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Debt Not Growing as Percentage of GDP; Economic Growth Key

Congresswoman Kristi Noem is scrambling to defend her vote for fiscal disaster Wednesday. She tries to turn our attention away from her destructive politics by claiming in her latest column that letting the national debt grow is a bigger problem.

This claim, like nearly every scripted word from Kristi's mouth, is baloney. Extending the government shutdown would have exacerbated the economic losses she and Ted Cruz caused with their PPACA obsession. Failing to pay America's bills would have exploded the debt by causing another downgrade in our credit rating, driving foreign investors away from Treasury Bills and the dollar, and increasing interest rates (not to mention crushing the global economy, which would have caused more domestic unemployment, driven down GDP, and reduced the tax revenues that help pay down the debt).

Besides, our Congresswoman is wrong about our growing debt. It's not growing:

Debt held by the public currently stands at about 75% of the GDP and will remain at about the same level next year, according to the latest projections from the Congressional Budget Office. After that, the debt will tick down slowly to around 71% of GDP in 2018, then get back up to 74% a decade from now. In the mid-2020s, the debt will once again start to grow more rapidly, the CBO projects, although such forecasts of the economy a decade hence come with a big measure of uncertainty [David Lauter, "Four Facts about the National Debt You May Not Know," Los Angeles Times, 2013.10.16].

Like a majority of Americans, the United States has had debt for most of its history, and that debt hasn't stopped us from becoming the world's strongest nation:

The federal government has been without a debt for only one year in U.S. history, during parts of 1835 and 1836. As a percentage of the GDP, the debt peaked at the end of World War II. Notably, the dollar value of the debt increased through the 1950s and 1960s, but because of rapid economic growth, the debt fell dramatically relative to the size of the economy.

As the rapid growth after World War II indicates, a large debt doesn’t necessarily strangle an economy. That doesn’t mean that large debts are good for a country, just that the relationship between the debt and economic growth is a lot more complicated than political rhetoric would indicate [Lauter, 2013.10.16].

If Rep. Noem were really worried about the debt, she would be focusing on promoting the economic growth that pushes past debt growth. She wouldn't be voting to slow down the economy by shutting down the government. She wouldn't be voting to crash the economy by defaulting on U.S. obligations. And she wouldn't be writing a column titled "A Better Way to Restore Our Fiscal Future" that contains no outline of specific cuts that would reduce the national debt. (Remember: repealing the Affordable Care Act increases our debt.)

Boosting the American economy will reduce our debt better than any of Congresswoman Kristi Noem's vague slash-and-burn proposals. Rep. Noem's ill-informed votes have only sandbagged the economy, making worse the debt problem she claims to want to solve.


  1. jerry 2013.10.19

    Good point CAH about your statement: "Like a majority of Americans, the United States has had debt for most of its history, and that debt hasn't stopped us from becoming the world's strongest nation"

    The dumbing down that republicans have had success at doing to the American people, has them thinking that debt is terrible. This is while they are paying a mortgage and a car note to name a few. Debt is what drives us to work in our own person. Debt is what sells bonds and notes for our country. The Netherlands do not buy bonds and notes just for the fun of it, nope, they are investments that the country makes on our good faith to work. It should be called work ethic, but instead, republicans have hijacked the word to mean filth.

    I worked for a feller once that told me when he sees one of his employees drive up in a new car, he smiles. He smiles knowing that they have the confidence in where they work and that they will stay employed with him to make the payments. That opened my eyes to see how this whole capitalism thingy works. So, the trick will be to tell people what they already know, that they live in debt and embrace what it provides, what is the difference? Stop being so afraid that the sky will fall. The only way that it will fall is if we keep sending these failed legislators to office. They cannot govern and should never ever be given that opportunity. NO More NOem

  2. Donald Pay 2013.10.19

    And another thing that goes against conservative mythology: post-WWII tax rates were very much more progressive and high on upper incomes. There was lots of government investment in people (GI Bill and government-backed mortgages) and infrastructure (interstate roads, schools, sewage treatment). Even Kennedy's tax rate reductions left rates at what today's conservatives would consider confiscatory. We've gone in exactly the wrong (conservative) direction for 40 years, and what we have to show for it is a declining middle class and growing poverty.

  3. Rick 2013.10.19

    So, if there are reporters who embrace accuracy and newsworthiness, where is a story on Noem's big fat lie defending her indefensible action to keep the nation plunged into an economic freefall?

    Her bizarre and foolish vote to continue the shutdown and to embrace an American and global economic meltdown are the silver bullet to her defeat. Cruz 'n Noem, right over the cliff. Together. South Dakota doesn't need a second kick from a mule.

  4. Douglas Wiken 2013.10.19

    The Daily Republic of Mitchell, SD criticized Kristi-ism, but started the editorial with "Sorry, Kristi, " It made me wonder if the editorial page had ever been sorry about any criticism of Obama and Democrats.

  5. Stan Gibilisco 2013.10.19

    My fellow Republicans need to learn the difference between spending and investment.

  6. Les 2013.10.19

    """"Her bizarre and foolish vote to continue the shutdown and to embrace an American and global economic meltdown """"
    Bizarre and foolish? Time will tell. Global meltdown? Words just can't describe the horror of a world economy run amuck on spending, failing, due to one countries issues. Whorer of whorers.

  7. Aachen 2013.10.19

    Yes. Bizarre and foolish. Shuttering the government is foolish. Defaulting on national debt would be catastrophically foolish.

    "Amuck (sic) on spending" is absolutely unimportant; to wit: "Words can't describe the horror of a ('the,' given we don't currently live on multiple worlds, FWIW) world economy failing due to one country's issues."

    So .... yeah, Noem preferring such catastrophe (as demonstrated by her votes) is both bizarre and foolish.

  8. John 2013.10.20

    Prediction: NOem and Thune will trip over themselves to sponsor the inevitable federal welfare bill to reimburse the state for opening and running Mount Rushmore. The hypocrisy of their whining about federal spending from this federal welfare queen state is rich.

    But first NOem will sponsor federal welfare for ranchers who cannot be bothered to buy private insurance (like the rest of us) to compensate for the loss of a mere 15,000 to 25,000 livestock - despite KNOWING the federal welfare bailout program lapsed due to the dysfunctional republican house of representatives. (Mid-1990s blizzards caused over 300,000 livestock deaths.)

    As to federal spending, as Sen. Mitch McConnell said, government spending DECLINED the past 2 years, that has not occurred since the Korean War, and it will not be reversed in the near term. (begins at 4 minutes)
    NOem and Thune need to pony up on cutting South Dakota's lavish federal welfare and set the state on a 124 year-late project of making South Dakota self-reliant.

  9. caheidelberger Post author | 2013.10.20

    Douglas, read that editorial to the end, and you find the Mitchell editors used "Sorry" not as a real apology, but as a sharp twist of her own knife, recalling the "Sorry, Nancy" ads Noem ran against SHS in 2010. MDR concludes that Kristi is more beholden to the right-wing extremists of her party than SHS ever was to the left wing of hers.

  10. caheidelberger Post author | 2013.10.20

    Les, I don't like debt and magic money, either, but the Lauter article makes the point that the United States has run on debt forever, and here we are, the greatest superpower. Sure, out-of-control debt would be bad, but Kristi's and your rhetoric doesn't match reality.

    You only go kamikaze like Randy Quaid in Independence Day when the good guys are out of missiles and the bad guys are about to destroy the world. Noem's kamikaze politics aren't justified because the debt she's screaming about isn't going to destroy the world, not in this decade, and not in any decade if Noem and the House GOP quit hamstringing economic growth.

  11. Les 2013.10.20

    What is reality Cory? It fits whatever you can make the people believe. Ask your community organizer what reality is. Kristi, whom I've not actively supported was willing to vote for 17B for Sandy victims, over twice the Katrina money. Your party and some of the bloated Christy bunch added an amendment of an additional 34B spending going out into 2015. How is 2014 and 2015 part of an emergency in 2013? She voted against the bill containing the amendment and is chastised by you and yours for doing so.
    Put up links showing all the pork that came out of the settlement on the shutdown and tell me how Kristi is to blame for Not leveraging SD into that game. Kristi is to blame for many things that don't need lies and exagerations but you who scream at everything or only wake up to hot button issues are no better than the worst of which we hear of on the Madville daily blame game.

  12. caheidelberger Post author | 2013.10.20

    Les, I'll not be lured into your convenient relativism. Reality is reality. Kristi Noem cast a vote for economic chaos this week, based on false claims about the magnitude of the debt problem, with no concrete counterproposal other than to defund a health care program that itself reduces the deficit.

  13. Les 2013.10.20

    Truth is truth. Reality is your accepted idea of truth. Nothing convenient about truth Cory.
    My reality is, my insurance costs have doubled since the ACA idea began. Time will prove truth.
    My other reality is, DC is all about politics and politics is all about the money and time will prove the ultimate failures of that system.

  14. Roger Cornelius 2013.10.20


    How much of your reality tells you that your health insurance doubled because of the corporate greed of insurance companies taking advantage of the ACA debate?

    Last week on FOX "News", Hannity had a spectrum of people telling just how ACA adversely impacted them. When fact checked, they were frauds and in some instances ACA would have actually helped them.
    There is a lot of crying around about ACA doubling and tripling insurance premiums, but saying it and proving it seem to be two different things.

  15. Les 2013.10.20

    Roger, you are telling me Obama played into the hand of insurance companies. Of course the corp world is all abut profits. What did our government do to protect us from the increases they all knew would come with the debate? It's not just greed tht raised the prices. Many docs are cash only and insurance companies understand the costs of ACA will bring down profits. So who pays besides me Roger? You? Jerry? Owen? Cory? Is this 20% paying for the 80%?

  16. jerry 2013.10.20

    Roger, I am quite sure that Les can prove what he says in that his healthcare has doubled since "the ACA idea began". Most everything has double in the last couple of decades maybe including Les's age. As health insurance is age based, he is merely stating what each one of us has already gone through, in other words, nothing to see here.

    The fact is, Les may or may not be able to save money on his premiums this coming year. His income may be such that he does not qualify for subsidies so with his income, he would have to pay the full price out of his pocket. However, this is for folks that do not presently have coverage or are not able to get that coverage in the open market. Sorry bout that Les, but sometimes you cannot be the head of the class.

  17. Roger Cornelius 2013.10.20

    Les may have had his premiums doubled, but are they are the direct result of ACA? Or like I asked a matter of corporate greed.
    I'm skeptical, FOX has run several hour long specials about this doubling of premiums because of ACA and we hear the same talking points repeatedly. I wonder how many people that complain about ACA have actually inquired or applied.
    Eric Stern, a Democratic lawyer from Montana has written a piece for that uncovered Hannity's misrepresentation of their individual issues with ACA. Most of their stories were debunked, they were simply repeating FOX talking points

  18. jerry 2013.10.20

    Roger, In the last 20 years, many things have doubled, so that does not surprise me that he can show that. Your auto insurance has probably done the same thing. Now, if Les is speaking of doubling in the last 3 years, that would be an argument that would need proof. The first thing needed would be the carrier he is speaking of. Then the next question would be why he did not change if the price was rising. You are correct though in that Fox entertainment always goes to the fabricated story as it sells.

  19. jerry 2013.10.20

    Les, I have a quiz for you regarding Obamacare. It always has puzzled me the fact that you republicans fought tooth and nail against Obama in the last election to protect us from the Obamacare. Your candidate had already put the same thing in his go Red Sox state of Massachusetts with the blessings of the Bush administration. So here is a conservative Republican getting an assist from a conservative Republican administration to put in a mandated healthcare system. I give you this quiz to see if you can tell the difference between the two plans.

  20. Les 2013.10.20

    In the years of 08/09 our Blue Cross for two was at 5900/year with a 5000 deduct. Those prices increased to abut 9000/year and this year we got a note of a 3300 increase. I went to a 7500 deduct to keep it in the 9000 area. We have had no health issues and have done few doc visits. As my wife says, most 25 year olds have thicker charts than we do.
    Our agent speaks of that happening to many and I don't have to trust her, but I do. SD doesn't have that competitive a market due to ins regs that are deigned to keep it that way. As to changing, I could have changed back to lower cost companies I used in the past with less bang for the buck.
    I don't have an argument with the greed Rogers's needle keeps skipping to but is that not a realistic problem that should have been addressed in comprehensive health changes if the authors truly were not in the pockets of the insurance industry?

  21. jerry 2013.10.20

    Les, I think your agent should have told you about what is called a Basic Plan from Wellmark, under 7 grand. Still a lot of moolah, but a couple thousand less. How do I know this, I don't for sure, but am guessing that we may be about the same age and the same circumstances. I think you should call your representative to discuss and get the low down.

  22. Les 2013.10.20

    There ya go again assuming Jer. Mittens wasn't my man. Lesser of two evils? I doubt it, I think they'd be neck to neck at the wire. I'll check on basic Wellmark. Is that the policy where your network is the local veterinarian? I'm a recent 61 Jer and have always paid my insurance plus the deduct plus anything not covered. Not very smart considering I could have put all the moola into wellness and have enjoyed a better life.

  23. jerry 2013.10.20

    Les, glad to hear that Mittens was not your man. I just sent the healthcare quiz as a little something to let you know that this Obamacare has been perking for several years now and has been in practice with satisfied results in Massachusetts. Our network is the Wellmark network. We used to have what you presently have and got out of it because it cost to much. This plan we have now is 5 K deductible and saved us a bunch. Thanks to Obamacare, all of the wellness will not cost you anything and you can even go get yourself one of those look sees to check your colon for no cost to you as well. What this is all about with the wellness is to catch something before it catches you. By the way, I would not have a problem seeing a veterinarian as they have to be able to diagnosis a patient that cannot tell them where they are sick. Seems like a fantastic doctor to me. Always remember one thing Les, it is not if you are gonna need health insurance, it is when.

  24. Michael B 2013.10.20

    What happens to payments servicing the national debt when interest rates rise to historic norms? We won't be paying for social programs or for the national defense because we will be making interest payments instead. No one here seems to be concerned.

    According to the Argus Leader, 24 people have signed up successfully for ObamaCare so far in SD. I'd love to see a cost analysis in 6 months to see how much money the gov't had to spend for each person covered under the ACA. In the "Cash for Clunkers" program, reported that the government spent $24,000 for each of the additional 125,000 cars sold. How is the government going to encourage people to sign up now that the interest has waned over the first few weeks of the website not being able to be accessed in a timely manner?

  25. Les 2013.10.20

    Michael, I believe it was recently stated here about Hitler and Indian tragedies that all that bad past or history needs to just stay there.
    Some of us believe we need to learn from history so Ill tell you a little story of my childhood and my father explaining the depression to me. He told me of many things that only cost a nickel, to an acre of land at 1 to 4 dollars. Remember, I could get a soda for a nickel when he told me this. Gee dad, why didnt you buy this and that I asked him. Son, we didn't have a nickel.
    3.5% home mortgages will be a problem without an increase in rates if you don't have the 3.5% Michael, something few wish to acknowledge can happen again.

  26. Michael B 2013.10.20

    We are better off than many places when it comes to taxes. In 2014, France will spend 57% of GDP on public expenditures.

  27. caheidelberger Post author | 2013.10.21

    France is not the question, is it, Michael? Kristi Noem is telling us our debt is so bad, she was justified in voting to wreck the global economy and America's standing in it. The information I present says the debt is not that bad of a problem.

    As for taxes as a percentage of GDP... well, as we could say comparing state expenditures in South Dakota and Minnesota, you get what you pay for.

  28. jerry 2013.10.21

    Model T Party folks cannot govern. This new republican party is so far against democracy itself that they continue to endanger it. From the Guardian:

    "Just as the House of Representatives was finally voting to reopen the government and save the nation from reneging on debt and inviting a downgrade, a House stenographer appears to have suffered a breakdown. Grabbing the microphone, she started defending God's honour before the nation.

    He will not be mocked. The greatest deception here is this is not one nation under God. It never was. The constitution would not have been written by freemasons. They go against God. You cannot serve two masters.

    After being removed and questioned, she was taken away for psychiatric evaluation.

    Her mental health is no laughing matter. But the description of her interjection by much of the media as a "bizarre" interruption to the House vote deserves interrogation.

    Because everything about this was bizarre. From the moment Ted Cruz got up and started quoting Ashton Kutcher and talking about Star Wars into the wee hours, this entire process has been nothing but bizarre. America, once again, took the familiar road from the height of dysfunction to the brink of default – until reality grabbed it by the scruff of the neck and slapped it straight, before it did itself and others grave harm." Gary Younge

    One of the greatest solutions to our "debt problem" would be to eliminate those who continue to exacerbate it, politicos like NOem along with those that vi for Senator Tim Johnson's seat for starters. We could put Rick Weiland into the drivers seat as someone who not only could represent South Dakota, but America herself. Right here in South Dakota we could start by saying NO More NOem and to replace her with someone who has a sense of service to America without doubt.

  29. Roger Cornelius 2013.10.21

    Obviously we should learn from history, but most of the time we choose not to, thus if you don't read your history you are doomed to live it.
    My comment about Hitler, slavery and Native American genocide is that these parts of history are each unto themselves and should not be compared to contemporary politics, ever. In that sense, they are history best left in the pages of history.

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