Re: A Hypothetical Disbursement Or Assignment Of Debt

In sci.econ, Sgt.Sausage
<someone@xxxxxxxxxxxxx>
wrote
on Fri, 18 Nov 2005 02:39:01 -0500
<16902$437d8519$42a1e6c9$25700@xxxxxxxx>:
>
> "The Ghost In The Machine" <ewill@xxxxxxxxxxxxxxxxxxxxxxx> wrote in message
> news:1r0053-tvl.ln1@xxxxxxxxxxxxxxxxxxxxxxxxxx
>> OK, I have a dumb question. Suppose that, somehow, the
>> Federal Government has just gotten a $10B windfall.
>> (Speculation can run rampant here, but that's a side point. :-) )
>
> Why disburse it -- why give it away. There's a couple
> of trillion borrowed dollars that need paid back. That
> 10 billion might pay for a month or so of the interest/debt
> service. How 'bout paying back the principle and calling
> in some bonds. I'm sure theres a program or two, maybe
> a couple of unfunded mandates on the books that could
> eat up the entire 10 billion.
>
> Why give it away?

That's option [1] in my list. As for the national debt, that's
currently running at about $8.1T. (That's an increase from
2003 where it was only about $6.8T.
http://www.publicdebt.treas.gov/opd/opdpenny.htm )

>
>
>> Of course, the reverse is rather nastier. Assume that the US
>> government has just been saddled with a $10B obligation. What
>> is the best way of dealing with it?
>
> There's nothing to figure out here. This happens on a
> weekly basis with Uncle Sugar. Another week, another
> $10B in debt. Why do anything? They're not doing it
> now.
>
> My opinion on "the best" -- tighten up the belt and
> cut something out for a couple of years to pay for it.
>

Define that "something". Should we:

[1] cut Social Security disbursements?
[2] cut Medicare and Medicaid?
[3] transport subsidies?

The US government currently embodies about 25% of the economy
($2.7T out of about $10-$11T). A lot of that does not appear
to be under Constitutional mandate:

[a] No army. Navy, yes, but no army; replace by militias.
[b] No NASA.
[c] No DEA, although the conservatives won't like that.
[d] No FCC.
[e] No HUD.
[f] No SS or Medicare.
[g] No NHTSA, or whatever it's called nowadays.

Much of this is probably under legal mandate, however.

I could go on and would actually have to look up the budgets of
the departments involved (NASA in particular consumes $16B,
projected to $18B in FY 2010 -- an about 2%-2.5% inflation rate).

However, this is getting slightly out of economics (though what
is economics anyway but the spending actions of large numbers
of people? :-) ).

--
#191, ewill3@xxxxxxxxxxxxx
It's still legal to go .sigless.
.

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