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The staggering 1.05 trillion isn't borrowed soley from international governments - it also says financial institutions. The bulk of the money borrowed to cover the deficit is owed to the American People. If you hold t-bills or t-bonds the government owes you. They issue the bonds to cover the debt. Foreign governments also buy US treasuries, but they do so because they see it as a good investment. No one would buy them if they thought they were going to be worthless.
When dealing with budget deficits, it does not matter if you pay them off by raising taxes now, or borrowing the money and raising taxes later. They expected value of future tax payments remains the same. See Ricardian Equivalence.
Clinton had a buget surplus, not because of his fiscal policies but because we were in the midst of a tech boom. Remember how the DJI went from under 5,000 to over 10,000 under Clinton? It had nothing to do with his fiscal policies. There were buget surpluses during the clinton admin because of a stock market boom, techinical advancements, the end of the soviet union, and no war. The best thing a president can do for the economy is to leave it alone. Bush came in and saw buget surpluses left by clinton as proof that the american tax-payer was being taxed too much. (I see it that way too, surpluses should belong to the tax payer, not the government) Bush was in office less than a year when the tech bubble burst and 9/11 happened, neither of which was bush's fault (I know some people think everything is bush's fault). Compared to our economic standing in Oct. '01, our economy is doing very well. Unemployment is down to 5.1%, the DJI is nearing 11,000. Bush's tax cuts early on are now proving to increase tax revenues.
There is just a lot of pessimism, and you can worry and fret all you want, but I just don't have the time.
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"If I am such a genius why am I drunk, lost in the desert, with a bullet in my ass?" -Otto Mannkusser
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