John McCain and Barack Obama both promise to be fiscally responsible and not raise taxes on the middle class if elected president. It’s a tall order no matter who wins… the current White House has released information about the country’s economic status and it’s not good news.
Last week, the White House estimated that the deficit will hit a record $482 billion deficit for the 2009 fiscal year. The crazy part is that does not include an additional $80 billion in costs related to the war in Iraq. That brings the country’s total debt to $9.5 trillion. (For more on the difference between debt and deficit, see my prior post)
What does that mean? For one, the US is paying a lot more interest and less principal (sound familiar?) to service its debt. According to The Concord Coalition, the US paid $200 billion in debt interest last year alone.
Paying off the debt – as well as the interest – will be a huge task for the next president. According to the Tax Policy Center, both candidates will add to the deficit. Estimates are that, if the plans stay as contemplated (which you can bet that they won’t), over the next 10 years, McCain will increase what we owe by $5 trillion, Obama by $3.4 trillion. Those numbers don’t include the costs of health care proposals or Social Security/Medicare, both of which are substantial issues for either candidate.
There has to be a “give” somewhere – continuing to increase spending and promising to cut revenue (taxes) isn’t likely to work. That’s a lesson that I learned the hard way in college… Why can’t Bush, McCain and Obama get it?
- Rebates Push Deficit to Record Highs
- McCain v Obama on Tax: Is It Really Just the Lesser of Two Evils?
- Obama v. McCain: Who Has the Best Tax Package For You?
- CBO Releases Updated Budget Outlook, Suggests Picture Improving
- Ask the taxgirl: Who Owns the US Federal Debt?