Obama and the Debt Continued

Total Revenues and Outlays as a Percentage of Gross Domestic Product in CBO's Baseline and the President's Budget

Just wonderful and to think people were wondering about insolvency, one of the more striking data points is that according to the CBO budget the President will never have a deficit less then 633 billion dollars (in 2012) As for Obama and the Debt, the tea parties continue to be vindicated.

The results of CBO’s updated analysis are similar to those released in March. CBO now estimates a 10-year deficit of $9.1 trillion under the President’s policies—about $130 billion lower than it estimated three months ago (a difference of about 1.4 percent of the cumulative deficit over the period). That difference reflects the details of the proposals and some technical changes in CBO’s estimates of the proposals. As with the March report, this analysis incorporates revenue estimates from the Joint Committee on Taxation (JCT). CBO has not updated its baseline budget projections or its economic forecast since the preliminary analysis of the President’s budget was released in March.

CBO’s and the Administration’s estimates of the President’s policies are very similar for 2009, but CBO’s estimate of the deficit over the next 10 years is $2 trillion higher. Most of that gap results from underlying differences in the two baselines.Under the president’s policies, the deficit in 2009 would total $1.8 trillion and equal 13.0 percent of gross domestic product (GDP), CBO estimates. In 2010, the deficit would measure 9.9 percent of GDP, or $1.4 trillion, CBO estimates. The cumulative deficit over the 2010–2019 period would equal $9.1 trillion (5.2 percent of GDP), more than double the cumulative deficit projected under the current-law assumptions embodied in CBO’s March baseline. As a result, debt held by the public would rise from 57 percent of GDP in 2009 to 82 percent of GDP by 2019.

Debt Held by the Public, 1965 to 2019 (Percentage of GDP)

Th debt held by the public is another happy affect of the president's policies, most importnatley

Outlays under the President’s policies would fall as a percentage of GDP over the next few years, from 28.5 percent in 2009 to 22.6 percent in 2012, after which they would begin rising largely because of climbing health care spending and increasing debt-service costs, reaching 24.5 percent in 2019—well above the average of 20.7 percent over the past 40 years. Those figures are virtually unchanged from what CBO estimated under the President’s initial budget request in March.

Often left out the President's absurd savings claims is that by spending trillions now we end in a worst fiscal even if his ideas panned out, which there is little evidence to suggest they will. As for revenue it will not come even close to matching the spending, and the CBO is assuming a significant amount pf the Bush Tax Cuts will not be renewed.