RE: Up From Debt Reduction

["Max Sawicky" <sawicky@xxxxxxxxxxxxxxxx>]

There is a minor wonk-controversy over how much
of the public debt is easily liquidated.  The
Repugs say the last $800 billion or so would cost
too much to buy back, since the holders of this
debt want very much to have safe assets and would
demand a premium to let them go.  Then our hero
A. Greenspan made similar noises.

>From my standpoint, this is a wonderful gift.
We no longer have to liquidate the entire public
debt -- only about 2/3rds of it.  That leaves a
trillion for something else.

Keep in mind a trillion in debt only requires
about $60b a year to service in interest payments.
Right now the Federal budget is $1,900 billion.
Twenty years from now it will much bigger, but
the trillion will still cost $60 billion to service.

mbs



>From "Up From D.R"

"A third tidbit in the CBO projections is the fate of public debt after
Bush's tax cut. By 2011, public debt with or without the tax cut is still as
low as thought possible. How could this be? Because the post-tax cut surplus
is still big enough to eliminate all Federal debt."

(((((((

CB: Do the current holders of the Federal debt  want to lose this gravy
train ?