The Department of the Treasury announced yesterday that it will begin paying down the debt for the first time in six years this quarter. But experts say the plan is less than meets the eye.
The Treasury expects to pay down $35 billion between April and June, up from an earlier projected borrowing amount of $103 billion.?This is the first quarter money has been allocated to pay down on the debt since the April to June quarter of 2007.
The Department points to policy changes that provided the Treasury with more revenue this quarter. The changes include?the expiration of the payroll tax holiday, sequestration of federal spending, and reported profits from the housing loan guarantors?Fannie Mae and Freddie Mac.
But according to some economists, this?announcement?will have little or no effect on the long term budget woes facing the country.
?It?s hard for me to get excited,? former director of the Congressional Budget Office and president of the American Action Forum Douglas Holtz-Eakin told The Daily Caller News Foundation.
?What you?d like to have is a budget that balances on average,? Holtz-Eakin lamented. ?What we have instead in a budget that bleeds red ink on average. There isn?t a month or two that changes that.?
Others still point to the announcement as a sign the economy is moving in the right direction.
Source: http://dailycaller.com/2013/04/30/skepticism-about-treasury-claims-of-debt-paydown/
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