The national debt. It is growing at an unprecedented rate and seemingly unnoticed by Congress and our executive leadership. At some point we as a country will need to pay for this debt. When will that happen? No one can tell for sure, but here are some things to think about:
- The national debt clock has broken. Designed and put into service in 1989 by Seymour Durst, the national debt clock has run out of digits for the rapidly increasing debt. Seymour's son (current owner of the clock) is planning on a new clock to track up to a QUADRILLION dollars. Sounds like something out of an Austin Powers movie.
- The federal government spent 451 billion dollars on interest expense related to our national debt. An absolutely astounding number. Broken out over the number of people in this country (assume 304 million) that is 1,484 dollars a person. Why is this not a bigger deal?
- Based on inflation (see chart below, from the US National Debt Clock FAQ by Ed Hall) our national debt has exploded in the last 30 years. Fundamentally, our government has gone from balanced budget fiscal policy to one disregarding financial responsibility. The exploding debt took only 13 months to go from 9 trillion to 10 trillion. Previously it took 22 1/2 months to get from 8 to 9 trillion.
So what does this mean for us? At some point their will be a day of reckoning where we as Americans will have to fund and respond to our out of control debt situation. Our government, our people and our tax dollars need to follow basic financial guidelines and set ourselves up for success. We cannot continue to mortgage our future. Currently, each individual theoretically owes about 34,000 dollars of our national debt! Can you stroke a check for your portion? For a family of four, the 136,000 dollar debt is SIX times the 2008 poverty level.
As you can clearly see, fundamental fiscal policy must change in this country. It will take more than a change leadership in Washington to solve this. We as a country must change, reversing negative saving rate and reining in our attachment to debt.