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[Lee Adler]

US debt going is parabolic, as is record high political polarization.  The polarization shown on the chart really amounts to squat in terms of the bottom line.   Presidente Zero throws his latest campaign piece of meat (a “budget”) out for the Republican to go into a dizzle fit over.  Great theater for mainstream media talking heads, but if you want to know what this will mean in due course,  look at Greece, and multiple the effect 30 fold. The bottom line in terms of Presidente Zero’s budget is this: $1.33 trn budget deficit in the 2013 fiscal year – more than the $1.296 trillion 2011 budget deficit.   That takes the debt up to $18 trillion, in late 2013, and I think sooner.   That’s about 118% debt to GDP assuming interest cost don’t spike or the economy sinks (this budget assumes increasing to 3% in 2012, 3.6% in 2013).   I see revenues lagging even this still too optimistic  projection.  The Prez Zero budget assumes higher taxes,  and the end of the Bush taxes.  We will see how that plays out during the next economic crisis. Meanwhile as a clue to how this plays out with the faux fiscal conservatives, the WSJ [...]

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