One of the economic issues that the Democrats are using against Bush is the ballooning of the deficit to about $400bn. I'll be the first to admit that I'm all for a balanced budget, but given that we are at war and we needed to get ourselves out of a recession, the amount is not outrageous as a percentage of GDP (3.7%). Here's some detail on current and projected budget numbers from the Congressional Budget Office.

Recent history shows that from 1982-1994 the deficit was at our above this percentage yet there has been no discernible long-term negative effect on our economic position in the world as far as I can see.

Well, you might say, what is important is how much debt is outstanding as we keep adding it on year after year. Good point. If you refer to the charts linked to above, debt outstanding is about 37% of current GDP. This number is still below the historical average for the last 20 years when the percentage ranged from 33% to as high as 49.5%. Also, as the economy bounces back these numbers will get better over time.

Yes, the dollar amounts sound scary - biggest deficit in history! $400bn! - largest debt ever! $4 TRILLION! The fact of the matter is that if I am in debt for $50,000 and someone with half my assets is in debt for $25,000 it's basically the same thing. In fact, one could argue that I was more solvent since my additional assets makes it easier to pay off debt before cutting into the meat of what I really need to live on. Therefore the percentages do matter, it's not just playing with numbers. Our GDP has doubled since 1989, so our capacity for debt has likewise doubled. $4 TRILLION to us now is the same as $2 TRILLION was to us then.

Also we have low interest rates, low inflation and historically low unemployment which is heading downward.

Comments welcome. Maybe there's something I'm missing.