Readers of MyGovCost will likely be interested in this week’s Econtalk podcast with Don Boudreaux on the nature and significance of public debt. Roberts and Boudreaux begin by discussing debt at the household level and then work to draw out which lessons apply to the spending of a federal government. In doing so, the…
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Last week, Moody’s cut Greece’s credit rating to the lowest level on its scale, citing risk of default despite the recent write-off deal. Moody’s said the rating decision was “prompted by the recently announced debt exchange proposals for Greece, which imply expected losses to investors in excess of 70%.” The sovereign debt crisis in…
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My colleague Jeff Hummel pointed out an interesting blog post by Ted Levy where he asks the question: what’s the point of the debt ceiling? Levy shows that since the debt ceiling was created in 1917, it has been raised over 100 times, 8 times in just the last ten years. In fact, Congress…
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I could not resist posting this beautiful graph of the current state of the momentousness US debt. The graph is particularly useful for eyeballing the historical path of U.S. debt to GDP. Often pundits will say that our current debt-to-GDP ratio is not unreasonable because it is not too high relative to the period…
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The New York Times has a useful infographic outlining proposals for how to trim the defense budget. The Pentagon has committed to cutting $450 billion in spending over the next 10 years—only a small slice of the tremendous increase in war and defense spending we have seen in the previous 10 years. The graph…
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The Daily Show with Jon StewartGet More: Daily Show Full Episodes,Political Humor & Satire Blog,The Daily Show on Facebook As it has come to light, from August 2007 to April of 2010 the Fed loaned out over $7.7 trillion to troubled banks. A Bloomberg report reveals that the U.S. government made these secret bailouts…
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James Buchanan and Richard Wagner begin their book Democracy in Deficit by explaining that prior to the absorption of Keynesian economics, the conventional wisdom of Adam Smith prevailed. Adam Smith had observed that: “What is prudence in the conduct of every private family, can scarce be folly in that of a great kingdom.” This…
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The United States will officially pass the 100 percent debt-to-GDP line on Halloween. This is the first time this has ever happened since World War II. As Zero Hedge reports, We decided to dig into the actual numbers (cancelling out the per capital denominator as it is the same on both sides of the…
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Since last summer, the top 3 ratings agencies (S&P, Moody’s, and Fitch Ratings) have made 196 “super-downgrades” on municipal bonds, according to research popularized in today’s Wall Street Journal. Super-downgrades are defined as cuts of at least three grade-letter scores on the traditional scale used by the firms. For example, when the US treasury…
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In a speech to the Libertarian Party in Indianapolis, Michael Munger gives three things the government has to do to deal with the debt crisis: 1. Cut defense spending by by at least 15%. More than 15% — even better! 2. Sell US bonds in the Social Security trust fund. Also raise the Social…
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