{"id":2335951,"date":"2024-09-03T06:48:02","date_gmt":"2024-09-03T10:48:02","guid":{"rendered":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/harris-biden-admin-made-americas-debt-worse-to-win-election\/"},"modified":"2024-09-03T06:56:02","modified_gmt":"2024-09-03T10:56:02","slug":"harris-biden-admin-made-americas-debt-worse-to-win-election","status":"publish","type":"post","link":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/harris-biden-admin-made-americas-debt-worse-to-win-election\/","title":{"rendered":"Harris-Biden Admin Made America&#8217;s Debt Worse To Win Election"},"content":{"rendered":"<aside class=\"mashsb-container mashsb-main mashsb-stretched\"><div class=\"mashsb-box\"><div class=\"mashsb-count mash-medium\" style=\"&quot;\"><div class=\"counts mashsbcount\">18<\/div><span class=\"mashsb-sharetext\">SHARES<\/span><\/div><div class=\"mashsb-buttons\"><a class=\"mashicon-facebook mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/www.facebook.com\/sharer.php?u=https%3A%2F%2Fwww.conservativenewsdaily.net%2Fbreaking-news%2Fharris-biden-admin-made-americas-debt-worse-to-win-election%2F\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Facebook<\/span><\/a><a class=\"mashicon-twitter mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/twitter.com\/intent\/tweet?text=&amp;url=https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=2335951&amp;via=ConservNewsDly\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Twitter<\/span><\/a><a class=\"mashicon-subscribe mash-medium mash-nomargin mashsb-noshadow\" href=\"#\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Subscribe<\/span><\/a><div class=\"onoffswitch2 mash-medium mashsb-noshadow\" style=\"display:none\"><\/div><\/div>\n            <\/div>\n                <div style=\"clear:both\"><\/div><\/aside>\n            <!-- Share buttons by mashshare.net - Version: 4.0.47--><p>The U.S. economy \u200cis encountering significant\u200c challenges, as\u200b recent data reveals a slowdown in\u200d economic health that contradicts the optimistic projections\u2063 of \u2064the Harris-Biden administration. A report from the U.S. Bureau of Labor Statistics indicated that the\u200c U.S.\u200d added 818,000 fewer jobs than previously reported over the past year, particularly\u200d in high-paying sectors. This was attributed to \u2062inaccuracies in \u200destimating business formations and closures since the pandemic, leading to inflated job creation\u2063 figures. Moreover, a significant\u200b portion of job gains has \u2064benefitted foreign-born \u2064workers.<\/p>\n<p>Several indicators suggest the economy is weakening: consumer spending is down, unemployment is rising, and the yield curve is inverted\u2014a typical precursor to recession.\u200c Federal spending has \u2064escalated to unprecedented levels, with a \u2064deficit of $1.5 trillion in 2023 and national debt exceeding $35\u200b trillion. This debt requires over $1 trillion\u2064 annually \u200dfor interest payments,\u200c a figure likely to grow, exacerbating the\u2062 financial\u200d obligations.<\/p>\n<p>The article\u200c highlights how current fiscal \u2062policies by the Treasury, including the issuance of short-term government\u200c debt at competitive rates, have temporarily masked the repercussions of over-spending.\u200d However,\u2064 as these\u200c funds, particularly from\u2064 programs like Overnight Reverse Repo, are depleted, the economy may face challenges, especially with the election approaching.\u2063 The government&#8217;s strategy to manage liquidity and debt is criticized for its <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/unconscionable-that-biden-administration-has-not-taken-more-action-over-alleged-iranian-influence-peddling\/\" title=\"Unconscionable That Biden Administration Has Not Taken More Action Over Alleged Iranian Influence Peddling\">potential long-term repercussions<\/a>, \u200das it prioritizes short-term stability over\u200d sustainable \u2064economic practices.  <\/p>\n<p class=\"readmore\">\n    <button onclick=\"showReadMore()\" id=\"readmorebtn\">Read more&#8230;<\/button>\n<\/p>\n<hr id=\"line\">\n<span id=\"more\"><\/p>\n<div>\n<p>The U.S. economy is slowing, and economic health is weaker than the Harris-Biden administration&rsquo;s economic data has led investors to believe. Last week, the U.S. Bureau of Labor Statistics reported that the U.S. added <a href=\"https:\/\/www.foxbusiness.com\/personal-finance\/us-added-818000-fewer-jobs\" target=\"_blank\" rel=\"noreferrer noopener\">818,000 fewer jobs<\/a> over the last 12 months (from March 2023 to March 2024) than previously reported. The largest reductions to estimated job-gains were in high-paying professional and manufacturing jobs, too.<\/p>\n<p>A large reason for the miss is that the Bureau of Labor Statistics (BLS) has incorrectly estimated the start and death of businesses (the birth-death adjustment) since the Covid lockdowns and stimulus, which has incorrectly pushed estimates of <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/two-year-treasury-yield-hits-16-year-high-on-hot-jobs-data\/\" title=\"2-year Treasury yield reaches 16-year peak due to strong job market data.\">job creation higher<\/a>. The birth-death adjustment was likely skewed post-stimulus because of the many business entities opened to facilitate PPP (Paycheck Protection Program) loan fraud. This could mean a large number of added jobs since 2021 are fake. Even if the data is correct, <a href=\"https:\/\/www.msn.com\/en-us\/money\/careers\/job-gains-are-going-to-immigrants-and-keeping-young-us-born-men-out-of-the-workforce\/ar-BB1ieibI\" target=\"_blank\" rel=\"noreferrer noopener\">most of the existing gains have gone to foreign born workers<\/a>.<\/p>\n<p>There are other signs of a slowing economy. The consumer is slowing, unemployment is edging higher (which is related to, but not exactly the same as the lower job-adds), and the yield curve is inverted (the yield on 2-year Treasury debt has been higher than the yield on 10-year Treasury debt), something that occurs before recession. Worse, a large part of post-Covid growth and job-adds (the real ones) have <a href=\"https:\/\/finance.yahoo.com\/news\/biden-administration-job-growth-numbers-175321823.html\" target=\"_blank\" rel=\"noreferrer noopener\">been fueled by government spending<\/a>. This spending-binge is about to turn from a tailwind to a headwind. &nbsp;&nbsp;&nbsp;<\/p>\n<h2><strong>An unprecedented federal spending binge<\/strong><\/h2>\n<p>Given we aren&rsquo;t in a major war and the economy is not in recession (markets are making all-time highs), federal government spending is completely off the rails. The best way to measure this is the overspending relative to taxes, relative to the size of the U.S. economy.<\/p>\n<figure><\/figure>\n<p>Federal spending in 2023 was $6.2 trillion, while receiving just $4.7 trillion in tax revenue &mdash; so the government spent $1.5 trillion more than it took in. Because of the increasing deficit, more debt is being issued (national debt is now over $35 trillion). This is resulting in <em>skyrocketing <\/em>interest cost to service the national debt. The government is now paying over $1 trillion per year just to service the debt load, an interest cost that will only increase, causing overall debt to increase in turn. There&rsquo;s no end in sight to this spiral.&nbsp;<\/p>\n<figure><\/figure>\n<h2><strong>No free lunch on debt<\/strong><\/h2>\n<p>Summing it up, debt is a real problem, and far more now than it ever has been since people started talking about the national debt in the last 20 years. Yes, all presidents add to debt, but the debt add under Biden and Harris is unprecedented in non-crisis times.<\/p>\n<p>This debt issuance would normally pull liquidity out of private markets &mdash; like the public stock market &mdash; as newly issued government debt eats up more investment dollars, crowding out private assets. This could be a major headwind to the stock market and <em>could have<\/em> even started to tank the market over the last 12 months going into an election year.<\/p>\n<p>But enter something called Overnight Reverse Repo (ON RRP). ON RRP was a facility at the U.S. Federal Reserve (Fed) started during the Covid stimulus to solve the problem of negative rates in money markets (short term lending markets) because of the massive amount of Covid cash that had flooded the system. ON RRP paid a minimal interest rate so nobody would accept a lower interest rate than the rate offered by this ultra-safe Fed facility. This facility has soaked up excess cash in the system since 2021, and as the Fed has raised interest rates, the rate offered by the ON RRP has gone commensurately higher.<\/p>\n<h2><strong>Janet Yellen&rsquo;s debt fudge<\/strong><\/h2>\n<p>Janet Yellen&rsquo;s U.S. Treasury has, since 2023, purposefully issued ultra-short-term government debt at a place on the &ldquo;curve,&rdquo; meaning term of the debt (or time between issuance and maturity), to compete with the funds built up in the ON RRP. The debt U.S. Treasury is issuing is also at a slightly higher rate than ON RRP pays, enticing funds to flow out of ON RRP and into the newly issued short term Treasuries (T-bills). <em>This has negated, or rather temporarily put off, the economic hit from all the government over-spending, until at least the ON RRP runs out<\/em>. ON RRP likely runs out going into the U.S. election &mdash; there has been no net T-bill issuance for much of 2024, but the Treasury will need to raise significant funds this quarter &mdash; and of course the hope is that the facility runs out <em>after<\/em> the election.<\/p>\n<p>The Treasury has explicitly admitted they are purposefully drawing down the ON RRP, but they call this &ldquo;supporting liquidity&rdquo; while they hope that the Fed starts to purchase (monetize) more U.S. government debt once the facility runs out.<\/p>\n<figure><\/figure>\n<p>What&rsquo;s wrong with this? For one, in trying to support liquidity (the stock market) before an election, the Treasury has only been issuing very <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/mcconnell-offers-short-term-debt-ceiling-extension-in-bid-to-stave-off-default\/\" title=\"McConnell Offers Short-Term Debt Ceiling Extension In Bid To Stave Off Default\">short-term debt<\/a>, because only the very short-term debt will pull money out of the ON RRP. But short-term debt costs more and requires the government to constantly roll the debt over, exposing the government to potentially far-higher interest payments in the future.<\/p>\n<p>Second, ON RRP&rsquo;s funds won&rsquo;t last forever. Instead of fixing the problem, or talking about it in an election year, Yellen has delayed the issue in a way that will make it worse for the country in the long run (the modus operandi of Washington). ON RRP soon running out is likely also a factor in the recent market volatility.&nbsp;<\/p>\n<p>Finally, we have yet another example of why all the talk about &ldquo;preserving America&rsquo;s institutions&rdquo; is hogwash. America&rsquo;s institutions are rotten to the core, especially when run by the party of America&rsquo;s ruling elite (the modern-day Democrat Party). These institutions, from the Fed to the Treasury, to the federal blobs that <a href=\"https:\/\/www.nytimes.com\/2024\/08\/21\/business\/economy\/bls-jobs-revision-data-leak.html\" target=\"_blank\" rel=\"noreferrer noopener\">report economic data<\/a>, consistently serve the connected and powerful. Here, the U.S. Treasury has very blatantly played games to re-elect Democrats at the expense of what is good for the United States. Normal Americans will be left to pick up the pieces once again. If Trump-Vance win, these institutions need to be put on the right track. For starters, more investigation should be done to examine how much the Federal Reserve has gone along with this irresponsible gamesmanship.&nbsp;<\/p>\n<hr>\n<p>      This individual is granted anonymity since publishing an article on The Federalist would <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/in-leaks-about-failed-russian-diplomacy-biden-exposed-dangerous-weakness-on-china\/\" title=\"In Leaks About Failed Russian Diplomacy, Biden Exposed Dangerous Weakness On China\">credibly threaten close personal relationships<\/a>, their safety, or their jobs. We verify the identities of those who publish anonymously with The Federalist.<\/p>\n<\/p><\/div>\n<p><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The U.S. economy is experiencing a slowdown, and its overall health appears to be weaker than what the Harris-Biden administration&#8217;s economic data suggests to investors. Recently, the U.S. Bureau of Labor Statistics revealed that there were 818,000 fewer jobs added in the past year (from March 2023 to March 2024) than earlier estimates indicated. The most significant declines were seen in high-paying professional and manufacturing sectors. A major factor contributing to this discrepancy is that the Bureau has miscalculated business openings and closures (the birth-death adjustment) since the COVID lockdowns and stimulus measures, leading to inflated job creation figures. This adjustment was likely distorted after stimulus efforts due to numerous businesses established for fraudulent purposes related to Paycheck Protection Program loans, suggesting that many jobs reported since 2021 may not be legitimate. Even if these figures are accurate, a substantial portion of job gains has gone to foreign-born workers.<\/p>\n<p>Additional indicators point towards an economic slowdown: consumer spending is decreasing, unemployment rates are rising (which correlates with but does not directly equate to lower job additions), and an inverted yield curve exists (where yields on short-term Treasury bonds exceed those on long-term bonds), often a precursor to recession. Furthermore, much of the post-COVID growth and genuine job additions have been driven by government spending\u2014a trend that is shifting from being beneficial (&#8220;tailwind&#8221;) to detrimental (&#8220;headwind&#8221;).<\/p>\n<p>In terms of federal spending in 2023, it reached $6.2 trillion while tax revenues totaled only $4.7 trillion\u2014resulting in a deficit of $1.5 trillion as national debt surpasses $35 trillion. This escalating deficit leads to soaring interest costs for servicing this debt; currently exceeding $1 trillion annually with no signs of abating.<\/p>\n<p>Debt has become an increasingly pressing issue\u2014more so now than at any time over the last two decades when discussions about national debt have emerged prominently again; while all presidents contribute incrementally to national debt levels, Biden&#8217;s administration has seen unprecedented increases during non-crisis periods.<\/p>\n<p>Typically, such debt issuance would drain liquidity from private markets like public stocks as new government debts absorb investment capital away from private assets\u2014a potential headwind for stock market performance especially leading into an election year.<\/p>\n<p>However, there&#8217;s been intervention through Overnight Reverse Repo (ON RRP), initiated by the Federal Reserve during COVID stimulus efforts aimed at addressing negative interest rates in money markets due largely from excess cash influxes into the system post-COVID relief measures; ON RRP offers minimal interest rates ensuring no one opts for lower returns elsewhere.<\/p>\n<p>Since early 2023 under Janet Yellen\u2019s Treasury leadership, ultra-short-term government debts have been issued strategically along certain points on their maturity curve competing against ON RRP funds\u2014this tactic draws money out of ON RRP into newly issued short-term Treasuries thereby temporarily alleviating some economic impacts stemming from excessive government overspending until ON RRP resources deplete which could coincide with upcoming elections.<\/p>\n<p>While Yellen\u2019s Treasury claims they\u2019re \u201csupporting liquidity,\u201d their approach relies heavily on very short-term debts which incur higher costs requiring constant refinancing exposing future financial risks due potentially elevated interest payments down-the-line rather than addressing underlying issues directly ahead of elections\u2014a strategy likely exacerbating long-standing problems instead.<\/p>\n<p>Moreover this situation exemplifies broader concerns regarding institutional integrity within America\u2019s governance structures particularly under Democratic leadership where institutions like Fed or Treasury appear more aligned with elite interests rather than serving average citizens\u2019 needs effectively leaving them vulnerable once again amidst political maneuverings; should Trump-Vance prevail further scrutiny will be necessary regarding how Federal Reserve policies align with responsible fiscal management practices moving forward<\/p>\n","protected":false},"author":822,"featured_media":2335952,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","fifu_image_url":"https:\/\/thefederalist.com\/wp-content\/uploads\/2024\/08\/National-Debt.png","fifu_image_alt":"","footnotes":""},"categories":[],"tags":[32431,39956,34402,39955],"class_list":["post-2335951","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","tag-2024-election","tag-americas-debt","tag-economic-policy","tag-harris-biden-administration"],"fifu_image_url":"https:\/\/thefederalist.com\/wp-content\/uploads\/2024\/08\/National-Debt.png","_links":{"self":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/2335951","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/users\/822"}],"replies":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/comments?post=2335951"}],"version-history":[{"count":0,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/2335951\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media\/2335952"}],"wp:attachment":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media?parent=2335951"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/categories?post=2335951"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/tags?post=2335951"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}