Total Government Debt Is Much Bigger
February 8, 2000
President Clinton wants Congress to increase the legal ceiling on how much debt the government can hold. That may sound odd as the Treasury makes plans to pay down the national debt. But in fact there are two types of government debt.
- The $3.48 trillion public debt -- which Clinton says he wants paid off by 2013 -- consists of obligations held by the public.
- But the total government debt consists of the public debt plus long-term obligations to other government agencies -- notably the Social Security Trust Fund -- a figure that will rise as aging baby-boomers make ever-larger claims for government benefits.
- In setting statutory limits on government borrowing, Congress lumps both figures together -- and arrives at a total government debt of $5.65 trillion currently.
- The current statutory limit is $5.95 trillion -- but under the Clinton plan government debt would hit $6 trillion in 2004 and $6.79 trillion in 2013.
Experts say the administration's budget is a shell game. In discussing spending increases and tax cuts, the administration focuses on net, not gross, figures to minimize proposed spending increases. The budget specifies $746 billion in spending increases and tax cuts. But it actually proposes $1.02 trillion experts say -- although that figure never appears in the official budget.
When it comes to tax cuts, administration officials focus on gross, not net figures. They put the 10-year net tax cut total at $351.4 billion. But when tax increases are included, the figure becomes a stingy $170.5 billion over 10 years.
Source: Jacob M. Schlesinger, "This Year's Proposal Hinges on Gimmicks, Creative Accounting," Wall Street Journal, February 8, 2000.
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