Scariest Story I Know

It’s Halloween – I was asked to tell a spooky story. I first thought about stories about Night Marchers, but then realized I have an even spookier story than that.

Here’s the scariest story I know.

Not long ago, a family was sitting at the kitchen table – wondering why they weren’t able to make ends meet.

In fact, simply sitting there, they were getting deeper and deeper into debt.

Their household income was $70,784. However, that year they spent $90,663 – they put about 30-cents of every dollar they spent on a credit card.

Because of their spending in the prior years, the family had accumulated about $447,142 in debt.

While that outstanding debt sounds like the amount of a mortgage, it’s not. Unlike a mortgage, they have no house or anything else to show for this debt – it is simply money they owe.

They scratch their heads and wonder why.

This seemingly fictional family is real – these numbers represent the context of the national deficit and the debt (in the context of if a median income family spent money like the federal government).

The US national debt has passed $33.4 trillion. (October 2, 2023)

Our president was vice president under Barack Obama was president. On president Barack Obama’s watch, the debt had increased, as campaign promise after campaign promise had drowned in a sea of federal spending. (Spending money we don’t have.)

When he was running for president, Obama condemned George W. Bush for adding $4 trillion to the national debt over eight years, calling it “irresponsible” and “unpatriotic.”

Then – in less than four years – Obama’s Administration (with Joe Biden as vice president) had already added $6 trillion to the debt.

Back to 10-years ago, by a vote of 414-0, the usually-divided House of Representatives unanimously voted in bipartisan unison to deny president Obama’s 2013 budget (not one democrat supported the president’s budget.)

In May 2011, 97 senators voted against a motion to take up his 2012 budget plan — no senator (republican and democrat) voted in favor of the motion.

Now, 10-years later, under Biden’s watch, the present national debt is approximately $32-trillion debt – that is 121% of the US Gross Domestic Product (that means it is about 20% greater than all that is produced in the US economy per year) – that’s how much we collectively owe.

These outcomes speak for themselves; neither republicans nor democrats in Congress agreed with the president’s budget.

Today, I think it’s pretty clear, folks in the federal government don’t want budgets – they want unlimited spending and no accountability for the money they spend (contrary to the key reasons why budgets are prepared.)

That’s like a family that makes $70,000 a year – and is already up to their necks in debt – blowing $90,000 a year.  It does not make rational sense.

Deficits and debt cost money; it is called interest – paying this cost of borrowing does nothing in providing services and programs for the people today.  In addition to the interest, you also need to repay the principal of the debt.

Likewise, to pay off the debt you have to use current dollars to pay back past expenditures – money spent paying interest and paying back past debt does nothing in providing services and programs for the people today.

We had been fortunate that interest rates had been low – their lowest ever … but, now interest rates are rising.  More of our hard-earned tax dollars will go to paying higher interest on our growing deficits and debt.

Think about your household – I bet you find ways to cut spending to make ends meet. The folks in Washington, including the White House, don’t even try.

Some say, “we don’t have to worry about it short-term.”

In other words, if you have $7 but spend $9 (and continually borrow to make up the difference,) year after year, it’s OK – let future generations of Americans worry about it (the can is being kicked to your children and grandchildren).

Government should follow the example set by the American household:

• live within your means (have a balanced budget)
• we can’t continue to spend money we don’t have (stop deficit spending and borrowing to cover the difference)

Stop the Rhetoric – Balance the Budget – Reduce the Debt

You can’t spend money you don’t have. You can’t borrow your way out of debt.

For those that still don’t get it, I think I need to repeat this simple, basic thought:

You can’t spend money you don’t have. You can’t borrow your way out of debt.

This is the scariest story I know – and we are all caught in the middle of it, whether we like it or not.

As of October 2, 2023, the US Treasury’s official figure for the debt of the federal government is $33.5 trillion, or more precisely, $33,443,148,619,617. This equates to:

• $99,674 for every person living in the US.
• $254,891 for every household in the US.
• 70% more than the combined consumer debt of every household in the US.
• 6.9 times annual federal revenues.
• 126% of annual US economic output (GDP).

“The deficit for fiscal year 2023 was $1.7 trillion, growing 23 percent in a single year as the Treasury used $879 billion just to service the federal debt.”

“The impetus for these massive deficits is federal government spending, which tipped the scales at $6.1 trillion last year. Government receipts, meanwhile, were $4.4 trillion“.

“[T]he Treasury doesn’t actually pay off debt when it matures. It simply issues new debt to pay off the old, along with the interest. Trillions of dollars in existing debt at low interest rates will roll over at rates two to three times as high within the next year.“ (Antoni)

Every man, woman and child in the United States owes more than $99,000 as his or her share of the national debt. Not every US citizen is a taxpayer; for taxpayers, you owe more than $258,000 (as his or her share of the national debt).

Scary, isn’t it? Happy Halloween.