The Dog Is Still Not Barking

Debt bombBack on August 3rd, 2019, I posted a piece titled “The Dog that Did Not Bark” on the occasion of the U.S. congress enacting and the president signing a “budget deal” which suspended the statutory limit on the national debt until July 2021.  A few days before, the House defeated an amendment which would have renamed the bill “A bill to kick the can down the road and for other purposes”.  I remarked that neither any of the Democrat presidential hopefuls nor President Trump had mentioned the deficit or the debt in any of their “debates” or rallies.

The only Presidential candidate who was talking about these issues was South Carolina former governor and congressman Mark Sanford, who was attempting a primary challenge to Trump with the debt and deficit as central issues.  On Wednesday, November 12th, Sanford “suspended” his campaign, just 65 days after announcing.  Sanford’s statement said, “I am suspending my race for the Presidency because impeachment has made my goal of making the debt, deficit and spending issue a part of this presidential debate impossible right now. From day one, I was fully aware of how hard it would be to elevate these issues with a sitting president of my own party ignoring them. Impeachment noise has moved what was hard to herculean as nearly everything in Republican party politics is currently viewed through the prism of impeachment.”

Meanwhile, on Halloween, the U.S. national debt blew through the US$ 23 trillion mark (you can watch the debt in real time at the US Debt Clock site).  This stands at more than 106% of GDP.  U.S. fiscal year 2019, which ended on September 30th, closed out with a deficit of US$ 984 billion, an increase of US$ 205 billion (21%) over fiscal year 2018.  In 2019, total receipts by the government were up 4% from the previous year, but expenditures grew by 8.2%, more than twice the increase in income.

With Sanford’s hapless and hopeless campaign at an end, nobody is talking about this ticking bomb.  Instead, Democrats are arguing over whether to spend 32 (Sanders) or 52 (Warren) trillion dollars on “Medicare for all”, 1.6 trillion (Sanders) on eliminating all student debt, or 2 trillion (Harris) on “historically black colleges and universities”.

In a column in the New York Post, Reason editor Matt Welch concludes,

Having one major party at least rhetorically committed to fiscal sanity, with the other at least sporadically impelled to acknowledge math, looks in retrospect like a golden era. With both parties now unmoored, be very afraid of what happens when the music stops.

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Author: John Walker

Founder of Ratburger.org, Autodesk, Inc., and Marinchip Systems. Author of The Hacker's Diet. Creator of www.fourmilab.ch.

3 thoughts on “The Dog Is Still Not Barking”

  1. Federal Reserve Chairman Jerome Powell warned lawmakers Wednesday ….

    Powell suggested such fiscal aid could be vital after the Fed has cut its benchmark interest rate three times this year, leaving the central bank less room to lower rates further in case of a recession.

    “The federal budget is on an unsustainable path, with high and rising debt,” Powell told the Joint Economic Committee. “Over time, this outlook could restrain fiscal policymakers’ willingness or ability to support economic activity during a downturn.”

    Powell also reiterated that the Fed is likely done cutting rates unless the economy heads south.

    The national debt recently surpassed $23 trillion.

    “The debt is growing faster than the economy and that is unsustainable,” Powell said.

    https://www.usatoday.com/story/money/2019/11/13/interest-rates-powell-tells-congress-federal-debt-unsustainable/2582302001/

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