by David Swanson
At $36 trillion and climbing, the US national debt poses a significant challenge to America’s economic future. Large-scale national and global debt seems like an abstract concept to many people. Unfortunately, this level of debt is unsustainable and has a genuine and far-reaching impact on every citizen’s financial stability and growth opportunities. At this challenging level of debt, even our national security and world leadership are in peril.
Addressing the national debt is essential if individuals want to remain free and prosperous. Here are ten critical reasons why reducing the national debt is more than just a fiscal responsibility—it’s necessary for our survival as a nationTrillion-dollar deficits are a dangerous new norm.
Let’s be honest. Most people, including those we have elected to lead us, have no clear concept of what a billion dollars looks like, much less a trillion. I found a photo from Academe that might give you some idea of what ONE trillion looks like. As they point out, if you spent one million dollars A DAY every day since Jesus was born, you still would not have spent a trillion dollars yet. Mind-blowing, isn’t it? Now, multiply that 36 times, and you might get a little queasy when considering the ramifications.
Photo by Academe Blog
Unfortunately, those in charge of our government continue to spend recklessly. The Congressional Budget Office (CBO) projects the US government will run annual trillion-dollar deficits over the next decade. If this mind-boggling scenario plays out, it could lead to an additional $22.1 trillion in cumulative debt by 2034. Unchecked borrowing is unsustainable, especially in the face of rising global competition and domestic demands.Insane debt levels have escalating interest costs
Economists project that the interest alone on the national debt will grow from $658 billion in 2023 to $1.7 trillion by 2034. Interest payments will far surpass crucial federal expenditures like Medicaid and veterans’ benefits. As we struggle to make these crushing, we’ll be unable to invest money in vital social programs.The debt cloud crowds out future investments.
When a country has high debt levels, it will have less money to put into critical infrastructure, such as roads, bridges, transportation, and the energy grid. This situation is similar to an individual who has maxed out their credit cards and can barely make the minimum payments. Repairs, maintenance, and investing tend to go by the wayside.
A nation struggling with excessive debt cannot spare cash to improve education and healthcare or fund innovation. Yet, these types of investments are essential for maintaining economic competitiveness and ensuring our future growth. With such a massive cloud of debt hanging over us, the US risks falling behind in innovation, and our quality of life will go down dramatically.
Too much debt means less economic opportunity
An unhealthy national debt hampers business investment, slows economic growth, and raises expectations of rising inflation. Confidence in the US dollar erodes both at home and abroad. Working Americans then find themselves with fewer opportunities for upward mobility and financial security. Many will find themselves forced to work long past their ideal retirement age.Debt can limit a government’s ability in a financial crisis.
A high debt burden means policymakers have far fewer options during economic downturns or crises. For instance, if another recession hits, our government may lack the fiscal flexibility to implement effective recovery measures. This lack of flexibility is due to the already wide deficits and mounting debt restricting the government’s ability to borrow furtherEssential safety nets will be threatened.
As mentioned previously, the public programs upon which millions of Americans depend are at risk as debt levels increase. Debt undermines the sustainability of many safety-net programs like Social Security, subsidized housing, and Medicaid. If debt levels continue rising, these programs—lifelines for millions—could face reductions or even collapse under the weight of fiscal pressure.
If you lose financial stability, you lose growth.
History demonstrates that a solid fiscal foundation leads to thriving economies and greater individual freedom and prosperity. When debt is lower, there is greater access to capital, enhanced consumer and business confidence, and safety nets can remain intact for those who need them. Uncontrolled debt creates fiscal instability and promotes an environment where innovation and prosperity cannot flourish.
Debt is not a partisan issue.
Every modern leader and every individual citizen has contributed to our jaw-dropping national debt. This situation did not happen overnight, and it did not occur because we elected a Republican or Democrat president. The national debt is a bipartisan issue that we can only tackle if both sides are willing to acknowledge our precarious situation and act together to fix it.
Recent surveys indicate that three out of four voters believe addressing the national debt should be a top priority for lawmakers. Tackling the debt is a shared concern that resonates across the political spectrum.
There is a solution if we act now.
The good news is that viable solutions for our debt situation exist, but only if we work together and are willing to experience a little pain now in exchange for an improved future. From enacting budget reforms to modernizing our inefficient and punitive tax system, experts from across the political spectrum have suggested ways we can put the US on a more sustainable economic path. However, acting on these recommendations requires political will and public support.We need to do this now rather than later.
You can only ignore the debt issue for so long. Denial and inaction will compound the amount of the debt and the associated problems. But, if we push our leaders to act now, beating back the debt monster will require smaller adjustments. Unfortunately, many politicians sidestep the issue and are not willing to risk losing their jobs over unpopular budget cuts and austerity proposals. However, by waiting, they are virtually assuring that we will have to accept more drastic, life-disrupting measures in the future. As with any debt, only early intervention can help minimize the long-term impacts.
A Path Forward
Despite the current challenges, the US has some unique strengths that can help us navigate this fiscal storm. Although the “BRICS” nations are working hard to change this, the US dollar currently remains the world’s primary reserve currency. And, although it’s generally considered impossible to borrow your way out of debt, the US may still have the power to borrow money, perhaps at more favorable interest rates. Lower interest will help slowly decrease the debt. Advancements in technology—such as artificial intelligence—also offer opportunities for economic growth that could help lessen some of the fiscal pressures.
Policymakers must prioritize bipartisan efforts to reform entitlement programs, modernize the tax system, and reduce wasteful spending. At the same time, Americans can play a role by staying informed, advocating for fiscal responsibility, and supporting leaders committed to sustainable economic policies. We must also keep personal debt in check and save and invest more.
Summing it up.
The national debt is more than a line item in the federal budget—it’s a challenge that impacts every American. By acting now, we can secure a brighter economic future, preserve essential safety nets, and maintain the nation’s standing as a global leader. The sooner we address this issue, the easier and less painful the solutions will be.
It’s time for policymakers to seize this moment and take bold, decisive action. The future of our economy—and the prosperity of generations to come—depends on it.
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