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"If at first an idea does not sound absurd, then there is no hope for it." Albert Einstein
"Conventional wisdom often is wrong." Steven D. Levitt and Stephen J. Dubner, Authors of FREAKONOMICS
"To swim against the current of human intuition is a difficult task." Leonard Mlodinow, Author of THE DRUNKARD'S WALK
The measure of an economy is money. A large economy has a larger supply of money than does a small economy. Therefore, to grow an economy requires a growing supply of money. Every form of money is a form of debt. Therefore, a growing economy requires a growing supply of debt.
Who pays for the National Debt? We Do! With our income taxes. The eye-popping $9 trillion gross national debt is owed by the "General Fund." That's the part funded by our income taxes. Half of that goes for the military and to pay interest on the debt.
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National Debt
National Debt as % of GDP. see also: (Source)
In 1981 the gross national debt, compared to the nation's annual income, reached its lowest point since 1931. Despite his claim to hate the debt, Reagan instituted unprecedented peacetime deficit spending.
High inflation allowed Reagan to misstate an inflated-dollar debt as a real growth in debt. On February 5, 1981, two weeks after taking office, in his "Address to the Nation on the Economy," Reagan said:
"By 1960 our national debt stood at $284 billion. ... Today the debt is $934 billion. ... We can leave our children with an unrepayable massive debt and a shattered economy."
But the 1960 debt he indicates was "smaller" was in fact a much larger fraction of our national income — 56.1% of national income in 1960 compared to the 32.5% fraction in 1981.
Source Page #57
This is not partisan politics, this is straight off the White House web site.
As the graph shows, Bush II repeated Reagan's performance and turned the debt upward again. Bush II's own Office of Management and Budget provides all the data.
