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Written by The Informed Aussie
Published on Thursday, November 8th, 2012
The current level of debt the United States Government owes stands at over $16.24 trillion.
President Obama, during his 2008 campaign, criticized former President Bush for allowing the national debt to grow to $11 trillion, yet he has done the exact opposite to what he promised.
In fact, President Obama promised that he would reduce (cut) America’s national debt in 2009 by 50% immediately after he was elected within his first term in office.
Four years later, America’s national debt has exploded to $16.24 trillion.
For President Obama to deliver on his 2008 promise, he would have to cut America’s national debt by an astonishing $10.7 trillion dollars.
In reality, to expect the American government to reduce America’s national debt by $2.7 Trillion per year over the next four years is unrealistic considering that America’s national debt has been growing at an appalling $1.55 trillion per year on average since 2008.
THE current debt ceiling, also known as debt limit, is $16.39 trillion. Therefore, at the current rate other growth (Borrowing), it is estimated that the United States Government will fail to meet its debt obligations in just over one and a half months.
At the current rate of growth ($1.55 trillion per year on average), if the American Government’s debt ceiling isn’t lifted before Christmas, then the consequences for the American economy would be dire.
Although the American Government has never failed to repay its debts, lifting the debt ceiling will only further delay the inevitable collapse of the United States economy.
How stupid does Obama and the United States Government think it’s constituents are in believing that the national debt can ever be repaid?
So what could President Obama do to reduce the American national debt? The only obvious solution that the newly elected president could employ is to immediately reduce government spending.
Unbelievably though, for the budget of 2012, the deficit totaled $1.09 trillion, an unsurprising fourth consecutive year that the United States Government deficit has been in excess of $1 trillion.
Therefore, considering that Obama has been in power for more than four years, does he need another four years to change his policies and attitude?
Alternatively, the United States Government could continue to do as it has done in the past to delay reaching the debt ceiling.
ONE unpopular tactic used to delay reaching the debt ceiling is to temporarily remove investments from government employee pension funds. How long this unsustainable practice can continue is unknown.
Therefore, If the United States Congress fails to increase its debt ceiling, an event unprecedented in American history would take place. This potential self-inflicted financial crisis could be more severe than the great depression that began after black Tuesday on October 29, 1929.