But much more important is the steep upward trajectory of our long-term debt ”“ which remains as dangerous as ever. In its latest long-term outlook, released in June, CBO projected that the federal debt will climb to 141 percent of GDP by 2046 ”“ by far the highest level on record.
Tick, tick, tick.
Our debt situation is among the worst in the world. (It’s actually at 104% of GDP, not around 75% as shown by the Jake Tapper CNN video–see the CNN Money/Peterson video at the bottom of the article–although other sources have it as high as 114%.) If you start measuring the ratio between debt and government tax revenue the situation is even worse than set forth in the linked article. Under that measure, our economy is in the third worst shape in the world, better than Japan and Greece but we are in worse financial shape than Iceland (which was devastated by the 2008 financial collapse because the country was heavily invested in bad U.S. securities), Italy or Portugal.
And this is before taking Social Security and other entitlements into account. If you subtract out the tax income that should be going to Social Security but is not, we are in worse economic shape than Greece.
You hear nothing about this although the effects are all around you in terms of things like crumbling infrastructure, economic malaise, homelessness and real unemployment (people that are actually out of work, not the manipulated “unemployment rate”). Right now the situation is being masked by interest rates being artificially kept at zero percent (although that also means no one can make anything by returns on investment other than by speculation), but that has to change at some point.
http://www.forbes.com/sites/jeffreydorfman/2014/07/12/forget-debt-as-a-percent-of-gdp-its-really-much-worse/#6d300cf36e0c
We are in a real mess. And yet the president will tell you with a straight face what a great economy we have.