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Sunday, June 05, 2005 4:26:46 PM
You misread the chart slightly. It does show debt as a percentage of GDP.
http://home.pacbell.net/nstuart/Debt_Federal_v_Total.gif (also shown below)
The top line shows total debt (consumer + business + government). The bottom blue area line shows only federal government debt.
The highest point in federal government debt, relative to national income, was 1945 at the end of WW-II. This was not a major problem as consumer and business debt was very low at the end of the great depression.
You'll notice that total debt levels remained constant, relative to income, from 1940 to 1980 - as is typical of a normal economy. After 1980 when Reagan made changes to the tax code encouraging a deadly build-up in debt almost tripled in the past 25 years. The last time we experienced a dangerous rise in debt of this magnitude was after WW-I during the 1920s.
http://home.pacbell.net/nstuart/Debt_Federal_v_Total.gif (also shown below)
The top line shows total debt (consumer + business + government). The bottom blue area line shows only federal government debt.
The highest point in federal government debt, relative to national income, was 1945 at the end of WW-II. This was not a major problem as consumer and business debt was very low at the end of the great depression.
You'll notice that total debt levels remained constant, relative to income, from 1940 to 1980 - as is typical of a normal economy. After 1980 when Reagan made changes to the tax code encouraging a deadly build-up in debt almost tripled in the past 25 years. The last time we experienced a dangerous rise in debt of this magnitude was after WW-I during the 1920s.
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