Week #7, Blog #1

At 10:35pm on 10/14/08 Fox News is reporting as its top article that the federal deficit is soaring. This year's deficit will hit $455 billion and next year could be as large as $700 billion if the current state of the economy continues.

In 2007 the federal deficit was $161.5 billion and this year figure is almost triple that amount. We have seen a decline in federal tax revenues because of the economy and certainly more federal spending including items such as an AMT patch, extension of unemployment benefits, the bailout package, and the list goes on. Congress and the President have to get together and promote some budget ideas that limits the growth in federal spending. The debt will eventually hit a point when it will no longer be manageable and we won't be able to find anyone to buy our bonds.

There are many reports in the news media today that says that there is every indication that we haven't hit the worst yet. Everyone is already freaking out so how much worse can it get without a mass panic? I believe that the federal government has begun to take steps to help stabilize the markets but why didn't we do this years ago? The answer to that question is because no one was taking real leadership on the issue. During this Congress the Democrats have been so worried about trying to put into place a timetable for withdrawal of United States forces in Iraq that they really ignored what was happening in the housing markets.

The deficit next year is projected to be $700 billion which is interestingly enough the price tag of the recently passed bailout plan by Congress which President Bush signed into law. Wait and see if we don't hear that in the debate tomorrow night and it other news ads and thirty-second sound bites by members of Congress who were opposed to the plan.

Less than three weeks left now until election day. Senator John McCain has some ground to make-up and Fox News is saying that this recent report certainly is not making that ground any easier to close up on Senator Barack Obama.