The National Debt Is $16.4 Trillion!
the web site of the National Debt Awareness Center (NDAC)
Published on Oct 15, 2012
A look into how much hard cash the US government spends and the fiscal mess the United States is in. The U.S. Budget explained and illustrated in cash money $100 bills. One of the many reasons for the rising national debt along with the government shutdown and debt ceiling. The US national debt will top 17 trillion dollars.
Oct 16, 2013
"Tonight, a deal was struck to re-open the government and avoid the debt ceiling deadline. That is a good thing," Sen. Paul said. "However, our country faces a problem bigger than any deadline: a $17 trillion debt. I am disappointed that Democrats would not compromise to avoid the looming debt debacle."
10/16/13
WASHINGTON, D.C. – Congressman Bill Flores (R-Texas) issued the following statement regarding the U.S. Senate’s proposed legislation to resume federal government funding and to raise the debt ceiling:
“This evening, I voted against the Senate’s proposed legislation to resume federal government funding and to temporarily suspend the debt ceiling. I voted ‘no’ because this legislation allows the debt ceiling to be increased without any much-needed reforms to fix our country’s critical fiscal challenges; it does not address the operational flaws and exploding costs of the newest federal entitlement, Obamacare; and it does not address other much needed economic growth policies such as tax reform, regulatory reform and energy security solutions.
“On the positive side, this legislation adheres to the post-sequester discretionary spending levels set forth in the Budget Control Act of 2011; restores near-term certainty to the capital markets by avoiding a debt ceiling default; and provides for the appointment of conferees to a Budget Conference, which I hope will substantively address the federal government’s precarious fiscal condition.
“While this legislation does reopen the doors to the federal government and avoids default, it does nothing to address the true drivers of our debt. Congress needs to quit kicking the can down the road and to address America’s critical fiscal challenges sooner rather than later. With each day that Congress delays dealing with this issue, the adverse impact upon the economic opportunities for future generations become increasingly harder to resolve. Like the rest of my colleagues in the House Majority, I remain committed to addressing our nation’s fiscal crisis and to improving the economic outlook for our children and grandchildren. Now more than ever, we must work towards a fiscally sustainable America through balanced budgets, job creation, economic growth and energy security.”
Congressman Bill Flores represents the 17th District of Texas and is an entrepreneur, former energy executive, Certified Public Accountant (CPA) and member of the House Budget, Natural Resources and Veterans’ Affairs Committees.
2012 should be remembered as the year that the super-rich and their Washington lackeys manufactured a debt crisis in order to dismantle Medicare, Medicaid and Social Security. Government debt is high because the Wall Street crash drove up unemployment and reduced tax revenues. That coupled with the Bush tax cuts for the super-rich (and two unfunded wars) ran up public debt.
Fiscal Cliff
Large deficits have driven a key ratio — government debt to gross domestic product — to 72.8 percent, from 36.2 percent in 2007. But without new policies, that’s just the beginning. Under realistic assumptions, the debt-to-G.D.P. ratio will rise to more than 80 percent over the next decade. The recommendations of the Simpson-Bowles Commission, if adopted by President Obama and Congress, would have brought this ratio down to 65 percent by 2022. But that plan never was adopted. Even if one of the proposals being debated by the White House and Congressional Republicans, very similar in the impact on the deficit, were put in place, it would only manage to drive down this ratio to 72 percent and stabilize it there — a minimally acceptable goal.
Another article of faith is that Congress has become far more polarized. That general perception is well supported by a number of academic studies. For example, one researcher, Keith T. Poole, assigned a score to each member of Congress based on his or her voting record. He then calculated an average for Democrats’ and Republicans’ scores and used the difference to create an index. His conclusion was that the House has become more polarized than at any time since at least 1879, and the Senate nearly so.
The most important economic event of 2012 was the collapse of Occupy Wall Street as a mass phenomena.
Because the crescendo against Wall Street's power has abated, financial elites can rest easy that their wealth and power will continue to rise.
Let's recall the ebb and flow of the economic debate before, during and after Occupy Wall Street.
In the summer of 2011, the entire national economic discourse centered on the need to cut debt and therefore "entitlements." Pundits and politicians of all stripes couldn't wait to make the poor suffer more by gutting the programs that serve them. After the Tea Party rise in the 2010 elections, the Obama administration offered a "Grand Bargain" to the Republicans that included cuts into Social Security, Medicare and Medicaid. Fortunately for the poor and the middle class, the Republicans stubbornly rejected it for fear it might help Obama's re-election.
In the fall of 2011 Occupy Wall Street blossomed, and the press went wild over it. The 1 percent/99 percent framework became the new meme. The national discourse rapidly shifted away from phony austerity and back to where the debate belonged -- how to get Wall Street to pay for the damage it had done.
It was a golden moment. It looked like a mass movement might emerge to take on the economic giants. Was this the beginning a modern populist movement that would threaten economic elites the way the Populist movement did in the late 19th century?
It didn't happen -- not yet.
What did occur is this: After the occupiers were removed from their encampments, the national discourse swung back to phony austerity, and Wall Street faded from view. Listen carefully to the current debate: Wall Street is not even mentioned during the fiscal cliff fiasco.
What's the biggest lesson of 2012? Building a mass movement that targets Wall Street and the economic royalists is possible. But doing so requires more than creative spontaneous combustion. We need to learn how to structure and sustain a structured national movement that makes Wall Street pay for the damage it has done.
Have a happy, healthy.... and demonstrative 2013!
How Much Do We Spend?
By law, the Pentagon must produce an annual “Overseas Cost Summary” (OCS) putting a price on the military’s activities abroad, from bases to embassies and beyond. This means calculating all the costs of military construction, regular facility repairs, and maintenance, plus the costs of maintaining one million U.S. military and Defense Department personnel and their families abroad — the pay checks, housing, schools, vehicles, equipment, and the transportation of personnel and materials overseas and back, and far, far more.
The latest OCS, for the 2012 fiscal year ending September 30th, documented $22.1 billion in spending, although, at Congress’s direction, this doesn’t include any of the more than $118 billion spent that year on the wars in Afghanistan and elsewhere around the globe.
While $22.1 billion is a considerable sum, representing about as much as the budgets for the Departments of Justice and Agriculture and about half the State Department’s 2012 budget, it contrasts sharply with economist Anita Dancs’s estimate of $250 billion. She included war spending in her total, but even without it, her figure comes to around $140 billion — still $120 billion more than the Pentagon suggests.
Wanting to figure out the real costs of garrisoning the planet myself, for more than three years, as part of a global investigation of bases abroad, I’ve talked to budget experts, current and former Pentagon officials, and base budget officers. Many politely suggested that this was a fool’s errand given the number of bases involved, the complexity of distinguishing overseas from domestic spending, the secrecy of Pentagon budgets, and the “frequently fictional” nature of Pentagon figures. (The Department of Defense remains the only federal agency unable to pass a financial audit.)
Ever the fool and armed only with the power of searchable PDFs, I nonetheless plunged into the bizarro world of Pentagon accounting, where ledgers are sometimes still handwritten and $1 billion can be a rounding error. I reviewed thousands of pages of budget documents, government and independent reports, and hundreds of line items for everything from shopping malls to military intelligence to postal subsidies.
Wanting to err on the conservative side, I decided to follow the methodology Congress mandated for the OCS, while also looking for overseas costs the Pentagon or Congress might have ignored. It hardly made sense to exclude, for example, the health-care costs the Department of Defense pays for troops on overseas bases, spending for personnel in Kosovo, or the price tag for supporting the 550 bases we have in Afghanistan.
In the spirit of “monitoring the construction,” let me lead you on an abbreviated account of my quest to come up with the real costs of occupying planet Earth.
Missing Costs
Although the Overseas Cost Summary initially might seem quite thorough, you’ll soon notice that countries well known to host U.S. bases have gone missing-in-action. In fact, at least 18 countries and foreign territories on the Pentagon’s own list of overseas bases go unnamed.
Particularly surprising is the absence of Kosovo and Bosnia. The military has had large bases and hundreds of troops there for more than a decade, with another Pentagon report showing 2012 costs of $313.8 million. According to that report, the OCS also understates costs for bases in Honduras and Guantánamo Bay by about a third or $85 million.
And then other oddities appear: in places like Australia and Qatar, the Pentagon says it has funds to pay troops but no money for “operations and maintenance” to turn the lights on, feed people, or do regular repairs. Adjusting for these costs adds an estimated $36 million. As a start, I found:
$436 million for missing countries and costs.
That’s not much compared to $22 billion and chump change in the context of the whole Pentagon budget, but it’s just a beginning.
At Congress’s direction, the Pentagon also omits the costs of bases in the oft-forgotten U.S. territories — Puerto Rico, Guam, American Samoa, the Northern Mariana Islands, and the U.S. Virgin Islands. This is strange because the Pentagon considers them “overseas.” More important, as economist Dancs says, “The United States retains territories… primarily for the purposes of the military and projecting military power.” Plus, they are, well, literally overseas.
Conservatively, this adds $3 billion in total military spending to the OCS.
However, there are more quasi-U.S. territories in the form of truly forgotten Pacific Ocean island nations in “compacts of free association” with the United States — the Marshall Islands, the Federated States of Micronesia, and Palau. Ever since it controlled these islands as “strategic trust territories” after World War II, the U.S. has enjoyed the right to establish military facilities on them, including the nuclear test site on the Bikini Atoll and the Ronald Reagan Ballistic Missile Defense Test Site elsewhere in the Marshalls.
This comes in exchange for yearly aid payments from the Office of Insular Affairs, adding another $571 million and yielding total costs of:
$3.6 billion for territories and Pacific island nations.
Speaking of the oceans, at Congress’s instruction, the Pentagon excludes the cost of maintaining naval vessels overseas. But Navy and Marine Corps vessels are essentially floating (and submersible) bases used to maintain a powerful military presence on (and under) the seas. A very conservative estimate for these costs adds another $3.8 billion.
Then there are the costs of Navy prepositioned ships at anchor around the world. Think of them as warehouse-bases at sea, stocked with weaponry, war materiel, and other supplies. And don’t forget Army prepositioned stocks. Together, they come to an estimated $604 million a year. In addition, the Pentagon appears to omit some $861 million for overseas “sealift” and “airlift” and “other mobilization” expenses. All told, the bill grows by:
$5.3 billion for Navy vessels and personnel plus seaborne and airborne assets.
Also strangely missing from the Cost Summary is that little matter of health-care costs. Overseas costs for the Defense Health Program and other benefits for personnel abroad add an estimated $11.7 billion yearly. And then there’s $538 million in military and family housing construction that the Pentagon also appears to overlook in its tally.
So too, we can’t forget about shopping on base, because we the taxpayers are subsidizing those iconic Walmart-like PX (Post Exchange) shopping malls on bases worldwide. Although the military is fond of saying that the PX system pays for itself because it helps fund on-base recreation programs, Pentagon leaders neglect to mention that the PXs get free buildings and land, free utilities, and free transportation of goods to overseas locations. They also operate tax-free.
While there’s no estimate for the value of the buildings, land, and utilities that taxpayers provide, the exchanges reported $267 million in various subsidies for 2011. (Foregone federal taxes might add $30 million or more to that figure.) Add in as well postal subsidies of at least $71 million and you have:
$12.6 billion for health care, military and family housing, shopping and postal subsidies.
Another Pentagon exclusion is rent paid to other countries for the land we garrison. Although a few countries like Japan, Kuwait, and South Korea actually pay the United States to subsidize our garrisons — to the tune of $1.1 billion in 2012 — far more common, according to base expert Kent Calder, “are the cases where the United States pays nations to host bases.”
Given the secretive nature of basing agreements and the complex economic and political trade-offs involved in base negotiations, precise figures are impossible to find. However, Pentagon-funded research indicates that 18% of total foreign military and economic aid goes toward buying base access. That swells our invoice by around $6.3 billion. Payments to NATO of $1.7 billion “for the acquisition and construction of military facilities and installations” and other purposes, brings us to:
$6.9 billion in net “rent” payments and NATO contributions.
Although the OCS must report the costs of all military operations abroad, the Pentagon omits $550 million for counternarcotics operations and $108 million for humanitarian and civic aid. Both have, as a budget document explains about humanitarian aid, helped “maintain a robust overseas presence,” while the military “obtains access to regions important to U.S. interests.” The Pentagon also spent $24 million on environmental projects abroad to monitor and reduce on-base pollution, dispose of hazardous and other waste, and for “initiatives…in support of global basing/operations.” So the bill now grows by:
$682 million for counternarcotics, humanitarian, and environmental programs.
The Pentagon tally of the price of occupying the planet also ignores the costs of secret bases and classified programs overseas. Out of a total Pentagon classified budget of $51 billion for 2012, I conservatively use only the estimated overseas portion of operations and maintenance spending, which adds $2.4 billion. Then there’s the $15.7 billion Military Intelligence Program. Given that U.S. law generally bars the military from engaging in domestic spying, I estimate that half this spending, $7.9 billion, took place overseas.
Next, we have to add in the CIA’s paramilitary budget, funding activities including secret bases in places like Somalia, Libya, and elsewhere in the Middle East, and its drone assassination program, which has grown precipitously since the onset of the war on terror. With thousands dead (including hundreds of civilians), how can we not consider these military costs? In an email, John Pike, director of GlobalSecurity.org, told me that “possibly a third” of the CIA’s estimated budget of $10 billion may now go to paramilitary costs, yielding:
$13.6 billion for classified programs, military intelligence, and CIA paramilitary activities.
Last but certainly not least comes the real biggie: the costs of the 550 bases the U.S. built in Afghanistan, as well as the last three months of life for our bases in Iraq, which once numbered 505 before the U.S. pullout from that country (that is, the first three months of fiscal year 2012). While the Pentagon and Congress exclude these costs, that’s like calculating the New York Yankees’ payroll while excluding salaries for each year’s huge free agent signings.
Conservatively following the OCS methodology used for other countries, but including costs for health care, military pay in the base budget, rent, and “other programs,” we add an estimated:
$104.9 billion for bases and military presence in Afghanistan and other war zones.
Having started with the OCS figure of $22.1 billion, the grand total now has reached:
$168 billion ($169,963,153,283 to be exact).
That’s nearly an extra $150 billion. Even if you exclude war costs — and I think the Yankees show why that’s a bad idea — the total still reaches $65.1 billion, or nearly three times the Pentagon’s calculation.
But don’t for a second think that that’s the end of our garrisoning costs. In addition to spending likely hidden in the nooks and crannies of its budget, there are other irregularities in the Pentagon’s accounting. Costs for 16 countries hosting U.S. bases but left out of the OCS entirely, including Colombia, El Salvador, and Norway, may total more than $350 million. The costs of the military presence in Colombia alone could reach into the tens of millions in the context of more than $8.5 billion in Plan Colombia funding since 2000. The Pentagon also reports costs of less than $5 million each for Yemen, Israel, Uganda, and the Seychelles Islands, which seems unlikely and could add millions more.
When it comes to the general U.S. presence abroad, other costs are too difficult to estimate reliably, including the price of Pentagon offices in the United States, embassies, and other government agencies that support bases and troops overseas. So, too, U.S. training facilities, depots, hospitals, and even cemeteries allow overseas bases to function. Other spending includes currency-exchange costs, attorneys’ fees and damages won in lawsuits against military personnel abroad, short-term “temporary duty assignments,” U.S.-based troops participating in exercises overseas, and perhaps even some of NASA’s military functions, space-based weapons, a percentage of recruiting costs required to staff bases abroad, interest paid on the debt attributable to the past costs of overseas bases, and Veterans Administration costs and other retirement spending for military personnel who served abroad.
Beyond my conservative estimate, the true bill for garrisoning the planet might be closer to $200 billion a year.
“Spillover Costs”
Those, by the way, are just the costs in the U.S. government’s budget. The total economic costs to the U.S. economy are higher still. Consider where the taxpayer-funded salaries of the troops at those bases go when they eat or drink at a local restaurant or bar, shop for clothing, rent a local home, or pay local sales taxes in Germany, Italy, or Japan. These are what economists call “spillover” or “multiplier effects.” When I visited Okinawa in 2010, for example, Marine Corps representatives bragged about how their presence contributes $1.9 billion annually to the local economy through base contracts, jobs, local purchases, and other spending. Although the figures may be overstated, it’s no wonder members of Congress like Senator Kay Bailey Hutchison have called for a new “Build in America” policy to protect “the fiscal health of our nation.”
And the costs are still broader when one considers the trade-offs, or opportunity costs, involved. Military spending creates fewer jobs per million dollars expended than the same million invested in education, health care, or energy efficiency — barely half as many as investing in schools. Even worse, while military spending clearly provides direct benefits to the Lockheed Martins and KBRs of the military-industrial complex, these investments don’t, as economist James Heintz says, boost the “long-run productivity of the rest of the private sector” the way infrastructure investments do.
To adapt a famous line from President Dwight Eisenhower: every base that is built signifies in the final sense a theft. Indeed, think about what Dal Molin’s half a billion dollars in infrastructure could have done if put to civilian uses. Again echoing Ike, the cost of one modern base is this: 260,000 low-income children getting health care for one year or 65,000 going to a year of Head Start or 65,000 veterans receiving VA care for a year.
A Different Kind of “Spillover”
Bases also create a different “spillover” in the financial and non-financial costs host countries bear. In 2004, for example, on top of direct “burden sharing” payments, host countries made in-kind contributions of $4.3 billion to support U.S. bases. In addition to agreeing to spend billions of dollars to move thousands of U.S. Marines and their families from Okinawa to Guam, the Japanese government has paid nearly $1 billion to soundproof civilian homes near U.S. air bases on Okinawa and millions in damages for successful noise pollution lawsuits. Similarly, as base expert Mark Gillem reports, between 1992 and 2003, the Korean and U.S. governments paid $27.3 million in damages because of crimes committed by U.S. troops stationed in Korea. In a single three-year period, U.S. personnel “committed 1,246 criminal acts, from misdemeanors to felonies.”
As these crimes indicate, costs for local communities extend far beyond the economic. Okinawans have recently been outraged by what appears to be another in a long series of rapes committed by U.S. troops. Which is just one example of how, from Japan to Italy, there are what Anita Dancs calls the “costs of rising hostility” over bases. Environmental damage pushes the financial and non-financial toll even higher. The creation of a base on Diego Garcia in the Indian Ocean sent all of the local Chagossian people into exile.
So, too, U.S. troops and their families bear some of those nonfinancial costs due to frequent moves and separation during unaccompanied tours abroad, along with attendant high rates of divorce, domestic violence, substance abuse, sexual assault, and suicide.
“No one, no one likes it,” a stubbly-faced old man told me as I was leaving the construction site. He remembered the Americans arriving in 1955 and now lives within sight of the Dal Molin base. “If it were for the good of the people, okay, but it’s not for the good of the people.”
“Who pays? Who pays?” he asked. “Noi,” he said. We do.
Indeed, from that $170 billion to the costs we can’t quantify, we all do.
David Vine, a Tom Dispatch regular, is assistant professor of anthropology at American University, in Washington, DC. He is the author of Island of Shame: The Secret History of the U.S. Military Base on Diego Garcia (Princeton University Press, 2009). He has written for the New York Times, the Washington Post, the Guardian, and Mother Jones, among other places. He is currently completing a book about the more than 1,000 U.S. military bases located outside the United States. To read a detailed description of the calculations described in this article and view a chart of the costs of the U.S. military presence abroad, visit www.davidvine.net.
Follow TomDispatch on Twitter @TomDispatch and join us on Facebook. Check out the newest Dispatch book, Nick Turse’s The Changing Face of Empire: Special Ops, Drones, Proxy Fighters, Secret Bases, and Cyberwarfare.
Copyright 2012 David Vine
Dear Friend,
Democrats just won big at the ballot box, with President Obama crushing Mitt Romney and Democrats winning more seats in both the House and Senate.
But Congress is headed for a major showdown over federal spending before the end of the year.
And far too many Democrats and Republicans are part of a concerted push to put Social Security, Medicare and Medicaid benefits on the chopping block.
Negotiations are already happening and Congress only has a few weeks left in session, so Sens. Hutchison and Cornyn need to hear from you today.
Let's be clear, there are any number of crises that demand urgent action by Congress — the foreclosure crisis, the unemployment crisis, the climate crisis to name just a few — but reducing the deficit isn't one of them.
It's true that without a new deal to decrease the deficit before the end of the year, we'll see the automatic cuts and tax increases start going into effect in January.
But no deal is far better than a bad deal.
If we do nothing, the Bush tax cuts will expire and we'll see automatic, in some cases brutal, cuts to government spending. But these cuts include significant reductions to defense spending while sparing Medicare, Medicaid and Social Security benefits (not to mention a host of programs that help the most vulnerable).
As painful as the status quo might be, it's substantially better than the deals that have been floated thus far.
And it's hard to imagine that President Obama and the Democrats could cut a better deal with Republicans in the next two weeks than what they could accomplish in the next Congress with more Democrats in the House and the Senate, the Bush tax cuts already expired and (quite possibly) filibuster reform that reduces the power of obstructionist Republicans.
Speak out and tell Sens. Hutchison and Cornyn to reject any deal that cuts Social Security, Medicare or Medicaid benefits, or cuts taxes for the wealthiest Americans. Click below to automatically sign the petition:
Thank you for speaking out.
The Senate has unanimously approved a $631 billion military spending bill. The measure includes a call for an acceleration of the U.S. withdrawal from Afghanistan as well as for intensified sanctions on Iran. The Obama administration has threatened a veto over limits on President Obama’s authority to handle alleged terrorism suspects.
While there has been a lot of bluster from the G.O.P. about how we should reduce the deficit with spending cuts, not tax increases, no leading figures on the Republican side have been able or willing to specify what, exactly, they want to cut.
And there’s a reason for this reticence. The fact is that Republican posturing on the deficit has always been a con game, a play on the innumeracy of voters and reporters. Now Mr. Obama has demanded that the G.O.P. put up or shut up — and the response is an aggrieved mumble.
A Billionaire Obsesses, Our Politics Regresses
To change history you just need a ton of money, the sort of fortune that the 86-year-old Peter Peterson has amassed over his years wheeling and dealing on Wall Street.
Peterson has been obsessing for years over federal budget deficits. Now his obsession has shoved the nation to a “fiscal cliff” that might well end up raising the age that Medicare kicks in and chopping billions out of all sorts of other programs near and dear to the hearts of America’s working families.
Five years ago, Peterson sold the bulk of his stake in the Blackstone private equity firm he co-founded 22 years earlier. That sale, in just one day of trading, added $1.8 billion to Peterson’s already ample personal fortune.
A year later, with a $1 billion outlay from that fortune, Peterson established the Peter G. Peterson Foundation to target “undeniable, unsustainable, and untouchable” threats to America’s fiscal future and began a massive lobbying blitz for a “bipartisan” solution to federal debt and deficit.
Peterson’s foundation almost immediately began dispensing millions from its imposing stash of cash, funding everything from a classroom curriculum to a film documentary and a “fiscal wake-up tour.” Other millions, a National Journal analysis points out, went to think tanks across the political spectrum.
Three years ago, Peterson dollars helped fund the high-profile national Simpson-Bowles Commission, a “bipartisan” maneuver to pitch cutbacks in social spending as an essential ingredient in any “responsible” approach to deficit reduction.
That commission would prove unable to reach a budget-fixing consensus. No problem. Peterson dollars were soon funding a new public relations campaign that enabled the commission co-chairs, former GOP senator Alan Simpson and former Clinton chief of staff Erskine Bowles, to barnstorm the nation.
This campaign, in turn, eventually morphed into “Fix the Debt,” a more tightly organized effort to resurrect the “core principles” that Pete Peterson holds near and dear. Among them: the need for “pro-growth tax reform” that “broadens the base, lowers rates, raises revenues, and reduces the deficit.”
Translation: Let’s shift tax burdens off the rich and onto average Americans.
Average Americans have largely tuned out Fix the Debt. One sign of the times: The Fix the Debt online petition backing the nostrums of Simpson-Bowles “as a starting point for a plan to reduce the federal debt” had just 300,000 signatures as of last week. The original Fix the Debt petition goal: 10 million signatures.
Please note how politicians play with your life:
- Under a deal reached last year between President Obama and the Republican-controlled Congress, existing stimulus measures - mostly tax cuts - will expire on 1 January 2013
- Cuts to defence, education and other government spending will then automatically come into force - the "fiscal cliff" - unless Congress acts
- The economy does not have the momentum to absorb the shock from going over the fiscal cliff without going into recession
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