[VIDEO] Budget Office: US Debt Picture Has 'Worsened Dramatically'

Congress' budget office again warned that the U.S. faces a massive debt problem Tuesday, using stark language to describe the government's long-term mismatch between spending and revenues even as it slightly upgraded its projections for debt over the next 25 years.

"The long-term outlook for the federal budget has worsened dramatically over the past several years, in the wake of the 2007-2009 recession and slow recovery," the Congressional Budget Office reported in its long-term budget outlook for 2015 released Tuesday.

RELATED: House defies veto threat, passes defense spending bill

The Budget Office, a nonpartisan in-house think tank for Congress, projected that the federal debt is set to rise from 74 percent of economic output today to 103 percent by 2040, driven by spending on government healthcare and retirement programs and interest payments on the debt.

The projection issued Tuesday, which is subject to significant uncertainty, is a slight improvement from last year, when the budget office estimated that debt would hit 106 percent by 2039. The outlook has gotten brighter, if only trivially, because financial markets now expect lower interest rates in the future, which will lower the cost of servicing the debt for the Treasury.

The budget office warned that debt would still be growing in 2040. It also could be nearly twice as large by 2040 as in the baseline estimate if a more realistic guess about how Congress will act in the years ahead and the economic feedback from higher debt placing a drag on economic growth are taken into account.

RELATED: Dems demand budget summit with GOP

Although the long-term budget picture is dark thanks to the anticipated costs of the Baby Boom generation retiring, the federal debt is anticipated to decline for the next few years, thanks partly to spending cuts and tax increases imposed by Congress in recent years.

But the larger development is the government dedicated more and more tax dollars to entitlement and healthcare programs.

Spending on Social Security, Medicare, Medicaid, Obamacare subsidies and other healthcare programs will rise from an average 6.5 percent of gross domestic product over the past 50 years to 14.2 percent of GDP by 2040.

Via: Washington Examiner

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Best of The Week 2/21/14

It’s a look at the stories that have made the CNSNews.com Best of The Week.

Bulking Up on Bullets

The government accountability office has released a report that shows that the Department of Homeland Security has contracted to purchase over 704 million rounds of ammunition over the next four years, which is equal to a total of about 2,500 rounds per DHS agent per year.

The report claims the ammunition is for training and qualifying agents.

Pack of Problems

Qualified animal agents may be needed in Arizona. Stray packs of Chihuahuas are reportedly roaming the streets of some Arizona communities ready to snarl and yap at anyone who is unfortunate enough to cross their path.

Double the Marketable Debt

Scarier than a pack of Chihuahuas is the marketable debt of the U.S. government doubling.

The marketable debt of the U.S. has climbed by 106 percent while President Barack Obama has been in office, increasing from over $5 trillion at the end of January 2009 to over $11 trillion at the end of January 2014, according to the U.S. Treasury.

The marketable debt of the U.S. government includes all debt securities sold by the U.S. Treasury that can be held by individuals, corporations or other entities outside the U.S. government and that can be sold in the secondary market.

Via: CNS News
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CHART: WHO DOES THE U.S. GOV’T OWE $17 TRILLION TO?

The U.S. government owes a lot of money.

A lot.

In fact, U.S. debt today stands at about $17 trillion.

Obviously, that’s a little difficult to understand with just words.

So here to help you visualize the debt situation in the U.S. — and help you understand where money is owed — is a helpful chart from National Public Radio:

National Public Radio

Here are some key takeaways [as presented by Business Insider]:

• We owe most of the money to ourselves.
• We owe a big chunk of the money — about $6 trillion — to the Federal government. So if there ever were a default (hopefully there won’t be) the government would also be stiffing itself.
• We owe about $5 trillion to other countries, including China.
• The total debt to China is only $1.3 trillion. So we’re not in hock to China as much as some people think we are.
• Yes, it’s a boatload of debt. But the experience of Japan, the U.S. after World War 2, and other countries, suggests that it’s a manageable amount, as long as we eventually get our long-term entitlement spending under control.

Click here to read the full NRP article on the U.S.’ debt load.

Via: The Blaze

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Stocks spike 2%, log 2nd best gains of 2013 amid debt deal hopes; Dow skyrockets 300 points

Stocks closed out the session with a sharp bang Thursday, with major averages rallying more than 2 percent across the board, as lawmakers seemed to move closer to a deal to resolve the political stalemate in Washington.

Major averages logged their second-best gains this year.

(Read more: Government standoff shakes trust in US debt)

"No one's going to get in the way of this move—we've been up more than 200 points all day so you're going to be hard pressed to find someone on the other side of the trade," said Art Hogan, managing director of Lazard Capital Markets. "This is clearly the light at the end of the tunnel that everyone wants."

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Stocks have 2nd best day of the year

CNBC's Bob Pisani looks at the day's market action after the closing bell. Materials and financials are among the sectors up more than 2 percent today.

	Name	Price		Change	%Change
DJIA	Dow Jones Industrial Average	15126.07		323.09	2.18%
S&P 500	S&P 500 Index	1692.56		36.16	2.18%
NASDAQ	Nasdaq Composite Index	3760.75		82.97	2.26%

The Dow Jones Industrial Average catapulted 323.09 points, or 2.18 percent, to close at 15,126.07. All 30 components in positive territory, propelled by Boeing and UnitedHealth.

Via: CNBC

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