The Obama Debt Plan

John Hinderaker, of Power Line, commented on President Obama’s plan to pay down the national debt, as demonstrated by Obama’s mid-year budget plan update.  Obama also is campaigning on his plan to “pay down the debt in a balanced way.”

Here’s what his “balanced plan” does to our national debt, illustrated by the following graph from Power Line, and The Washington Times.

That’s a rather startling increase in the size of this paid-down debt.  “But wait,” some of you might object.  “What about the debt as a per cent of our GDP, a perhaps better way to assess the size of our debt?”

Our 2011 GDP was some $15 trillion, and it’s projected to be in the neighborhood of $24 trillion by 2021 (my calculation based on data in Table 1-6 of the CBO’s report “Budget and Economic Outlook: Fiscal Years 2011 to 2021.”

That makes our national debt 98.7% of GDP in 2011, and 105.8% of GDP by 2021.  This is how Obama intends to “pay down the debt in a balanced way” via Obamanomics’ New Math.

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