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Obama: Trillion-Dollar Deficits 'for Years to Come'

After meeting with his economic team earlier today, President-elect Barak Obama predicted this afternoon that the United States would have trillion-dollar budget deficits "for years to come."

Obama said that Peter Orszag, Obama's choice to head the Office of Management and Budget, forcasted that the United States would have a budget deficit of $1 trillion "even before we start the next budget."

"We have already, that we are already looking, at a trillion dollar budget deficit or close to a trillion dollar budget deficit," Obama said. "And that potentially we've got trillion dollar deficits for years to come even with the economic recovery that we are working on at this point."

Nonetheless, Obama said, "We are going to have to spend money to jump-start the economy."

The president-elect has proposed a jobs-heavy economic stimulus plan that could range in cost from $850 billion to $1 trillion.

The national debt -- which now stands at $10.6 trillion -- is the sum of all federal deficits since the founding of the United States.

Currently, it is about 73 percent of U.S. gross domestic product, not an overly worrisome figure, most economists agree. But some, such as former U.S. comptroller David Walker, have argued that without significant reform of Social Security and medical entitlement programs as the Baby Boomers move on to the federal dole, the national debt could be as much as 200 times GDP in a matter of years, which many say could lead to political instability.

-- Frank Ahrens
The Ticker is Twittering!

By Frank Ahrens  |  January 6, 2009; 3:12 PM ET
Categories:  The Ticker  | Tags: Obama, budget deficit, national debt  
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Comments

AH HAH, what was suggested during the campaign and pooh poo'd by the OBAMA supporters will be a fact of life for the next decade and a burden for future generations.

OBAMA is using our money and credit to solve a crisis brought on by the liberalization of housing and other credit by the Democrat's party..and buying our way out of recession with massive debt.

Thanks OBIE!...you are so intelligent!!!

Posted by: poppadata | January 6, 2009 4:34 PM | Report abuse

This shouldn't be a surprise so, for sure, Wall Street shouldn't go into shock because Obama always has meant mega-spending and deficits. However, what no-one seems to realise is that for investors (including foreign) to absorb the huge amount of paper, yields will have to rise significantly to, say, Carter Era levels. The implications for Americans' cost of living are dire, just what they need given the current atmosphere. T Bone Pickins' $250/bbl oil vision seems much more likely now.

Posted by: HassanAliAl-Hadoodi | January 6, 2009 4:41 PM | Report abuse

The FAT CATS on Wall Street are MEOWING at you!

They want more CAT CHOW.

More money! You the taxpayer must give them MORE MONEY!

The FAT CATS are like junkies!

They are soooo hunnnngry!

Meow! Meow!

They won't ever shut up until you feed them!

FAT CATS are starving at their luxury resort vacations! They want more food!

You are a taxpayer! You must FEED the FAT CATS.

Meow! MEOW!

Posted by: Bitter_Bill | January 6, 2009 4:45 PM | Report abuse

$10.6 TRILLION of debt is not worrisome?

Just one simple question:
What exactly is the plan to pay this money back?
They ARE planning to pay it back, aren't they?
If I borrow without a play to pay back, it's called stealing.

Folks, this isn't rocket science here. Whenever anybody suggests "don't worry about paying for it", you -should- worry...you should worry VERY much!

You can't make something out of nothing, no matter what some politician (or political economist) tells you, any more than water can flow uphill.

We got here in large part because of "creative" accounting, and slick talkers saying how great things were.

Those who ignore the mistakes of the past are bound to repeat them, and we're letting them do it to us again.

Posted by: hziemba | January 6, 2009 4:48 PM | Report abuse

People get over Obama did not make this mess by himself the current Administration put us in the situation.

Posted by: dbarnes1 | January 6, 2009 4:58 PM | Report abuse

People get over it Obama did not make this mess by himself the current Administration put us in the situation.

Posted by: dbarnes1 | January 6, 2009 4:59 PM | Report abuse

Hey poppa what the heck? Who the heck has been in power for the last 8 years? Who the heck spent, what 5 or 6 or 7 trillion dollars. Lets see it couldn't have been Bush and the Neo-Cons? No way like Reagan Neo-Cons never do anything wrong must have been someone else!

Posted by: Shediac | January 6, 2009 5:00 PM | Report abuse

Thank BushCo for sending a trillion to Baghdad (no questions asked) and hundreds of billions to Wall Street (no questions asked). Now of course they will complain and point fingers about the spending needed to clean up their mess. But it's all the Democrats' fault, yeah right. Was there ever a bigger bunch of lying criminals than the Bush Syndicate?

Posted by: hairguy01 | January 6, 2009 5:00 PM | Report abuse

Quite an understatement in the last line.

$10.6 Trillion national debt is 73% of GNP means GNP is about $15 Trillion.

Future national debt estimated to be 200 times GNP is $3,000 Trillion (or about $10,000,000 for each citizen).

Could lead to political instability indeed.

Perhaps David Walker said 200% of GNP?

Posted by: SIrving1 | January 6, 2009 5:05 PM | Report abuse

We wonder why we are 10.6 trillion in debt. We spend 550 billion a year on national defense. We should prioritize better. We have a mere 30 billion dollar annual shortfall to END WORLD HUNGER.

The Borgen Project has some good info on the cost of addressing global poverty.

Posted by: willborgenproject | January 6, 2009 5:08 PM | Report abuse

>

Hey Ahrends you idiot, they are not going on the dole, which is a British term for welfare, they are collecting what they contributed to. Look to the real welfare to the SOBs on Wall Street to see the real dole...

Posted by: Bill22042 | January 6, 2009 5:34 PM | Report abuse

So let me get this straight: The GOP and Bush waste 7 trillion dollars...and it is Obama's fault?

Posted by: maurban | January 6, 2009 5:41 PM | Report abuse

O'Neill said he tried to warn Vice President Dick Cheney that growing budget deficits-expected to top $500 billion this fiscal year alone-posed a threat to the economy. Cheney cut him off. "You know, Paul, Reagan proved DEFICITS DON'T MATTER," (emphasis mine) he said, according to excerpts. Cheney continued: "We won the midterms (congressional elections). This is our due." A month later, Cheney told the Treasury secretary he was fired.

Posted by: dijoe33 | January 6, 2009 5:41 PM | Report abuse

People need to get past abstract numbers and look at the real goods and services. The near term stimulus is not a big problem because it involves using excess capacity and keeping people working. Social Security may needs some adjustments. But as a society we should be able to provide seniors with basic food and housing. Medicare is another story. Some difficult choices are likely to be needed because there is only so much that a society can afford to spend on health care and it is likely both because of the increase in the older population and in the appearance of new expensive forms of treatment that we are going to bump up against the limits. Obama's plans for universal health care could also run into a problem. If the people are not available to provide the care, no amount of deficit is going to pay for them. On the other hand, if we can solve the problem of affordable energy and continue to improve our skill at automation, we might have the resources to sustain people with reasonable comfort.

Posted by: dnjake | January 6, 2009 5:43 PM | Report abuse

Make no mistake about it, this crisis started with the Iraq war and out-of-control defense and military spending. Half our federal taxes are being funneled into this nonsense now. We could gut the Pentagon by $300 billion a year, bring the troops home and close the overseas bases. America would be safer and we would be on our way to balancing our budget.

Posted by: sofla | January 6, 2009 5:49 PM | Report abuse

Wasn't it Reagan who said deficits don't matter? Reagan left office with a $5+ TRILLION DOLLAR DEBT.
cheney repeated Reagan's nonsense and he and shrub added another $5+ TRILLION DOLLAR$ to the debt.
Republican's have been trying to bankrupt the country for 30 years now they want us to work for wal-mart wages and wal-mart benefits.
Heck of a job republicans!!!

Posted by: knjincvc | January 6, 2009 7:27 PM | Report abuse

"Make no mistake about it, this crisis started with the Iraq war and out-of-control defense and military spending. Half our federal taxes are being funneled into this nonsense now. We could gut the Pentagon by $300 billion a year, bring the troops home and close the overseas bases. America would be safer and we would be on our way to balancing our budget.

Posted by: sofla | January 6, 2009 5:49 PM"

Hogwash!

Sub prime lending by pandering Democrats and failure to pay debts by irresponsible buyers, coupled with greedy Financial firms and crooked CEOs caused this problem. Don't try to blame our national defense needs for the massive failures of the left.

Posted by: rplat | January 6, 2009 7:30 PM | Report abuse

The Federal deficit will explode under Obama.

Posted by: brewstercounty | January 6, 2009 7:36 PM | Report abuse

"Don't try to blame our national defense needs for the massive failures of the left."

Soooo ..... flushing $4BILLION DOLLAR$ A MONTH DOWN A TOILET IN IRAQ is good?

Armchair chicken hawk generals are going to spit when they realize wasteful defense expenditures are going to be cut. USA needs boots on the ground not high tech planes and high tech ships.

Posted by: knjincvc | January 6, 2009 7:43 PM | Report abuse

What will 20 million illegal aliens do with $500 each - stimulate the US economy?

Nope, they will send it to Mexcio and El Salvador and America's grand children will pay for it.

Posted by: Patriot12 | January 6, 2009 7:49 PM | Report abuse

As long as their are good paying jobs that's fine
but to save our entire health system illegal aliens must return to their country of origin with their families
otherwise the remaining hospitals in America will go bankrupt
and shut down. That's the beginning of the return to the way America was.

It would also clear out half our prisons which are paid for by tax payer dollars.

We need a research and development program for promising startups paid for by the government so problems are tackled by different approaches and those that make progress get funding.

Posted by: blakesouthwood | January 6, 2009 8:01 PM | Report abuse

Hey, deficits don't matter according to Cheney. So let's tax the heck out of Cheney and GWB to get the United States back where it was when GWB took office, namely with a surplus.

Posted by: brwntrt | January 6, 2009 8:05 PM | Report abuse

This is new and this is change--change for the worse. I expected that he would have announced sweeping spending CUTS. Where are all the new ideas and fresh policies? I guess this is what one gets when a guy with no experience and no track record for doing anything gets elected.

Posted by: plhare | January 6, 2009 8:27 PM | Report abuse

The Democrats created this huge debt problem!? That's such a patently dishonest, corrupt and offensive assertion, I'm not even going to address it.

Posted by: ebdavies1 | January 6, 2009 8:39 PM | Report abuse

plhare wrote:
"I guess this is what one gets when a guy with no experience and no track record for doing anything gets elected."

You're right, it was amazing that someone like George W. Bush -- someone who had no experience in government, and had never accomplished even ONE SINGLE THING IN HIS ENTIRE LIFE (not even ONE THING!!!) -- could get elected president. It is clearly the most outrageous thing that has EVER happened in this country.

The guy was a pampered and spoiled punk his entire life; was a drunk until the age of 40, bankrupted several companies (financed by his father, and Osama bin Laden's father), never made a cent on his own in his entire life ... so he was elected Governor of Texas!? (Texas, the cesspool of the country). Then sponsored by the corporations/republicans for one reason; to loot the American treasury -- and he succeeded.

So, tough luck to you guys who don't have the rock-solid investments I have.

[Free tip: by gold and silver, and buy it now!!!]

Posted by: ebdavies1 | January 6, 2009 8:53 PM | Report abuse

Posted by: plhare | January 6, 2009 8:27 PM
"This is new and this is change--change for the worse. I expected that he would have announced sweeping spending CUTS. Where are all the new ideas and fresh policies? I guess this is what one gets when a guy with no experience and no track record for doing anything gets elected."

More white wing hate radio talking points!
All of your comments should have been made when neo-con's (deficits don't matter) selected shrub as their stealth dup to run as a compassionate pseudo conservative republican.
You were all suckered and hate like heck to admit you voted for him twice!!!
They call him W so he can spell it!!

Posted by: knjincvc | January 6, 2009 9:18 PM | Report abuse

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