Critics are using the calculation error to distort correlations between public debt and growth rates while discounting public policy that advocates spending cuts, Santelli said:

RICK SANTELLI: [...] You know, I really find it very important that we handicap how we’re looking towards the ECB meeting. Our own Fed meeting, I don’t really believe there’s much doubt. I think — it seems to me ever since the Reinhart Rogoff paper was dissed. And believe me there were obviously some issues there. But I do think it’s been a stellar drop from grace as to what debt may mean and the notion of austerity being very much not very helpful. I will continue to say that I think that the generalized theme of that research paper is, is that whatever your growth rate is, especially when you look at it over a 5- 10-15-20-year horizon, if you have higher debt you underperform whatever that benchmark is. Pure and simple. We can argue about sampling, countries that are tiny and some of the errors that were made. But there seems to be very little doubt the more debt you have you’re going to underperform. It’s just a matter of how much. [...]

Previously, Reinhart and Rogoff’s research indicated when public debt reaches of 90 percent of GDP, the average economic growth rate for advanced economies is -0.1 percent.

Revised estimates put the average growth rate for countries with debt over 90 percent of GDP at 2.2 percent.

As Andrew Ferguson of The Weekly Standard points out, the upward shift to 2.2 percent still evidences a negative correlation between debt and growth:  

Countries with up to 30 percent debt-to-GDP ratio, according to [Herndon Ash and Pollin (HAP) revisions to Rogoff and Reinhart], average 4.2 percent growth; growth falls to 3.1 percent at a 60 percent ratio. Growth increases to 3.2 percent as the ratio reaches 90 percent. After 90 percent, growth averages 2.2 percent.

In other words, by the time a debt ratio rises above 90 percent of GDP, growth will be cut roughly in half—according to HAP’s own calculations. High debt-GDP ratios, once they take hold in a country, tend to last for 15 years or more. An annual loss of 2 percentage points in growth over such a sustained period really starts to add up: A country will be significantly poorer than if it had kept debt under control.

The United States currently has 2.5 percent GDP and a debt to GDP ratio of 101.6 percent.

Oct. 29, 2012, marks another mournful milestone for Senate Majority Leader Harry Reid and his Democratic colleagues. Today is exactly three and a half years from the last time Senate Democrats passed a formal budget resolution, as required by law.

As Politico noted earlier this year, “Democratic leaders have defiantly refused to lay out their own vision for how to deal with federal debt and spending.”

Reid has said offering a Democratic budget would be “foolish.” And that is probably true from one perspective, as doing so would force vulnerable Democratic incumbents facing reelection to cast a series of politically difficult votes on spending and deficit issues.

Vice President Joe Biden, a former Democratic senator, has often said of Republicans on the campaign trail: “Don’t tell me what you value, show me your budget, and I’ll tell you what you value.”

But Biden’s former colleagues have done no such thing. Since April 29, 2009, when Senate Democrats last approved a budget resolution, the federal government has added more than $5 trillion in new debt.

President Obama’s most recent budgets, on the other hand, were widely panned by independent analysts and did not receive a single Democratic vote in either chamber of Congress.

Budgets are typically considered to be a beneficial tool for maintaining the fiscal health of large countries.

Although he has served less than a term, Obama is now the first American president to see the federal government’s debt increase by more than $5 trillion during his time in office.

During the full eight years that George W. Bush served as president, the federal government’s debt increased by $4,899,100,310,608.44. (Rising from $5,727,776,738,304.64 to $10,626,877,048,913.08.)

The $5,027,761,476,484.56 that the debt has increased during Obama’s presidency equals $16,043.39 for every one of the 313,385,295 people the Census Bureau now estimates live in the United States.

“In all, between 2013 and 2022, deficits would total $6.4 trillion (or 3.2 percent of total GDP projected for that period), $3.5 trillion more than the cumulative deficit in CBO’s baseline,” the nonpartisan office wrote in its analysis of the president’s budget.

Under the CBO baseline, which assumes that current spending and tax policy would remain unchanged, the deficit would increase by $2.9 trillion over the same period.

In the next year alone, the president’s budget would increase the deficit by $365 billion, CBO projected.

The CBO projects that under the president’s budget, federal debt held by the public would rise by $8.7 trillion over the next decade, totaling $18.8 trillion (76 percent of GDP) by 2023. Under the current-law baseline, public debt would increase more slowly, to $15.1 billion by the end of the decade.

The findings cast considerable doubt on President Obama’s own claims about his budget.

When he unveiled his budget in February, Obama said it was a fiscally responsible document that, if enacted, would significantly reduce the federal deficit.

“Part of our job is to bring down our deficit,” Obama said. “And if Congress adopts this budget, then along with the cuts that we’ve already made, we’ll be able to reduce our deficit by $4 trillion by the year 2022—$4 trillion.”

He was off by $7.5 trillion.

 The CBO’s figures show that despite repeated efforts to trim spending, the government has borrowed 42 cents of every dollar it spent during the first five months of this fiscal year.

The nonpartisan agency projected the government will run a deficit of $229 billion in February, the highest monthly figure ever. The previous high was $223 billion a year ago, in February 2011.

For all of fiscal year 2012, which began Oct. 1, the budget analysts said the government has raised $869 billion in revenue but spent $1.5 trillion so far.

Republican analysts on the Senate Budget Committee used figures from the Congressional Budget Office to calculate the relative share of the national debt–currently $16 trillion and counting–among different age groups.

The results are stunning:

Calculate your share of the national debt here.

According to Politico, he said that if congress and the administration fail to act the exploding federal debt could bring about a fiscal catastrophe.

“Although we have been warned about such developments for many years, the time when projections become reality is coming closer,” Bernanke told the House Budget Committee. “To achieve economic and financial stability, U.S. fiscal policy must be placed on a sustainable.”

The worst case scenario—“which ultimately will happen” without changes—in that borrowing costs would skyrocket as investors lose confidence, mirroring the kinds of panic currently being seen in European countries like Greece, Bernanke said.

Bernanke’s comments come days after the Congressional Budget Office presented a grim economic forecast for the coming years, stressing the need to bring deficits under control.

In his January 24 State of the Union Address, President Obama suggested an approach to deficit-reduction centered on the so-called “Buffett Rule,” which would impose a mandatory minimum tax on families earning more than $1 million annually. It is estimated that a bill recently introduced by Sen. Sheldon Whitehouse (D.-R.I.) to enforce the “Buffet Rule” would increase federal revenues by $50 billion per year.

The CBO estimates a federal deficit of more than 20 times that amount ($1.1 trillion) in 2012.

Politico surveyed the office budgets of all U.S. senators for the last three fiscal years. The study revealed that Boxer returned only .65 percent of her budget to the Treasury, putting her at the bottom of the list. The most frugal senator was Alabama Republican Richard Shelby, who gave back 40 percent of his budget during the same time.

The study also concluded that, for the last two years, Republicans have returned more unspent office funds to taxpayers than Democrats, 11.7 percent to 8.3 percent. The study did not measure funds spent by committee offices.

“We have always dedicated our resources to serving the 38 million people who live throughout California,” Boxer spokesman Andy Stone told Politico, “whether it’s helping thousands of homeowners avoid foreclosure, ensuring that veterans and seniors get the benefits they deserve or responding to the millions of calls and emails we receive each year from constituents.”

More than 90 percent of Boxer’s office funds are spent on payroll, the Politico study found.