Federal debt limit raised to $9,000,000,000,000

[Friday]

Pretty soon the federal debt will have to be written in scientific notation.   

Thank goodness our taxes are spent on important things like killing Iraqis, again.     

http://www.cnn.com/2006/POLITICS/03/16/congress.debt.ap/index.html

WASHINGTON (AP) -- The Senate voted Thursday to allow the national debt to swell to nearly $9 trillion, preventing a first-ever default on U.S. Treasury notes.

The bill passed by a 52-48 vote. The increase to $9 trillion represents about $30,000 for every man, woman and child in the United States. The bill now goes to President Bush for his signature.

The measure allows the government to pay for the war in Iraq and finance Medicare and other big federal programs without raising taxes. It passed hours before the House was expected to approve another $91 billion to fund the war in Iraq and provide more aid to hurricane victims.

The partisan vote also came as the Senate continued debate on a $2.8 trillion budget blueprint for the upcoming fiscal year that would produce a $359 billion deficit for the fiscal year beginning October 1.

The debt limit will increase by $781 billion. It's the fourth such move -- increasing the debt limit by a total of $3 trillion -- since Bush took office five years ago.

The vote came a day after Treasury Secretary John Snow warned lawmakers that action was "critical to provide certainty to financial markets that the integrity of the obligations of the United States will not be compromised."

On Thursday, Treasury postponed next week's auction of three-month and six-month bills pending Senate action, though the move was likely to be quickly reversed given the Senate's vote.

The present limit on the debt is $8.2 trillion. With the budget deficit expected to approach $400 billion for both this year and next, another increase in the debt limit will almost certainly be required next year.

The debt limit increase is an unhappy necessity -- the alternative would be a disastrous first-ever default on U.S. obligations -- that greatly overshadowed a mostly symbolic, weeklong debate on the GOP's budget resolution.
Democrats blast Bush

Democrats blasted the bill, saying it was needed because of fiscal mismanagement by Bush, who came to office when the government was running record surpluses.

"When it comes to deficits, this president owns all the records," said Minority Leader Harry Reid, D-Nevada. "The three largest deficits in our nation's history have all occurred under this administration's watch."

Only a handful of Republicans spoke in favor of the measure as a mostly empty Senate chamber conducted a brief debate Wednesday evening.

Senate Finance Committee Chairman Charles Grassley, R-Iowa, said Bush's tax cuts account for just 30 percent of the debt limit increases required during his presidency. Revenue losses from a recession and new spending to combat terrorism and for the war in Iraq are also responsible, he said.

As for the $781 billion increase in the debt limit, Grassley said: "It is necessary to preserve the full faith and credit of the federal government."

Before approving the bill, Republicans rejected by a 55-44 vote an amendment by Max Baucus, D-Montana, to mandate a Treasury study on the economic consequences of foreigners holding an increasing portion of the U.S. debt.

At present, foreign countries, central banks and other institutions hold more than one-fourth of the debt, but that percentage is growing rapidly.

Following the debt limit vote Thursday, the Senate was expected to vote late in the day on the budget plan, a nonbinding measure proposing tax and spending guidelines for the next five years.
Specter seeks spending increases

Sen. Arlen Specter, R-Pennsylvania, appears poised to win an increase of $7 billion in new and real funding for education and health research. The $7 billion would effectively be used to break Bush's $873 billion budget cap for 2007, which represents the most significant vestige of fiscal discipline remaining in Senate Budget Committee Chairman Judd Gregg's budget.

The underlying Senate budget plan is notable chiefly for dropping Bush's proposed cuts to Medicare and for abandoning his efforts to expand health savings accounts or pass legislation to make permanent his 2001 tax cut bill.

Unlike last year, when Congress passed a bill trimming $39 billion from the deficit through curbs to Medicaid, Medicare and student loan subsidies, Senate GOP leaders have abandoned plans to pass another round of cuts to so-called mandatory programs.

But Gregg's measure re-ignites last year's battle over allowing oil drilling in Alaska's Arctic National Wildlife Refuge, since it would let Senate leaders bring an ANWR drilling measure to the floor under rules blocking a filibuster by opponents.

Copyright 2006 The Associated Press. All rights reserved.This material may not be published, broadcast, rewritten, or redistributed.

[Kat Kanning]

That's a lotta zeros.   

[Dreepa]

If we send a check for $30K per person in NH to the feds will they let us go?

[Kat Kanning]

Let my people go!

[aries]

I ain't gonna help pay for it.

Bureaucrats dig a hole, they can dig themselves out.

As soon as I get self employed (not for a while), I will never EVER pay any tax. I don't owe someone for working, and I dont really expect to consume any federal services anyway.

[tracysaboe]

This makes me mad. Flippin Angry.

As a 26 year old myself and my generation are the ones you have to pay for this largass.

This is just another indicator that Hyper Inflation is close at hand.

Tracy

[DC]

At $30,000 per person and at 5% interest then each person is paying $1,500 a year in interest. That would be if all the people in the U.S. were paying taxes which they arn't so the number is larger. If they don't cut spending and stop increasing the benifits to the babyboomers then they will have to make huge increases in taxes on us to pay for it. This will be when I give this country the one finger salute and leave.

[cpmarch]

Don't think of it as a "higher debt ceiling".  Think of it as "closer to the collapse of the dollar".  I hope you're holding some gold & silver.

[Kat Kanning]

Just think how rich the banks who loaned all that debt to the US are getting.

[Dreepa]

Or countries... .China and the Petro dollars own a lot of the US.  Happy Dude will like that.

[SocialDemocrat]

The wages of war are expensive...wait to you see our war on Iran....Tally Hoo!...White man's burden and all that Kipling crap....The Empire! The Empire! All power to the Empire!

[KBCraig]

[Otosan]

If I aint badly mistaken, that $9 trillion debt does not include welfare, SS, and other items that are "off the books"?

So my wife and I owe someone $60k,  who do we owe this money to?  ???

If the wife and I sold every thing we "own", we would be lucky to have $60K..

Does this mean that everything the wife and I "own" belongs to whom every the USA Gov owes money too???? and they can come and take it when the Gov defaults on its loans???

[cpmarch]

Correct, that $9t does not include unfunded liabilities such as: the railroad pension fund, social security, medicare, and medicaid.

Check out Walter Williams commentary on "federal deficit reality" from 2004, and the update for 2005:

2004 - http://www.gillespieresearch.com/cgi-bin/bgn/article/id=342
2005 update - http://www.gillespieresearch.com/cgi-bin/bgn/article/id=596

[cathleeninnh]

JOHN Williams

Cathleen