On Tue, 28 Sep 2004 15:00:44 -0400 "Johnson, Tracy" <[log in to unmask]> wrote:

> I'd trust the Government "Accounting" Office, vice the Congressional =
> "Budget" Office.

It seems curious to me that the arm of the government tasked with
setting taxes and appropriating their use is not considered a
reliable source of information on the subject.  However, if you have
contradictory information from another, more reliable, source then
please provide it.

As it happens the USA Census Bureau reports on income inequity track
the CBO reports very closely, even though the figures in the census
seem to be a little higher overall in every category.  They do not
give numbers for the top 1%, but their lower limit cut-off for the
top 5% shows an increase of 317% over the period 1979 to 2001
(measured in constant dollars) while the upper limit of the lowest
20% experienced a whopping 13% gain!  But, perhaps this source is
unsatisfactory as well?

As a significant side issue, the U.S. public debt now stands at ~ 7.3
Trillion, or more than $24,000.00 USD for every man, woman and child
resident in the United States or about $65,000 per household.  This
represents 3.6 times the annual household income for the top earners
in the lowest 20% of the population. 1.8 Trillion of the debt is held
by foreigners with 1.0 Trillion of this directly by foreign
governments.  Further, the US balance of payments position now stands
at -0.366 Trillion and is worsening by an estimated 0.066 Trillion
per quarter or 0.25 Trillion per year. The USA's net investment
position is presently -2.4 Trillion.  All figures are provided
courtesy of the U.S. Census Bureau or the U.S. Treasury Department;
two highly suspect organizations but the best that I could come up
with.  No doubt those that disagree with these figures have more
authoritative sources that they can share with us?

What this means is that the USA is living on credit, has effectively
sold off every international asset it possessed, and has mortgaged a
good deal of what remains at home.  It means that more that 13% of
the public debt is now controlled by foreign governments with over 9%
by the Japanese government alone.  It means that the surplus
generated by at least 2.8 Trillion dollars worth of commercial and
industrial plant now goes abroad rather than stays in the United
States, or if it stays then it is used to purchase more of what is
left for sale.  Eight percent of the annual federal budget, or more
than half of what is spent directly on national defence, goes to
servicing the accumulated debt and this is with interest rates at
close to fifty year lows at 1.6 to 1.9 %.  If a liquidity crisis
develops, such as often accompanies large unprofitable outlays by
governments on wars say, then a sudden increase in interest rates
would follow.

Now, for those that understand the implications of all this, just how
much latitude do you think the United States presently retains in
setting its own policies and how much longer will it hold onto what
does remain?  Foreign governments are not like ordinary debt holders.
 The financial return on their investment is not necessarily the
thing that they value most.

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