The U.S. Treasury said it is considering whether to resume selling 30-year bonds, a security it eliminated four years ago and vowed not to bring back.
"We will examine if we have the flexibility to issue 30-year bonds while maintaining deep and liquid markets in our other securities and determine if nominal bond issuance is cost effective,'' Timothy Bitsberger, the Treasury's assistant secretary for financial markets, said in Washington today.
A decision on the security will be made in August and if the Treasury decides to issue new bonds, it will do so by issuing them on a semi-annual and nominal basis beginning next February, Bitsberger said. A separate document released by the Treasury said the department envisages selling $20 billion to $30 billion in bonds if they are brought back.
Bloomberg Link
Here's what they should have said, simply in the name of honesty.
"We're in debt up to our eyeballs, and we need to get longer term financing to deal with it because we're not gonna balance this budget."
And why do we need to issue longer debt? According to the same story:
"President George W. Bush's administration is pursuing policies that may require bonds. Its plan to overhaul Social Security by introducing private fixed-income and stock accounts will require an estimated $2 trillion in transition costs. The Labor Department is also proposing new rules for pension funds that may require them to measure the market value of their assets and liabilities against the yields of long-term debt. Bitsberger said the new debate over the bond was unrelated to such policies."
So, we need to issue more bonds because the fiscally conservative, better-for the-economy Republican President is going to send the US further into debt. He's going to increase total government debt - which is currently 7.8 trillion dollars, by at least another 1-2 trillion.
And why did we get rid of longer-term maturities? Well, CBS.Marketwatch says:
Its fate (the 30-year Treasury) was sealed in the late 1990s, when President Clinton and the Republican Congress agreed on a plan to balance the budget. The booming economy quickly moved the government into the black.
So, we got rid of the longer-term maturities by being fiscally responsible.
And Bloomberg also notes:
The Treasury, concerned about costs, suspended the 30-year bond in 2001, saying it was too costly. The decision was made 16 months before John Snow was named secretary. At the time, the Treasury foresaw a diminishing need to borrow. The bipartisan Congressional Budget Office projected budget surpluses would grow to $5.6 trillion by 2011.
That surplus forecast proved wrong after President George W. Bush's 2001 tax cuts and a recession reduced government revenue. The war in Afghanistan that year and 2003 military operations in Iraq drove up spending. The White House predicts the deficit this fiscal year will reach $427 billion, the third successive record, compared with last year's $413 billion."
I'll give Bush the recession and 9/11. But that was a few years ago. Since then, all he has done is spend money. He gave us two wars and declining government revenue. And now he wants our children to pay for it. That is so responsible of him.
The only President to balance a budget in the last 30 years was Clinton. Yes, he lied about getting a blow job in the oval office. So the fuck what. He created 20 million jobs and balanced the budget.
Rush and Hannity: shove it up your ass.
