 70 percent of GDP, the highest since the immediate aftermath of World War II, when the U.S. was still paying off war debt.
This takes into account what we'll be spending on shoring up financial institutions and states who are also destined to suffer. What makes things even worse is that human opportunism is still in high gear during times that call for restraint and sacrifice.
budget watchdogs say the sheer size of the interventions is making Washington more profligate than usual. To attract votes in Congress, leaders added several costly items to the $700 billion rescue, including extensions of some tax credits and tax breaks for makers of wooden arrows and stock-car racetrack owners.
[snip]The rescue legislation ``creates a mask for all sorts of fiscal irresponsibility,'' said Bixby. ``It covers up a multitude of sins.''
Tags: Markets | American | deficit | US Economy | analyst | Financial crisis | Tech & Biz | Bailouts
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