We've all read the stories about how college-age kids, between massive student loans and being bombarded with credit-card offers, rack up huge debt by the time they graduate. Well, I've got some bad news. Your 5-year-old? He already owes the U.S. government $27,717.68. So does his sister. So do you and your husband, for that matter.
Right now, before the federal government spends another nickel on bombs, health care, hurricane relief, farm subsidies, bridges in Alaska, or education (hah!), we all - ALL, as in every single living American, man, woman and child - have to pony up nearly $28,000, just to get to "0," as in, "zero."
Our
national debt is soaring to record heights. And the Senate is about to
vote to raise the statutory debt ceiling beyond its current $8.18 trillion limit. Things are so tight that as of March 2, we were within $25 million (that's million-with-an-"M") of hitting the limit. So the Treasury Department has been performing all kinds of fiscal
contortions, including not paying into the federal Civil Service Retirement and Disability Fund for a period, in order to free up money to pay bills.
If you think this is really bad, you're right.
The Treasury said in January it plans to borrow $188 billion from January to March, the most ever for a single quarter. [ . . . ]
This is the fourth time the administration of President George W. Bush has asked lawmakers to raise the debt limit. Congress complied with the last request, in November 2004, only after the Treasury was forced to delay auctioning bills and notes and move money among government pension funds.
Since Bush took office in 2001, the federal budget has gone from four years of surpluses, the longest such run since before the Great Depression, to deficits
This should not surprise anyone. Take a look at how the national debt as a proportion of GDP has fared since the end of the Vietnam War:
Under Carter and Clinton, debt-to-GDP declined; under Reagan and both Bushes, it climbed.
At the end of Bill Clinton's first year in office (1993), the national debt on a per capita basis represented 82% of average personal income. At the end of Clinton's final year in office (2000), the national debt on a per capita basis represented 67% of average personal income. The reduction represented a decrease of 18.3% over his eight-year term, or an average annual DECREASE of 2.3%.
By contrast, in the five years of the current Bush administration, national debt on a per capita basis has increased from 68% at the end of Bush's first year in office to 83% at the end of his fifth year, a total increase of 22.1%, or an average annual INCREASE of 4.4%. And there is no sign of slowing.
This is not surprising, given that average income is growing much more slowly under George W. Bush than under Clinton. Average income growth during Clinton's eight years in office was 4.98% annually; during Bush's five years, average income has grown at an annual rate of 1.61% on average; last year, the increase was an abysmal 0.32%.
So - what does this all mean? I'm no economist, but it can't be good. With the 2007 budget proposal from the Bush White House leaving out expenditures for the war in Iraq, and relying on income from oil leases in the Arctic National Wildlife Refuge, I'd guess that the old credit card will be maxed out pretty darn quick.
Senate Democrats on February 5 wrote a letter to President Bush, asking that he not seek to raise the national debt limit. The letter even included a noble appeal to the President's campaign promises, as well as to Scripture:
Mr. President, during the campaign you talked a great deal about moral issues, and about how you didn't think it was appropriate to push today's problems onto future generations. We agree with that sentiment, and we admire you for your willingness to address the long-term fiscal challenges in Social Security. We stand ready to work with you in a bipartisan way.
But we view taking on this level of debt as an important moral issue of concern to the American people. [ . . . ] We are spending enough of our kids' money. Our country needs to get back to following the teachings of Romans 13:8, which says we should "let no debt remain outstanding."
But, since the Republicans are not the party of fiscal responsibility, the letter was ignored.
And down the rabbit hole we plummet . . .