US government's financial position hit $11.46 trillion deficit in 2009 | Hacker News Reader

US government's financial position hit $11.46 trillion deficit in 2009

finance.yahoo.com

10 pointscwan15 comments

Don't they mean debt? I thought deficit was net increase in debt per year.

You're right. Deficit is d(Debt)/dT.

It's not just debt though, it's entitlements and obligations.

National entitlements and obligations are at about 100 trillion dollars (medicare, medicaid, social security etc.). This is based on estimates made by David Walker who was the head of the GAO under Clinton.

"I am not worried about the deficit. It is big enough to take care of itself. " - Reagan

Now they only need a half of that half-kilometer S-type asteroid...

Deficit worries are hocus pocus. America should go should in much debt as possible if there are people willing to lend it money. When it comes to payback time it can simply deflate away its currency and as a side effect get many offshored jobs back. The real problem is not deficits, but where they are spent. military and the rich.

First it's inflation not deflation.

Second, what you are suggesting is one of the worst and most immoral ideas possible. Inflation steals wealth the most from the poor and middle class. Second all government debt is inherently immoral because you are in essence taking out a loan in someone else's name.

No, inflation steals wealth from people who own dollars and dollar-denominated assets. That's mostly the risk averse rich, as well as many foreign governments who are trying to prop up the dollar.

No, dantheman has it right. Inflation hurts poorer people proportionately more. Richer people tend to have assets like property which inflate in value right along with the currency. If you inflate by 15% from one week to the next a rich person's standard of living hasn't decreased much, but a poor person's certainly has.

Inflation has two effects; across the board pay cuts and it reduces the value of dollar denominated assets. Pay cuts hit everyone with an income equally.

The poor/middle class tend to have a larger fraction of their wealth in property. The typical middle class family owns either a home or a call option/mortgage on a home which comprises the bulk of their wealth.

The rich also own property, but it's not as large a fraction of their wealth as it is for the poor. The typical rich person owns both a home and an investment portfolio, the latter of which will suffer with inflation.

Inflation hurts the poor to a greater degree than the absolute value of wealth it steals. If all I have is a paycheck or two, a jump in the cost of everything hurts me a lot more than someone with a pile of dollars and assets.

Would you lend your money to such a country? If so, there are some African nations you might consider investing in.

I think I have the phone number of some of them. Let me check my email ...

I think you're looking for the words devalue or debase, not deflate.

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