Wednesday, June 29, 2005

A Conservative's Dilemma

I'm on travel today, in the Washington DC area, for a couple of business meetings. Nothing really stressful today, just a three hour session with some business development folks after a lunchtime train ride down. We hung around the office a little late trying to plan out the rest of the week, since none of our higher-level management will be in on Friday.
So after we finished that, I took the Metro down to Alexandria. It was after 6:00, so the cars were not crowded at all. I picked a hotel in Old Town Alexandria for the night, since they have a negotiated rate with my company (got to keep the bean counters happy). I was kind of surprised when I walked into the hotel, because there was a medium sized crowd in the lobby, with several eager young faces watching the doors like hawks. Obviously, they've been placed in charge of greeting the guest speaker for whatever event is going on. I know they aren't waiting for me, so I go check in.
On my way to the elevator, I notice that this group has a placard up by the entrance to the room they've rented - it looks kind of like a woodcut portrait in black, on a bright red background. It's a familiar face. As I get closer, I can see that those waiting are wearing red, white, and blue buttons, I guess to identify the group.
So here's the conservative's dilemma: the group is called "Friends of Hillary." (Yes, that Hillary.) What is the proper response when faced with such a situation? Return to the lobby, wait for the Senator, and try to get her attention so I can tell her how much I loathe her politics? Maybe a little impromptu street protest? Or just ignore the whole thing?

Update: I tried to ignore the whole situation, but couldn't. A thunderstorm popped up as I was getting hungry, so I decided to eat in the hotel. I walked into the bar, and standing there is James Carville waiting for a table in the restaurant. I let him off the hook ;-) , because he had his daughters with him. (Lovely girls, by the way. Mr. Carville is a lucky man.)

Update 2: Apparently, the highlight of the fundraiser was Senator Clinton's flogging of the budget deficit. As I was eating dinner at the bar, a woman sat next to me and made a telephone call to her office - probably a reporter, as she was careful to point out that she was paraphrasing and not quoting. From what I heard, the point made was that our budget deficit costs us $50 billion per day, that the Saudis and Chinese are holding the notes, and that are vulnerable because we can't go against our bankers.
I must have misheard the conversation, because $50 billion per day works out to about $18 trillion per year. This is clearly impossible, since the total gross domestic product of the US economy was only $11.735 billion in 2004.
Watch for the press releases / articles to see what the real claim was. In the meantime, here are a couple of facts for your consideration:

  • The public debt as of June 28, 2005 was $7,780,135,114,161.43.
  • Nearly 42% of that debt is carried as "intragovernmental holdings," which includes trust funds.
  • Interest paid on the public debt in fiscal year 2005 (through May) averaged $26.05 billion per month, or about $870 million per day.
  • The average interest paid on the public debt in the four most recent full years was $332.9 billion: just over 4% of the current balance, and only 2.8% of gross income. The US government gets a very good rate on its debt.
  • The national debt ($7.78 trillion) amounts to about 66% of national production ($11.7 trillion). This could be compared to a family with an annual income of $50,000 holding a mortgage for about $76,000. The total monthly payment on a $76,000 mortgage (30-yr fixed @ 5.375%) would be $425.58, or $5,106.96 annual -- 6.7% of the balance, 10% of gross income.
This comparison shows pretty clearly that the national debt is not a significant economic problem, with the nation as a whole in much better position than a moderately indebted homeowner. So, why would Senator Clinton be trying to make hay with a line that says otherwise?