December 19, 2014

Ted Cruz, Addressing Delegates, Says National Debt Exceeds the U.S. Gross Domestic Product

August 29, 2012
Austin American-Statesman

Excerpt

In a March 13, 2012, blog post, the anti-deficit Concord Coalition said the gross debt would top the nation’s GDP this year for the first time since World War II. Projections showed the gross debt continuing to increase rapidly "as we continue to borrow and as today’s unusually low interest rates eventually rise toward their historic average," the group wrote. . . .

In contrast (to intragovernmental debt), public debt reflects money borrowed from outside sources -- giving it more of a connection to the economy, which is why the coalition tends to focus on it, Josh Gordon, a coalition analyst, told us by phone. "If your problem with the national debt is that you think it’s affecting the economy or interest rates or something like that, the only part of the national debt that affects the economy is the debt held by the public. That’s where the (U.S.) Treasury is borrowing money on the open market." . . . 

Gordon pointed out that the Congressional Budget Office said in its Aug. 22, 2012, update on the nation’s economic outlook that by October 2012, the public debt would reach 73 percent of GDP -- the highest level since 1950, the report said, and about twice the share that it measured at the end of September 2007, before the financial crisis and recent recession. The report says too that if deficits continue apace, "debt held by the public would climb to 90 percent of GDP by 2022 -- higher than at any time since shortly after World War II."